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Municipal cell tower leases to wireless infrastructure providers New York – telecom tower lease

Telecommunication Providers’ Access to Municipal Land

Telecommunication providers in New York may at times be wary of municipal leasing, purchasing, or public property use requirements when it comes to constructing wireless infrastructure on municipal lands. Providers and municipalities alike nevertheless have numerous opportunities under the law to undertake such projects on municipal lands, and should explore them as part of expediting the deployment of wireless services to local communities.

Municipalities have always had the ability to lease and sell property to providers. This right is rooted in Article IX of the New York State Constitution,1 which states that municipalities have the ability to dispose of land not devoted to public use. This right is further incorporated into Village Law,2 General City Law,3 and Town Law4 provisions related to municipal authority over public lands.

Some municipalities’ charters and codes may have additional requirements, including the need for a lease of public lands to incorporate a public benefit.5 The sale or lease of municipal property, particularly that not located in a public right of way, is considered a discretionary action under New York’s State Environmental Quality Review Act, which can add some additional review processes.6 In towns, such a disposition is also expressly subject to a permissive referendum under Section 64(2) of Town Law.7

We are at a point in time where municipalities should appreciate the public benefits of wireless telecommunication infrastructure. Steps are being taken at the federal and state levels right now to expand accessibility and funding for telecommunication infrastructure, particularly in rural and/or underserved areas of New York.

Another nuance to these transactions is to evaluate any “parkland” considerations. In Friends of Van Cortlandt Park v. City of New York 8 the New York Court of Appeals noted that alienation of parkland requires legislative approval from the State, and held that long-term non-park uses of public parkland must provide a public benefit. While providers have in some cases been able to leverage how their services promote economic development, increase public safety, and improve service – the New York State Office of Parks, Recreation, and Historic Preservation has advised that leases of parkland to telecommunication providers should have a 25-year cap; have a condition that if use ends, the tower be removed, and land restored; and that the fair market value of the lease be dedicated to capital improvements to existing park facilities or the purchase of additional parkland. These “requirements” can create significant limits on the disposition of parkland.9

Notably, under the Telecommunications Act of 1996,10 the FCC’s 2018 Small Cell Order,11 the New York State Constitution,12 and the New York Transportation Corporations Law,13 municipalities have very limited non-proprietary regulatory authority to manage access and use of public rights-of-way for wireless facilities. As a result, municipalities cannot deny access – they can regulate the reasonable time, place, and manner of small cell installations in accordance with federal law, and these regulations must incorporate clearly-defined and ascertainable standards that do not materially impact the deployment of wireless facilities (particularly in comparison to cable and other wireline broadband infrastructure).

We are at a point in time where municipalities should appreciate the public benefits of wireless telecommunication infrastructure. Steps are being taken at the federal and state levels right now to expand accessibility and funding for telecommunication infrastructure, particularly in rural and/or underserved areas of New York. The Treasury Department has issued a Final Rule regarding the use of funds under the American Rescue Plan Act (“ARPA”) for broadband infrastructure;14 the NTIA is in the process of finalizing new broadband maps to guide where federal funding may be utilized;15 the recently-passed federal infrastructure bill allocated $65 billion to expand high-speed internet access to rural and underserved areas;16 and Governor Hochul has recently announced the $1 billion Connect All Initiative to expand broadband connectivity.17 Municipalities that want to address local broadband connectivity for their constituents need to, at a minimum, consider rolling back prohibited regulations, leverage public lands where viable, and open up their rights-of-way to new technologies. Municipalities such as New York City, with its 2020 Internet Master Plan18 and a related RFP for Open Networks;19 and Yonkers, with its Y-Zone Initiative utilizing citizens broadband radio service (“CBRS”) technology;20 are strong regional examples of communities taking such important steps.

Cannabis Business Opportunities NY - Cannabis Business Licensing in New York

Leveraging Opportunities In New York’s New Cannabis Market

In March, New York legalized adult-use cannabis, opening the door for entrepreneurs to set up shop in local communities. But with new opportunities come new laws and regulations. In this series, Cuddy & Feder’s Cannabis Law practice offers helpful tips and best practices for prospective New York cannabis applicants.

