27TH ST. v. Dormitory Auth.

• Citation: 302 A.D.2d 155,752 N.Y.S.2d 277
• Parties: In the Matter of 27TH STREET BLOCK ASSOCIATION et al., Appellants,<BR>v.<BR>DORMITORY AUTHORITY OF THE STATE OF NEW YORK et al., Respondents.
• Decision Date: 03 December 2002
• Court: New York Supreme Court Appellate Division

302 A.D.2d 155

752 N.Y.S.2d 277

In the Matter of 27TH STREET BLOCK ASSOCIATION et al., Appellants,

v.DORMITORY AUTHORITY OF THE STATE OF NEW YORK et al., Respondents.

SULLIVAN, J.

December 3, 2002.

Charles Palella of counsel (Phyllis Weisberg and Emily Simons on the brief; Kurzman Karelsen & Frank, LLP, attorneys), for appellants.

Philip E. Karmel of counsel (Robert S. Davis and Margery Perlmutter on the brief; Bryan Cave LLP, attorneys), for Dormitory Authority of the State of New York, respondent.

Kristin M. Helmers of counsel (Leonard Koerner and Gail C. Saunders on the brief; Michael A. Cardozo, Corporation Counsel of New York City, attorney), for New York City Department of Transportation, respondent.

WILLIAMS, P.J., MAZZARELLI, ROSENBERGER and GONZALEZ, JJ., concur.

OPINION OF THE COURT

SULLIVAN, J.

Petitioners, consisting of a community organization, individual residents and commercial establishments located on West 27th Street between 7th and 8th Avenues in Manhattan adjacent to the Fashion Institute of Technology (FIT), a community college of the State University of New York system, appeal from the dismissal of their CPLR article 78 petition on the ground of failure to join a necessary party, FIT, and the denial of their cross motion to amend the petition to add FIT as a party respondent.

Petitioners bring this proceeding to challenge the determinations, i.e., negative declarations, of two governmental agencies, the Dormitory Authority of the State of New York (DASNY) and the New York City Department of Transportation (DOT), the respondents herein, issued pursuant to the New York State Environmental Quality Review Act (SEQRA) and New York City Environmental Quality Review (CEQR) procedures in connection with the "New Additions, Streetscape, Renovation and Refunding Project," a capital improvement project at the FIT campus.^[*] Petitioners allege that the negative declaration issued by DASNY for the proposed project is in violation of SEQRA and that the negative declaration issued by DOT with respect to a part of the proposed project, i.e., FIT's proposed designation of the eastern portion of West 27th Street between 7th and 8th Avenues as a "restricted use street," closed to vehicular traffic, and the western portion as a two-way street ending in a cul-de-sac (the Streetscape Project), is in violation of CEQR procedures and the uniform land use review procedure (ULURP) of New York City Charter § 197-c. Petitioners also sought, in the alternative, to prohibit DOT's designation of the eastern portion of West 27th Street between 7th and 8th Avenues as a restricted use street on the ground that such designation could be accomplished only by the City Planning Commission pursuant to ULURP.

DASNY, a public benefit corporation, which is financing 75% of the project, was designated as the lead agency and charged with conducting a coordinated environmental review of the Streetscape Project pursuant to SEQRA, and DOT, a department of New York City which assumed involved agency status, was charged with conducting a coordinated CEQR review to fulfill the State and City's obligations under SEQRA and CEQR. Petitioners claim that DASNY and DOT issued the SEQRA and CEQR negative declarations without performing the full review required by SEQRA and CEQR.

West 27th Street between 7th and 8th Avenues is currently a one-way street, westbound, with vehicular traffic, except for those vehicles with a destination on the block, restricted between the hours of 7:00 A.M. and 7:00 P.M. weekdays and entry regulated by a gatekeeper. The Streetscape Project is, as noted, part of a larger capital improvement project being financed by DASNY on the FIT campus that includes the renovation of current facilities and the construction of two 23,000-square-foot buildings within FIT's west and east courtyards. Significantly, the cost of the Streetscape portion of the project represented only about 6% of DASNY's total financing.

FIT sought DOT's approval to designate approximately two thirds of the eastern portion of West 27th Street as a restricted use street and, in order to facilitate access to the area, to convert the western portion into a two-way street terminating in a cul-de-sac. Under Rules of the City of New York, title 34, § 4-12 (r) (4), a restricted use street "is a legally mapped street to be permanently closed to motor vehicles by the [DOT] * * * and open to use by pedestrians." While pedestrian access to the street would be unrestricted, vehicular access to the restricted use portion would be limited to emergency vehicles. As part of the Streetscape Project, FIT proposes, among other things, to create a park-like landscaped pedestrian mall open to the public. DASNY is financing its share of the cost of the project through the issuance of tax exempt bonds. FIT is making an equity contribution to pay for the remaining 25% of the project's cost. The total capital cost of the improvement is $19,430,105, of which $1,555,761 is allocated to the Streetscape Project.

