The Continuing Struggle Against Government Extortion, and Why the Time Is Now Right to Employ Heightened Scrutiny to All Exactions
Marc J. Herman
“I’m going to make him an offer he can’t [afford to] refuse” —The Godfather
THE GODFATHER, FRANCIS FORD COPPOLA’S 1972 blockbuster, is a timeless
classic.1 In addition to its legacy as one of Hollywood’s most successful
motion pictures, The Godfather exemplifies a theme that roots
itself in the very fabric of human nature: extortion. What is central to
The Godfather has parallels, nuanced and more subtle, to land use regulation.
Through a pervasive scheme of exactions, governments are
coercing property owners. This coercion may neither be as blatant
nor as repugnant as finding a horse’s decapitated head in one’s bed,
but, nevertheless, it exists and mandates judicial oversight. Indeed,
in 1987 the United States Supreme Court warned against the risk of
municipal plans of “out-and-out. . . . extortion.”2
The Supreme Court has made efforts to inhibit government extortion
in the context of exactions. In two well-known cases, Nollan3
and Dolan,4 the Court crafted a framework that subjected exactions
to heightened scrutiny. This framework, known as the “dual rationality
test,”5 measures the constitutionality of modern-day exactions.
1. The Godfather (Paramount Pictures, 1972). Strong caveat required: “depending
on one’s audience” (mostly for the benefit of my wife, who leaves the room whenever
the film is playing).
2. Nollan v. Cal. Coastal Comm’n., 483 U.S. 825, 837 (1987) (internal citations
omitted).
3. Id.
4. Dolan v. City of Tigard, 512 U.S. 374 (1994).
5. See infra Part IV.
655
Since Nollan and Dolan, the Supreme Court has had little opportunity,
or rather, has declined, to provide further guidance on the precise contours
of the dual rationality test. This article focuses on the Court’s
most recent exactions decision: Koontz v. St. Johns River Water Management
District.6 Koontz—advanced by private property rights advocates
as a resounding victory7—expanded the dual rationality test to
monetary exactions, an issue that had plagued lower courts for decades.
8 Yet despite Koontz’s ability to provide some much-needed
clarity, the decision left an important question unanswered: whether
heightened scrutiny—the legacy of Nollan and Dolan9—is equally
applicable to both legislative and adjudicative exactions,10 i.e.,
generally applicable exactions and individually tailored exactions,
respectively.
“[S]ome of the most frequently litigated issues in this area are
whether the rules established in [Nollan and Dolan] apply to legislative
or adjudicative exactions.”11 Judicial fragmentation in the lower courts
is rife. While some argue that “Nollan and Dolan cannot be read as
limited to discretionary, case-by-case conditions,”12 others advocate
6. 133 S. Ct. 2586 (2013).
7. See, e.g., Jonathan Stempel & Lawrence Hurley, U.S. Top Court Backs Florida
Property Owner in Land-Use Case, REUTERS (June 25, 2013), http://www.reuters.com/
article/2013/06/25/us-usa-court-property-idUSBRE95O0XM20130625.
8. See LEE ANNE FENNELL & EDUARDO M. PENALVER, EXACTIONS CREEP 8 (2013)
(“Before Koontz, the Supreme Court had not intervened to decisively resolve [the]
debate.”).
9. See Nollan, 483 U.S. 825; see also Dolan, 512 U.S. 374.
10. See Steven Eagle, Koontz in the Mansion and the Gatehouse, 46 URB. LAW. 1, 6
(2014); D.S. Pensley, Real Cities, Ideal Cities: Proposing A Test of Intrinsic Fairness
For Contested Development Exactions, 91 CORNELL. L. REV. 699, 706 (2006) (providing
a concise explanation of the distinction between legislative and adjudicative (ad
hoc) decision making). Essentially, the distinction rests on the underlying process utilized
to implement governmental policy: legislative decision-making is formulated via
the law-making process, and, necessarily, has universal application. Adjudicative decision
making, on the other hand, “sometimes called ‘quasi-judicial’ proceedings, are
a hybrid between a purely legislative enactment and a full judicial proceeding.” Jane
C. Needleman, Exactions: Exploring Exactly when Nollan and Dolan Should Be Triggered,
28 CARDOZO L. REV. 1563, 1574 n.76 (2006). Such decision-making involves
individualized and tailor-made exercise of legislative authority. See id.; see also Catherine
Buchanan Lehmann, Dolan v. City of Tigard: A Heightened Scrutiny of the Fifth
Amendment, 32 HOUS. L. REV. 1153, 1176 (1995) (suggesting that there are three different
tests that courts usually employ to distinguish legislative acts from adjudicative
acts).
11. W. Andrew Gowder, Jr. & Bryan W. Wenter, Recent Developments in Exactions
and Impact Fees: Who Pays for New Schools, Fair Housing, and Clean Air?,
42 URB. LAW. 615 (2010).
12. DAVID A. DANA & THOMAS W. MERRILL, PROPERTY: TAKINGS 226 (1998); see also
Fred P. Bosselman, Dolan Works, in TAKING SIDES ON TAKINGS ISSUES: PUBLIC AND PRIVATE
PERSPECTIVES 351 (Thomas E. Roberts ed., 2002); see also J. David Breemer, The
Evolution of the “Essential Nexus”: How State and Federal Courts Have Applied Nol-
656 The Urban Lawyer Vol. 46, No. 3 Summer 2014
that “[t]here is language in Supreme Court decisions suggesting that
Nollan and Dolan (and hence Koontz13) should be limited to [adjudicatory]
fees.”14 The answer to this question is tremendously important
for landowners. With no explicit guidance from the Supreme Court,
landowners cannot assert whatever constitutionally preserved rights
they may have, and protect their property interests from government
extortion. This article supports the equal treatment of legislative and
adjudicative exactions: both should be subject to Nollan and Dolan’s
heightened scrutiny analysis.
Part I of this article briefly examines the history of the Takings
Clause, tracking its transatlantic voyage and its eventual re-birth in
the United States. It then delineates the framework for a modernday
exactions analysis, discussing the Supreme Court’s decisions in
Nollan15 and Dolan,16 and the subsequent reactions to those decisions
in the lower courts. Finally, after analyzing the Court’s decision in
Koontz,17 this article argues that the answer to the above-proposed
question is an emphatic yes—heightened scrutiny is, or ought to be,
applicable to legislative exactions. A bifurcated approach (one that
treats legislative and adjudicative decisions differently) is perversely
artificial and unworkable. To be sure, we do not want local municipalities
making offers that landowners, in the words of Marlon Brando,
“can’t refuse.”18 In addition, it would be remiss if this writing failed
to spend some time discussing the level of scrutiny imposed by heightened
review—in particular whether, as its label suggests, heightened
review mandates exacting scrutiny.
lan and Dolan and Where They Should Go from Here, 59 WASH. & LEE L. REV. 373,
381(2002) (“When one looks beyond the bare facts of Nollan and Dolan and examines
the purposes underlying the essential nexus standard, it becomes apparent that the test
cannot easily be limited to exactions of real property and/or exactions imposed
administratively.”).
13. Koontz, 133 S. Ct. 2586.
14. John D. Echeverria, Koontz: The Very Worst Takings Decision Ever?, Vermont
Law School Paper No. 28-13, 45 (Feb. 4, 2014) (forthcoming in N.Y.U. ENVTL. L.J.),
available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2316406; see also
FENNELL & PENALVER, supra note 8, at 2.