Part 1: Where to Locate Your Retail Cannabis Business

The New York Marihuana Regulation and Taxation Act (MRTA) requires applicants seeking a retail license to have identified the location for their business at the time the license application is submitted. Specifically, the applicant must either own the property, have a valid lease in place or provide proof that they will possess the property within 30 days of being granted a license for a term that equals the license period (which is renewed every 2 years).

The majority of local municipalities in New York have not yet amended their local ordinances to address cannabis uses, but it is anticipated that they will do so over the next 6 months before the State releases license applications.

This requirement leaves applicants in the risky situation of securing a location at a potentially significant cost and outlay of capital without even being granted a license and leads to many unanswered questions about where they should purchase or lease property. These concerns are compounded by the fact that a handful of communities have already opted out of allowing retail dispensaries and on-site consumption sites within their jurisdiction, with more communities expected to opt-out before the end of the year when the deadline to do so expires.

Aside from the challenges under federal law related to financing or leasing property to operate a business that involves a plant that is fully legal under state law but still not legal under federal law, applicants face another obstacle: onerous and restrictive local zoning provisions. The MRTA delegates to local municipalities the ability to regulate time, place and manner of the operation of retail dispensaries and onsite consumption sites, as long as such regulation does not render the business unreasonably impracticable.

The majority of local municipalities in New York have not yet amended their local ordinances to address cannabis uses, but it is anticipated that they will do so over the next 6 months before the State releases license applications. A survey of other states with similar adult-use cannabis statutes indicates several popular local zoning restrictions that can be expected. These restrictions could include:

  • Limiting the distance between cannabis businesses;
  • Minimum setbacks from specific uses such as parks, playgrounds, athletic fields, daycare facilities and alcohol and drug treatment facilities (the MRTA has minimum setbacks from houses of worship [200 feet] and schools [500 feet]);
  • Limiting the total permitted gross floor area for a cannabis business;
  • Enacting cannabis-specific off-street parking requirements that differ from parking requirements for other uses;
  • Minimum setbacks from adjacent properties for a building with a cannabis business;
  • Limiting the time, place and manner of the business, such as restricting the hours of operation and hours that deliveries can be received; and
  • Exterior façade requirements that balance security with street activation.

Interestingly, municipalities may make exceptions to these requirements for dispensaries owned by social and economic equity applicants, as defined in the MRTA, for businesses owned by individuals from communities disproportionately impacted by cannabis enforcement (with extra priority to those who have been convicted of cannabis offenses), minorities, women, distressed farmers and service-disabled veterans. This is one unique approach to furthering social justice and encouraging small businesses owned by such applicants within a municipality.

Another common and significant local zoning requirement seen in municipalities in other states with legal adult use cannabis programs is a provision that prohibits retail cannabis businesses from being located within a pre-existing nonconforming building. Essentially, this provision prevents cannabis businesses from operating in a building that pre-dates zoning restrictions and does not conform with the applicable dimensional requirements, such as maximum height, setback, lot size and floor area. The objective of such a provision is to minimize impacts to adjacent properties and the surrounding area. Since it may not be readily apparent whether a building is fully zoning-compliant, applicants should engage zoning counsel to complete a zoning analysis on a parcel before entering into a lease or contract to purchase.

Further, some municipalities choose to enact a restriction that prohibits a cannabis business from operating on a parcel with any other uses. Applicants should be aware of this limitation when considering potential locations since many options for both lease and purchase may have residential units or office space above the ground floor or may be in building with other retail tenants, such as space in a shopping center or strip mall.

With the race to secure property for a cannabis business, it is critical that potential applicants be familiar with existing zoning regulations and perform a comprehensive zoning analysis on a proposed location. Cuddy & Feder’s land use and zoning attorneys have experience working with cannabis license applicants to analyze potential business locations, perform the requisite due diligence and begin the municipal entitlement process.

Stay tuned for Part 2- the municipal entitlement process.

The Commission Escrow Act - NY Real Estate Commission Law

The Commission Escrow Act — A Broker’s Tool to Resolve Residential Real Estate Commission Disputes

In residential real estate transactions, sellers and buyers frequently rely on the expertise of licensed real estate brokers to show properties, negotiate terms of a sale, attend inspections and otherwise bring deals to closing. The services – and the payment of the commission due – are typically memorialized in a contract between the seller and the broker (who, when applicable, splits the commission with the buyer’s agent). The commission is generally paid at the closing by the seller. Occasionally, however, the situation arises where the seller fails or refuses to pay the commission despite having closed on the sale of the property.

