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Appeals Court Rules Church Can Sue City over Zoning Dispute

Faith Fellowship Foursquare Church sued the city several years ago over a rezoning issue.

A lawsuit filed against the city by one of its biggest churches could be headed to court after a ruling by a federal judge. 

On Tuesday, the Ninth U.S. Circuit Court of Appeals cleared the way for a court battle between  and the City of San Leandro over the city's denial of a rezoning permit for a new church in an industrial area. The ruling reverses a lower court's decision in favor of the city.

"We’re very pleased about the precedent this has set," said Kevin Snider, chief counsel for the Pacific Justice Institute, which argued the case for Faith Fellowship.

He said the decision could have wide-ranging effects for other religious organizations seeking to establish themselves in areas with restrictive zoning regulations.

Gary Mortara, senior pastor at the church, said he was happy about the decision but wished the matter could have been settled without a lawsuit.

“I never wanted to get in a fight with the city,” Mortara said. “But I knew that what they were doing was not right and legal and fair.”

The conflict began in 2006 after Faith Fellowship signed an agreement to purchase two properties on Catalina Street off Farallon Drive with the intent to relocate. The church, which has more than 2,000 members, had outgrown its current location on Manor Boulevard. Traffic congestion and parking had become increasingly problematic, Mortara said. 

The church’s new site, however, was located within an area zoned for industrial and technological use and off limits to "assembly uses," such as private or non-profit clubs, lodges or religious organizations. 

While the property was in escrow, the church held talks with the city about rezoning the area. The city advised the church to apply for a change in the zoning law and an amendment to the zoning map to allow for assembly use at the Catalina Street site, according to the facts laid out in the federal appeals court ruling (see attached). 

The city did change its zoning laws in March 2007, but the change didn’t apply to the Catalina Street property. Instead, it identified 196 other properties where assembly use could be permitted.

At the time, the church had already closed escrow on the Catalina Street property, saying it couldn’t delay the process any further. The down payment was nearly $54,000.

The church also argued–and still does—that the Catalina Street property is the only site in the city that is suitable for its expansion. 

The church appealed the city’s decision not to rezone the Catalina Street property, but the city denied the appeal. It argued that the property didn’t meet all of the criteria laid out in the new law, notably, that it not be located within an area designated by the city as a strong industrial district, and therefore, a potential important source of tax revenue.

As non-profit organizations, churches and religious organizations are exempt from paying various taxes.

Faith Fellowship sued the city soon afterwards.

The church claimed the city violated its First and Fourteenth Amendment rights along with a federal law, the Religious Land Use and Institutionalized Persons Act of 2000, designed to protect religious institutions from overly burdensome land use regulations. 

A district court rejected the case in 2008, saying Faith Fellowship hadn’t proved that the city’s zoning actions amounted to a substantial burden for the church.

Tuesday’s federal appeals court ruling reverses that decision, sending the case back to district court.

City Attorney Jayne Williams said the city now has to decide whether to take the case up on an appeal.

“We’re analyzing the decision carefully and we’ll be talking to City Council in closed session next week,” she said.

Williams said the city had spent somewhere between $200,000 and $500,000 on the case since 2006.

Faith Fellowship sold its Catalina Street property last year. Mortara said the church couldn’t afford the $40,000 per month upkeep costs and mortgage payments. He said the church lost more than $2 million from the sale because of declining property values. 

Mortara, who said he’s been a pastor at the church for 17 years, said moving to the Catalina Street property would have been a “win-win for everybody.”

He said he had “talked with everyone who’s anyone in this city” in order to avoid taking the case to court.

“We’re here to help the city,” he said. “We’re not trying to hurt anybody.”