15. Nollan, 483 U.S. 825.
16. Dolan, 512 U.S. 374.
17. Koontz, 133 S. Ct. 2586.
18. The Godfather, supra note 1.
The Struggle Against Government Extortion 657
I. Historical (and Very English) Underpinnings of the
Takings Clause
An understanding of American takings jurisprudence requires a brief
journey across the Atlantic Ocean (“The Pond”).19 Sir Edward
Coke, an English jurist who boasts an illustrious stature analogous
to Learned Hand, declared: “the house of everyone is to him as his castle
and fortress, as well for his defence [sic] against injury and violence
as for his repose.”20 This libertarian-esque philosophy of personal
freedom revered, and sought to protect, the sacrosanct natural
right of autonomy over one’s property21—a philosophy that ultimately
motivated the drafting of the takings clause.
Coke advocated his theory four centuries after the Magna Carta
Charter was signed and sealed under the reign of King John. The
Charter was a direct response to the King’s common and arbitrary
abuse of his sovereign power.22 In pertinent part, it stated: “[n]o freeman
shall be taken . . . or in any way destroyed . . . except by the lawful
judgment of his peers and by the law of the land.”23
The adoption of the Charter “marked the dawn of the modern era of
land law in England.”24 And, with the passage of time, it eventually led
to a general practice of providing compensation when one’s title or
possession of property was transferred to the government by force of
law.25 This practice “preserved horizontal equity among property owners”
26—i.e., it ensured that any burdens placed upon some property
owners would be offset by compensation, thus restoring equality
among similarly situated landowners. Inevitably, with the advent of
colonization, this practice, too, travelled across the Atlantic before
firmly cementing itself as the “legal status quo.”27 The “brainchild
of James Madison” was to codify this status quo, and accordingly,
19. But see WILLIAM A. FISCHEL, REGULATORY TAKINGS 101 (1995) (suggesting that
tracking the historical underpinnings of the takings clause, while useful, is not
dispositive).
20. Semayne’s Case, 77 Eng. Rep. 194, 195; 5 Co. Rep. 91a, 91b (K.B. 1604).
21. See GEORGE SKOURAS, TAKINGS LAW AND THE SUPREME COURT 99-102 (1998).
22. Laurence H. Tribe, Death by a Thousand Cuts: Constitutional Wrongs Without
Remedies After Wilkie v. Robbins, 2007 CATO SUP. CT. REV. 23, 41 (2007).
23. MAGNA CARTA CHARTER, art. 39.
24. RUTHERFORD H. PLATT, LAND USE AND SOCIETY: GEOGRAPHY, LAW AND PUBLIC POLICY
51 (2004).
25. William Stoebuck, A General Theory of Eminent Domain, 47 WASH. L. REV.
553, 575-79 (1972); DANA & MERRILL, supra note 12, at 16.
26. Stoebuck, supra note 25, at 584.
27. DANA & MERRILL, supra note 12, at 15.
658 The Urban Lawyer Vol. 46, No. 3 Summer 2014
he instigated its discussion at the state conventions.28 Madison’s successful
efforts are evident in the Federal Constitution. Interchangeably
referred to as the Eminent Domain Clause, Just Compensation Clause,
and the Takings Clause,29 the Fifth Amendment reads in pertinent part:
“nor shall private property be taken for public use, without just
compensation.”30
II. Takings 101
A “taking” ordinarily means to acquire possession or control of something.
31 From an originalist’s viewpoint, the ratifiers of the Fifth
Amendment most probably understood “taking” as referring to government
action that typically transfers possession or control of private
property to the state.32 This practice—eminent domain—does not define
the limits of the takings clause.33 As American takings jurisprudence
has developed, so has its complexity. Takings jurisprudence
can be classified into several categories: per se takings, regulatory takings,
and exactions.
A. Per se Takings
A per se taking may manifest itself in one of two ways: permanent
physical invasion or complete economic deprivation. As to the former,
“[w]here government requires an owner to suffer a permanent physical
invasion of her property—however minor—it must provide just compensation.”
34 As to the latter, a regulation that “completely deprive[s]
an owner of all economically beneficial use of her property,” similarly
entitles such owner to compensation.35
28. Id. at 13.
29. FISCHEL, supra note 19, at 1.
30. U.S. CONST. amend. V.
31. DANA & MERRILL, supra note 12, at 86.
32. Id.
33. BARLOW BURKE, UNDERSTANDING THE LAW OF ZONING AND LAND USE CONTROLS
12-13 (2d. ed. 2009).
34. Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 538 (2005) (citing Loretto v.
Teleprompter Manhattan CTV Corp., 458 U.S. 419, 435-38 (1982), where New
York law authorizing cable television company to place equipment within petitioner’s
building constituted a physical invasion of her property. The United States Supreme
Court held that any physical occupation of private property, authorized by the government,
requires just compensation. (Id. at 441.)).
35. Lingle, 544 U.S. at 538 (citing Lucas v. S.C. Coastal Council, 505 U.S. 1003,
1019 (1992), where South Carolina statute imposed developmental restrictions upon
petitioner’s property that “denie[d] all economically beneficial or productive use of
land,” and was thus a taking. (Id. at 1015.)).
The Struggle Against Government Extortion 659
B. Regulatory Takings
Regulatory takings, on the other hand, are less categorical—they demand
a fact-intensive, multi-factored inquiry into whether the governmental
action amounts to an unreasonable interference with one’s
private land rights, as to trigger the takings clause.36 In Penn Central
Transportation Company v. New York City,37 the United States Supreme
Court delineated several dispositive factors (“The Penn Central
Factors”) that have particular significance to a takings analysis: (1) the
economic impact of the regulation on the claimant; (2) the extent to
which the regulation has interfered with distinct investment-backed
expectations; and (3) the character of the government action.38 “The
Penn Central factors—though each has given rise to vexing subsidiary
questions—have served as the principal guidelines for resolving regulatory
takings claims that do not fall within [the per se takings
framework.]”39
C. Exactions
While per se and regulatory takings jurisprudence have been subject
to extensive development by the Supreme Court, the law pertaining
to exactions is still, relatively speaking, in its infancy. An exaction describes
a quid pro quo between the state and a private landowner.40 As
described below, when negotiation becomes fiction, and exchange becomes
involuntary, the takings clause is triggered.
Exactions are commonplace.41 Governments often require developers
to mitigate the potential adverse impacts of their projects by exacting
something in return for an approval.42 There are several types of
exactions: on-site land dedications, off-site land dedications, money
36. See Lingle, 544 U.S. at 538 (citing Penn Cent. Transp. Co. v. N.Y.C., 438 U.S.
104, 124 (1978)).
37. 438 U.S. 104 (1978).
38. Id. at 124.
39. Lingle, 544 U.S. at 539.
40. DANA & MERRILL, supra note 12, at 86.
41. See generally ALAN A. ALTSHULER, JOSE´ A. GO ´ MEZ-IBA´N˜ EZ & ARNOLD M. HOWITT,
REGULATION FOR REVENUE: THE POLITICAL ECONOMY OF LAND USE EXACTIONS
(1993); see also Ann E. Carlson, Takings on the Ground: How the Supreme Court’s
Takings Jurisprudence Affects Local Land Use Decisions, 35 U.C. DAVIS L. REV.