In New York, a broker is not entitled to file a lien against the property in order to ensure payment. The State, however, does provide brokers with a mechanism to make recovery of their commission a bit easier in the event a payment issue arises. The broker may file an affidavit of entitlement to the commission in the county clerk’s office in the county where the property is located pursuant to Section 294-b of the Real Property Law, also known as “The Commission Escrow Act” (the “Act”). Under certain circumstances, the Act also requires a seller to deposit the lesser of the net sales proceeds from the sale or the unpaid commission with the county clerk. The broker must take the steps identified below in order to benefit from the deposit requirement. First, the Act requires that the broker have a written brokerage agreement with the seller that includes the following provision:

At the time of closing, you may be required to deposit the broker’s commission with the county clerk in the event that you do not pay the broker his or her commission as set forth herein. Your obligation to deposit the broker’s commission with the county clerk may be waived by the broker.

Next, the broker must file the affidavit of entitlement with the clerk of the county where the property is located before the deed is delivered to the buyer. The affidavit must include the name and license number of the broker; the name of the responsible party for commission; the name of the seller or the person authorizing the sale; a copy of the agreement; description of the property involved; the amount of the commission earned; description of the broker’s services; and the dates services were provided. The affidavit, though not a lien, is placed in the lien docket for that property. Once the broker files the affidavit of entitlement with the county clerk and pays the fees associated with such filing, the broker must notify the seller and seller’s attorney (if the broker has the attorney’s contact information) of the filing within five (5) business days. The seller must then deposit the amount demanded in the affidavit with the county clerk.

If the seller is required to make the aforementioned deposit and fails to do so, then, in any action brought by the broker in which it is determined that the broker is entitled to compensation, the broker will also be awarded costs and reasonable attorneys’ fees. This serves as an incentive for the seller to comply with the deposit requirement of the Act.

Once the deposit is made, the Act requires that the broker commence an action within sixty (60) days from the date of the deposit. If neither the broker nor the seller commences an action within such time period, then the seller is entitled to an order directing a return of the deposit. However, this order does not impact the broker’s claim for commission.

The Commission Escrow Act serves to provide some leverage to a broker whose commission was wrongfully withheld by temporarily diverting a portion of sales proceeds due to the seller to the county clerk’s escrow account. However, to be entitled to utilize this remedy, the broker must have a well-drafted agreement with the seller. The transactional team at Cuddy & Feder can provide sellers and brokers with guidance to help promote a successful broker-seller relationship.

What to Make of the SEC’s ESG and Climate-Related Focus

Perhaps the hottest buzzword—or buzz acronym—in the world of asset management is ESG (Environmental, Social, and Governance). By any measure, the demand for and size of ESG products is rapidly increasing. For example, in the 30-month period ending June 30, 2020, “socially conscious”-registered investment products grew 6-fold and since the start of 2020, the total amount of assets invested in US-exchange traded ESG portfolios has more than doubled.

Investors’ voracious appetite for ESG products has led to demand for data regarding individual issuers’ ESG policies and practices and fund and asset managers’ ESG strategies. This, in turn, has drawn the attention of regulators, and particularly the Securities Exchange Commission.

This all begs the questions of whether companies face increased risks regarding ESG disclosures, what are those risks, and who bears them—asset managers and investment advisors working with ESG products or issuers more broadly?

In the first several months of this year, the SEC has issued multiple statements, reports, and risk alerts emphasizing the Commission’s focus on disclosures relating to ESG and climate-related risks.7 These pronouncements raise questions about the Commission’s examination and enforcement regime and its rule making moving forward. Here, we examine some of those questions in the context of SEC examinations and enforcement actions.

Recent SEC Statements

The SEC has commented on ESG disclosure issues in the past, but never with the frequency or focus that it has in the past few months. On February 24, 2021, Acting Chair Allison Herren Lee issued a Statement on Review of Climate-Related Disclosure21 in which she directed the Division of Corporate Finance to enhance its focus on climate-related disclosures in company filings with the intention of ultimately updating the Commission’s more than decade-old guidance regarding such disclosures.22 Approximately a week later, on March 3, 2021, the Division of Examinations identified reviewing the consistency, adequacy, and accuracy of disclosures about ESG processes and practices as one of its 2021 examinations priorities.23 The following day, the Commission announced the creation of a Climate and ESG Task Force in the Division of Enforcement,24 which was tasked with identifying material gaps or misstatements in issuers’ disclosure of climate-related risks under existing rules and analyzing disclosure and compliance issues relating to investment advisers’ and funds’ ESG strategies.

