Appellate Court Reaffirms Use Variance Approval for Former CVS Pharmacy Site

DECISION: Ship Bottom officials must decide within 45 days of receipt of a gaming license application for the site of the former CVS Pharmacy, where a family-style entertainment center is planned, a judge ruled in June. (Photo by Ryan Morrill)

In part, a ruling by the Superior Court of New Jersey, Appellate Division, affirmed, reversed and remanded a prior court’s decision ratifying the Ship Bottom Land Use Board’s approval of a use variance to the owners of the former CVS Pharmacy at the Causeway Circle, where a family-style entertainment center is planned.

The initial legal proceeding stems from the April 2019 actions of a majority of the land use board, which agreed Wainwright Amusement LLC met the criteria for a use variance at the vacant site, located between Seventh and Eighth streets on Long Beach Boulevard. A use variance was required because entertainment is not a permitted use in the borough’s general commercial district.

Since the early 2000s, Ship Bottom has limited the number of amusement licenses to two in the borough. Hartland Golf and Arcade and Our Endless Summer, located at opposite ends of the town’s roughly 1-mile strip of the Boulevard, each owning one of those licenses. They sued Wainwright Amusement and the land use board, arguing amusement and gaming facilities are prohibited in all zones by the borough’s zoning ordinance.

In affirming the land use board’s approval of the use variance, the Appellate Division wrote in its April 11 opinion “Wainwright’s application met the negative and positive criteria required by statute, substantial credible evidence supports the board’s decision, and the board did not exceed its authority in granting the use variance.”

Additionally, the Appellate Division reversed and remanded Ocean County Superior Court Judge Mark Troncone’s December 2020 order that dismissed Wainwright Amusements’ challenge of Ship Bottom’s amusement games license ordinance.

Plans for the site include an updated, technologically savvy entertainment center at the site. The lot’s dimensions include a 200-foot frontage on the Boulevard with a 160-foot depth and a total lot area of ​​32,000 square feet.

“Based on the limited record, we cannot discern if the zoning portion of the ordinance amounts to ‘spot’ zoning,” which might also be relevant to Wainwright’s counterclaim and arguments on appeal, according to the April ruling of the Appellate Division.

During the appeal process, the court found Wainwright Amusement tried to apply for a license to operate amusement games in June 2019. While the borough confirmed it received the application, the company, which owns and operates Fantasy Island Amusement Park in Beach Haven, was told the borough “was unable to consider it,” according to court documents.

In October 2019, Wainwright Amusements filed an application with the New Jersey Office of the Attorney General’s Legalized Games of Chance Control Commission, according to court records.

“The application was then apparently forwarded back to the borough. The borough then informed Wainwright, again, that it was in receipt of the application but would not consider it,” court records show.

Troncone determined Wainwright Amusements did not formally apply for a gaming license and as such no formal action was taken by the borough.

In June, Troncone issued an amended opinion, finding “the zoning portion of the contested (amusement games license) ordinance is invalid on both substantive and procedural grounds. Substantively, it constitutes spot zoning.”

The measure, according to Troncone’s June ruling, “was never referred to the appropriate borough land use board at its adoption in 2003. On either ground, the zoning portion of this ordinance is invalid and thus, unenforceable.”

In his 20-page ruling, which recounts testimony of whether the ordinance constituted spot zoning from plenary hearings in July 2020, Troncone noted Wainwright Amusements has received all the proper land use approvals to move forward with a licensed gaming facility at the site.

“It may now make application to the borough to obtain the gaming license. The court also finds the borough is legally obliged to diligently process the application,” according to Troncone’s ruling.

He set a 45-day deadline for the borough to make a final determination on the application. The time frame begins on the day a completed application is received.

In a June 22 letter to Ship Bottom officials, John Paul Doyle, attorney for Wainwright Amusements, called Troncone’s rulings “clear and unambiguous,” but noted it omits reference to another statute that “must be strictly followed by (the) borough in processing” the gaming license application.

Specifically, the borough must investigate the qualifications of the applicant along with the merits of the application and determine whether the applicant is duly capable to hold, operate and conduct amusement games under the license law, Doyle wrote.

Citing Section 103 of the New Jersey licensing law, Doyle said the borough’s scrutiny is limited to a two-part query. One, Ship Bottom officials must consider whether Brian Wainwright of Wainwright Amusements “is a person of good moral character and (has) never been convicted of a crime or that such disqualification has been removed by the commissioner,” according to the attorney’s missive. Secondly, they must consider whether Wainwright would “comply with the relevant sections of the licensing law; the regulations adopted by the New Jersey Amusement Games Control Commission and the borough’s gaming license ordinance.”

“Given Mr. Wainwright’s valid use variance and impeccable qualifications, Ship Bottom is legally obligated to issue a gaming license for the former CVS site because the licensing law states that the borough ‘shall issue a license to (a qualified) applicant’ once the necessary license fee is paid , Doyle wrote.

Should borough officials decide in favor of granting the gaming license, it would need to do so only by adopting a resolution, according to Doyle’s letter. The borough could deny the petition only after a hearing is held to discuss the merits of the application and the qualifications of the applicant.

In the event the borough denies the application in “bad faith or considers criteria other than those mandated by the license law,” Doyle said Wainwright’s substantive rights would be violated and he would “be left with no other course but to seek the various remedies, Including damages and reasonable counsel fees, for this entire litigation,” as permitted by the New Jersey Civil Rights Act.

However, Dennis M. Galvin, attorney for Hartland Golf and Arcade as well as Endless Summer, said in a June 28 letter hand delivered to the borough, “threat of a constitutional violation would amount to a frivolous lawsuit.”

“Turning down the request based upon a bona fide license limit established over 20 years and which is consistent with New Jersey law is not a discriminatory act,” he wrote.

However, both the Appellate Division and Troncone in his amended opinion found flaws with the two-decades-old license limit, saying over the years the borough’s master plan did not include a statement that amusement uses were not permitted and that zoning ordinances were never referred to the land use board prior to adoption.

The Appellate Division concluded “The board’s omission of a prohibition on amusement uses in the 2018 Master Plan Re-examination reasonably indicates the abandonment of its previous prohibition,” according to its April ruling. “Furthermore, it is logical to conclude that prohibition of a use also does not determinatively preclude granting a use variance on reconciliation grounds, as the purpose of the statute delegating variance power to the board is to allow ‘a use or principal structure in a district restricted against such use or principal structure’ for special reasons.”

For his part, Troncone referenced sections 26 and 64 of the state’s municipal land use law, which requires all zoning ordinances and its amendments to be referred to the board.

“Failure to comply with this express provision of the state law thus invalidates the zoning provisions of the ordinance,” according to Troncone’s amended opinion. “The borough has consistently maintained throughout this litigation that its ordinance, in part, recognizes the rights of the two properties identified in the ordinance as prior, non-conforming uses, and entitled to continue to operate licensed amusement games. Yet, the borough refuses to recognize Wainwright’s property status, ie, a property whose owner has met the rigorous standards imposed by law by obtaining a use variance approval from the borough’s land use board.”

Until a final determination on a formal game license application has been made, the matter will remain under the jurisdiction of the court, Troncone wrote.

“Despite past and ongoing controversies, Mr. Wainwright would like nothing more than to establish a mutually beneficial and cooperative relationship with Ship Bottom, its elected and appointed officials and its highly competent professionals,” Doyle said in his June letter. “As such, he is extending his hand to the borough in good faith and is truly looking forward to making his family-oriented, self-contained amusement facility a shining ‘destination point’ for Ship Bottom’s residents and tourists alike, now and in the future.”

— Gina G. Scala

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