In Bacharach Institute for Rehabilitation, Inc. v. Galloway Township Zoning Board of Adjustment, the New Jersey Superior Court Appellate Division continued to add to the body of precedent establishing the standard by which applications for a conditional use variance should be evaluated. Expanding upon the Supreme Court's decision in TSI East Brunswick, LLC v. Zoning Bd. of Adjustment of Twp. of East Brunswick, the court considered the trial court's affirmance of the zoning board's grant of a conditional use variance and corresponding relief in the underlying action in lieu of prerogative writs, which challenged the development of a three-story nursing home in Galloway Township, NJ. The Appellate Division held that an applicant's inability to comply with a standard for conditional use does not automatically convert such an application into a standard use variance under N.J.S.A. 40:55D-70(d)(1). Rather, the court determined that a relaxed standard should be applied based on the materiality of the unmet condition.
The applicant, Health Resources of New Jersey, LLC, applied to the Galloway Township Zoning Board of Adjustment for minor subdivision approval, preliminary and final site plan approval and a conditional use variance for the construction of a three-story nursing home facility in Galloway Township. The appellant, Bacharach Institute for Rehabilitation, Inc. is a nursing home and rehabilitation center and, as noted by the court, a prospective competitor of the applicant. In challenging the zoning board's approval of the application, the appellant initially argued that the proposed "nursing home" use is not listed as a permitted use under Galloway Township's planned commercial recreation zoning district (PCR), which envisioned a "resort-oriented development." In contrast, the zoning board found that the newly subdivided lot, on which the nursing home would be constructed, no longer fronted on Jimmie Leeds Road. As such, the "nursing home" was governed by the planned neighborhood residential district (NR) regulations, which permitted a nursing home use as a conditional use.
In the alternative, the appellant argued that even if permitted as a conditional use in the NR zone, the applicant failed to meet all of the NR zone's conditions required for a conditional use to be permitted. In furtherance of this argument, the appellant contended that the trial court incorrectly applied the rule that "specific provisions in an ordinance or statute will take precedence over general provisions," in determining that the PCR controlled with respect to the requirements for landscape buffering. The appellant specially questioned the court's determination that the PCR standards apply as they directly addressed the buffering requirements between adjacent lots, while the NR standards only provide general buffering requirements. The appellant averred that because "the nursing home is permitted in the PCR district only in accordance with the NR regulation, and such NR regulation does not address buffer requirements, the trial court should have found that the ordinances' general buffering provision should control." In rejecting this argument, the Appellate Division determined that the appellant did not meet the burden of showing that the board's decision was arbitrary and capricious or unreasonable, and thus affirmed the trial court's finding on the issue.
The appellant also argued that the applicant's failure to meet the building height standard applicable to nursing homes converted the application to a use variance under N.J.S.A. 40:55D-70(d)(1). The Appellate Division rejected the appellant's claim based on New Jersey case law, which clearly negated this argument.
The Appellate Division cited the trial court's opinion, which stated:
"New Jersey courts have consistently deemed conditional uses a form of permitted use and not a prohibited use, even when the conditional use fails to meet all of the conditions pertaining to the use. . . . The court has consistently required conditional uses that failed to meet a condition of that use to be subject only to the (d)(3) variance in conjunction with the lower level of judicially construed proofs required for that type of variance."
The Appellate Division cited to Coventry Square, Inc. v. Westwood Zoning Bd. of Adjustment, 138 N.J. 285, 297-98 (1994) and TSI East Brunswick, LLC v. Zoning Bd. of Adjustment of Tp. of East Brunswick, 215 N.J. 26 (2013) as cases that expressly distinguish the standards applicable to a use variance under N.J.S.A. 40:55D-70(d)(1) and a conditional use variance under N.J.S.A. 40:55D-70(d)(3). Under a conditional use variance, the applicant's must substantially meet the conditional use standards. In the current case, the applicant's deviation from the height standard was de minimis with no negative impacts.
As precedent on conditional use variances develops, the key issue will be what conditions are material and how materiality should be defined. In Bacharach, the applicant presented unrefuted expert testimony from a planner that the height deviation was not material. Bacharach may have been a closer case if there was competing testimony or if the objector could demonstrate that the failure to meet the condition resulted in some adverse impact to the surrounding neighborhood.
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