103, 119 (2001) (noting that “[l]ocalities in California have used exactions for an
array of purposes including streets, parks, school construction, sewage, public art,
low income housing, environmental litigation mitigation and child care centers.”).
42. See FENNELL & PENALVER, supra note 8, at 11 (“Land use deal making frequently
takes the form embodied in the Court’s exactions cases: regulators have discretion
to block or permit a project to go forward, and they bargain with the landowner
over the terms on which they will approve the project.”).
660 The Urban Lawyer Vol. 46, No. 3 Summer 2014
payments, and other conditions. The government essentially seeks to
obtain a variety of public improvements, infrastructure, and facilities
through a process of bartering. “The most common (and expensive) facilities
include street[s] and street improvements, water and sewage facilities,
affordable housing, parks and recreation, and schools.”43 Traditionally,
the burden of providing such infrastructure was spread
among existing residents.44 However, “there has been a dramatic
change in regimes in the United States, so that newcomers must pay
all of the cost of infrastructure to serve them, plus shar[e] in the cost
of infrastructure of existing residents through real estate taxes.”45
The current increase in government exactions evinces a trend of “exclusionary
fiscal policy.”46
Rich or poor, professional developer or not,47 anybody is susceptible
to government exactions. Borrowing from one author’s proposed
formulaic representation of a typical exaction, consider the following:
48 John owns a magnificent two-story property by the beach. His
ownership interest grants him certain rights and benefits. Those rights
include the right to use, possess, and enjoy the land. We shall label
those benefits as “A.” Incident to ownership, John must also endure
certain burdens, such as compliance with zoning regulations, and payment
of property taxes. Those burdens shall be labeled “B.” Thus,
“A” + “B” = the status quo land use package. After several years of
ownership, John wishes to develop his beachfront property. He proposes
to add a third floor to his home. The planned addition will
add approximately 15 feet to the property’s height, and 10 feet to its
width. This proposal shall be labeled “C.” Naturally, one’s benefit
often inures to another’s misfortune, and John’s proposed development
burdens the local municipality—the increased height specifications
cast a large shadow upon the beach, imposing an encumbrance
upon avid sunbathers. This burden shall be labeled “D.” After seeking
development permission from the local municipality, he is informed
43. DAVID L. CALLIES ET AL., DEVELOPMENT BY AGREEMENT: A TOOL KIT FOR LAND
DEVELOPERS AND LOCAL GOVERNMENTS 4 (2012).
44. Jan K. Brueckner, Infrastructure Financing and Urban Development: The Economics
of Impact Fees, 6 J. PUB. ECON. 383, 384 (1997) (“Historically, infrastructure
financing in U.S. cities relied on the cost-sharing approach.”).
45. See Eagle, supra note 10, at 10.
46. See id.
47. See id. at 15 (“Broadly speaking, land development applicants might be classified
in two categories. The first is professional developers, who see property rights in
instrumental terms. The second is home and small business owners, who see land
ownership in personal and subjective terms.”).
48. FENNELL & PENALVER, supra note 8, at 13-18.
The Struggle Against Government Extortion 661
that, despite his compliance with zoning regulations, he must pay a
“development impact fee” of $10,500 before he can proceed with
the desired extension. The fee, according to the municipality, will
be utilized to fund a public transportation project, enabling those wishing
to sunbathe to take advantage of a shuttle bus that will transport
them to a different beach. We shall label this condition “E.”
In light of the above, John has two options available to him. First,—
“A” + “B”—which gives John the status quo of land ownership. Second,—“
A” + “B” + “C” + “D” + “E”—granting John his desired development,
but conditioned upon his payment. This second option is
a quintessential example of an exaction. It is essentially a bargain between
two parties looking to strike a deal; “[o]n the one hand, we have
a developer who wants to build something. On the other hand, we have
a local government that is in the business of providing services and facilities.”
49 The Supreme Court has established a framework to analyze
the constitutionality of exactions: there must be an “essential nexus”50
between the alleged burden and the government-imposed condition in
order for the exaction to pass constitutional muster, i.e., there must be
a substantial relationship between the burden imposed by John’s development—
aggravating avid sunbathers—and the city’s proposed
solution.
This framework provides a safety mechanism that protects against
“thinly-disguised schemes for extortion.”51
III. The United States Supreme Court: Passivism and
Activism Toward Land Use Regulation
Before delving into the legal patchwork of exactions, one must answer
a gateway question: namely, whether land development is a right or a
privilege. This question has provoked extensive controversy over the
years; not least in California, where the California Supreme Court
has often found itself supporting the latter position.52 On the
opposite end of the spectrum, perhaps under a Hegelian perspective,
land development is viewed as more of a right. The United States Su-
49. Bosselman, supra note 12, at 345.
50. Nollan, 483 U.S. at 837 (“essential nexus” is directly attributable language to
this landmark Supreme Court decision).
51. Eagle, supra note 10, at 9.
52. See Daniel J. Curtin, Jr., How the West Was Won: Takings and Exactions—
California Style, in TRENDS IN LAND USE LAW FROM A-Z: ADULT USES TO ZONING
193, 214 (Patricia E. Salkin ed., 2001).
662 The Urban Lawyer Vol. 46, No. 3 Summer 2014
preme Court has of late aligned itself more with this view.53 It adopted
this philosophy during an era known as “The Renaissance of Land
Use.”54 The word ‘renaissance’ conveys the Court’s progression
from abandonment to reengagement—from the 1920s to the 1970s,
various stimuli provoked the Court to take a prolonged absence
from land use issues.55 One plausible explanation for this passivism
is that the Court may have reasoned that land use is a “State and
local concern,”56 and no business of the federal judiciary. Nevertheless,
a new period of judicial activism ushered in throughout the latter
part of the twentieth Century, with the Supreme Court taking an “unusual
interest” in exaction theory.57 One academic describes this period
as “spectacular” for land use.58 This writing agrees with such a
proposition; for it was in this period that the Supreme Court conveyed
intolerance toward the regulatory state to which many had become
naturally accustomed.59
IV. A Legal Framework: The Unconstitutional
Conditions Doctrine and Nollan/Dolan
A. The Unconstitutional Conditions Doctrine
Nollan v. California Coastal Commission60 and Dolan v. City of Tigard61
are at the heart of any modern exactions analysis. The Supreme
Court viewed those cases as an ideal opportunity to clarify the constitutional
safeguards against unlawful governmental interference with
private land rights. The Court advanced its dual rationality test, and,
in doing so, “broke new ground.”62
The dual rationality test is a derivative of the unconstitutional conditions
doctrine. This doctrine buttresses the proposition that “the government
may not deny a benefit to a person because he exercises a
53. Nollan, 483 U.S. at 833 n.2 (“But the right to build on one’s own property—
even though its exercise can be subjected to legitimate permitting requirements—
cannot remotely be described as a ‘governmental benefit.’ ”).
54. See generally SKOURAS, supra note 21, at 49-64.
55. See id. at 40.
56. See id.
57. See FISCHEL, supra note 19, at 11.
58. SKOURAS, supra note 21, at 59.
59. Id. (“The Supreme Court with the addition of Justice Scalia attempted to chart a
new course for land use law, by attempting to halt the expansion of regulatory
government.”).