On May 19, 2000, FIT, as the "project sponsor" under SEQRA regulations (see 6 NYCRR 617.2 [ad]), submitted the informational component of the SEQRA environmental assessment form (EAF) to DASNY, as required by section 617.6 (a). The EAF included a narrative description of the capital improvement projects, maps and architectural schematics, a traffic study prepared by retained consultants, Eng-Wong, Taub & Associates, and a zoning map of the area. DASNY then circulated letters to other involved agencies, including DOT and FIT, advising that it proposed to designate itself as lead agency (see 6 NYCRR 617.6 (b) (3) [i]). Since no agency objected to the designation, DASNY conducted a "coordinated review" of the project pursuant to section 617.6 (b) (3) (ii) and (iii) of the regulations. On June 27, 2000, DASNY, as lead agency, issued a negative declaration—notice of determination of nonsignificance, thereby ending the SEQRA review process (6 NYCRR 617.6 [b] [3] [ii], [iii]; 617.7 [a] [2]) as to the environmental aspects of the project. Accordingly, preparation of a draft environmental impact statement (EIS) was not required.

DOT, as part of the CEQR process, reviewed the EAF submitted to DASNY and prepared an environmental assessment statement describing the City's action regarding the proposed project. DOT concurred with the DASNY negative declaration, as well as with the environmental assessment and determinations included in the DASNY EAF and, on June 29, 2000, issued its own notice of negative declaration stating that, based on environmental assessments and supporting documentation, it had determined that the proposed project would have no foreseeable significant adverse effects on the environment and therefore preparation of an EIS was not required.

Petitioners commenced this proceeding against DASNY and DOT a few days before the expiration of the four-month statute of limitations applicable to article 78 proceedings, claiming that the proposed Streetscape plan would turn the western end of West 27th Street into a problem area, creating safety and environmental hazards where none currently exist. They also claimed that the proposed midblock turnaround would be inadequate and pose a danger to pedestrians and to the safety of the surrounding community. In that regard, petitioners argue that in a document prepared by FIT, it tacitly concedes the existence of those problems by claiming it would provide personnel to escort fuel oil delivery trucks and other large vehicles through the street. Petitioners also contended that the conversion of a narrow, 34-foot-wide street in the heart of Manhattan into a two-way street would increase traffic and create noise and pollution on West 27th Street as well as in the surrounding community, and would inhibit the ability of the resident commercial enterprises to operate, thereby jeopardizing the successful mixed use nature of the community. Petitioners argued that these issues were not adequately addressed by the environmental reviews undertaken by respondents and, in fact, in some instances, not addressed at all. They seek to annul DASNY and DOT's negative declarations as arbitrary and capricious and, alleging that DOT lacks the authority to close a portion of West 27th Street to nonemergency vehicles, seek an injunction prohibiting DOT from approving the Streetscape Project.

In lieu of answering, DASNY and DOT moved separately to dismiss the petition pursuant to CPLR 7804 (f), 3211 (a) (10) and 1001 (a) for failure to join FIT as a respondent. Although not conceding that FIT was a necessary party, petitioners cross-moved pursuant to CPLR 1003 to amend the petition to add FIT as a party respondent, arguing that, while ordinarily the statute of limitations would have expired, under the "united in interest" doctrine their claims against FIT were timely since they "relate back" to the commencement of the proceeding. The motion court, finding that FIT was a necessary party because if the SEQRA and CEQR negative declarations were annulled, FIT's interest "would be adversely and inequitably affected, without the benefit of notice and an opportunity to be heard," dismissed the petition for failure to join FIT as a respondent prior to the expiration of the statute of limitations. The court rejected petitioners' argument that their claim against FIT should relate back and thus toll the statute of limitations, on the ground that FIT and respondents DASNY and DOT are united in interest. The court found that DASNY, DOT and FIT are distinct entities with different interests in the proceeding, and that neither of the governmental agencies shared FIT's interest in protecting its long-term plans for growth and development. Petitioners appeal from the dismissal of the petition and the denial of their cross motion to amend. We modify to reinstate the petition.

At the outset, we note that the joinder provisions of CPLR 1001 (a) apply to article 78 pr...