Most recently, on April 9, 2021, the Division of Examinations released a Risk Alert25 regarding its review of ESG investing, in which the Division stated that it had observed deficiencies, internal control weaknesses, and potentially misleading statements regarding ESG investing processes.

ESG Disclosure Risks Under Current Rules

This all begs the questions of whether companies face increased risks regarding ESG disclosures, what are those risks, and who bears them—asset managers and investment advisors working with ESG products or issuers more broadly? In fact, the SEC’s two republican commissioners have made several statements criticizing the SEC’s focus on ESG disclosures as nothing more than public relations spin, which leads to confusion in the investing community.

Chairman Gary Gensler’s testimony at his confirmation hearing may provide some guidance. Chairman Gensler explained that in assessing ESG and climate-related disclosures, he would apply the historical materiality standard—i.e, what a reasonable investor would consider material in making investment and voting decisions. He went on to note, however, that this analysis could be guided by the investor community, which has demonstrated support for ESG-related disclosures. Accordingly, asset managers and investment advisors are unlikely to be saved from exposure for misrepresentations regarding ESG practices and policies by arguing that the misrepresentations are immaterial since the ESG strategy itself—not only the performance implications of it—is material to many investors’ investing and voting decisions. This is consistent with the SEC Investor Advisory Committee’s observation in May 2020 that information regarding ESG strategy “is material to investors regardless of an issuer’s business line, model or geography.”26

For now, at least, it appears that the focus of the Divisions of Examinations and Enforcement will be on disclosures from investment advisors and funds regarding ESG strategies. But issuers generally will face scrutiny as well, particularly with respect to climate risk disclosures or where issuers make representations about ESG practices.

How the Commission will deal with the inherently thorny nature of ESG disclosures in a complex world involving cross border supply chains where “green” technologies often require the environmentally damaging mining of rare earths remains to be seen. But the Commission’s repeated pronouncements to start this year about its ESG focus cannot be disregarded.

Proposed Statewide Zoning Mandates Could Promote Smart Growth Throughout Connecticut

Several proposed Connecticut state legislative amendments are being considered which would enact statewide zoning mandates upon municipalities. These mandates are intended to combat discrimination and address disparities in housing needs while also creating opportunities for smart growth and increased development potential throughout Connecticut.

The Planning and Development Committee Raised Bill Number 1024 and Housing Committee Bill Number 804 each contain proposed legislation mandating all municipalities permit four or more residential unit developments (or mixed-used developments containing same) as-of-right in at least 50% of the area within a one-half mile radius of a municipality’s primary transit station. Transit station in both instances includes rail stations, bus rapid transit stations, ferry terminals, and bus terminals. Similar statewide provisions would mandate zoning provisions for “middle housing” (duplexes, triplexes, quadplexes, cottage clusters, and townhouses) and accessory dwellings while also controlling certain bulk restrictions such as the minimum density that local zoning can permit and the maximum number of parking spaces that can be required.

TOD proposals are attractive to many young professionals or “empty nesters” looking to downsize.

Similar bills also presented during this year’s legislative session include Proposed Bill Numbers 551 and 554 which would, respectively, require “fifty percent of the land within one-half mile of transit stations and commercial corridors be zoned for multifamily housing and that accessory dwelling units be permitted on such land as of right, provided such units conform to applicable health and building codes” and “require that a municipality’s zoning regulations permit a greater density of housing within one-half mile of a public transit station than is otherwise permitted by such municipality.” Draft legislative language has not yet been made available for Proposed Bill Numbers 551 and 554.

In addition to increasing housing potential, such mandates permitting multi-family developments, accessory dwellings, and/or increased density around public transportation hubs promote the core tenet of Transit-Oriented Development (TOD) and helps capitalize on investments in public transportation.

