Rouse-Fairwood Ltd. Partnership v. Supervisor of Assessments of Prince George's County

• Decision Date: 01 September 1997
• Docket Number: ROUSE-FAIRWOOD,No. 793,793
• Citation: 120 Md.App. 667,708 A.2d 19
• Parties: LIMITED PARTNERSHIP v. SUPERVISOR OF ASSESSMENTS OF PRINCE GEORGE'S COUNTY, Maryland. ,
• Court: Court of Special Appeals of Maryland

Page 667

120 Md.App. 667

708 A.2d 19

ROUSE-FAIRWOOD LIMITED PARTNERSHIP v. SUPERVISOR OF ASSESSMENTS OF PRINCE GEORGE'S COUNTY, Maryland.

No. 793, Sept. Term, 1997.

Court of Special Appeals of Maryland.

April 7, 1998.

Kurt J. Fischer (Evelyn W. Pasquier and Piper & Marbury, L.L.P., on the brief), Baltimore, for appellant.

David M. Lyon, Asst. Atty. Gen. (J. Joseph Curran, Jr., Atty. Gen., on the brief), Baltimore, for appellee.

Argued before MOYLAN, HOLLANDER and SONNER, JJ.

HOLLANDER, Judge.

This appeal focuses on the phrase "more intensive use" as it was used in Md.Code (1986, 1994 Repl.Vol., 1996 Cum.Supp.), § 8-209(h)(1)(ii) of the Tax-Property Article ("T.P."). ¹ On December 1, 1994, the Supervisor of Assessments for Prince George's County, appellee, imposed an agricultural transfer tax and penalty upon appellant, Rouse-Fairwood Limited Partnership ("Rouse"), in connection with three properties that appellant owned in Prince George's County. The Maryland Tax Court upheld that determination on February 21, 1996, and, by order dated March 28, 1997, the Circuit Court for Prince George's County affirmed. Rouse timely noted its appeal and presents two questions for our review, which we have rephrased slightly:

I. Did the Tax Court err in construing the language of T.P. § 8-209 to equate "more intensive use" of land with enhanced value and flexibility or variety of use, as opposed to the traditional factors of intensity that measure the impact of use on the land?

II. Did the Tax Court err in tacitly rejecting or failing to address Rouse's argument that the intensity of use permitted on Parcels 2 and 3, when viewed separately, is less under M-X-C zoning?

For the reasons that follow, we answer the first question in the negative and the second question in the affirmative. Therefore, we shall affirm in part and reverse in part and remand for further proceedings. ²

Factual background

The facts are largely undisputed. In 1990, Rouse acquired three properties in Prince George's County from three different owners, consisting of a total of 1,058 acres located just west of the City of Bowie (the "subject properties"). Parcel 1 measures approximately 473 acres, Parcel 2 measures approximately 339 acres, and Parcel 3 measures approximately 246 acres. At the time the subject properties were acquired, each was used as a sod farm and had an agricultural use tax assessment. To maintain that favorable assessment, appellant filed three declarations of intent to maintain the agricultural use of the properties for five years (i.e., through June 30 1995). Pursuant to T.P. § 13-305, such a declaration of intent permits a transferee to avoid imposition of the 5% agricultural land transfer tax. If the transferee fails to comply with the declaration of intent, however, or if the property fails to qualify during the five-year period for the agricultural assessment under T.P. § 8-209, then T.P. § 13-305(c)(2)(i) provides that the agricultural transfer tax, plus a 10% penalty, "is due on that portion of land that fails to comply with the declaration of intent or to qualify for farm or agricultural use."

Pursuant to T.P. § 8-209(h)(1)(ii), land did not qualify for an agricultural use assessment if it was "rezoned after July 1, 1972, to a more intensive use than the use permitted on or before July 1, 1972...." On July 1, 1972, the subject properties were zoned R-R (Rural Residential). ³ T.P. § 8-209(h)(1)(ii) stated:

[T]he following land does not qualify to be assessed under this section:

* * * *

(ii) land rezoned after July 1, 1972, to a more intensive use than the use permitted on or before July 1, 1972, if a person with an ownership interest in the land has applied for or requested the rezoning....

In 1992, the District Council amended the Prince George's Code to include a Planned Unit Development ("PUD") zoning category, called Mixed Use Community Zone ("M-X-C"). One of the stated purposes of the M-X-C zone is to "[c]reate a comprehensively planned community with a balanced mix of residential, commercial, recreational, and public uses." Prince George's County Code § 27-546.1. Appellant participated in developing the ordinance that created the classification. Generally, it allows a PUD on property that is at least 750 acres in size and permits a phased-in development of property.