60. 483 U.S. 825.
61. 512 U.S. 374.
62. SKOURAS, supra note 21, at 60.
The Struggle Against Government Extortion 663
constitutional right.”63 Thus, it follows that the government may not
condition the granting of a discretionary benefit upon one’s agreement
to relinquish a constitutionally protected right.64 To illustrate, a public
university may not, under the unconstitutional conditions doctrine,
condition the renewal of a faculty member’s contract upon his promise
to forego his public criticism of its current administration, without violating
the Constitution. Such temptation could conceivably unduly
coerce a faculty member who values the assurances of a consistent salary
over his rights to free expression. Essentially, the doctrine “vindicates
the Constitution’s enumerated rights by preventing the government
from coercing people into giving them up.”65
In the land use context, permit applicants are especially vulnerable to
the types of coercion that the unconstitutional conditions doctrine seeks
to inhibit. Typically, applicants value a development permit a lot more
than their own property; consequently, the government is in prime position
to pressure an applicant into “giving up property for which the
Fifth Amendment would otherwise require just compensation.”66
Cue Nollan67 and Dolan68: when the government conditions its
approval upon an applicant’s agreement to burden his property, an accession
that may otherwise require compensation under the Fifth
Amendment, the dual rationality test prohibits the governmentimposed
condition if it unduly coerced a property owner into forfeiting
his Fifth Amendment right to compensation, i.e., there is no essential
nexus between the negative externalities of the proposed development
and the government-imposed condition. As will be seen below, the
dual rationality test is eerily reminiscent of the unconstitutional conditions
doctrine.
63. Koontz, 133 S. Ct. at 2594 (internal citations omitted).
64. For a more detailed discussion on the unconstitutional conditions doctrine, including
its limitations and virtues, see Vicki Been, “Exit” as a Constraint on Land
Use Exactions: Rethinking the Unconstitutional Conditions Doctrine, 91 COLUM. L.
REV. 473 (1991); Frederick Schauer, Too Hard: Unconstitutional Conditions and
the Chimera of Constitutional Consistency, 72 DENV. U.L. REV 989 (1995); and Kathleen
M. Sullivan, Unconstitutional Conditions, 102 HARV. L. REV. 1413 (1989).
65. Koontz, 133 S. Ct. at 2594.
66. Id.; see also Needleman, supra note 10, at 1570-71 (“A heightened level of
scrutiny is necessary because, when a municipality requires an exaction as a condition
to grant of a permit, the risk increases that the municipality is simply trying to deprive
the landowner of a property right for which it would otherwise have to provide compensation.”);
Nollan, 483 U.S. at 841 (“When the actual conveyance of property is
made a condition to the lifting of a land-use restriction, since in that context there
is heightened risk that the purpose is avoidance of the compensation requirement,
rather than the stated police-power objective.”).
67. Nollan, 483 U.S. 825.
68. Dolan, 512 U.S. 374.
664 The Urban Lawyer Vol. 46, No. 3 Summer 2014
1. NOLLAN v. CALIFORNIA COASTAL COMMISSION
A beachfront lot in Ventura County, California, provided the backdrop
as the Supreme Court first defined the constitutional limits of an exaction.
The owners of the beachfront lot, the Nollans, proposed to demolish
their existing property and replace it with a three-bedroom house.69
Before building, the Nollans were required to obtain a development permit
from the California Coastal Commission.70 After submitting a
proposal, the Commission conditioned its approval on the Nollans’
agreement to grant a public easement over a portion of their property.71
The easement, according to the Commission, would alleviate the burden
placed upon the public’s beach access—which, the Commission
claimed, included “psychological” and “visual” access—by, the Nollans’
proposed construction.72 The Nollans refused to accede to such demands.
The case ultimately reached the United States Supreme Court.
The Court recognized that ordinarily, if a local government obtains
an easement over private land, under a traditional Fifth Amendment
analysis, the government is obligated to pay compensation.73 However,
in Nollan, the precise issue before the Court was whether requiring the
easement to be conveyed as a condition altered the outcome.
Central to its analysis, the Court identified two separate, mutually
exclusive, acts: the petitioner’s proposed development and the government’s
condition.74 The Court assumed, without deciding, that under a
substantive due process analysis,75 the government could have lawfully
denied the Nollans’ proposal; it entertained the Commission’s assertion
that such denial had legitimately sought to preserve the public’s
view of the beach.76 With this assumption firmly rooted, it then asked
whether the condition substituted for the denial “fails to further the end
advanced as the justification for the [denial].”77 In other words,
whether there is an “essential nexus”—or logical connection—between
69. Nollan, 483 U.S. at 828.
70. Id.
71. Id.
72. Id.
73. Id. at 830.
74. Id. at 834.
75. See Lingle, 544 U.S. at 541 (A substantive due process analysis subjects municipal
exercise of the police power—inter alia zoning regulations, permit approvals and
denials—to a very deferential standard of review. As long as the exercise of the police
power “was not clearly arbitrary and unreasonable, having no substantial relation to
the public health, safety, morals, or general welfare,” it will pass constitutional
muster.).
76. Id. at 837.
77. Id.
The Struggle Against Government Extortion 665
the conditioned public easement and the alleged burdens on the public’s
beach access. The Court made it clear that when there is no essential
nexus, there is no constitutional propriety, and compensation must
be paid.78 Applying this framework, the Court deemed it “impossible”
to understand how an easement across the Nollans’ property alleviates
the alleged viewing burden created by the development.79 “In short,
unless the permit condition serves the same governmental purpose as
the development ban, the building restriction is not a valid regulation
of land use but an ‘out-and-out plan of extortion.’ ”80
2. DOLAN v. CITY OF TIGARD
The Court in Nollan had articulated what later became known as less
than a decade later, in Dolan, the Supreme Court revisited the exaction
issue, clarified Nollan’s essential nexus test, and added another layer
of judicial scrutiny. The Court explained that Nollan’s essential nexus
test was merely the first step in the analysis; the second part of the analysis
requires a court to determine whether the degree of the exactions
demanded by the government bore the required relationship to the projected
impact of the petitioner’s proposed development.81 This, adopting
the parlance of the Court, is the rough proportionality test.82 The
framework enunciated in Nollan and Dolan has been described as an
“insurance policy” against municipal racketeering.83 Together, the
tests form the dual rationality test.
While the Court unambiguously articulated a framework, it declined
to explicitly communicate a formal standard of review.84 Was “rough
proportionality” and “essential nexus” to be synonymous with strict
scrutiny? Or, rather, were they to be equated with rational basis review?
One author, relying on Chief Justice Rehnquist’s opinion in
Dolan, has suggested that Nollan and Dolan’s framework is not synonymous
with strict scrutiny.85 It should be recalled that in Dolan, Chief
78. Id.
79. Id. at 838.
80. Id. at 837. The Court borrowed this phraseology from the New Hampshire Supreme
Court’s decision in J.E.D. Assocs., Inc., v. Atkinson, 121 N.H. 581, 584 (1981).
81. Dolan, 512 U.S. at 386.
82. Id. at 391.
83. See CALLIES ET AL., supra note 43, at 2-3.
84. See Eagle, supra note 10, at 5 (“Notably, the opinions in neither Nollan, nor
Dolan, nor Koontz explicitly refer to Nollan/Dolan as employing a heightened scrutiny
standard of review.”).
