          IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Rector Church Wardens and           :
Vestrymen of Trinity Church         :
in Oxford Township Philadelphia     :
County,                             :
                        Appellant   :
                                    :
             v.                     : No. 1338 C.D. 2018
                                    : Argued: June 3, 2019
City of Philadelphia Historical     :
Commission and City of Philadelphia :

BEFORE:        HONORABLE MARY HANNAH LEAVITT, President Judge
               HONORABLE ROBERT SIMPSON, Judge
               HONORABLE ELLEN CEISLER, Judge

OPINION
BY JUDGE SIMPSON                                  FILED: JULY 11, 2019

               Rector Church Wardens and Vestrymen of Trinity Church (Church)
(collectively, Owners) appeal from an order of the Philadelphia County Court of
Common Pleas (trial court)1 that affirmed the City of Philadelphia Historical
Commission’s (Commission) designation of their Parish House as a historic place.
Owners argue the trial court erred in deferring to the Commission’s construction of
its regulations because the Commission disregarded a crucial prerequisite for
designation, that the place be significant. Owners also assert the trial court should
have analyzed the Religious Land Use and Institutionalized Persons Act of 2000
(RLUIPA), 42 U.S.C. §§2000cc-2000cc-5, because the designation burdens the
Church’s religious exercise by creating obstacles to profiting from the property.
Upon review, we affirm the trial court’s order.




      1
          The Honorable Paula Patrick presided.
                                          I. Background
                Parish House, located at 6901 Rising Sun Avenue, is on the western
side of the same parcel as the Church (previously designated as historic) 2 in
Philadelphia. Parish House, also referred to as School House, was constructed in
two phases in 1928 and 1963.                Its construction in 1928 followed the City’s
Sesquicentennial celebration featuring the Colonial Revival architecture style. The
first phase featured an auditorium and gymnasium. The addition in the second phase
added a larger classroom wing following the same Colonial Revival style.


                Features of the Colonial Revival style reflected in Parish House include:
a Doric portico entrance and porch; a tabernacle window; double doors; and a 1928
date stone and “bulls-eye” window above the entrance. Reproduced Record (R.R.) at
63a, 219a-20a, 258a. The expansion added a gable roof and an octagonal cupola also
reflective of the Colonial Revival style. R.R. at 217a-19a, 222a.


                Owners leased the space at Parish House for various secular uses
including classes, community meetings and activities. Notably, Parish House has
not been used for religious services. R.R. at 227a-29a. The gym in Parish House
was leased to the Philadelphia Police Athletic League from 1969-2015, and other
portions were leased to a child care center from 1978-2015. Owners stopped leasing
Parish House in 2015.


                In April 2017, the Preservation Alliance for Greater Philadelphia (the
Alliance) nominated Parish House for designation on the Philadelphia register of

      2
          There is no dispute that the Church is a historic place and its designation is not at issue.


                                                   2
historic places (Register). The nomination proposed that Parish House met three of
the 10 criteria in the Preservation Ordinance, Phila. Code, §14-1004(1), specifically,
(c), (d) and (j). Criterion (c) requires the building to reflect an era characterized by
a distinctive architectural style, here Colonial Revival popular in the 1920s.
Criterion (d) requires a building to embody distinguishing characteristics of an
architectural style. Criterion (j) allows designation of places that exemplify cultural
or social heritage of the community.


             In September 2017, the Committee on Historic Designation, (which
reports to the Commission), met to consider the nomination. The five-person
Designation Committee included two architectural historians, an archaeologist and
a registered architect.


             During the Designation Committee meeting, the Alliance, local
politicians and members of the community presented their views on the architectural
and historic importance of Parish House itself and as an integral part of the
community. Owners opposed the designation as they were in negotiations to enter
a binding lease or sale with Royal Farms to build a gas station/convenience store.
The financial hardship alleged is that Parish House could not be altered or
demolished once on the Registry.


             The Designation Committee discussed the comments and considered
the arguments. It then voted to recommend to the Commission that Parish House
met the criteria for designation on the Register.




