International Church of the Foresquare Gospel v. City of San Leandro, Case No. 09-15163

SUMMARY: On February 15, 2011, the Ninth U.S. Circuit Court of Appeals ruled that:

(1) A City cannot use zoning laws to prevent the building and use of a church because it prefers taxable use of the property; and 

(2) The City violated federal law in its denial of a zoning variance to allow a church to assemble in a building on industrial land.  

The church had presented evidence that there were no other suitable places to have a church of its size.  While the zoning ordinance may have been a facially neutral law of general applicability, the City’s assessment for a zoning variance was not.

FACTS:

Faith Fellowship Foursquare Church’s congregation grew tremendously in recent years.  Therefore, they outgrew their current location in a residential area of the City of San Leandro, California.  They searched for a larger suitable property.  They found only one large enough building in the entire City.  The property with a vacant industrial building was in an area zoned for industrial uses.  Various manufacturing businesses surrounded the building.  The area was virtually deserted on the weekends when the church services would occur.  The building also offered adequate parking.

Relying on statements from city officials that zoning would be ultimately approved, in December, 2006, the Christian Church purchased the property.  But the City ultimately voted against allowing a rezoning application and conditional use permit (i.e., a zoning variance) to use the property as a nonprofit Christian church for religious purposes.  The city said it preferred tax-producing entities such entertainment facilities instead of non-profit service-oriented churches and religious institutions.

The planning commission rejected the proposed conditional use permit because, in part, there were nearby up businesses using hazardous materials.  The church then appealed to the City Council who also unanimously denied the permit. 

FEDERAL COURT LAWSUIT:

The International Church of the Foursquare Gospel (“ICFG”) then filed a lawsuit in federal district court.

Note: Faith Fellowship Foursquare Church is an affiliate church of ICFG. 

The Church alleged violations of the Religious Land Use and Institutionalized Persons Act (42 U.S.C. § 2000cc [“RLUIPA”]), and also asserted First and Fourteenth Amendment violations.

The Church submitted evidence from a real estate agent that no other suitable properties existed.  There were 296 parcels rezoned for assembly (i.e., church) use.  But none of the 296 parcels were large enough and suitable for the needs of this large religious congregation.

The District Court ruled in favor of the City.  The federal judge in San Francisco accepted the City’s rationale that industrial uses are more important to the city than churches.  The judge questioned why the church could not split and divide into small multiple congregations.

APPEAL:

The Church appealed the court's granting of summary judgment in favor of the City.

The Church contended that the City violated its rights by denying a rezoning application and a conditional use permit, to build new church facilities on certain industrial land in the City.  Further they alleged that such a denial violated the “substantial burden” and “equal terms” provisions under RLUIPA.

The Appellate Court found that there is a material triable factual issue regarding whether the City imposed a substantial burden on the Church’s religious exercise under RLUIPA.

Under RLUIPA, a federal statute, local entities that receive federal funds are limited on how they may impose land use restrictions on property use for religious purposes.  If a government land-use restriction imposes a substantial burden on religious exercise, it must be non-discriminatory and must be no greater than necessary (i.e., the least restrictive means) to further a compelling governmental interests.

“Thus, RLUIPA analysis proceeds in two sequential steps.

First, the plaintiff must demonstrate that a government action has imposed a substantial burden on the plaintiff’s religious exercise.

Second, once the plaintiff has shown a substantial burden, the government must show that its action was “the least restrictive means” of “further[ing] a compelling governmental interest.”

The appellate court also decided that the City failed as a matter of law to prove a compelling interest for its actions.  Preservation of industrial land and generation of tax revenues is not a compelling reason to keep the church out of the property.

“In Grace Church, 555 F. Supp. 2d 1126 (S.D. Cal. 2008), the district court concluded that “preservation of industrial lands for industrial uses does not by itself constitute a ‘compelling interest’ for purposes of RLUIPA…Grace Church, 555 F. Supp. 2d at 1140. This is because “[c]ompelling state interests are ‘interests of the highest order.’ ” Id. (citing Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520, 546 (1993))." 

"Similarly, the district court in Cottonwood Christian Center held that revenue generation is not a compelling state interest sufficient to justify denying a religious institution a [[variance]] when such denial imposes a substantial burden. Cottonwood Christian Ctr., 218 F. Supp. 2d at 1228. The court there reasoned that if “revenue generation were a compelling state interest, municipalities could exclude all religious institutions from their cities.” Id. This is so because religious and educational institutions are tax exempt and the land would always generate more revenue if put to a commercial or industrial use. See id. Further, the court there went on to support its conclusion with evidence that the subject property, which the city decided that it wanted to use for a Costco, had not been put to a revenue-generating use in twelve years and that the city had not suffered. Id. at 1228-29. Analogously, here, the Catalina property was on the market because it had been unable to sustain the use preferred by the City as a technology company. It had been on the market for seven months when the Church entered into its contract with the then-property owners to buy the property for religious purposes.”

Accordingly, the appellate court reversed the judgment of the district court and remand for further proceedings in the district court that are consistent with its opinion.

NOTES:

The Church was represented by attorneys at the Pacific Justice Institute.

Amicus briefs were filed by attorneys for the Church State Council and Calvary Chapel.

An Amicus brief was also submitted by the League of California Cities in favor of the City. 

The City was also represented by a private law firm.

Decisions from the Ninth Circuit are binding on federal courts in the following places: California, Oregon, Washington, Montana, Idaho, Arizona, Nevada, Alaska, Hawaii and U.S. Territories in the Pacific. Further, the court’s decisions sometimes influence decisions by courts in other regions of the United States.