McKee Family I, LLC v. City of Fitchburg

2017 WI 34

SUPREME COURT OF WISCONSIN
CASE NO.: 2014AP1914
COMPLETE TITLE: McKee Family I, LLC and JD McCormick Company,
LLC,
Plaintiffs-Appellants-Cross-
Respondents-Petitioners,
v.
City of Fitchburg,
Defendant-Respondent-Cross-Appellant.

REVIEW OF A DECISION OF THE COURT OF APPEALS
Reported at: 366 Wis. 2d 329, 873 N.W.2d 99

OPINION FILED: April 12, 2017
SUBMITTED ON BRIEFS:
ORAL ARGUMENT: November 3, 2016

SOURCE OF APPEAL:
COURT: Circuit
COUNTY: Dane
JUDGE: John C. Albert

JUSTICES:
CONCURRED:
DISSENTED:
NOT PARTICIPATING: Shirley S. Abrahamson and Rebecca Grassl
Bradley, JJ.

ATTORNEYS:

For the plaintiff-appellant-cross-respondent-petitioners,
there were briefs by Matthew Fleming and Murphy Desmond, S.C.,
Madison, and oral argument by Matthew J. Fleming

For the defendants-respondent-cross-appellant, there was a
brief by Lisa M. Lawless, Ross A. Anderson, Husch Blackwell,
LLP, Milwaukee and Mark R. Sewell, Fitchburg City Attorney, and
oral argument by Lisa M. Lawless

An amicus curiae brief was filed by Thomas Larson, Madison
for Wisconsin Realtors Association, NAIOP Wisconsin and the
Wisconsin Builders Association.
 An amicus curiae brief was filed by Ryan J. Walsh, Chief
Deputy Solicitor General with whom on the brief was Brad D.
Schimel, Attorney General and Misha Tseytlin, Solicitor General
for Wisconsin Attorney General and Department of Justice.

An amicus curiae brief was filed by Daniel M. Olson,
Madison for League of Wisconsin Municipalities.

2
 2017 WI 34
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2014AP1914
(L.C. No. 2010CV3808)

STATE OF WISCONSIN : IN SUPREME COURT

McKee Family I, LLC and JD McCormick Company,
LLC,

Plaintiffs-Appellants-Cross- FILED
Respondents-Petitioners,
APR 12, 2017
v.
Diane M. Fremgen
City of Fitchburg, Clerk of Supreme Court

Defendant-Respondent-Cross-Appellant.

REVIEW of a decision of the Court of Appeals. Affirmed.

¶1 ANN WALSH BRADLEY, J. Petitioner, McKee Family I,

LLC ("McKee") appeals an unpublished decision of the court of
appeals affirming a circuit court grant of summary judgment in

favor of the City of Fitchburg.1 The court of appeals determined

that McKee did not have a vested right under a planned

1
McKee Family I, LLC v. City of Fitchburg, No. 2014AP1914,
unpublished slip op. (Wis. Ct. App. Nov. 5, 2015) (affirming
judgment and ordered entered by the circuit court for Dane
County, John C. Albert, J., presiding).
 No. 2014AP1914

development district zoning classification and that its

constitutional claim failed as a result.

¶2 McKee contends that the court of appeals erred and

that it is entitled to summary judgment in its favor.

Acknowledging the fact that it did not submit an application for

a building permit, it nevertheless argues that it had a vested

right in developing land under the zoning classification.

¶3 According to McKee, vested rights accrue when a

developer has made substantial expenditures or incurred

substantial liability based upon reasonable expectations

established by government action. It contends that to the

extent that the zoning classification is contractual in nature

it also creates expectations upon which developers may rely.

Contingent on its vested rights arguments, McKee further asserts

that it has a claim for damages under the Takings Clause of the

United States Constitution.2

¶4 We conclude that McKee did not have a vested right in

developing the property under the planned development district
zoning classification because it did not apply for a building

permit. Wisconsin follows the bright-line building permit rule

that a property owner's rights do not vest until the developer

has submitted an application for a building permit that conforms

2
The Takings Clause of the Fifth Amendment of the United
States Constitution, made applicable to the states through the
Fourteenth Amendment, provides that private property shall not
"be taken for public use, without just compensation." U.S.
Const. amend V.