85. Needleman, supra note 10, at n.50 (“It is important to note that although a
heightened scrutiny is necessary, the Court does not demand (in either Nollan or
Dolan) the strictest scrutiny usually applied in situations like discrimination
cases.”). Indeed, Justice Rehnquist, in Dolan, explained that “very generalized state-
666 The Urban Lawyer Vol. 46, No. 3 Summer 2014
Justice Rehnquist outwardly rejected the rigors of “exacting [or strict]
scrutiny,”86 but cautioned against a standard of review that was “too
lax.”87 Instead, he endorsed a test that demanded an intermediate position—
one “requiring the municipality to show a ‘reasonable relationship’
between the required dedication and the impact of the proposed
development.”88 In an oft-cited passage, the Chief Justice summarized
the required standard of review: “[n]o precise mathematical calculation
is required, but the city must make some sort of individualized determination
that the required dedication is related both in nature and
extent to the impact of the proposed development.”89 Despite its cryptic
overture, Rehnquist’s analysis is widely accepted as subjecting exactions
to heightened, or intermediate, review—a standard that is less
demanding than strict scrutiny, but more demanding than rational
basis scrutiny.90 Practically, what does this mean for an exaction’s litigant?
John Echeverria suggests, based on an empirical analysis, that
“the rough proportionality test, in operation, is only somewhat less demanding
than the strict scrutiny test applied in other contexts.”91 After
surveying various appellate opinions across the country, Professor
Echeverria’s research revealed that the government “flunk[ed] the
[rough proportionality] test about half the time.”92 Thus, Nollan and
ments as to the necessary connection between the required dedication and the proposed
development . . . [are] too lax.” Dolan, 512 U.S. at 389. But, he continued,
“The Federal Constitution [does not] require such exacting scrutiny.” Id. at 390.
Rather, he suggested that an “intermediate position” was most apt. Id.; see also STEVEN
J. EAGLE, REGULATORY TAKINGS §7-10(b)(4) (5th ed. 2012) (highlighting that Chief Justice
Rehnquist “seemed to have [initially] contemplated . . . a standard of ‘rational
basis in fact,’ or meaningful rational basis.”).
86. Dolan, 512 U.S. at 390.
87. Id. at 389; see also Lehmann, supra note 10, at 1166 (“The [Dolan] Court . . .
delved into the various state court decisions dealing with land use regulations . . .
[s]ome states required only a very generalized finding of a necessary connection between
the required dedication and the proposed development.”).
88. Dolan, 512 U.S. at 391.
89. Id.
90. See Koontz, 133 S. Ct. at 2603 (Kagan., J. dissenting) (“Nollan and Dolan prevent
the government from exploiting the landowner’s permit application to evade the
constitutional obligation to pay for the property. They do so, as the majority explains,
by subjecting the government’s demands to heightened scrutiny.”); see also Ehrlich v.
City of Culver City, 911 P.2d 429, 438 (“In our view, the intermediate standard of judicial
scrutiny formulated by the high court in Nollan and Dolan is intended to address
[exactions.]”); Needleman, supra note 10, at 1570 (“Nollan and Dolan [demand] that
heightened scrutiny should be applied when examining takings challenges in the development
permit context.”); EAGLE, supra note 85, at §7-10(b)(4); Echeverria, supra
note 14, at 12 (“Nollan and Dolan plainly establish a distinctive, heightened standard
of review for the review of land use exactions under the Takings Clause.”).
91. Echeverria, supra note 14, at 8 n.39.
92. Id. at 7 (citing to numerous cases that formed his research and opinion); see also
Robert J. Hopperton, STANDARDS OF JUDICIAL REVIEW IN THE SUPREME COURT LAND USE
The Struggle Against Government Extortion 667
Dolan’s rough proportionality test is evidently a little more venomous
than Justice Rehnquist initially envisioned.
As discussed above, exactions are pervasive in a contemporary society.
There is no doubt that commercial land development requires a
surrounding infrastructure of facilities and services. While at one time
local governments were obligated to bear the principal cost of development
improvements and facilities, now—for the past several decades—
local governments have been charging land developers for at
least a portion of the cost of public facilities.93 Such charges have
manifested themselves in the form of fees—“impact fees”—and land
dedications. Exactions have also been utilized in the context of affordable
housing; local governments have conditioned the granting of a
development permit upon the developer’s agreement to provide lowincome
or affordable housing.94 Notwithstanding the commercial context,
Nollan’s and Dolan’s heightened level of scrutiny is equally
applicable. To illustrate, in Commercial Builders of Northern California
v. City of Sacramento, an ordinance was enacted that required developers
to pay a fee to offset the anticipated burdens of attracting
low-income workers to the city.95 The Ninth Circuit held that Nollan’s
essential nexus test had been satisfied because the fee had been designed
to further the city’s legitimate interest in housing low-income
workers.96 In contrast, in Building Industry Association of Central
California v. City of Patterson, a development agreement that conditioned
a permit upon the payment of a fee did not pass constitutional
muster.97
Opinions 71 (1997), available at https://law.wustl.edu/journal/51/Hopper_.pdf (“Notwithstanding
Chief Justice Rehnquist’s characterization of this new test as one akin to
an ‘intermediate position,’ the rough proportionality test is an activist standard of review
because it reverses the presumption of validity and places the burden of proof on
the non-judicial decision maker.”); Breemer, supra note 12, at 381 (“In the years since
Dolan, lower courts consistently have applied the essential nexus test . . . [T]he essential
nexus standard is routinely enforced beyond the halls of the High Court.”).
93. CALLIES ET AL., supra note 43, at 2-3.
94. See Peter Salsich, State and Local Regulation Promoting Affordable Housing, in
THE LEGAL GUIDE TO AFFORDABLE HOUSING DEVELOPMENT ch. 4, (Tim Iglesias and Rochelle
E. Lento, eds., 2011) (exploring the constitutional issues that pepper legislative
responses to shortages of affordable housing); see also the CALIFORNIA COALITION FOR
RURAL HOUSING (“CCRH”), http://www.calruralhousing.org/publications (last visited
May 21, 2014), as evidence of California’s increasing use of inclusionary zoning
techniques. The number of jurisdictions employing inclusionary zoning is growing.
See, e.g., MONTGOMERY COUNTY, MD. CODE §25A; MONTEREY COUNTY, CAL. CODE
§ 18.40.090 (2003); N.J. ADMIN. CODE tit. 5, §§ 5:94-6.1-6.18 (2005); LA. REV.
STAT. ANN. §§ 33:5001-5003 (2009).
95. 941 F.2d 872, 873 (9th Cir. 1991).
96. Id. at 876.
97. 90 Cal. Rptr. 3d 63, 72-4 (Cal. Ct. App. 2009).
668 The Urban Lawyer Vol. 46, No. 3 Summer 2014
V. Adjudicative vs. Legislative
Exactions
Nollan and Dolan delineated a framework for analyzing government
exactions: unless the exaction satisfies the judicially created essential
nexus and rough proportionality tests (collectively, the dual rationality
test), the government’s conduct is treated as a taking. There
were, however, unanswered questions in the Court’s analysis. First,
was Nollan/Dolan applicable to monetary exactions, in addition to
physical land dedications? Or, as local governments regularly argued,
was the analysis limited to physical dedications?98 As discussed
below, the United States Supreme Court has now settled this issue, explaining
that Nollan and Dolan’s analysis is indeed applicable to impact
fees.99 A second, and somewhat more fundamental, question is whether
Nollan and Dolan’s analysis was applicable to legislative exactions.100
Below, it is posited that such analysis is, or ought to be, applicable to
both legislative and adjudicative exactions. Disparate treatment is illogical
and leads to troubling results.