TOD proposals are attractive to many young professionals or “empty nesters” looking to downsize so they present little strain on school systems while directing commuters away from streets and onto alternative modes of transportation. The additional housing stock permitted by the bills could also promote the growth and accessibility of affordable housing throughout the state. While the specifics of these proposed mandates and any strings that may be attached are yet to be seen, the potential benefit to communities and landowners throughout the state is certainly apparent.

These bills have a long journey ahead of them before becoming law including public hearings during which legislators, state agency representatives, and the public will be permitted to comment. One area that is certain to receive attention is the state’s willingness and authority to pre-empt local authority under home rule delegation which grants local municipalities sole legislative authority “relative to the powers, organization, and form of government of such political subdivision.” This home rule delegation has long afforded municipalities broad authority to regulate “local concerns” which includes specific local zoning regulations and controls while the state retains regulatory authority over areas that touch matters of “statewide concern.”

So while these concepts could be beneficial to the public and development community, it is still to be seen whether these proposed bills will gain enough support to be advanced and, if so, whether a sufficient matter of “statewide concern” can be demonstrated.

Time is of the Essence Clause in Real Estate

Time is of the Essence Clauses in New York and Connecticut Contracts for the Sale of Real Property

Contrary to what many people may believe, the closing date in a contract is usually only a target date. Generally, absent a “time is of the essence” provision, both New York and Connecticut laws give each party the right to adjourn the date set forth in the contract as the closing date for a reasonable period of time.

Parties to a contract may decide to put a “time is of the essence” provision in the contract when setting the closing date. In both New York and Connecticut, a “time is of the essence” clause in a contract indicates that the failure to close the transaction by the time specified will be considered a material breach under the contract.

If the contract does not contain a “time is of the essence” clause, either party may unilaterally make the closing date time of the essence by giving the other party “clear, unequivocal notice” that the failure to close the transaction by the date specified in the notice will be considered a default under the contract. Both New York and Connecticut law requires that the date specified in the notice as the “time is of the essence” date must provide the other party with a “reasonable” period of time to close in order for the notice to be effective. Generally speaking, courts have interpreted a “reasonable” period of time as thirty (30) days after the date of the notice. However, whether a period of time is reasonable under the circumstances is a fact-specific determination.

In New York, a time is of the essence notice must be delivered after the original closing date identified in the contract, otherwise it is not effective. On the contrary, in Connecticut, a time is of the essence notice may be sent before the closing date identified in the contract. However, both New York and Connecticut law requires that the date of closing set forth in the “time is of the essence” notice must be after the original closing date set forth in the contract.

The Real Estate and Transactional Department at Cuddy & Feder is available to address any questions you may have regarding closings and the sale of real property.

Cuddy and Feder Law Firms New York

New York State Enacts COVID-19 Emergency Eviction and Foreclosure Prevention Act of 2020

On December 28, 2020, Governor Cuomo signed the COVID-19 Emergency Eviction and Foreclosure Prevention Act of 2020 (the “Act”) into law in an effort to stabilize the housing situation for tenants and qualifying borrowers during the pandemic. The Act suspends certain evictions of residential tenants and certain mortgage and tax lien foreclosures from proceeding until May 1, 2021. In order to be eligible for a stay of a mortgage or tax lien foreclosure, the borrower cannot own more than ten residential dwellings, including their primary residence.

In order to receive relief under the Act, a tenant or borrower must complete a “Hardship Declaration”, in the form set forth in the Act, under penalty of perjury, and illustrate that the reasons behind the tenant or borrower’s inability to meet its payment obligations was the result of COVID-19. These reasons include financial hardship due to significant loss of income during the pandemic; increase in out-of-pocket expenses as a result of the pandemic; childcare or the care of elderly, disabled or sick family members during the pandemic negatively impacting the ability to earn income; moving expenses and difficulty obtaining alternative housing; reduction in household income or significant increase in household expenses. For eligible borrowers, a default by tenants in payment of rent also counts as financial hardship. Once the Hardship Declaration is submitted by a tenant or a borrower, an eviction or foreclosure proceeding, as applicable, may not be initiated until May 1, 2021.

In addition to the relief referenced above, the Act actually imposes an obligation on landlords and lenders to provide the Hardship Declaration to their tenants or their borrowers. A landlord must provide the form of Hardship Declaration to its tenants together with every written demand for rent and with every written notice required to be provided prior to the commencement of an eviction proceeding. Similarly, lenders are required to provide their borrowers with the form of Hardship Declaration together with every written notice required by law in connection with a foreclosure. The Hardship Declaration must be translated to the tenant’s or borrower’s primary language.

