Permit Denial Costs Santa Barbara $2.4 Million

A Santa Barbara jury concluded that the City of Santa Barbara must pay Thomas Felkay $2.4 million because the Santa Barbara City Council denied him the permits necessary to build a new three-bedroom home on the bluff-top Mesa property he bought in 2006 for $850,000.

City planners found that Felkay’s property lay perilously in the path of the 1978 mudslide and opted to deny him the Local Coastal Permit needed to proceed. Felkay sued, claiming City Hall had effectively taken his property without compensation. After a trial last year, Judge Thomas Anderle agreed.

Last week, a jury determined that City Hall owed Felkay $2.4 million for “taking” his property. That’s about the same amount as what he paid for the land originally coupled with the $1.5 million his attorney said he spent on geological studies showing it was safe to build. It’s also about halfway between the $1 million City Hall said the property was worth and the $3.3 million Felkay thought it was.

The $2.4 million does not include the $2 million Felkay’s attorney, Joseph Liebman, says the city will soon be on the hook for in legal fees. City Attorney Ariel Calonne indicated that he would be asking the council to consider an appeal of Judge Anderle’s ruling.