A narrow reading of Dolan might suggest that its analysis was limited
to adjudicative decision-making. In its opinion, the Court, via a
footnote, firmly distinguished legislative decision-making from adjudicative
decision-making.101 Moreover, the Court emphasized the adjudicative
nature of the exaction at issue.
Justice Stevens’ dissent takes us to task for placing the burden on the city to justify
the required dedication. He is correct in arguing that in evaluating most generally
applicable zoning regulations, the burden properly rests on the party challenging
the regulation to prove that it constitutes an arbitrary regulation of property rights.
Here, by contrast, the city made an adjudicative decision to condition petitioner’s
application for a building permit on an individual parcel. In this situation, the burden
properly rests on the city.102
One might argue that because the Dolan Court highlighted the
adjudicative character of the challenged exaction, it is reasonable to
conclude that the Court limited its analysis to adjudicative exactions.
98. See Ehrlich, 911 P.2d 429 (finding that Nollan and Dolan’s tests were applicable
to monetary exactions).
99. See Koontz, 133 S. Ct. at 2599; see also Echeverria, supra note 14, at 39 (attacking
the Court’s decision to expand Nollan and Dolan’s analysis beyond the realm
of physical land dedications).
100. See DAVID L. CALLIES, BARGAINING FOR DEVELOPMENT 22 (2003); see also Breemer,
supra note 12, at 381 (“Even as the split over monetary exactions begin to favor
applying Nollan and Dolan, a controversy over the applicability of the nexus test to
legislative acts continues to retard judicial consistency in application of that test.”).
101. Dolan, 512 U.S. at 391 n.8.
102. Id. (internal citations omitted).
The Struggle Against Government Extortion 669
This proposition is flawed. The Court’s reference to adjudicative/
legislative decision-making ought not be afforded great significance—
it merely clarified the allocation of the burden of proof. As is evident
from the above excerpt, the Court placed the burden of proof upon the
government because the challenged exaction was adjudicatory in nature.
This burden allocation essentially reversed traditional constitutional
doctrine103—when economic and non-fundamental rights are implicated,
the post-Lochner Court “generally defers to legislatures,”104
placing the burden of proof upon the petitioner. This burden shift
was unexpected,105 and, to the delight of some,106 “set up a constitutional
obstacle course for local governments.”107 In highlighting the
adjudicatory character of the challenged exaction, the Dolan Court
was merely justifying its decision to depart from its previous prolegislature
stance—quite simply, the distinction was required by doctrinal
necessity.108 Thus, the above passage ought not to be construed
as indicative of Nollan and Dolan’s limited applicability; it was, rather,
an attempt to legitimize its burden allocation.
To further muddy the waters, Justice Souter, in his dissent, argued
that the exaction at issue in Dolan was actually legislative in nature.109
The permit conditions were, after all, imposed pursuant to Tigard’s
103. The Court was merely acknowledging that when a government engages in legislative
decision-making, there is often an abundance of judicial deference and the
burden of proof properly rests on the moving party. However, in the context of adjudicative
decision-making, the burden properly rests on the government. See Lehmann,
supra note 10, at 1171 (“[T]he Court strayed from the presumption of constitutionality
of such economic regulations and imposed a much higher scrutiny.”). See generally
Marshall S. Sprung, Taking Sides: The Burden of Proof Switch in Dolan v. City of Tigard,
71 NYU L. Rev. 1301 (1996) (discussing the interesting proposition that, unlike
in Nollan, the Dolan Court shifted the burden of proof upon the defendant); see also
Inna Reznik, The Distinction Between Legislative and Adjudicative Decisions in
Dolan v. City of Tigard, 75 N.Y.U. L. REV. 242, 243-44 (2000).
104. Reznik, supra note 103, at 250; see also Lehmann, supra note 10, at 1170,
n.138 (“In Lochner, the Court struck down a New York law that limited the hours
a bakery employee was allowed to work to 10 per day and 60 per week as an abridgement
of liberty of contract and thus a violation of [substantive] due process.”).
105. See Georgette C. Poindexter, Comment – Dolan v. City of Tigard, 114 S. Ct.
2309 (1994): The Poor Relation Theory, 29 REAL PROP. PROB. & TR. J. 451, 456
(1994).
106. See Gideon Kanner, Tennis Anyone? How California Judges Made Land Ransom
and Art Censorship Legal, 25 REAL EST. L.J. 214, 226 (1997) (“In terms of constitutional
theory, Dolan was of prime importance. Reversing decades of judicial disparagement
of private property rights in the constitutional scheme of things, Chief
Justice Rehnquist’s majority opinion obverted the burden of proof (by placing it on
the regulators) . . .”).
107. See Poindexter, supra note 105, at 457.
108. Reznik, supra note 103, at 250.
109. Dolan, 512 U.S. at 413; see also Lehmann, supra note 10, at 1175.
670 The Urban Lawyer Vol. 46, No. 3 Summer 2014
Community Development Code.110 According to Justice Souter, “[t]he
[only] adjudication here was of Dolan’s requested variance from the
permit conditions.”111
If, arguendo, the Dolan Court did limit its dual rationality test to
ad hoc determinations, it is arguable that ad hoc assessments occur
whenever a local government implements legislative policy to particular
land parcels, and therefore, the “potential for the unconstitutional
placement of disproportionate burdens” is present in legislative
decision-making, too.112 Consider the following: if town X passes ordinance
Y, the town will be required to implement the ordinance on an
individual basis. Moreover, if a property owner challenges the ordinance,
the town will be required to adjudicate. Accordingly, notwithstanding
the ordinance’s original legislative character, its mandate will
inevitably be facilitated through individual application; by their very
nature, legislative acts fuel adjudicative proceedings. This paradox
has been appropriately labeled as “The Dolan Misstep”113 and further
deprives the legislative/adjudicative distinction of credibility.114
Predictably, the legislative/adjudicative distinction has been debated
in the lower courts that continue to apply the dual rationality
framework. While many, if not most, courts have concluded that the
analysis is restricted to ad hoc determinations, some judicial opinions
cite approval for a blanket application.115 California, on the other
110. Dolan, 512 U.S. at 377.
111. Id. at 413 n.* (Souter, J., dissenting).
112. See Douglas W. Kmiec, The “Substantially Advance” Quandary: How
Closely Should Courts Examine the Regulatory Means and Ends of Legislative Applications?,
in TAKING SIDES ON TAKINGS ISSUES 374 (Thomas E. Roberts ed., 2002).
113. See id.
114. See Breemer, supra note 12, at 405 (“There is no logically consistent way to
pinpoint the source of an exaction because they typically reach the landowner only
after the involvement of both legislative and adjudicative bodies.”).
115. Compare cases that have adopted a bifurcated approach, such as Home Builders
Ass’n of Cent. Ariz. v. City of Scottsdale, 930 P.2d 993 (Ariz. 1997); Waters
Landing Ltd., v. Montgomery Cnty., 650 A.2d 712 (Md. 1994), Arcadia Dev.