                                           3
               In November 2017, the Commission held a public meeting where it
considered the nomination.          Community members and leaders supported the
designation. Over 3,000 community members signed a petition supporting the
designation. R.R. at 55a-62a. The Commission also heard Owners’ objections.
Owners emphasized the Church’s financial difficulties and the necessity of obtaining
revenue from Parish House. They provided a preliminary economic analysis of their
finances, including the annual cost of maintaining Parish House of $30,000-$36,000.
Owners planned to allow a commercial tenant to demolish Parish House and
repurpose the property as a convenience store. Owners maintained a lease or sale of
Parish House was necessary for the Church’s survival as it was its only secular asset.


               After emphasizing its role in acting on the nomination, and not in
deciding a financial hardship application, the Commission concluded Parish House
met the three designation criteria as the Designation Committee recommended.3 On
November 29, 2017, the Commission issued its official notice of designation. R.R.
at 5a-6a. Owners appealed the Commission’s decision to the trial court.


               Based on the record before the Commission, the trial court upheld the
designation. Owners then appealed the trial court’s order to this Court.


               The trial court directed Owners to file a Rule 1925(b) Statement of
errors complained of on appeal. After receiving the Statement, it then filed an
opinion supporting its order. See Tr. Ct., Slip Op., 10/2/18. It deferred to the
Commission’s construction of the Preservation Ordinance and its application of the


      3
          There is a separate financial hardship process under Commission regulations.

                                               4
designation criteria to Parish House. The trial court cited the evidence presented at
the Commission’s meeting. It also concluded that RLUIPA did not apply because
there was no indication on the record that Parish House was used for any religious
purpose or that the designation impaired any religious exercise.


               After briefing4 and argument the matter is ready for disposition.


                                           II. Discussion
               On appeal,5 Owners argue the trial court erred in applying an abuse of
discretion standard to the Commission’s decision. Primarily, they assert the trial
court overlooked an overarching significance criterion in the Preservation Ordinance.
They contend the designation criteria are ambiguous, requiring the Commission to
consider the significance of Parish House. Owners also claim substantial evidence
does not support the designation. In addition, they assign error in that the trial court
concluded RLUIPA did not apply to preclude designation, an alleged burden on the
Church’s religious exercise.


               The City responds that Parish House meets designation criteria because
it reflects the Colonial Revival style and has historically been a center for community
activities. It counters that the Commission’s meeting minutes and the records it
considered constitute sufficient evidence in support of the Commission’s decision.

       4
         Owners and the City on behalf of the Commission filed briefs. The Alliance was
precluded from filing a brief.
       5
          “An administrative agency’s interpretation of [a rule] it is charged to administer is entitled
to deference on appellate review absent ‘fraud, bad faith, abuse of discretion, or clearly arbitrary
action.’” Turchi v. Phila. Bd. of License & Inspection Review, 20 A.3d 586, 591 (Pa. Cmwlth. 2011)
(quoting Winslow–Quattlebaum v. Maryland Ins. Grp., 752 A.2d 878, 881 (Pa. 2000)).

                                                   5
             Chapter 14-1000 of the Philadelphia Code, pertaining to Historic
Preservation, serves as the City’s Preservation Ordinance. As a matter of policy, it
recognizes the importance of preserving buildings of “historic, architectural, cultural,
educational and aesthetic merit” and preserving buildings important to the education,
culture, traditions and economic values of the city. Phila. Code, §14-1001 (Public
Policy and Purposes). To that end, the Code empowers the Commission to render
decisions on historic preservation, including designation of buildings for the Register.
See Turchi v. Phila. Bd. of License & Inspection Review, 20 A.3d 586, 590 (Pa.
Cmwlth. 2011) (Turchi I).


             The Commission designated Parish House for the Register based on the
criteria contained in the Preservation Ordinance. We consider the Commission’s
interpretation of the Preservation Ordinance. We also examine whether the record
supports the Commission’s application of the criteria to Parish House.


