Holbrook, AZ, Tramples on Small Business Owner's Property Rights—So We’re Suing

In the heart of Navajo County, officials in the city of Holbrook, Ariz., are determined control who enters their town, and they’re violating property rights to do it. Today, the Goldwater Institute sued the city on behalf of local motel owner Anil Patel after the government’s actions greatly diminished the value of Anil’s property and left him without a buyer for his land.

Anil owns a motel just off Route 66, located in a general commercial zone that permits hotel, motels, and inns, as well as “Residential Care Services,”—or in-home care service for disabled and senior citizens. Anil was looking to sell his property, and he found a buyer who wanted to turn the motel into temporary short-term lodging for low-income individuals. Indeed, the city’s planning and zoning administrator confirmed that the buyer’s intended purpose for the motel was a permitted use.

However, as the sale loomed, the city administrator reversed course and said the buyer would now need a conditional use permit for a “Residential Care Service.” That change postponed the pending sale, as Anil had to wait for the conditional use permit process to play out.

At the same time, the planning and zoning administrator presented a new ordinance to the Holbrook City Council to specifically change Residential Care Services from being a permitted use to a conditional use that required a conditional use permit. The city council was aware that this ordinance would affect the pending sale of Anil’s property: Mayor Kathleen Smith even said on the record that the ordinance was related to this transaction, and that the ordinance would provide “a little more control of who’s coming in.”

The ordinance passed unanimously. And not surprisingly, with a conditional use permit now required, the planning and zoning administrator denied Anil’s application. The sale fell through, and the value of Anil’s property dropped considerably.

It’s just the latest instance of government bureaucrats usurping private property rights—but the Goldwater Institute is fighting back. Today, Goldwater sued the city on Anil’s behalf, demanding the just compensation he is entitled to for the government’s unfair restriction of his property rights.

Arizona voters have already rejected the notion of giving state officials carte blanche to seize private property for whatever reason they consider worthwhile. That’s why they enacted Goldwater’s Property Ownership Fairness Act(also known as Prop 207, or the Arizona Private Property Rights Protection Act) more than 15 years ago, ensuring property owners are fairly compensated when government regulations forbid them from using their land as they best see fit.

This common-sense reform has been a smashing success, ensuring Arizonans enjoy the strongest protections for property rights in the nation. Goldwater has recovered nearly $100 million for property owners in Flagstaff after the city government imposed a sweeping land-use ordinance that would eliminate residents’ right to use their property. And when Maricopa County issued a moratorium on building permits for properties near Luke Air Force Base, which had a devastating effect on property values, Goldwater filed nearly $20 million in claims on behalf of more than 175 property owners—so the county rescinded its freeze on permits.

The Holbrook city government should take note, and respect Anil’s right to use his own property.

You can read our complaint here.

Stacy Skankey is a Staff Attorney at the Goldwater Institute.