Lakewood Associates, Robert G. Moore, Tax Matters Partner - Page 4

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            residents of the proposed development.  Based on the staff's                              
            recommendation, in September 1988, the Planning Commission                                
            recommended to the Chesapeake City Council (City Council) that                            
            Lakewood's rezoning application be denied.  In October 1988,                              
            however, the City Council approved Lakewood's rezoning                                    
            application contingent on certain proffers.                                               
                  Residents of Chesapeake, Virginia, mounted a petition drive                         
            against the rezoning and, after obtaining the required 15 percent                         
            of voters’ signatures, requested that the City Council repeal the                         
            approved rezoning of Lakewood's Elbow Lake property.  The City                            
            Council voted not to repeal the rezoning.  On March 7, 1989, a                            
            voter referendum was held on whether or not to rezone the Elbow                           
            Lake property as mandated by the Chesapeake City Charter.  The                            
            proposed rezoning was defeated by the voter referendum with over                          
            95-percent voting against rezoning the property for residential                           
            use.  The referendum was subsequently upheld by the Virginia                              
            Supreme Court in an opinion filed April 20, 1990, in which the                            
            court found that the referendum provisions of the City Charter                            
            apply to zoning ordinances.  R.G. Moore Bldg. Corp. v. Committee,                         
            239 Va. 484, 391 S.E.2d 587 (1990).  Lakewood did not make any                            
            subsequent attempts to rezone the Elbow Lake property from the                            
            time of the voter referendum defeating the residential zoning to                          
            the time of trial.                                                                        







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