Real estate lawyer: ‘Ward veto’ keeps developers away from Solon

SOLON, Ohio — A lawyer whose practice concentrates on real estate development, land use and zoning told the city’s Charter Review Commission that Solon’s zoning restrictions have been a deterrent to developers.

At the commission’s meeting Tuesday (May 4) at City Hall, Chairman Dennis Tidmore asked attorney Majeed Makhlouf, “Do developers stay away from Solon due to the ward veto and zoning restrictions?”

“The simple answer is yes, and I’ll be very frank,” Makhlouf said. “Solon is viewed as a city that is difficult to develop, and I think the ward veto has very much to do with that.”

The idea of referendum zoning, in which voters determine the fate of zoning amendments, is very prevalent in Northeast Ohio, but perhaps unique to this area, Makhlouf said.

“If you go to Columbus — or any other parts of Ohio or even other states — they have no idea what referendum zoning is,” he said.

The commission has been discussing the merits of changing the city’s requirement for ward approval in elections involving zoning issues.

Currently, zoning amendments placed on the ballot must pass both citywide and in the affected ward. So if the majority of the city approves an issue, but most of the affected ward votes no, the issue fails, resulting in the “ward veto.”

The commission invited Makhlouf — former law director for Cuyahoga County who is now a member of the Beachwood-based Berns, Ockner and Greenberger law firm — to discuss project challenges for developers in Solon.

Rob Frankland, the city’s director of planning and community development, was also invited to answer questions about zoning challenges facing the city.

Any recommendations for amendments to the city charter that the commission makes must be approved by City Council before going to the electorate.

‘Not worth the fight’

Makhlouf said the most significant loss to a city is “the development that you never get to hear of.”

“A developer comes into our office and says, ‘I’m interested in this development in Solon,’” he said. “We start walking them through that process, what it means to have the development in Solon.

“Their head is shaking; they walk out. They literally walk out of our office, thinking, ‘OK, we can do development in other places.’ They (developments for Solon) never go anywhere, because the type of return on that development is not worth the fight.”

The cost of an election campaign, when a city has referendum zoning, can be a real deterrent to a developer, Makhlouf said.

“How much does a campaign cost?” he said. “And now you’re having to hire a campaign consultant, and you’re hoping that the ward councilman will be on your side and that the stars are aligned somehow that the measure is going to pass on the ballot.”

The two “biggest killers” to any development are risk and time — even more than cost sometimes — because a developer wants to invest when the market is right, Makhlouf said.

“Right now, residential is very hot, and everybody wants to do residential, especially senior housing,” he said. “Everybody wants to get their project out now, because they don’t know what the market will be a year down the road.

“If (a developer comes) to Solon, they realize they can’t be on the ballot this November. So, for a developer who is ready to do a senior housing development, but the zoning isn’t there for it, we’re talking months, almost a full year, before they can get their zoning done.

“Who needs that risk? So, I think those are the kinds of opportunities the city loses and doesn’t know about.”

The city is fortunate that it’s doing well and doesn’t need those developers at this point, Makhlouf noted.

“But watch what you push away, because there comes a point where you really need them,” he said. “And that is something to think about seriously in terms of the impact of referendum zoning or the ward veto.”

Legal challenge difficult

Makhlouf said from a legal standpoint, challenging a ward veto in court is a very difficult thing to do.

“We live in this country on the idea of one person, one vote,” he said. “We all read George Orwell about, ‘Some people are more equal than other people.’

“That’s sort of what the ward veto is saying, and it sometimes doesn’t have a rational relationship. You need a rational relationship, why you’re restricting somebody’s right to vote.”

There never has been a court case in Ohio that has truly upheld the constitutionality of the ward veto, Makhlouf said.

“Seven Hills realized they were losing all that development to Independence, so they ended up voluntarily getting rid of the ward veto,” he said. “They put it to the voters, and the voters got rid of it.

“But a court has never invalidated it. That’s why you almost need a fix for it on the ballot, because it’s very difficult to structure a case that would undo it in court.”

The better course of action for a city, Makhlouf said, is “to stop waiting for the court to do it for you, and sort of just do it yourself.”

“Have the citizens understand the value of getting rid of it, and have them make the choice to get rid of it through a charter amendment, as opposed to waiting for a court to do it for you,” he said.

Impact of master plan

Frankland, who has worked for the city since 2001, was asked about how the city’s master plan impacts its zoning.

“The good thing about having a master plan is it basically demonstrates that you’ve shown forethought before you’ve done your zoning,” he said. “The master plan is more of an insurance policy, and it’s protection.

“If we’re facing a challenge that we don’t want apartments on SOM (Center Road), the master plan protects us from the types of zoning we don’t want and defends the zoning that we do want.”

The master plan highlights ideal redevelopment that a city wants, such as mixed use of the downtown area, Frankland said.

“That’s been in the master plan since 2010,” he said.

Frankland said he views the ward veto as more of a political decision than a planning decision.

“With referendum zoning, in general, you have a long wait,” he said. “In Solon, it’s going to take at least seven months to get a zoning change; it can take as long as a year, depending upon when you apply.

“So, it’s a long time and it’s a high hurdle at the end, because not only is there referendum zoning, but there’s also the ward veto. I’m not saying that’s bad or good or whatever.”

Frankland noted that he has talked to developers who “get very nervous” about the ward veto.

He said most of the city is “built out,” so there isn’t much room for new development. There is some land available for development, however, in Wards 5 and 3.

“(The other five wards) are not likely to have development, but you could come in with redevelopment,” he said.

Tidmore reminded the commission that it faces a tight timeline, with a June 21 deadline for making recommendations to council. He suggested that it break up into subcommittees to discuss some of the amendments it is considering.

“I believe with the talent we have on this commission, we can get something worthwhile to recommend to council,” he said.

At its next meeting at 7:30 p.m. Tuesday (May 11) at City Hall, the commission will discuss input recently received about the charter from former mayor Kevin Patton and former councilman John Scott, Tidmore said.

The commission has received feedback from Mayor Ed Kraus and two former mayors, but not Susan Drucker, as was incorrectly reported in a previous article.

Read more from the Chagrin Solon Sun.