                             A. Deference to Commission
             First, we consider Owners’ argument that the Commission erred in
construing and applying the Preservation Ordinance. Specifically, they assert the
Commission ignored the “threshold standard for designation: It is not ‘significant to
the City’ as required by Section 14-1003(2)(a) of the Preservation Ordinance.”
Appellants’ Br. at 16.


             Throughout their briefs, Owners maintain that the Philadelphia Code,
§14-1001(1), contains criteria requiring significant attributes. In particular, they
claim Section 14-1003(2)(a) contains a significance requirement.



                                           6
             Section 14-1003(2) lists the Commission’s powers and duties “shall be
as follows: […] (b) designate as historic those buildings, structures, sites and objects
the [Commission] determines are significant to the City, pursuant to the criteria of
Section 14-1004(1).” Phila. Code, §14-1003(2) (emphasis added). In context, it is
clear the Commission has the discretion to determine what is significant, guided by
the criteria in Section 14-1004(1). In pertinent part, Section 14-1004(1) provides:

        A building [or] complex of buildings … may be designated for
        preservation if it:
                                       ****

         (c) Reflects the environment in an era characterized by a distinctive
             architectural style.

         (d) Embodies distinguishing characteristics of an architectural style
             or engineering specimen.

                                            ****
         (j) Exemplifies the cultural, political, economic, social, or
             historical heritage of the community.

Phila. Code, §14-1004(1) (Preservation Ordinance). Only one criterion must be met.
Here, the Commission concluded Parish House met three different criteria for
nomination. As a result, it designated Parish House and placed it on the Register.


             In Turchi I, we recognized the Commission has expertise given its
mandated composition of specialists in historical, architectural, and real estate fields.
This Court held that given the Commission’s expertise, its ability to promulgate
regulations, and its authority to administer the Preservation Ordinance, “the
[Commission’s] reasonable interpretations of the ... Ordinance are entitled to




                                           7
deference and that these interpretations ‘become[ ] of controlling weight unless [they
are] plainly erroneous or inconsistent’ with the ... Ordinance.” Id. at 594.


             We reasoned that “the administrative interpretation and [c]onstruction
of [phrases] are matters within the province of the [Commission’s] administrative
expertise.” Id. at 595 (citation omitted); see also Turchi v. Phila. Bd. of License &
Inspection Review (Pa. Cmwlth., No. 658 C.D. 2014, filed May 15, 2015), 2015 WL
5437160 (unreported) (Turchi II). As such, the Commission’s construction of the
Preservation Ordinance and the designation criteria are entitled to deference.


             Applying a deferential standard here, we uphold the Commission’s
designation of Parish House as a historic place. The Commission’s construction of
the criteria is reasonable.


             Because the Commission has the discretion to designate what qualifies
as historically significant using the designation criteria, we discern no merit in
Owners’ contention that the Commission disregarded a significance requirement.
Even presuming such an overarching significance requirement exists, the Commission
has the express authority to determine what qualifies as significant. Meyer v. City of
Pittsburgh Historic Review Comm’n, 201 A.3d 929 (Pa. Cmwlth. 2019).


                               B. Substantial Evidence
             Next, Owners contend the record does not contain substantial evidence
to support the Commission’s application of the nomination criteria to Parish House.
This Court recognizes that minutes of Commission meetings are evidence and may



                                          8
support a designation. See id. (applying Pittsburgh Zoning Code; deferring to
historic commission); see, e.g., Woodland Terrace Homeowners’ Ass’n v. Phila. Bd.
of License & Inspection Review (Pa. Cmwlth., No. 801 C.D. 2014, filed April 22,
2015), 2015 WL 5436758 (unreported) (upheld Commission grant of financial
hardship application to demolish historic building).


             The Commission met on November 10, 2017, accepting statements and
documents in support of the designation. Owners submitted documents, including a
preliminary economic analysis, supporting their objections and financial concerns.
Community members and nominators spoke in support of the designation.