2
 No. 2014AP1914

to the zoning or building code requirements in effect at the

time of application. Lake Bluff Hous. Partners v. City of S.

Milwaukee, 197 Wis. 2d 157, 172, 540 N.W.2d 189 (1995).

¶5 Additionally, we determine that a planned development

district zoning classification does not create contractual

expectations upon which developers may rely. There is a very

strong presumption that legislative enactments do not create

contractual or vested rights. Dunn v. Milwaukee Cty., 2005 WI

App 27, ¶8, 279 Wis. 2d 370, 693 N.W.2d 82 (citation omitted).

Further, there must be a clear indication that a legislative

body intends to bind itself contractually in order to overcome

the presumption. Nat'l R.R. Passenger Corp. v. Atchinson,

Topeka and Santa Fe Ry. Co., 470 U.S. 451, 465-66 (1985). McKee

failed to overcome the presumption that Fitchburg did not intend

to enter into a binding contract when it enacted an ordinance

approving the zoning classification.

¶6 Finally, we do not need to reach McKee's

constitutional takings claim because McKee conditioned its
takings claim on its claim for vested rights. Because McKee has

no vested right in a planned development district zoning

classification, it cannot succeed on its asserted contingent

takings claim.

¶7 Accordingly, we affirm the decision of the court of

appeals affirming the circuit court's grant of summary judgment

in favor of the City of Fitchburg.

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I

¶8 This case involves a dispute about a change in the

municipal zoning classification of property that McKee owns in

Fitchburg. Specifically, McKee objects to Fitchburg's rezoning

of two lots (53 and 54) from a planned development district

("PDD") zoning classification to a residential-medium ("R-M")

zoning classification. To provide the necessary context, we

begin by explaining Fitchburg's process for adopting a zoning

classification.

¶9 Pursuant to Wis. Stat. § 62.23 (2013-14),

municipalities may use a PDD zoning classification to establish

planned mixed-use developments that have a higher density than

is allowed under an R-M classification.3 The R-M zoning

3
Wis. Stat. § 62.23(7)(b) provides in relevant part:

[T]he council may divide the city into districts of
such number, shape, and area as may be deemed best
suited to carry out the purposes of this section; and
within such districts it may regulate and restrict the
erection, construction, reconstruction, alteration or
use of buildings, structures or land . . . The counsel
may establish mixed-use districts that contain any
combination of uses, such as industrial, commercial,
public, or residential uses, in a compact urban form.
The council may with the consent of the owners
establish special districts, to be called planned
development districts, with regulations in each,
which . . . will over a period of time tend to promote
the maximum benefit form coordinated area site
planning, diversified location of structures and mixed
compatible uses. . . .

All subsequent references to the Wisconsin Statutes are to
the 2013-14 version unless otherwise indicated.

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 No. 2014AP1914

classification allows development of only single-family or

duplex structures.

¶10 Before a property owner can develop land that is zoned

under the PDD classification, Fitchburg's General Ordinances

require the property owner to submit a general implementation

plan ("GIP") to Fitchburg's Plan Commission. Fitchburg, Wis.,

Gen. Ordinances §§ 22-593, 22-594 (2015).4 The Plan Commission

then makes a determination and recommendation whether to advise

the Fitchburg Common Council to approve the rezoning and GIP, to

approve it with modifications, or to deny it. Id. § 22-594(b).

¶11 If Fitchburg approves a general plan, a property owner

is then required to submit a specific implementation plan

("SIP"). Id. § 22-599. A property owner is allowed to apply

for a building permit if Fitchburg approves the SIP. Id. § 22-

597.

¶12 The relevant zoning history of this case extends back

to 1989, when McKee Brothers Partnership agreed to dedicate

approximately 60 acres of farmland to the City of Fitchburg.
This farmland, which became McKee Farms Park, was donated to

fulfill Fitchburg's park land dedication requirements for a

variety of McKee Brothers' projects, including the property at

issue in this case. Credit for the parkland allocation was

determined by a settlement agreement, which gave McKee Brothers

4
The references to the Fitchburg General Ordinances in
paragraph 11 are also to the 2015 version of the ordinances.

5
 No. 2014AP1914

the right to build 600 dwelling units on a variety of lands it

owned.