Faith Fellowship is a branch of the International Church of the Foursquare Gospel, a Pentecostal denomination with nearly 60,000 churches and meeting places in 140 countries around the world, according to its website

Marga Lacabe February 23, 2011 at 07:07 AM
This disturbs me. You can only get a rehearing with the 9th circuit if the appeals court overlooked a /material/ point of fact or law. This basically means something really important. Just "some things" are unlikely to cut it. You would think that if Ms. Williams knew what material point of fact or law the 9th circuit overlooked, she wouldn't be so coy as to what it was. It sounds, rather, like she's grasping at straws while filling her own pockets. I doubt she'll be filing this petition for rehearing pro-bono. And if the city does win, will she represent the city pro-bono in the re-hearing or will she just line her pockets with another $250K of our money? BTW, I think you should be able to find the petition once filed a http://www.ca9.uscourts.gov/ (you need to sign up for a PACER account but it's free if used in moderation)
Fran February 23, 2011 at 03:47 PM
You are so right Marga. The way I am understanding it, the only way the city can win, is if miraculously the commercial vacancy rate goes to zero. Can't wait to see the petition.
Jill Replogle February 23, 2011 at 04:24 PM
We were having a quick, casual conversation about it, not a sit-down interview so I don't think it's fair to make any judgments.
Marga Lacabe February 23, 2011 at 05:04 PM
Wow! I just listened to oral argument (http://www.ca9.uscourts.gov/media/view_subpage.php?pk_id=0000006468). The city's attorney got her butt whipped by the appellate judges, mostly vis a vis the question of equal protection. I'll have to re-read the decision, but I don't remember the court ruling on this particular issue. I haven't seen the filings on this case, but just relying on what came up on oral argument I don't see what the "overlooked material facts or legal points" that the city is relying upon could be. The court addressed on its decision what the city said was their main argument vis a vis "compelling reason", and none of the "arguments" the city attorney made vis a vis substantive burden were overlooked, as far as I can see. They just weren't strong arguments. If the city was smart, it would hire a new law firm to deal with the remainder of this case. But I don't think they are smart.
Fran February 24, 2011 at 08:03 PM
I listened also. Thanks for the link. The judge wasn't too sympathetic to the city to say the least. But in her defense the city didn't give her much to work with. They are the ones who omitted the church from the overlay after the fact, which was heavily frowned upon by the judge. That lost them a lot of credibility with me also.
Marga Lacabe February 24, 2011 at 08:26 PM
But remember, Fran, this is the law firm which had been advising the city all along. It's clear from city council sessions that the City Council relies *a lot* on the city attorney so I"m sure they did not come up with that plan without Jayne Williams' approval - so, really, it's her law firm's fault. The question is: is the law firm going to compensate the city in some way for its bad advise or is it going to just make more money out of it?
Fran February 24, 2011 at 09:23 PM
I meant as far as in the beginning when the church was buying the building, etc. and the permitting process for the overlay. It didn't even cross my mind as far as the city attorney giving them advice on that aspect of it. The city proving negligence on the part of the city attorney is a long shot, sadly, your latter scenario is all I can expect at this point.
Marga Lacabe February 26, 2011 at 05:54 AM
So I re-read the 9th circuit decision and realized I'd missed the footnote that said the court was not ruling on the question of whether the city's actions violated the church's equal protection rights under RLUIPA or the 1/14th amendments, as they had found that the district court had erred in granting summary judgment for the city on the "substantial burden" question. But, they said, /if/ the church goes to trial and loses, they can appeal again on equal protection grounds. And my impression from the oral arguments I linked to earlier is that the city would lose on those grounds as well - after spending another $500K-$1M on legal fees. Indeed, it seems to me that everyone in this case thought the "equal protection" claim was the strongest one for the church. BTW, today the 9th circuit granted the city's request for an extension until 3/14 to file a petition for rehearing. The city has a new attorney on this case now, J. Scott Smith who I think is with this lawfirm: http://www.akk-law.com/ Smart move, but I wonder if the City Council has been informed :)
Marga Lacabe February 26, 2011 at 03:07 PM