Appellant filed an application in May 1993, to rezone the subject properties to M-X-C and, in May 1994, the District Council approved the rezoning. ⁴ Rouse indicated that it intends to develop the subject properties over a period of ten to fifteen years.

In December 1994, appellee issued three separate notices to appellant stating that the May 1994 rezoning of the subject properties to M-X-C violated Rouse's declarations of intent. Therefore, the Supervisor of Assessments imposed the agricultural transfer tax, plus penalties, on each parcel. In total, the Supervisor levied $408,377.50 in taxes and $40,837.75 in penalties. Appellant challenged the assessments by way of an appeal to the Maryland Tax Court.

On January 17, 1996, the Tax Court held a day-long hearing at which both parties presented expert witnesses. The experts testified about the permitted uses of the subject properties under the current M-X-C zoning and those that were permitted on July 1, 1972, when the subject properties were zoned R-R. The experts also expressed their opinions about whether M-X-C zoning constituted a more intensive use than R-R zoning as of July 1, 1972.

Under R-R zoning in 1972, the minimum lot size was 20,000 square feet for single family detached residential development. "Cluster" developments, ⁵ with reduced lot sizes and the flexibility to introduce single family attached dwellings (townhouses) into the total dwelling yield of a development proposal (but at no greater number of total units than could be obtained under the maximum allowed non-cluster density of 2.0 units per acre), were also permitted. But the difference between the reduced lot size (10,000 square feet for detached dwellings and 1,500 square feet for townhouses) and the conventional lot size (20,000 square feet) was to be set aside as open space elsewhere in the parcel. Nonresidential uses, permitted as of right, included, inter alia: Churches, libraries, museums, public buildings, public parks, and animal hospitals. Uses permitted by special exception included, inter alia: airports, antique shops, cemeteries, commercial recreational attractions, golf courses, hospitals, motels, horse racing tracks, sanitary landfills, sawmills, and tourist homes. Principal uses not enumerated as permitted uses or as special exception uses were expressly not allowed in the R-R zone.

M-X-C zoning permits a mix of uses on the land. In order to obtain M-X-C zoning, a Preliminary Development Plan ("PDP") must accompany the rezoning application. The ordinance requires a PDP to comply with the following criteria: (1) at least 30% of the gross area must be devoted to community use areas; (2) at least 10% of the gross area must be devoted to single family, low density dwellings; (3) at least 20% of the gross area must be devoted to single family, medium density residential units; (4) no more than 15% of the gross area may be devoted to "other residential" units; and (5) nonresidential areas must comprise between 5% and 20% of the gross area of the zone. These general parameters of the development are refined in the subsequent phases of the approval process, in which the developer must submit a Comprehensive Sketch Plan ("CSP") and a Final Development Plan ("FDP"). Both the CSP and FDP must be consistent with the PDP. Under's Rouse's PDP, 25% of the gross acreage will be used for single family low density dwellings, 20% for single family medium density dwellings, 15% for other residential uses, 5% for nonresidential uses, and 35% for community use areas.

Permitted residential uses in the M-X-C zone include: single family detached houses; townhouses; duplex houses; and apartments. As a matter of right, various nonresidential uses are also permitted under M-X-C zoning, but not under R-R zoning: banks; data processing facilities; eating or drinking establishments; research and development and testing laboratory; blueprinting, book, camera, gift, jewelry, music, souvenir, or other specialty stores; department store; dry cleaning; drugstore; food and beverage store; gas station; hardware store; pet shop; photographic supply store; seafood market; repair shops; variety and dry good stores; and an arena.

Appellant's land use planning expert, Thomas Kieffer, the head of the planning and zoning department of Ben Dyer Associates, opined that "the development permitted under the M-X-C at [the subject properties] is less intense than that permitted under the R-R." He compared the properties under the two zones, using some of the criteria developed in the 1960s by the Federal Housing Administration ("FHA") ⁶ and some of his own. Kieffer admitted that he could not perform an analysis using all of the FHA factors, however, because the factors were designed to analyze completed projects rather than planned projects. He considered the following factors: (1) density, expressed in terms of dwelling units per acre ("du/ac") for residential development, and floor area ratio ("FAR") for nonresidential development; (2) average household size; (3) student yield; (4) sewage disposal requirements; (5) parking requirements; and (6) traffic congestion. Kieffer concluded that, in every category except two (parking requirements and traffic generation during p.m. peak hour trips), the R-R zoning category was more intensive than that under M-X-C zoning.

Regarding the nonresidential uses, Kieffer compared a hospital, which was a permitted use in R-R zoning in 1972 as a matter of right, to the mix of office, service, and institutional type uses permitted under M-X-C zoning. For comparison purposes, Kieffer used the Greater Laurel...