In re BY Development, Inc.

Decision Date02 August 2000
Docket NumberNo. 21104.,21104.
PartiesIn the Matter of the Application of B.Y. DEVELOPMENT, INC.
CourtSouth Dakota Supreme Court

Roger A. Tellinghuisen, Michelle K. Percy, Spearfish, South Dakota, Paul J. Bradsky, Rapid City, South Dakota, Attorneys for appellee B.Y. Development, Inc.

Jon W. Mattson, Deadwood, South Dakota, Attorney for City of Deadwood and the Deadwood Historical Preservation Commission.

Mark Barnett, Attorney General, Michele K. Bennett, Diane Best, Assistant Attorneys General, Pierre, South Dakota, Attorneys for appellant South Dakota Department of Education and Cultural Affairs, Office of History.


[¶ 1.] This appeal concerns the proposed construction of a hotel-gaming facility within a historic district in the City of Deadwood, South Dakota. The Deadwood Historic Preservation Commission approved a modified project plan, with alterations suggested by, among others, the Department of Education and Cultural Affairs, Office of History. On appeal before the circuit court, the Office of History contended that although it did have an earlier opportunity to comment on the project, it did not have notice of the modified project plans ultimately approved by the Commission. In its ruling, the circuit court concluded that the Office of History received proper statutory notice of the project, and that later alterations to the plans did not require a new statutory notice, as every design change is not the instigation of a new project. We affirm.


[¶ 2.] In the spring of 1998, B.Y. Development, Inc. proposed a plan for a hotel-gaming project on the 300 block of Main Street in Deadwood. Located near the edge of town, the project area lies within the Deadwood National Historic Landmark District, but outside the Downtown Historic District. The area was zoned commercial in 1990. Among the properties currently in the general vicinity are an apartment building, a gas station-convenience store, several hotels, a restaurant, an insurance agency, and a rodeo grandstand and arena. The project required demolition of a 1950s era motel and certain residences, and the relocation of other buildings.

[¶ 3.] B.Y. applied to the Deadwood Historic Preservation Commission for permits to demolish the buildings in April and May of 1998. No plans for the project following the demolition were submitted at that time, so the application was tabled until the plans were presented. Four preliminary concept designs were submitted to the Commission on May 18, 1998. The City of Deadwood reviewed these designs and suggested changes. In the next several weeks, B.Y. submitted further preliminary concept designs that reflected the comments made by the City and the Commission. On June 5, 1998, the City submitted the preliminary concept design to the State Department of Education and Cultural Affairs, Office of History, for review and comment pursuant to SDCL 1-19A-11.1. B.Y. submitted color drawings of the project and preliminary floor plans, a site plan, and elevations to the City to review on June 7. The City suggested changes, which B.Y. incorporated into the plans, and on June 18, B.Y. submitted updated plans. On June 24, the Commission reviewed these revised project plans. B.Y supplied a computerized drawing of the completed project, after which the Commission approved the project design and sent its approval to the Office of History with an abbreviated case report.

[¶ 4.] After reviewing the project plans, the Office of History issued a "Determination of Adverse Effect." The Commission reviewed this, but reaffirmed its approval. Several days later the Office of History met with the City and B.Y. to discuss design alternatives. No consensus for an acceptable design was reached at this meeting. B.Y., however, incorporated some suggestions made by the Office of History and revised the project, reducing the building height from 58 feet to 45 feet, increasing the length of the building from 250 feet to 296 feet, decreasing the number of rooms from 90 to 80, adding landscaping to improve the appearance of the facade, and simplifying the design. Before the Commission met to review and vote on the revised plan on August 12, 1998, Christopher Hetzel, the Deadwood Historic Preservation Officer, spoke with the Office of History about the revised plan. The Office informed him that this plan too would not be approved and Hetzel duly reported that decision to the Commission. Nonetheless, formal notice of the revised plan was not sent to Office of History as it now insists is required under SDCL 1-19A-11.1. The Commission approved the revised plan and entered its written determination and case report detailing the factors and alternatives it considered in making its decision.