¶13 Over the years, the property at issue has been

transferred between various McKee entities. After the parkland

dedication, McKee Brothers transferred the property to MAF

Development, Inc., to create the Plat of Chapel Valley.5 The

plat included four lots, the two undeveloped lots at issue (53

and 54), as well as two additional lots that have already been

developed (10 and 11).

¶14 In conjunction with the creation of the Plat of Chapel

Valley, MAF Development entered into an agreement with Fitchburg

that it would make improvements in preparation for developing

its land. The required improvements included: standard street

improvements, installation of sidewalks, walkways and driveways,

sanitary sewers, water mains laterals and easements, drainage

facilities, grading and landscaping, erosion control, and

electric, communications and gas facilities.

¶15 At the time the plat was created, it had an R-M zoning
classification, but MAF Development applied for and received

approval for rezoning to a PDD classification. When Fitchburg

enacted Ordinance No. 94-O-11 rezoning Lots 10, 11, 53, and 54

from R-M to PDD zoning, it also approved MAF Development's

general implementation plan for developing the property.

5
William F. McKee was the president of MAF Development.

6
 No. 2014AP1914

¶16 As the general plan explained, the proposed

development would provide "high quality multi-family housing

that is in strong demand" for "mature adults." Citing the "lack

of housing options for mature adults in the Fitchburg area," the

proposed development was intended to complement the "Independent

Living" and "Elder Care" developments nearby. The GIP explained

that the "formation of such a 'senior community' will serve the

community by making the most efficient use of public and private

services these people will require."

¶17 Lots 10 and 11, which are not at issue in this case,

were developed between 1995 and 2002 under the PDD-GIP zoning

plan with assisted living facilities, senior housing and senior

condominiums. Lots 53 and 54 were not developed and were

eventually deeded from MAF Development to McKee in 2007.

¶18 In 2008, more than a decade after Fitchburg approved

the planned development district zoning and MAF Development's

general implementation plan, McKee and JD McCormick Company, LLC

("McCormick"), entered into negotiations for McCormick to
purchase the undeveloped lots 53 and 54 from McKee. The

purchase agreement was contingent on McCormick's ability to

obtain approval from Fitchburg to build 128 apartment units on

the lots.6

6
McCormick was a plaintiff in this action before the
circuit court granted Fitchburg's motion to dismiss McCormick
from the case for lack of standing. McCormick did not appeal
the order dismissing it from the case and McKee did not raise
the issue on appeal.

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 No. 2014AP1914

¶19 McCormick presented a plan for a 128-unit apartment

complex on Lots 53 and 54 at a Fitchburg neighborhood meeting.

Fitchburg residents expressed concern about the effect of the

proposed development on traffic, crime and housing values. The

neighborhood's objections were set forth in a petition signed by

600 Fitchburg residents detailing concerns about the scale and

density of the proposed development:

If a rental development of this scale and density were
built . . . it would result in significant increases
in and unacceptable levels of traffic, noise, litter,
vandalism, storm water run-off, and would
significantly impact the quality of life and the
property values of those already residing in our
neighborhoods.
In particular, Fitchburg residents were concerned that the

proposed development did not comport with the original PDD-GIP

plan to develop senior housing.

¶20 Despite these objections, McCormick prepared a PDD-SIP

application for the 128-unit apartment complex on lots 53 and

54. The proposed development consisted of four three-story 32-

unit apartment buildings, with a clubhouse and a pool. It hired

an architect, engineer, and landscape architect, but there is no

evidence in the record regarding the costs McCormick incurred.

¶21 After McCormick submitted the specific plan, two

Fitchburg Common Council members submitted a rezoning

application and draft ordinance to rezone lots 53 and 54 from

PDD-GIP to R-M. McKee and McCormick then filed a revised

application for PDD-SIP approval. Following a public hearing,

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 No. 2014AP1914

Fitchburg adopted Ordinance 2009-O-03, which rezoned the

property from PDD-GIP to R-M.

