Matter of Develop Don't Destroy (Brooklyn) v. Urban Development Corp.

• Decision Date: 26 February 2009
• Docket Number: M-4100.,4206.
• Citation: 59 A.D.3d 312,874 N.Y.S.2d 414,2009 NY Slip Op 01395
• Parties: In the Matter of DEVELOP DON'T DESTROY (BROOKLYN) et al., Appellants, v. URBAN DEVELOPMENT CORPORATION, Doing Business as EMPIRE STATE DEVELOPMENT CORPORATION, et al., Respondents.
• Court: New York Supreme Court — Appellate Division

59 A.D.3d 312

874 N.Y.S.2d 414

2009 NY Slip Op 01395

In the Matter of DEVELOP DON'T DESTROY (BROOKLYN) et al., Appellants, v. URBAN DEVELOPMENT CORPORATION, Doing Business as EMPIRE STATE DEVELOPMENT CORPORATION, et al., Respondents.

4206.

M-4100.

Appellate Division of the Supreme Court of the State of New York, First Department.

Decided February 26, 2009.

Order and judgment (one paper), Supreme Court, New York County (Joan A. Madden, J.), entered January 17, 2008, inter alia, dismissing the action challenging various administrative findings concerning the Atlantic Yards Arena Redevelopment Project, affirmed, without costs. [See 2008 NY Slip Op 30104(U).]

Respondent Forest City Ratner Companies (FCRC) has proposed to construct a vast and purportedly transformational mixed-use development on a 22-acre swath of real estate in Brooklyn extending eastward from the junction of Atlantic and Flatbush Avenues. "Atlantic Yards," as the project is called by reason of its planned situation atop of and in blocks adjacent to the rail yards serving the Long Island Rail Road (LIRR) Atlantic Terminal, is to include 16 high rise structures and a sports arena. Six thousand, four hundred thirty housing units, more than a third of which will be "affordable," are to be accommodated in the project's towers along with hundreds of thousands of square feet of space dedicated to commercial purposes. Also to be included within the project footprint is an 18,000-seat arena, intended to serve, inter alia, as the new home of the Nets, the National Basketball Association franchise now situated in New Jersey, which would, upon its move to the new arena, become Brooklyn's first major professional sports team since the Dodgers left the borough for Los Angeles in 1957. The proposed arena's design is by the eminent American architect, Frank Gehry, and the eight acres of open space to be situated amid the arena and the project's other structures are to be laid out according to the plans of the highly regarded landscape architect, Laurie Olin. Other promised benefits of the project include improved access to the major transit hub already located at its site and construction of a new, covered LIRR rail yard.

The project has been shepherded through its preconstruction phases and otherwise promoted by respondent New York State Urban Development Corporation, doing business as the Empire State Development Corporation (ESDC). In addition to acting as the "lead agency" in connection with the project's environmental review (see generally 6 NYCRR 617.2 [u]), the ESDC has obtained authorization from the State Legislature and respondent New York State Public Authorities Control Board (PACB) to finance a portion of the project through a bond issue. It has also made certain findings simultaneously placing the project within its purview and exempting it from compliance with otherwise applicable city zoning and land use laws (see McKinney's Uncons Laws of NY § 6266 [3] [Urban Development Corporation Act (UDCA) § 16 (3), as added by L 1968, ch 174, § 1, as amended]), namely, that the project qualifies as a "land use improvement project" pursuant to Unconsolidated Laws § 6260 (c) and § 6253 (6) (c) (UDCA § 10 [c]; § 3 [6] [c]), based upon blight at its site, and that the project's proposed arena qualifies under Unconsolidated Laws § 6260 (d) and § 6253 (6) (d) as a "civic project." Also, in collateral proceedings the ESDC has exercised its condemnation power (see Uncons Laws § 6255 [7] [UDCA § 5 (7)]) on the project's behalf (see Matter of Anderson v New York State Urban Dev. Corp., 45 AD3d 583 [2007], lv denied 10 NY3d 710 [2008]) and has defended that exercise against constitutional challenge (see Goldstein v Pataki, 516 F3d 50 [2008], cert denied 554 US ___, 128 S Ct 2964 [2008]).

The project footprint extends over eight city blocks, the majority of which are now occupied by subgrade rail yards lying within an area that has, since 1968, been designated the Atlantic Terminal Urban Renewal Area (ATURA). There is no dispute that this previously designated area is in fact blighted and that the proposed development, insofar as it affects this area, has been properly deemed a "land use improvement project." Adjoining the rail cut on its southern side, however, lie two full blocks and part of a third that are not within ATURA but are within the FCRC project footprint. These non-ATURA project blocks, although never previously earmarked for urban renewal, have, since the announcement of the project, been found blighted by the ESDC and thus proper for development under the ESDC's auspices, along with the contiguous rail yard blocks, as a "land use improvement project."