[¶ 5.] The Office of History appealed the matter to the circuit court. At the hearing, B.Y. sought to admit affidavits that had not been presented to the Commission. Over the Office of History's objection, the court admitted a portion of the affidavits. Thereafter, the court affirmed the decision of the Commission. The Office of History now appeals to this Court contending that (1) the circuit court erred by improperly admitting evidence outside the administrative record; (2) the Commission erred by issuing its final decision before the Office of History was provided with and afforded an opportunity to review final project plans; (3) the Commission erred by failing to address each feasible and prudent alternative to the proposal; and (4) the Commission erred by failing to include concise and explicit fact statements to support its findings.

Standard of Review

[¶ 6.] We review an agency's decisions the same as the circuit court, "unaided by any presumption of the correctness of the circuit court's determination." Olson v. City of Deadwood, 480 N.W.2d 770, 775 (S.D.1992) (citation omitted). Our first inquiry under SDCL 1-26-36 is whether the question is one of fact or law. Questions of law and statutory construction are fully reviewable. Hanten v. Palace Builders, Inc., 1997 SD 3, ¶ 8, 558 N.W.2d 76, 78. Mixed questions of law and fact are also fully reviewable. Abild v. Gateway 2000, Inc., 1996 SD 50, ¶ 6, 547 N.W.2d 556, 558-59. Factual findings are reviewed under the clearly erroneous standard. Sopko v. C & R Transfer Co., 1998 SD 8, ¶ 6, 575 N.W.2d 225, 228.

Analysis and Decision
1. Admission of Evidence Outside the Administrative Record

[¶ 7.] The Office of History challenges the admissibility of the affidavits, pointing out that they were written after the Commission made its decision, and the Commission therefore could not have considered them. In the circuit court hearing, B.Y. offered the affidavits of Christopher Hetzel, the Deadwood Historic Preservation Officer, and Bernadette Williams, the Deadwood Zoning Administrator. In admitting the affidavits, the court explained:

Well, it's my view that some of it is additional evidence; some of it is not. And I will—I will accept the filings only insofar as they're specifically referenced and it's evident that that evidence was considered by the Commission. The affidavits also go beyond that and to the extent that they incorporate any other matters that aren't specifically in the record or referred to in the record and show that they were considered, they're excluded.

It is unclear, however, exactly what was admitted and what was excluded. Pointing to SDCL 1-26-35,1 the Office of History believes that while this statute allows a court sitting without a jury to go beyond the record in certain instances, the exceptions are inapplicable here. Because the circuit court did not specify what was being admitted, the Office of History argues that the affidavits and the accompanying exhibits should have been entirely excluded.

[¶ 8.] Comparing the information before the Commission and the information in the circuit court's findings and conclusions confirms that the findings that form the basis for the court's decision do not refer to any fact stated in the affidavits not also contained in the official record. Those items not considered by the Commission were also not considered by the court in its ruling. For example, an attachment to the affidavit of Williams lists variances granted in zoning unit four, the most stringent unit for historic preservation, and in zoning unit ten. The list states the various Deadwood businesses given a variance and the nature of the variance. A check of the references to the location in the record that allegedly indicate that the Commission considered this information shows that the Commission discussed the height of several buildings, but no specific variances were mentioned. The court's findings and conclusions do not mention this information either. Similarly, Williams stated in her affidavit that the project as approved by the Commission "satisfies the 1:7:1 Floor Area Ratio requirement in Commercial Highway zoning." It would be an overstatement to say that the general conversations in the record concerning zoning to which the court was directed are the same as this specific information, but the circuit court also did not include this in its findings.

[¶ 9.] As declared in SDCL 1-26-35, the court's review is confined to the record below, absent an exception. Stanley County Sch. v. Stanley County Educ. Ass'n, 310 N.W.2d 162, 164 (S.D.1981). However, we presume until the contrary is shown that the "court did not rely on improper evidence." State Highway Comm'n v. Foye, 87 S.D. 206, 205 N.W.2d 100, 103 (1973) (citing Sabbagh v. Prof'l and Bus. Men's Life Ins. Co., 79 S.D. 615, 116 N.W.2d 513, 521 (1962)). It appears the circuit court relied only on evidence the Commission considered in making its decision. Even though the court did not specify what exact evidence it admitted, it made clear that to the extent an affidavit contained information not specifically in or referred to in the...

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