¶22 Under the R-M zoning classification, McCormick was

limited to developing 28 dwelling units, compared to a maximum

of 132 dwelling units under the PDD zoning classification.

McKee and McCormick filed a lawsuit seeking declaratory

judgment, damages and injunctive relief on the grounds that the

rezoning of the lots was unlawful.

¶23 The amended complaint asserted two claims. First, it

alleged that Ordinance 2009-O-03 is void as a matter of law

because it was adopted by Fitchburg without the consent of the

owner of the property, contrary to Wis. Stat. § 62.23(7)(b).

Second, it alleged that if Fitchburg "wrongfully adopted

Ordinance 2009-O-03, and wrongfully refused to process and

approve the PDD-SIP application," then McKee was deprived of the

full economic use of the property and from earning a reasonable

return on its respective investment. McKee further alleged that

it was deprived of substantive and procedural due process
guarantees in violation of the Fifth and Fourteenth Amendments

of the United States Constitution, and Article I, Section 13 of

the Wisconsin Constitution.

¶24 The parties filed cross-motions for summary judgment.

At issue here is the circuit court's grant of summary judgment

in favor of Fitchburg. On summary judgment, the circuit court

dismissed McKee's first claim, determining that Lots 53 and 54

were rezoned in accordance with Wis. Stat. § 62.23(7)(b) and the
relevant local ordinances. The circuit court did not reach
9
 No. 2014AP1914

McKee's constitutional takings claim because it was conditioned

on the dismissed first claim.

¶25 McKee appealed the circuit court's summary judgment

order. On appeal, however, McKee did not argue that the

rezoning ordinance was void under Wis. Stat. § 62.23(7)(b) for

lack of consent. Instead, McKee asserted that it had a vested

right in the PDD zoning classification, that the PDD

classification created a contract that gives rise to

expectations on which developers may rely, and that the rezoning

ordinance constituted a taking under the Fifth Amendment to the

United States Constitution.

¶26 The court of appeals determined that McKee did not

have a vested right in the PDD zoning classification when

Fitchburg rezoned the lots. McKee Family I, LLC v. City of

Fitchburg, No. 2014AP1914, unpublished slip op., ¶32 (Wis. Ct.

App. Nov. 5, 2015). It declined to address McKee's

constitutional taking argument, concluding that it was an

undeveloped argument. Id., ¶32 n.6.
II

¶27 In this case we are asked to review the court of

appeals decision affirming the circuit court's grant of summary

judgment in favor of the City of Fitchburg. We review a

decision granting summary judgment independently of the

determinations rendered by the circuit court and the court of

appeals. Lambrecht v. Estate of Kaczmarczyk, 2001 WI 25, ¶21,

241 Wis. 2d 804, 623 N.W.2d 751. Summary judgment is
appropriate when there is no genuine issue as to any material
10
 No. 2014AP1914

fact and a party is entitled to judgment as a matter of law.

Id., ¶24.

¶28 At issue is whether McKee has a vested right in the

zoning classification and whether the classification creates

contractual expectations upon which McKee may rely. We

additionally address whether a constitutional takings claim can

be maintained. These issues present questions of law that this

court reviews independently of the determinations rendered by

the circuit court and the court of appeals. Zealy v. City of

Waukesha, 201 Wis. 2d 365, 372, 548 N.W.2d 528 (1996).

III

¶29 We must address first whether McKee forfeited the

arguments it raised for the first time on appeal. Fitchburg

contends that McKee did not appeal the claims dismissed by the

circuit court on summary judgment. According to Fitchburg,

McKee forfeited the arguments it now advances because they were

raised for the first time on appeal.

¶30 Although the circuit court dismissed McKee's claim
that Ordinance 2009-O-03 was void for lack of consent, it did

not appeal that issue. Instead, on appeal McKee asserts that it

has a vested right in developing lots 53 and 54 under the PDD

zoning classification due to expenditures incurred based upon

reasonable expectations established by government action. McKee

further asserts that to the extent the zoning classification is

contractual in nature, it also creates expectations upon which

developers may rely.

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 No. 2014AP1914

¶31 Contingent on its vested rights arguments, McKee

contends that it has a claim for damages under the Takings

Clause of the United States Constitution.

