In a recent case before the D.C. Court of Appeals, the Oakland Condominium challenged a BZA determination that a couple who ran a small hotel out of a row home were entitled to a use variance. The couple purchased the home from a prior owner who had operated a fifteen-unit rooming house in the row home. Once they purchased the row home, they tried to apply for a Certificate of Occupancy identical to the one held by the previous owner, but city officials told them that their Certificate of Occupancy would only be granted for eight (8) rooms. They filed anyway, but their application was denied. They were then informed by the Zoning Administrator that they would require a use variance to run their inn. When the couple applied for the use variance, they were denied. Meanwhile, the couple secured building permits from the Department of Consumer and Regulatory Affairs (“DCRA”) for renovation of the property on the basis of a twelve-room housing operation. They again applied for a twelve-room Certificate of Occupancy, but they were again denied. After they completed the renovations, the DCRA requested that the couple change their permits to only an eight-room renovation, but they never did. Six (6) years later, the couple filed for another use variance. This time, it was granted.

In affirming the decision of the BZA, the Court of Appeals held that the couple had relied in good faith on the actions of D.C. officials, particularly the DCRA. They had no reason to understand why a building permit did not represent a zoning determination, especially when the DCRA took no enforcement action against them. This good faith, along with their detrimental reliance in completing renovations on the property constituted an exceptional condition, which satisfied the first prong of the use variance test.

The couple also needed to demonstrate that they had suffered undue hardship. The Condominium argued that no matter what financial hardship the couple had suffered, it was brought about by their own affirmative acts. However, both the BZA and the D.C. Court of Appeals disagreed, concluding that the couple could never have renovated the building into twelve rooms without the implicit approval of the District government, through the DCRA. The BZA found that renting four (4) of the rooms for extended stay; and thus, complying with occupancy rules was “unreasonable.” The Court concluded that the BZA’s decision was rational and supported by substantial evidence.

In the District of Columbia, Order 614 coupled with 11 DCMR § 330.6 prohibits transient rooming in residential areas. However, the BZA concluded that these were put in place to control new hotels, not existing hotels. The Court, mindful that it was to adhere to the BZA’s determination as long as there was a rational basis for it, agreed. This satisfied the third and final prong of the use variance test, since it would not disrupt the area’s zoning plan. The Court affirmed BZA’s determination.