On March 31, 2016, the Court of Appeals of New York held that a town board's positive declaration under State Environmental Quality Review Act (SEQRA) that a proposed rezoning may have a significant effect on the environment is not ripe for judicial review (Ranco Sand and Stone Corp. v. Vecchio, 27 N.Y.3d 92 (March 31, 2016)).

In 2002, Ranco Sand and Stone applied to rezone a parcel of land in Smithtown, New York from residential to heavy industrial use. Five years later, the town's board, acting as a lead agency under SEQRA, issued a positive declaration that the rezoning may have a significant effect on the environment. The resolution stated that there was a potential for impacts on noise level, air quality, light, traffic, as well as the increased use and storage of toxic and hazardous materials.

In order to proceed with the application to rezone, Ranco would have to prepare a draft environmental impact statement (DEIS), which generally costs over $75,000 to complete. Instead, Ranco commenced an Article 78 proceeding against the town board, arguing that the positive declaration was arbitrary, capricious, and unauthorized. The town moved to dismiss the case for failure to state a cause of action. The supreme court held that SEQRA positive declarations were the initial step in the decision making process, and did not give rise to a justiciable controversy. The appellate division affirmed.

The Court of Appeals clarified its previous holding in Gordon v. Rush (100 N.Y.2d 236 (2003)) and explained that a positive declaration is ripe for judicial review if:

The court found that while Ranco's obligation to prepare a DEIS, which is both time consuming and expensive satisfied the first condition, the facts of the case did not satisfy the second condition. The court held that imposing a DEIS requirement is not a final agency action, but rather the initial step in the SEQRA process.

In contrast, the court explained that a positive declaration may be ripe for judicial review where the administrative agency is not authorized to serve as a lead agency under SEQRA, or the action is not subject to SEQRA.

This case is significant for project developers, landowners, and land use practitioners in New York. SEQRA lead agencies (such as town boards) may issue a positive declaration for politically unpopular projects or projects where the significance of the project's environmental impact is disputed. Without the option of judicial review, developers facing DEIS preparation might kill a project rather than endure the lengthy and expensive task of DEIS preparation.