A final comment vis a vis equal protection. Remember how when we were talking about the Bal theater we were amazed that the owners were told they could not have "live performances" or "religious assemblies"? And Leah, you were wondering about whether the city would object to having a choir sing at the Bal? Well, that's exactly what they would object to and they're trying to avoid. You see, according to the zoning code you can get a conditional use permit for properties zoned commercial or industrial to use the property for commercial entertainment purposes but you cannot get one for non-commercial/religious assembly purposes. You want to have 50 people over to watch a wrestling match? Be our guest, the city says. Those same people to pray to god? No way. This is the equal protection issue that the Church argued in court - and the one that the 9th circuit reserved for addressing later if needed. In the scenario you speak of, the problem you would have with having a choir is deciding whether an audience listening to the choir is "assemblied" for entertainment purposes or for religious purposes. Are you going there because you like the music or because you are communing with God through the music? I think the city wants to avoid getting anywhere near this question. But I think the city messed up when they made it clear to the Bal that they objected to "religious" assemblies explicitly. And I bet the church's lawyers will find out.
The Omordha February 26, 2011 at 03:25 PM
That the City Council would authorize funding to continue this losing lawsuit is disgraceful. The church won their case, though their ability as I understand it, is stalled. I sure hope that this stops. City should be enhancing growth in the city, not providing duplicitous advice and fomenting litigious actions that are of benefit only to the lawyers.
Leah Hall February 26, 2011 at 09:08 PM
Fascinating, Marga. What a question! Some people go climb a mountain top and watch eagles fly "to get closer to the spirit." Why not a wrestling match or a Lady Gaga concert? The Oakland Interfaith Gospel Choir (which plays at the Paramount Theatre) sells tickets to anyone, you don't have to be a member of one religious group or another or pass some kind of test to enjoy the rich traditions and soulful art of African spirituals and gospel hymns. From their mission statement, The OIGC works with artists and young people "to serve as a model for what is possible among all peoples." Living in peace and harmony, may our vocalists and musicians bring this message to our community, especially our young people.http://www.oigc.org/about.html
Fran February 26, 2011 at 09:13 PM
Yup, the city clearly doesn't have a good defense. They should quit while they are ahead instead of wasting more $, that can be better used to, oh I don't know, fill a pothole. the most similar case I found was Cottonwood Christian Center v. Cypress Redevelopment Agency, which the city of Cypress settled. Maybe, more cities will learn from our mistakes and save $. As far as the Bal Theatre and the exclusion of religious assembly, I think the city is able to do that on the grounds the Bal isn't a "religious landowner".
Leah Hall February 26, 2011 at 09:18 PM
Hi Fran, Perhaps, but as I mentioned in my post above, the Oakland Interfaith Gospel Choir performs at venues throughout the area, including the Paramount Theatre in Oakland. This kind of "litmus test," if it truly exists, seems very weird to say the least.
Fran February 26, 2011 at 09:58 PM
Maybe that would be considered entertainment. Maybe they mean more general religious services / classes. And look at Joel Osteen, he tours all over, but the bigger places can easily accommodate.
Leah Hall February 27, 2011 at 12:14 AM
I believe our understanding and conversation about both the Bal Theatre and the Faith Fellowship law suit with our city would be greatly improved if the focus was broadened to include benchmark analysis of regional venues and performing groups (secular, non-secular and otherwise). In other words, our conversation needs to be broad enough to include consideration of regional venues of various sizes, locations, and states of vitality. How does good zoning and planning meet the challenge of striking the balance between the good that live performance brings to our community as well as how to keep assemblies safe, our neighbors content, and our city coffers full? I might be wrong but my general sense is that some of these conditional use restrictions placed on the Bal have to do with the fact that our city is not ready to commit the resources needed for the theatre to be revitalized, chief among them a parking structure and mass transit linkages. The Bayfair Mall area has lots of problems and also needs to be revitalized. Its proximity to the Bal Theatre makes the challenges more complex. I understand that the city and regional planning efforts strive to phase reinvestment and redevelopment in over time. It is what happens in the meantime that is causing conflict. A theatre is a theatre is a theatre, no?
Fran February 27, 2011 at 01:00 AM