             In support of Criterion (j), the minutes of that meeting reflect that over
3,000 members of the community support the designation based on the cultural
import of Parish House to the community. R.R. at 54a-56a. Also, in support of
Criteria (c) and (d), the minutes explain how Parish House exhibits Colonial Revival
architecture. Specifically, that Parish House was unique in embracing the Colonial
Revival style following the Sesquicentennial, was one of the oldest in northeast
Philadelphia, a striking building in the neighborhood. R.R. at 58a. Parish House
has a Doric portico with double doors, a tabernacle window with a segmental arch,
a date stone and a bulls-eye window. R.R. at 63a.


             Primarily, Owners assert Parish House is merely an ordinary example
of Colonial Revival style architecture. They allude to the existence of many other
examples of that style that would be better, more worthy examples. However, that
there are other examples of the Colonial Revival style of architecture does not



                                          9
diminish the necessity for preserving Parish House. An ordinary or representative
building constructed in the Colonial Revival style still reflects the era and a distinctive
type of architecture as Criteria (c) and (d) prescribe.


              It bears emphasis that only one criterion must be met for designation.
Here, most of the evidence relates to Criterion (j), and the role Parish House played
in the history and culture of the community. However, it is undisputed that Parish
House contains specific architectural elements of the Colonial Revival style, which
the Commission deemed sufficient for designation under Criteria (c) and (d). The
record supported the Commission’s application of the criteria here.


                                 C. Effect of Designation
              Owners also contend the Commission’s designation decision adversely
affects their ability to use their property as they wish. They assert the trial court should
have construed any ambiguity in the Preservation Ordinance in their favor as
landowners because designation constitutes a land use restriction. They also assign
error to the trial court’s conclusion that the designation is not a restriction on land use
when historic designation subjects owners to additional requirements and limits their
use or modification of the property. In addition, Owners maintain the trial court erred
in disregarding the impact designation had on their ability to profit from Parish House.


                                      1. Zoning Code
              Owners contend that the Commission ignored the rules of construction
in the Philadelphia Zoning Code. In support, Owners cite the “Rules of Interpretation”
of the Zoning Code, which states how words in the Zoning Code shall be construed.



                                            10
Phila. Code, §14-201. Specifically, it provides: “Where the meaning of a restriction
in this Zoning Code is ambiguous and the intent cannot be discerned through the
usual rules of statutory construction, the restriction shall be construed in favor of the
landowner.” Id. (emphasis added).


             Despite that the effect of the designation decision restricts Owners’ land
use, it does not constitute a “restriction” as that term is used in Section 14-201. Id.
In so construing this provision, Owners disregard its plain language.


             While the criteria for designation are enumerated in the Preservation
Ordinance, (Chapter 14-1000 of the Zoning Code), the designation follows a
decision to designate by the Commission. Thus, the designation itself does not
consist of ambiguous terms “in the Zoning Code” that may be construed in a
landowner’s favor. Id. Thus, we agree with the trial court that Section 14-201 does
not apply to the Commission’s designation of Parish House.


             Further, the Zoning Code expressly delegates authority to the
Commission to make designation decisions.               See Phila. Code, §14-1003.
Accordingly, we do not disturb the Commission’s interpretation of the Preservation
Ordinance absent “fraud, bad faith, abuse of discretion, or clearly arbitrary action.”
Winslow-Quattlebaum v. Maryland Ins. Grp., 752 A.2d 878, 881 (Pa. 2000).


                                      2. RLUIPA
             Lastly, we consider Owners’ argument that the designation imposes a
substantial burden on religious exercise that is prohibited by RLUIPA.



                                           11
             RLUIPA provides in pertinent part:

             No government shall impose or implement a land use regulation in
             a manner that imposes a substantial burden on the religious exercise
             of a person, including a religious assembly or institution .…

42 U.S.C. §2000cc(a)(1). Here, Owners contend the designation of Parish House
under the Preservation Ordinance is a land use regulation that poses a substantial
burden in that it limits their ability to sell/modify Parish House. Once designated,
Owners would need to seek a financial hardship exemption to modify Parish House.