The COVID-19 Emergency Eviction and Foreclosure Prevention Act 2020 provides a way for tenants to maintain their current living situations during the pandemic and also provides qualifying borrowers with the opportunity to work out loan extensions or other relief made necessary due to their own inability to pay their loan or the inability of their tenants to pay rent due to the impact of COVID-19.

The Real Estate and Transactional team at Cuddy & Feder will continue to monitor and advise of changes in the law in response to COVID-19 and stands ready to assist in navigating through these issues.

New York City 5G Regulation – Wireless Regulatory Requirements NYC

New York City’s 5G Regulatory Playing Field in Flux?

With the advent of 5G a few years ago, numerous agencies in the City of New York undertook evaluations of their rules and regulations governing the deployment of wireless facilities throughout the five boroughs. Agencies like the Department of Information Technology & Telecommunications (DoITT) issued new RFPs for small cell access to City right of way, the Department of Buildings (DOB) reviewed its long-standing building and zoning interpretations, and the Fire Department of New York (FDNY) provided further guidance on its firefighter access requirements for rooftop installations. For those engaged with the City collaborating on the legal and practical issues associated with wireless siting for decades, it’s felt like déjà vu all over again.

The DOB’s new shift had an immediate impact halting permitting for most modifications to existing tower sites that had been previously permitted as a Use Group 6D facility similar to the numerous other public utility facilities allowed by right in commercial and manufacturing zoning districts.

In late 2018 in unpublished informal guidance, the DOB’s Technical Affairs division directed plan examiners across the City to implement numerous regulatory interpretive changes immediately. The effect was swift and serious and involved numerous provisions of the City’s Building Code, Zoning Resolution and TPPN #5/98 as formally adopted by the DOB to exempt rooftop cellular facilities from zoning over twenty years ago. Two years later, the wireless industry is still addressing many of the informal changes which are materially impacting the technical ability to deploy 5G equipment and provide New Yorkers with the best-in-class wireless services they deserve.

One of the little-known changes to come from DOB in 2018 was a new zoning interpretation reclassifying monopole towers in commercial and manufacturing districts as a “radio tower” use versus an “other communications structure” use as they had been defined and historically interpreted under the City’s Zoning Resolution. The DOB’s new shift had an immediate impact halting permitting for most modifications to existing tower sites that had been previously permitted as a Use Group 6D facility similar to the numerous other public utility facilities allowed by right in commercial and manufacturing zoning districts. It also resulted in the revocation of building permits for one proposed monopole behind a shopping center next to the Willowbrook Parkway on Staten Island as proposed by one of the wireless carriers (the “Carrier”).

On behalf of the Carrier, our office filed an appeal with the New York City Board of Standards and Appeals (BSA) challenging the DOB’s shift in interpretation of the City’s Zoning Resolution which had sought to reclassify monopole uses by interpretation and as a matter of law. We filed briefs arguing that the state’s highest court ruling in Rosenberg v. Cellular One, 82 N.Y.2d 364 (1993) holding that cellular facilities are ‘public utility’ facilities for zoning purposes, the language of NYC’s Zoning Resolution and the DOB’s own formal prior interpretations including TPPN #5/98 all recognized wireless carriers’ status as utilities under zoning laws in New York. In a well-reasoned decision published in November of 2020, a majority of the BSA agreed with the Carrier’s legal positions and upheld the appeal ordering the DOB to classify the proposed monopole at issue as a Use Group 6D by right facility for zoning purposes. New Cingular Wireless PCS, LLC, BSA 2019-281-A (BSA Decision).

Importantly, the value of the BSA Decision to the wireless industry is more than just one new tower victory in a commercial zoning district. It constitutes legally binding precedent that effectively recognizes that the thirty plus existing monopoles in commercial and manufacturing districts that were permitted by right are in fact legal and do not require any special permit approvals and the multitude of submission and hearings before community boards and the BSA itself. That alone represents a multimillion-dollar savings to tower owners and clears the way for DOB permitting of their tenant’s 5G upgrades at existing tower sites. Additionally, the BSA Decision reinforces with DOB the industry’s unique status under New York State zoning law (with corollaries in federal law), that requires balancing of regulatory requirements for wireless infrastructure with the critical services they provide in delivering public safety, innovation, economic development and internet access to the public.