Well Leah, in all frankness, I don't want my taxpayer money going to the likes of accommodating the Bal, if that's what you are intending by "committing resources". As far as the Bayfair Mall, I most definitely don't want my taxpayer $ going to an out of state company investing in real estate that was speculative at best. I also don't like taxpayer money fighting fruitless lawsuits.
The Omordha February 27, 2011 at 01:18 AM
Fran, I could not agree with you more. Not a dime of taxpayer money should be spent on Bayfair, the Bal or on Foursquare Faith. The city ought to be out of the business of making it difficult for folks to make a buck, worship or party. The expansion regionally beyond the extents of the city are within the jurisdiction of the county not the city. This is not really the forum for that.
The Omordha February 27, 2011 at 01:28 AM
Leah, congratulations on your appointment. Perhkaps some of the problems at Bayfair have to do with the fact that the city and the county deal with the citizens in manifestly different manners. Certainly there are many issues in the Manor due to its proximity to issues in San Lorenzo. Ashland and Cherryland certainly impact the Bal. When you are suggesting greater city-regional planning, including reinvestment and redevelopment, it sounds as though you are really advocating an annexation of unincorporated areas to the City of San Leandro. Is this your focus for the next years? I am pretty sure that for the immediate future, based on vacancy rates and the general economic growth that reinvestment and redevelopment capital are likely to be thin at best. Of course as part of the Human Services Commission you, Nestor, Mary Ann, Deborah, Robert and Sabrina may be able to built a solid coalition to drive this forward. Good luck on this.
Leah Hall February 27, 2011 at 01:28 AM
It would be great to get the pulse of the community and learn how other cities in our region took on revitalization efforts of community use projects. My sense is that public/private partnerships (and philanthropy) are usually needed to get valuable work done. The Alameda Theatre, the Paramount and Fox Theatres in Oakland, The Richmond Plunge and the Historic Ford Assembly Plant in Richmond all come to mind. It sounds to me as if federal dollars are shifting and going to ambitious regional scale projects, not the more provincial minded projects of the past. Not sure where a historic theatre would fit into the new funding landscape, but I think it is probably unrealistic to for us to bank on finding a private owner who would be willing and able to take such a property to the finish line without substantial community support. As I've written before, if it is the community's will to not support the Bal, then we need to be forthright about this fact and "call for the wrecking ball " or have the theatre moth-balled in order to thrive another day. I think the states quo, to the extent I am familiar with it, is rather unreasonable and unfair to Dan Dillman and his family.
The Omordha February 27, 2011 at 01:41 AM
Leah, I thought that this discussion was about Faith Fellowship, and neither the Bal or Bayfair. I certainly do not support closing the Bal. I do support the Bal and the efforts by Brad Dillman, his family and business partners in generating as much responsible business as he can. I hope that he is successful with the City in getting them to realize that Bal is good for San Leandro. I do not think that a million dollars should be spent on the Lorenzo theater, as is scheduled to happen now, suing redevelopment money. As you correctly called out, renovating and being able to use the Lorenzo is very expensive and way beyond the scope of anything that the County or the City has. I support knocking down the Lorenzo, rather than spending money on its good looks which are for just the fascia and roof. This is a waste of money. In no event was there a public initiative on any of these issues. Lorenzo was decided by the San Lorenzo Redevelopment Commission, the Bal has been done privately as has Bayfair.
Leah Hall February 27, 2011 at 03:22 AM
I think you have me confused with another person, as I've never commented on the San Lorenzo Theatre and have no personal familiarity with it. Dan Dillman is the owner of the Bal Theatre (not Brad).
Leah Hall February 27, 2011 at 03:31 AM
t is my understanding that several of the projects I mentioned also included community "friends of the X" organizations or a step-up by a local non-profit. The Fox Theatre, for example, was contemplated either as a demolition or a parking lot before Oakland decided to sell to a non-profit in the 1990's for $1 in order for it to operate it. Unless we have a critical mass of folks who have the willingness and know-how to support the theatre, my take is that complacency, neglect and "market forces" will all take their toll and the theatre will be lost to San Leandro for better or worse. I haven't found any historical info on the Alameda Theatre, which recently underwent a revitalization which included a new parking structure. I would find it very to imagine that a private developer funded entire complex without public and philanthropic support and visioning input. It is quite nice and seems to be loved and highly used with a regional draw. Much improved over what it was being used as before, many would agree. An aside, The Alameda Theatre was modernized as part of the renewal project and new screens added in order to make it a multiplex. This helps it compete in the contemporary market place, according to a post on another string on this site.