While the principal focus of this appeal would appear to be upon the propriety of the ESDC's UDCA findings that the non-ATURA project blocks are blighted and that the proposed arena qualifies as a "civic project," petitioners in this hybrid CPLR article 78/declaratory judgment action have also raised numerous challenges to the adequacy of respondents' compliance with the State Environmental Quality Review Act (SEQRA), several of which survive for our review. Petitioners urge (1) that the PACB determination approving the ESDC's financial participation in the project was improper in the absence of environmental findings by the PACB; (2) that the ESDC's environmental review was deficient due to its failure to address the risk of a terrorist attack upon the project; (3) that the "build years" used by the ESDC in its environmental impact statement (EIS) were irrational and skewed the ensuing analysis of the project's environmental effects; and (4) that because the ESDC failed to study and give due consideration to real estate market trends in the non-ATURA project area, it could not have adequately discharged its statutory obligation to consider alternatives to the proposed project not involving that area's development as part of an urban renewal project. We address these SEQRA claims first and then turn to the claims arising under the UDCA.

Ordinarily, under SEQRA an involved agency must, when exercising discretion to approve an action for which an EIS is required, make certain statutorily enumerated environmental findings based on the EIS (see ECL 8-0109 [8]; 6 NYCRR 617.11 [d]). This requirement, however, is logically premised upon the relevance of the EIS to the decision the agency is called upon to make. Accordingly, where the decision, although discretionary, is governed by criteria unrelated to the environmental concerns addressed in an EIS, environmental findings based on the EIS are unnecessary as it would be pointless to mandate reliance on an EIS in the interest of informed decision-making in circumstances where the EIS is by hypothesis irrelevant to and cannot inform the decision to be made (see Incorporated Vil. of Atl. Beach v Gavalas, 81 NY2d 322, 326 [1993]). Here, the PACB's approval of the ESDC's financial participation in the project was governed by closely drawn statutory criteria specifically relevant to a distinct, statutorily prescribed inquiry, i.e., whether "there [were] commitments of funds sufficient to finance the acquisition and construction" of the project (Public Authorities Law § 51 [3]). Plainly, this singular, discrete financial inquiry would not have been usefully informed by the EIS's account of the project's environmental effect and, accordingly, did not trigger an obligation to make environmental findings pursuant to ECL 8-0109 (8).

Petitioners' remaining SEQRA claims allege substantive deficiencies in the project's EIS. However, our power to review the substantive adequacy of an EIS is extremely limited. It is by now a familiar refrain that we may not disturb an agency determination as substantively flawed unless it is affected by an error of law, arbitrary and capricious, or constitutes an abuse of discretion (see CPLR 7803 [3]; Akpan v Koch, 75 NY2d 561, 570 [1990]; Matter of Jackson v New York State Urban Dev. Corp., 67 NY2d 400, 416 [1986]), and, in the context of reviewing a lead agency's SEQRA determination, this generally expressed limitation has been understood to confine judicial inquiry to a "review [of] the record to determine whether the agency identified the relevant areas of environmental concern, took a hard look at them, and made a reasoned elaboration of the basis for its determination" (id. at 417 [internal quotation marks and citations omitted]). In assessing whether an agency has met its substantive SEQRA obligations, the appropriate judicial focus is not upon the agency's ultimate judgments but upon the deliberative process by which they were reached, and the touchstone is reasonableness. "Not every conceivable environmental impact, mitigating measure or alternative must be identified and addressed before a FEIS will satisfy the substantive requirements of SEQRA. The degree of detail with which each factor must be discussed obviously will vary with the circumstances and nature of the proposal" (Jackson, 67 NY2d at 417 [internal quotation marks and citations omitted]).

While the 3,500-page final EIS approved by the ESDC in connection with the proposed project provides impressively detailed analyses of the project's anticipated environmental impacts in 16 separately identified areas, petitioners contend that it fails to identify and take a "hard look" at a relevant area of environmental concern because it does not address the risk of a terrorist incident at the project site. But SEQRA contains no provision expressly requiring an EIS to address the risk of terrorism and, indeed, it would not appear that terrorism may ordinarily be viewed as an "environmental impact of [a] proposed action" (ECL 8-0109 [2] [b] [emphasis added]) within the statute's purview. We do not, however, find it necessary to determine whether consideration of the prospect of terrorism may ever lie within the scope of the environmental review mandated by the statute,...