Agriculture in the Hudson Valley: When State and Local Policies Conflict

This blog is the second in a series discussing the ins and outs of Article 25-AA of the Agriculture and Markets Law (AML) and its protections for farm operations including agricultural tourism (or agri-tourism) – such as farm stays and retreats, hotels and resorts, and beverage-based operations such as wineries, cideries, distilleries and breweries.

The Agriculture and Markets Law (AML) ensures that local governments shall not “unreasonably restrict or regulate farm operations” within approved Agricultural Districts. But what happens when local laws or regulations conflict with the State’s policy objectives? In that case, the local law or regulation is superseded by the State policy and is subject to nullification.

New York State’s Department of Agriculture and Markets (the Department) can proceed in several ways:

  • Opinion Letter – Upon a request from a municipality, farm owner or operator, the Department will issue an opinion letter as to whether the municipality adopted, proposes to adopt or is administering a law or regulation that will violate AML §305-a by unreasonably restricting or regulating a farm operation. Often, if the Department finds that an unreasonable restriction has or will occur, the municipality will communicate with the Department to develop mutually acceptable modifications to the law or regulation.
  • Order – At times, the municipality does not agree with the opinion letter and will not change its proposed law or regulation accordingly. The Department is then authorized to issue Orders to protect farm operations from unreasonably restrictive laws. These Orders are issued on a case-by-case basis only after conducting a thorough review, where both the farm owner/operator and the municipality have the opportunity to submit arguments to the Department. A party disagreeing with the order of the Commissioner could challenge the determination through legal action.
  • Direct Action – The Department’s Commissioner also has authority, upon receiving a complaint from a person owning property within an agricultural district, to bring a direct action against a municipality to enforce the provisions of the Agriculture and Markets Law.

Submissions to the Department should be accompanied by legal argument as to why the municipality’s law or regulation unreasonably restricts agriculture and why the assistance of the Department is necessary. The attorneys at Cuddy & Feder, LLP have successfully advocated before the Department on behalf of agricultural operations and are available if you believe a local law may unreasonably restrict your agricultural business.

Read Part 1: Agriculture in the Hudson Valley: Understand Your Right to Farm

close NYC storefronts during COVID 19

Rethinking Force Majeure in Light of COVID-19 (December Update)

On December 16th, 2020, the United States District Court for the Southern District of New York issued an opinion in which the Court interpreted a force majeure provision as it relates to the COVID-19 pandemic.

In JN Contemporary Art LLC v. Phillips Auctioneers LLC, the parties disputed whether performance under a New York contract was excused due to the COVID-19 pandemic, in accordance with a force majeure clause in the contract. JN Contemporary Art LLC v. Phillips Auctioneers LLC, 2020 WL 7405262 (S.D.N.Y. 2020). The force majeure provision in the contract stated that one of the parties had the right to terminate the contract “[i]n the event that the auction is postponed for circumstances beyond our or your reasonable control, including, without limitation, as a result of natural disaster, fire, flood, general strike, war, armed conflict, terrorist attack or nuclear or chemical contamination . . .” The Court concluded that the term “natural disaster” did in fact include and cover the COVID-19 pandemic, therefore excusing performance under the contract. The Court further held that the COVID-19 pandemic, which required the shutdown of normal business activity, “is the type of ‘circumstance’ beyond the parties’ control that was envisioned” in the contract’s force majeure clause, and that the “environmental calamities” and “widespread social and economic disruptions” listed in the force majeure clause are of a similar nature to the pandemic.

It is important to note that the case has not yet reached the higher courts, and, if it does, it is unclear how the 2nd Circuit Court of Appeals will rule on the issue. Generally, New York courts narrowly construe force majeure clauses, only excusing performance in circumstances where the force majeure clause specifically included the event that prevented performance. However, if this case is upheld, it has the potential to change New York contract law and provide contractual relief to parties affected by the COVID-19 pandemic, where relief previously may not have been available.

We will continue to provide updates as the courts further discuss and rule on the COVID-19 pandemic and its impacts on force majeure clauses in contracts.

Read more about force majeure