The Omordha February 27, 2011 at 03:34 AM
Leah, my aplogies. I have familiarity with it and have heard many call for tearing it down. I have never heard anyone say that the Bal should be razed. Brad Dillman was an actor and a misthought and mispeak on my part. My apologies to all including the Dillmans.
The Omordha February 27, 2011 at 03:42 AM
I made an offer on the Fox theater in 1982, but the family would not sell it. I was able then to raise 6 million and that was only half of what we needed after the first in depth survey. The building was then classified as a landmark and the city would not let us do much to remove asbestos, lead and some other heavy metals that contaminated the site. They city would also not allow us to add sprinklers and we had major issues with the project. It took more than 50 million and the full support of the city to get that project up and done after the family was coerced to sell twenty years later. The seismic work was also significant. The Fox and the Paramount are great achievements. The Alameda is not so hot in my opinion, but it is there and working. I hope that Dillmans are able to make a good deal with the City on the use of the Bal.
Leah Hall February 27, 2011 at 03:46 AM
I haven't given annexation of unincorporated areas any thought, O. Just to be clear, my posts are my own opinions as someone who lives in San Leandro. They are not meant to represent views of the body I was just appointed to, The Human Services Commission. I also would like to register in a friendly way my disappointment in all posters such as yourself who choose to post anonymously. As I have written previously, I would advocate (as it pertains to all of us here) that a "community covenant" be created and monitored by all of us which would include the guideline/rule that with the privilege of engaging in this forum comes the expectation that all who choose to do so identify themselves authentically. Perhaps the barn doors are already open and it is too late?
The Omordha February 27, 2011 at 03:54 AM
Leah, your point is a good one. At present AOL is responsible for the blog, not the community. The covenant of the community is not covered by any supporting laws. I think that blog owners get to put whatever rules they want to limit communication and enhance censorship. Certainly Patch can do that if they choose.
The Omordha February 27, 2011 at 03:56 AM
Leah, how do you separate yourself into each of your entities as parent, wife, woman, civic official, church member, professional or are they all the same? Sorry to get so metaphysical, but I submit that we are all just what we are.
Marga Lacabe February 27, 2011 at 05:04 AM
Leah, while I think the Patch's policy is that you must register with your own name, I'm not particularly concerned about people remaining anonymous. A few of us came to the Patch with some degree of local notoriety but the majority of Patch readers are generally "unknown" outside of Patch. Now, I'm as curious as everyone else as to who The O'Mordha is - but really, chances are that if I found out he'd just be another name to me. "John O'Connor" as opposed to "The O'Modrha", but as I have no idea who John O'Connor is, why should I care? Now, it's true that the fact that there are anonymous accounts will make some people suspect. I daresay Mike Santos, Paul Vargas and a couple of other people will show up under assumed names (if they haven't already), as that's their modus operandi. But will it ultimately matter? As we build a community, won't we be able to tell which posters we trust and which ones we don't, regardless of what their name or moniker is? All that said, there was a very interesting article on AlterNet today about companies/etc. who create fake personalities to defend themselves in boards: http://www.alternet.org/story/150049/corporate-funded_online_%27astroturfing%27_is_more_advanced_and_more_automated_than_you_might_think?akid=6576.54649.SrWKne&rd=1&t=2
The Omordha February 27, 2011 at 05:22 AM
Marga and all, I assure you I am not a multiple poster of identities. I will be happy to conform to the rules once there are some. That being said, until the courts catch up to the Internet, when slander and libel and obscenity are regulated, as they are by the FCC. Were I to be a public figure, which I am not, I would be happy to post by my legal name.
Leah Hall February 27, 2011 at 05:34 AM
Hi O, Wow, I better see a shrink when you put it that way. Just call me Sybil, or Sally Fields, I guess :^) Add to that list: soccer mom. My daughter is getting ready for try-outs tomorrow (early) so I'll let y'all hash this out without me. Buona Ventura!


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