Corp., v. City of Bloomington, 552 N.W.2d 281, 286 (Minn. Ct. App. 1996) (“T[he
Nollan/Dolan] analysis, however, applies only to adjudicative determinations that
condition approval of a proposed land use on a property transfer to the government,
which, standing alone, would clearly constitute a taking.”), Rogers Mach., Inc., v.
Washington Cnty., 45 P.3d 966 (Or. Ct. App. 2002), with cases that render the distinction
irrelevant, such as N. State Home Builders Ass’n v. County of Du Page, 649 N.
E.2d 384 (Ill. 1995); Amoco Oil Co. v. Vill. of Schaumberg, 661 N.E.2d 380, 390-91
(Ill. App. Ct. 1995); J.C. Reeves Corp. v. Clackamas Cnty., 887 P.2d 360, 365 (Or. Ct.
App. 1994) (emphasizing that the nature of land use regulations, and not the source, is
most dispositive for a constitutional analysis.); Curtis v. Town of S. Thomaston, 708
A.2d 657 (Me. 1998); Benchmark Land Co. v. City of Battle Ground, 14 P.3d 172
(Wash. Ct. App. 2000); see also Julian Conrad Juergensmeyer & Thomas E. Roberts,
LAND USE PLANNING AND DEVELOPMENT §10:5 (2007).
The Struggle Against Government Extortion 671
hand, appears to have settled the issue.116
In Ehrlich and San Remo Hotel, the California Supreme Court rejected
the suggestion that Nollan and Dolan are applicable to legislatively
borne exactions.117 In Ehrlich, the petitioner fell victim to a
legislative “ransom.”118 Following his request to build a 30-unit condominium,
valued at $10,000,000, to replace his financially inept sports
and tennis club, Culver City conditioned approval upon the following:
(1) the payment of $280,000 to be used for additional public recreational
facilities as directed by the City Council; and (2) the payment of an exaction
under the city’s “art in public places program” that would require
the petitioner to provide artwork in an amount equal to one percent of
the total building valuation, or pay for the city to provide it.119 Such demands
reflect an inverted perception of legislative responsibilities; it is
as though the legislature viewed itself with innate entitlement to a
profit-sharing scheme. As succinctly put by one critic, “[t]o say that
these conditions were startling would be an understatement.”120 The
petitioner sued the city under a takings theory. The trial court invalidated
the $280,000 fee, but it declined to set aside the “art in public places”
fee.121 The appellate court found that there was a “ ‘substantial nexus’
between the proposed condominium project and the $280,000 exaction.
‘The mitigation fee was imposed to compensate the City for the benefit
conferred on the developer by the City’s approval of the townhome project
and for the burden to the community resulting from the loss of recreational
facilities.’ ”122 Granting certiorari,123 the California Supreme
Court reversed the appellate court’s approval of the $280,000 mitigation
fee, but affirmed the legality of the art in public places fee.124 While
an in-depth analysis of the court’s decision is beyond the scope of this
116. See San Remo Hotel L.P. v. City and Cnty. of San Francisco, 41 P.3d 87 (Cal.
2002); Ehrlich v. City of Culver City, 911 P.2d 429 (Cal. 1996) (legislative exactions
need not be exposed to heightened scrutiny).
117. See San Remo Hotel, 41 P.3d 87; Ehrlich, 911 P.2d 429.
118. Kanner, supra note 106, at 214.
119. Ehrlich, 911 P.2d at 435. The local government valued the petitioner’s project
at $3.2 million, and therefore he would be required to pay $33,200 in lieu of providing
the artwork.
120. See Kanner, supra note 106, at 214.
121. Ehrlich, 911 P.2d at 450.
122. Id. at 436
123. Initially, the California Supreme Court declined to review the case, but in light
of the United States Supreme Court’s decision in Dolan, it reneged on its original decision.
See Kanner, supra note 106, at 214.
124. Ehrlich, 911 P.2d at 450 (“The requirement of providing art in an area of the
project reasonably accessible to the public is, like other design and landscaping requirements,
a kind of aesthetic control well within the authority of the city to impose.”).
This decision demonstrated “unabashed nullification of [the Supreme Court’s]
672 The Urban Lawyer Vol. 46, No. 3 Summer 2014
article,125 it is noteworthy for present purposes that the California Supreme
Court drew a firm distinction between legislative and adjudicative
decision-making, and limited Nollan and Dolan’s application to the
latter.
It is the imposition of land-use conditions in individual cases, authorized by a permit
scheme which by its nature allows for both the discretionary deployment of the
police power and an enhanced potential for its abuse, that constitutes the sine qua
non for application of the intermediate standard of scrutiny formulated by the court
in Nollan and Dolan.126
Thus, the California Supreme Court concluded that because the risk of
extortion is far more likely when the exaction is imposed on an individual
basis, Nollan and Dolan are only applicable to ad hoc decisions.
127 According to the Court, ad hoc decisions present “an inherent
and heightened risk that local government will manipulate the police
power to impose conditions unrelated to legitimate land use regulatory
ends, thereby avoiding what would otherwise be an obligation to pay
just compensation.”128
More recently, the California Supreme Court took a similar approach
in San Remo Hotel v. City & County of San Francisco.129 As discussed
below, limiting Nollan and Dolan to individualized determinations is
untenable. Instead, it is more doctrinally consistent for Dolan’s test
to be applied universally to both ad hoc and legislative determinations.
There exists a significant reason: in its most recent takings decision,
Koontz v. St. Johns River Water Management District,130 the Supreme
Court has implicitly signaled that both legislative and adjudicative
exactions are deserving of heightened scrutiny. Adopting the parlance
of Judge Alex Kozinski of the Ninth Circuit, a contrary approach
Nollan decision.” Gideon Kanner, In California, a Land Owner Loses Again, WALL
ST. J., Feb. 8, 1995, at A15.
125. See Kanner, supra note 106, at 214 (offering an interesting perspective on the
court’s decision).
126. Ehrlich, 911 P.2d at 439.
127. Id.
128. Id.; see also Daniel Curtin, Applying Nollan/Dolan to Impact Fees: A Case for
the Ehrlich Approach, in TAKING SIDES ON TAKINGS ISSUES 333, 339 (Thomas E. Roberts
ed., 2002) (“In the more common situation when exactions are imposed pursuant to a
general legislative act or rule, cities act within their traditional police powers.”).
129. 41 P.3d at 105 (“We decline plaintiffs’ invitation to extend heightened takings
scrutiny to all development fees, adhering instead to the distinction we drew in Ehrlich
. . . between ad hoc exactions and legislatively mandated, formulaic mitigation
fees. While legislatively mandated fees do present some danger of improper leveraging,
such generally applicable legislation is subject to the ordinary restraints of the
democratic political process.”).