¶32 Generally, issues not raised or considered by the

circuit court will not be considered for the first time on

appeal. State v. Holland Plastics Co., 111 Wis. 2d 497, 504,

311 N.W.2d 320 (1983). However, it is within this court's

discretion to "disregard alleged forfeiture or waiver and

consider the merits of any issue because the rules of forfeiture

and waiver are rules of 'administration and not of power.'"

State v. Beamon, 2013 WI 47, ¶49, 347 Wis. 2d 559, 830

N.W.2d 681. The arguments raised on appeal have been briefed

and argued by both parties. Accordingly, we choose to address

McKee's arguments set forth above in order to clarify the

important issues of law that are presented in this case.

IV

¶33 The primary issue before this court is whether McKee

had a vested right in the PDD zoning classification before
Fitchburg rezoned the land to the R-M zoning classification.

Despite the fact that it was not eligible for, and did not apply

for a building permit, McKee asserts that it had a vested right

in the PDD zoning classification.

¶34 McKee contends that this court should depart from

Wisconsin's bright-line building permit rule and evaluate

whether a developer has vested rights on a case-by-case basis.

It argues that Fitchburg should not have had the discretion to
change zoning regulations before a building permit was approved
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 No. 2014AP1914

because McKee had already made substantial expenditures in

preparation for development under the PDD-GIP zoning.

¶35 We begin with the basic premise that municipalities

have broad discretion to enact zoning ordinances and land use

regulations for a variety of purposes:

For the purpose of promoting health, safety, morals or
the general welfare of the community, the council may
regulate and restrict by ordinance . . . the height,
number of stories and size of buildings and other
structures, the percentage of lot that may be
occupied, the size of yards, courts and other open
spaces . . . the density of population, and the
location and use of buildings, structures and land for
trade, industry, mining, residence or other purposes
if there is no discrimination against temporary
structures.
Wis. Stat. § 62.23(7)(am). Any ordinance adopted under this

section "shall be liberally construed in favor of the city."

Id.

¶36 Additionally, "reliance on a particular zoning

designation applicable to [a landowner's] property does not

suffice to give the landowner a vested right to such
designation." Rainbow Springs Golf Co. v. Town of Mukwonago,

2005 WI App. 163, ¶12, 284 Wis. 2d 519, 702 N.W.2d 40 (citing

Zealy, 201 Wis. 2d at 381). A "vested right" is a "right that

so completely and definitely belongs to a person that it cannot

be impaired or taken away without the person's consent." Stoker

v. Milwaukee Cty., 2014 WI 130, ¶24, 359 Wis. 2d 347, 857

N.W.2d 102 (quoting Black's Law Dictionary 1520 (10th ed.

2014)).

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 No. 2014AP1914

¶37 The exception to the rule that zoning does not create

vested rights arises when a property owner has applied for a

building permit conforming to the original zoning

classification. See Lake Bluff, 197 Wis. 2d at 182. In Lake

Bluff, this court concluded that the developer "obtained no

vested rights, because it never submitted an application for a

building permit conforming to the zoning and building code

requirements in effect at the time of the application." Id.

¶38 Lake Bluff explained that "[o]ur cases have

consistently held that no rights vest in such an instance" when

a building permit has not been obtained. Id.; see also State ex

rel. Humble Oil & Ref. Co. v. Wahner, 25 Wis. 2d 1, 13, 130

N.W.2d 304 (1964); Vil. of Hobart v. Brown Cty., 2005 WI 78,

¶28, 281 Wis. 2d 628, 698 N.W.2d 83. Therefore, Lake Bluff

reasoned that the developer "did not possess the 'clear,

specific legal right which is free from substantial doubt' that

is required in an action for mandamus." Lake Bluff, 197

Wis. 2d at 182 (quoting Collins v. Am. Family Mut. Ins. Co., 153
Wis. 2d 477, 483, 451 N.W.2d 429 (1990)).