             Assuming that RLUIPA applies, the next question is whether the sale
of Parish House constitutes a “religious exercise.” The burden is on petitioner to
prove that the commercial transaction, i.e., the sale or lease of Parish House by the
Church, constitutes a “religious exercise.” 42 U.S.C. §2000cc–2(b).


             RLUIPA defines “religious exercise” as “any exercise of religion,
whether or not compelled by, or central to, a system of religious belief.” 42 U.S.C.
§2000cc–5(7)(A).     RLUIPA specifically provides that “[t]he use, building, or
conversion of real property for the purpose of religious exercise shall be considered
to be religious exercise of the person or entity that uses or intends to use the property
for that purpose.” 42 U.S.C. §2000cc–5(7)(B).


             In determining whether an activity qualifies as a religious exercise, this
Court considers whether the activities “are administered by a religious leader, i.e., a
minister, priest, rabbi or other spiritual leader.” Glenside Ctr., Inc. v. Abington Twp.
Zoning Hearing Bd., 973 A.2d 10, 17 (Pa. Cmwlth. 2009). It is also relevant that



                                           12
Parish House does “not hold any religious services or have any religious
affiliations.” Id.


             Here, Owners cannot avail themselves of the protections of RLUIPA
without showing an impairment of religious exercise. However, Owners did not
submit any evidence to show that the designation impaired a religious exercise. The
record is clear that Parish House was not used for religious activities and the Church
used it as a source of funds.


             Relevant here, a “religious exercise” is not the equivalent of any
exercise by a religious body. The sale or lease of secular property owned by a church
is not a religious exercise. California–Nevada Annual Conf. of Methodist Church
v. City & Cty. of San Francisco, 74 F. Supp. 3d 1144, 1154 (N.D. Cal. 2014). Sale
of property only used for secular purposes is not a religious exercise even if the
profits from the sale will go toward furthering a religious mission. Id.


             Moreover, a land use regulation that makes it more expensive or
difficult to practice religion is not a substantial burden. Braunfeld v. Brown, 366
U.S. 599 (1961); Lakewood, Oh. Congreg’n of Jehovah’s Witnesses, Inc. v. City of
Lakewood, Oh., 699 F.2d 303 (6th Cir. 1983); Episcopal Student Found. v. City of
Ann Arbor, 341 F. Supp. 2d 691 (E.D. Mich. 2004).


             RLUIPA’s statutory language and relevant case law establish that
commercial endeavors such as that here– the sale or lease of property previously
used for only secular activities– do not constitute “religious exercise” protected by



                                         13
RLUIPA.6 Accordingly, the trial court did not err in concluding that RLUIPA did
not apply so as to preclude the Commission’s designation of Parish House.


               In sum, this Court defers to the Commission’s interpretation and
application of the nomination criteria in the Preservation Ordinance. The trial court
did not err in concluding that RLUIPA did not apply. Regardless, Owners bore the
initial burden to demonstrate the commercial transaction that the Church
contemplated qualified as a “religious exercise” so as to trigger the statute’s
application.


                                        III. Conclusion
               For the foregoing reasons, the trial court’s order is affirmed.




                                              ROBERT SIMPSON, Judge



Judge Fizzano Cannon did not participate in the decision of this case.




       6
         Because we agree with the trial court’s conclusion that RLUIPA does not apply, it is not
necessary to analyze the designation under a strict scrutiny standard (i.e., whether the City proved
a compelling governmental interest in the designation and used the least restrictive means of
furthering that interest).

                                                14
       IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Rector Church Wardens and           :
Vestrymen of Trinity Church         :
in Oxford Township Philadelphia     :
County,                             :
                        Appellant   :
                                    :
             v.                     : No. 1338 C.D. 2018
                                    :
City of Philadelphia Historical     :
Commission and City of Philadelphia :


                                    ORDER

           AND NOW, this 11th day of July, 2019, the order of the Court of
Common Pleas of Philadelphia County is AFFIRMED.




                                     ROBERT SIMPSON, Judge