¶39 McKee argues first that Lake Bluff's building permit

rule should be limited to the facts of that case because the

developer in Lake Bluff requested relief in the form of a writ

of mandamus. According to McKee, Lake Bluff declined to

consider the developer's substantial expenditures in determining

whether it had vested rights because a writ of mandamus requires

"strict and complete compliance with all necessary and
applicable provisions of the relevant ordinance . . ." Id. at
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 No. 2014AP1914

174 (quoting 4 Edward H. Ziegler, Jr., Rathkopf's The Law of

Zoning and Planning, § 44.04[1], at 44-14 to 44-15 (4th ed. 1956

& Supp. 1994) (footnotes omitted)). Thus, McKee asserts that

because it brought claims for declaratory judgment and damages

arising from alleged constitutional violations, the permit rule

should not be applied here given that the requested remedies are

distinguishable from the relief requested in the writ of

mandamus in Lake Bluff.

¶40 We decline McKee's invitation to limit Lake Bluff to

cases in which a developer seeks relief in the form of a writ of

mandamus. The Lake Bluff court did not base its decision on the

developer's requested remedy. Instead, it reasoned that "[f]rom

the very beginning of zoning jurisprudence in this state [] a

building permit has been a central factor in determining when a

builder's rights have vested." Id. at 172.

¶41 Indeed, Lake Bluff considered prior Wisconsin case law

on this issue in reaching its decision and explained that "a

common factor . . . was the presence or absence of a building
permit." Id. at 172. As Lake Bluff explained, Building Height

Cases examined three separate cases and ruled on the nature of

the vested rights, if any, in each case. Id. at 171 (citing

State ex rel. Klefisch v. Wisconsin Tel. Co. (Building Height

Cases), 181 Wis. 519, 195 N.W. 544 (1923)). In two of the cases

it examined whether there were vested rights when the developer

obtained a permit. However, in the third case where there was no

application for a permit, there were no vested rights. Id. at
172.
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 No. 2014AP1914

¶42 Underlying the vested rights doctrine is the theory

that a developer is proceeding on the basis of a reasonable

expectation. Id. at 175 (citing State ex rel. Cities Serv. Oil

Co. v. Bd. of Appeals, 21 Wis. 2d 516, 528-29, 124 N.W.2d 809

(1963); 8 McQuillin Mun. Corp. § 25:157 at 701 (3d ed. 1991).

As Lake Bluff explained, "[r]equiring an application for a

building permit which conforms to applicable zoning or building

code requirements in order to show a clear legal right also

serves the goals of the vested rights doctrine." 197 Wis. 2d at

175.

¶43 Wisconsin applies the bright-line building permit rule

because it creates predictability for land owners, purchasers,

developers, municipalities and the courts. See, e.g., Guertin

v. Harbour Assurance Co. of Bermuda, 141 Wis. 2d 622, 634-35,

415 N.W.2d 813 (1987) (explaining that bright line rules provide

predictability and protect all parties). It balances a

municipality's need to regulate land use with a land owner's

interest in developing property under an existing zoning
classification. A municipality has the flexibility to regulate

land use through zoning up until the point when a developer

obtains a building permit. Once a building permit has been

obtained, a developer may make expenditures in reliance on a

zoning classification.

¶44 In contrast, the rule proposed by McKee, which would

require a case-by-case analysis of expenditures, would create

uncertainty at the various stages of the development process.
Nevertheless, McKee urges this court to follow other
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 No. 2014AP1914

jurisdictions, which it contends recognize expenditures made

after a municipality approved the development of plats of land.

See, e.g., Telimar Homes, Inc. v. Miller, 14 A.D.2d 586, 587

(1976); Milcrest Corp. v. Clackamas Cty., 650 P.2d 963, 967

(1982). According to McKee, "the concept of fair play and

protection of settled expectations demands a more flexible and

searching inquiry than bright-line rules such as the building

permit test can provide."

¶45 For the reasons set forth above, we decline to adopt

this approach. Additionally, we observe that even if this court

were to determine that a rule based on substantial expenditures

should apply here, McKee's claim would fail because it has not

introduced evidence supporting its claims.

¶46 We previously addressed the two-fold impediments of

failure to apply for a building permit along with the failure to

present evidence in support of the claim. In Zealy, the court

determined that the developer did not have a vested right to the

former residential zoning on his land. 201 Wis. 2d at 381-82.
It reasoned that "Zealy has not shown that he made any

expenditures in reliance on the zoning, nor has he ever

submitted an application for a building permit proposing a

residential use of the land." Id. McKee's claim suffers from

the same lack of evidence of expenditures made in reliance on

the PDD zoning as well as the failure to submit an application

for a building permit.

¶47 In sum, we decline to depart from Wisconsin's bright-
line building permit rule. A property owner's rights do not
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 No. 2014AP1914

vest until the developer has submitted an application for a

building permit that conforms to the zoning or building code

requirements in effect at the time of application. Lake Bluff,

197 Wis. 2d at 182. It is undisputed that McKee did not apply

for a building permit. Like the court of appeals, we conclude

that McKee did not have a vested right in developing the

property under the PDD zoning classification because it did not

apply for a building permit.

V

¶48 We turn next to McKee's argument that to the extent

the zoning classification is contractual in nature it also

creates expectations upon which developers may rely.

¶49 McKee bases this assertion on the City of Fitchburg

Ordinances that set forth the procedures for the PDD zoning

process that were in effect at the time the PDD-GIP was adopted.

Specifically, McKee relies on language in the Ordinances that

referred to a PDD zoning classification as "an agreement [that]

is reached between the property owner and the City of
Fitchburg." Fitchburg, Wis., Gen. Ordinances § 22.82.

Additionally, McKee contends that section 22.91, which stated

that "[t]he City Council shall approve a Specific Implementation

Plan that is reasonably consistent with the previously approved

General Implementation Plan," is an expression of intent to

create expectations upon which developers are expected to rely.

Fitchburg, Wis., Gen. Ordinances § 22.91.

¶50 According to McKee, we should interpret the language
of the Fitchburg Ordinances as expressing an intention to create
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 No. 2014AP1914

expectations upon which developers are entitled to rely. Thus,

McKee asserts that we should decline to apply the building

permit rule, because it contends that a planned development

district is a form of negotiated zoning that a developer may

rely upon once it is adopted by Fitchburg.

¶51 McKee's argument here contravenes the strong

presumption that legislative enactments do not create

contractual rights. Dunn, 279 Wis. 2d 370, ¶8 (citing Morrison

v. Bd. of Educ. of City of W. Allis, 237 Wis. 483, 487-88, 297

N.W. 383 (1941)). Treating legislative acts as contracts would

"enormously curtail the operation of democratic government."

Id., ¶9 (quoting Pittman v. Chicago Bd. of Educ., 64 F.3d 1098,

1104 (7th Cir. 1995)).

¶52 It is a well-established principle that "[o]ne

legislature may not bind a future legislature's flexibility to

address changing needs." Flynn v. Dep't of Admin., 216 Wis. 2d

521, 543, 576 N.W.2d 245 (1998). Accordingly, a current city

government "may not enact a statute which has 'implications of
control over the final deliberations or actions of future

legislatures.'" Id.

¶53 The facts of this case demonstrate why a legislative

body must have the flexibility to adopt and repeal legislation

in response to its community's changing needs. Lots 53 and 54

were undeveloped for fifteen years after Fitchburg approved the

PDD-GIP, yet McKee asserts that the current Fitchburg Common

Council is contractually bound by a city ordinance adopted in
1994.
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 No. 2014AP1914

¶54 The original GIP proposed a development for "mature

adults," citing the "lack of housing options for mature adults

in the Fitchburg area." It was intended to compliment the

"Independent Living" and "Elder Care" developments nearby. The

GIP explained that the "formation of such a 'senior community'

will serve the community well by making the most efficient use

of public and private services these people will require."

¶55 Lots 10 and 11, which are not at issue in this case,

were developed between 1995 and 2002 under the PDD zoning plan

with assisted living facilities, senior housing and senior

condominiums. In 2008, more than a decade after the PDD-GIP

zoning was approved, McCormick presented a plan for a 128-unit

apartment complex on lots 53 and 54 at a Fitchburg neighborhood

meeting. The development proposed in 2008 consisted of four

three-story 32-unit apartment buildings, with a clubhouse and a

pool.

¶56 In a petition signed by 600 Fitchburg residents, the

neighborhood detailed its concerns about the scale and density
of the proposed development:

If a rental development of this scale and density were
built . . . it would result in significant increases
in and unacceptable levels of traffic, noise, litter,
vandalism, storm water run-off, and would
significantly impact the quality of life and the
property values of those already residing in our
neighborhoods.
The primary focus of concern was that the proposed development

did not comport with the original PDD-GIP plan to develop senior
housing.

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¶57 The concerns of Fitchburg's citizens in this case

demonstrate why the legislature must have flexibility to address

the changing needs of the community. See Flynn, 216 Wis. 2d at

543. Although Fitchburg adopted the PDD-GIP in 1994, it needed

to be able to respond to the changing development needs of the

community in 2008.

¶58 Not only was the development far different than what

was originally proposed, McCormick would have been the fourth

owner of the property since McKee Brothers Partnership dedicated

parkland to Fitchburg in 1989. Subsequent to the parkland

dedication, the property was transferred to MAF, which in 1994

applied for and received approval for rezoning to a PDD

classification. Eventually, MAF deeded lots 53 and 54 to McKee,

which now argues that the potential purchaser, McCormick, has

the same zoning right granted to MAF in 1994 and reliance rights

arising from the parkland dedication in 1989.

¶59 As the United States Supreme Court has explained,

there must be "some clear indication that the legislature
intends to bind itself contractually" in order to overcome the

presumption that a law is not intended to create private

contractual rights. Nat'l R.R. Passenger Corp., 470 U.S. at

465-66 (1985). McKee points to no evidence other than the

language of the ordinances in setting forth the development

process as support for its argument that PDD zoning created a

contract upon which it was entitled to rely. Accordingly, McKee

failed to overcome the presumption that Fitchburg did not intend

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to enter into a binding contract when it enacted the 1994

Ordinance approving the PDD zoning classification.

¶60 Finally, we observe that we need not consider McKee's

argument that the rezoning of Lots 53 and 54 constituted a

taking.

¶61 McKee brought its takings claim as contingent on its

claim for vested rights, contending it had a takings claim only

if this court determined that it had a vested right in the PDD

zoning classification. In its amended complaint, McKee alleged

that it suffered a taking in violation of the Fifth and

Fourteenth Amendments "in the event that the Court finds that

the Defendant wrongfully adopted Ordinance 2009-O-03, and

wrongfully refused to process and approve the PDD-SIP

application . . ." Likewise, in its opening brief McKee argues

that "[f]inding vested rights will revive McKee's takings

claim." Finally, at oral argument, McKee reiterated "you cannot

have a taking without a vested right."

¶62 As asserted, McKee's takings claim is contingent on
the success of his vested rights claim. Having failed on his

vested rights claim, his takings claim does not survive.

VI

¶63 We conclude that McKee did not have a vested right in

developing the property under the planned development district

zoning classification because it did not apply for a building

permit. Wisconsin follows the bright-line building permit rule

that a property owner's rights do not vest until the developer
has submitted an application for a building permit that conforms
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to the zoning or building code requirements in effect at the

time of application. Lake Bluff, 197 Wis. 2d at 182. It is

undisputed that McKee did not apply for a building permit.

¶64 Additionally, we determine that a planned development

district zoning classification does not create contractual

expectations upon which developers may rely. There is a very

strong presumption that legislative enactments do not create

contractual or vested rights. Dunn, 279 Wis. 2d 370, ¶8

(citation omitted). Further, there must be a clear indication

that a legislative body intends to bind itself contractually in

order to overcome the presumption. Nat'l R.R. Passenger Corp.,

470 U.S. at 465-66. McKee has not overcome the presumption that

Fitchburg did not intend to enter into a binding contract when

it enacted an ordinance approving the zoning classification.

¶65 Finally, we do not need to reach McKee's

constitutional takings claim because McKee conditioned its

takings claim on its claim for vested rights. Because McKee has

no vested right in a PDD zoning classification, it cannot
succeed on its asserted contingent takings claim.

¶66 Accordingly, we affirm the decision of the court of

appeals affirming the circuit court's grant of summary judgment

in favor of the City of Fitchburg.

¶67 SHIRLEY S. ABRAHAMSON and REBECCA GRASSL BRADLEY, JJ.,

did not participate.

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