130. Koontz, 133 S. Ct. 2586.
The Struggle Against Government Extortion 673
merely reflects courts’ “thinly disguised contempt” for landowners’
constitutional rights.131
VI. Koontz: The Supreme Court’s Renewed
Vindication of Private Land Rights
Koontz has caused turbulence in an already volatile and uncertain
area.132 Critics have attempted to undermine its analysis with pointed
cynicism, sarcasm, and rhetoric.133 Coy Koontz, Sr., the petitioner,134
had purchased an undeveloped 14.9 acre tract of land in his home state
of Florida. Keen on developing 3.7 acres, he applied to the District for
the appropriate development permits.135 To offset the perceived environmental
impact from his planned development, Koontz offered to
deed 11 acres to the District as a conservation easement.136 Despite
this concession, the District considered the conservation easement “inadequate,”
and conditioned its approval upon Koontz’ acceptance of
one of the following conditions: (1) reduce his proposed development
to one acre and deed to the District the remaining 13.9 acres as a conservation
easement; or (2) permit as originally planned, but only if
Koontz also agreed to hire contractors to make improvements to
District-owned land several miles away (i.e., to fund offsite public
projects).137
After Koontz refused to accede to the District’s demands, his application
was rejected.138 In an attempt to vindicate his Fifth Amendment
right to compensation, he sought judicial redress. His chief
argument in the Florida District Court was that the District’s proposed
exaction constituted a taking without just compensation.139 The district
court sided with Koontz and awarded him $376,154 in compensation.
140 Its decision was affirmed in the Florida District Court of
131. Tahoe-Sierra Pres. Council, Inc., v. Tahoe Reg’l Planning Agency, 911 F.2d
1331, 1346 (9th Cir. 1990).
132. See David L. Callies, Koontz Redux: Where We Are and What’s Left, 65
PLAN. & ENVTL. L. 7 (2013).
133. See, e.g., Echeverria, supra note 14.
134. Actually, Coy Koontz, Jr., his son, represented the estate in the proceedings,
but for ease of reference, Coy Koontz, Sr. shall be treated as the petitioner and
applicant.
135. Koontz, 133 S. Ct. at 2592.
136. Id.
137. Id. at 2593.
138. Id.
139. Id.
140. Petition for Writ of Certiorari at 7, Koontz v, St. John’s River Water Mgmt.
Dist., 133 S. Ct. 2586 (2013) (No. 11-1447), 2012 WL 1961402, at *7.
674 The Urban Lawyer Vol. 46, No. 3 Summer 2014
Appeals. Exercising its discretionary reviewing authority, the Florida
Supreme Court reversed on two grounds: (1) the mere denial of a permit
application—as opposed to an acceptance with conditions—does
not trigger the protection afforded by the Fifth Amendment; and (2) a
demand for money, as opposed to land, cannot constitute a taking
under the Fifth Amendment.141
In an opinion authored by Justice Alito, the United States Supreme
Court reversed the Florida Supreme Court, and remanded. It concluded
that there is no substantive difference between the denial and acceptance
of an application permit.142 It recognized that a contrary conclusion
would encourage untenable results; essentially, it would enable
the government to evade the limitations of Nollan and Dolan simply
by phrasing its demands for property as conditions precedent to permit
approval. Specifically, “[u]nder the Florida Supreme Court’s approach,
a government order stating that a permit is ‘approved if ’ the owner
turns over property would be subject to Nollan and Dolan, but an identical
order that uses the words ‘denied until’ would not.”143 Rather,
articulated the Court, the unconstitutional conditions doctrine declines
to attach significance to the distinction between conditions precedent
and conditions subsequent. Second, the Supreme Court held that
“so-called ‘monetary exactions’ must satisfy the nexus and rough proportionality
requirements of Nollan and Dolan.”144 Koontz undoubtedly
provided two clear-cut answers to two very specific questions.145
Yet, the Court did not provide an explicit answer as to whether Nollan
141. Koontz, 133 S. Ct. at 2594.
142. Id. at 2597.
143. Id. at 2595-96.
144. Id. at 2599. As alluded to above, the Court’s decision has come under fierce
criticism. Most notably, John D. Echeverria has vehemently criticized the decision.
See generally Echeverria, supra note 14.
145. But see Echeverria, supra note 14, at 32 (describing the Court’s expansion of
Nollan/Dolan to encompass monetary exactions as “convoluted, illogical thinking”).
According to Professor Echeverria, the mandated payment of a fee does not trigger
the Takings Clause because an exactions analysis requires one to assess whether the
exaction, viewed independently, constitutes a taking. Relying on the Supreme Court’s
analyses in Eastern Enterprises v. Apfel, 524 U.S. 498 (1998) and Nollan and Dolan,
he asserts that the payment of a fee, viewed independently, is not a taking. To respond
to Professor Echeverria’s observation, I suggest that the fundamental philosophy that
underlies the Court’s exactions jurisprudence is a consistent observation of the unconstitutional
conditions doctrine. See infra Part VII. That doctrine seeks to protect property
from unwarranted governmental coercion, notwithstanding the nature of that coercion.
Accordingly, Echeverria’s concern is not dispositive to the analysis. What is
most troubling about Professor Echeverria’s approach is that a government could
avoid an exaction analysis by simply requiring the payment of a fee, instead of a
land dedication.
The Struggle Against Government Extortion 675
and Dolan’s analysis is limited to ad hoc exactions.146 It is submitted,
nevertheless, that Koontz provides ample justification for including
generally applicable legislative exactions within the penumbra of Nollan
and Dolan’s framework.147
A. The Court Implicitly Conveyed a Universal
Application of Nollan and Dolan
Unlike its previous opinion in Dolan, the Koontz Court declined to define
the exaction at issue.148 If, as proponents of disparate treatment
suggest, the type of exaction is indispensable to a court’s constitutional
analysis, then surely the Court would have ensured that its opinion
clearly conveyed it. Koontz was, after all, decided almost 20 years
after the Court expounded its exactions analysis in Dolan. Given the
timing of the decision, and the disharmonious muddle percolating in
the lower courts, one may assume that the Court would have drawn
attention to the type of exaction if it was relevant to the constitutional
analysis. The Court did not do so.149
Second, in writing for the Court, Justice Alito was presumably
aware of the disparate treatment of the issue in the lower courts. Indeed,
almost two decades prior, Justice Thomas had pointed out that
“the lower courts are in conflict over whether [Dolan] . . . should
be applied in cases where the alleged taking occurs through an act
of the legislature.”150 Thomas, in his dissent, suggested that any distinction
between legislative and adjudicative acts was artificial.151 Furthermore,
if Thomas’s dissent had not captured Alito’s attention, then
Kagan’s dissent, in Koontz, surely did. In her passionate dissent,
Kagan requested that the majority clearly articulate its stance: “[t]he
majority might, for example, approve the rule, adopted in several
states, that Nollan and Dolan apply only to permitting fees that are imposed
ad hoc, and not to fees that are generally applicable . . . [m]aybe
146. See Eagle, supra note 10, at 6 (“The major issue regarding unconstitutional
conditions and land development approvals left unanswered after Koontz is whether
the doctrine applies to legislative determinations as well as adjudicative decisions
by administrators.”).
147. But cf. Callies, supra note 132, at 7.
148. Dolan, 512 U.S. 374; Koontz, 133 S. Ct. 2586.
149. John M. Baker, Koontz Decision and Its Impact on Municipal Land Use Decisions,
Panelist at Minnesota Association of City Attorneys Educational Conference
(Feb. 7, 2014) (“The Dolan court may have cared about the difference between legislative
and adjudicative exactions. However, in Koontz, Justice Alito seemed generally
concerned about exactions.”).
150. Parking Ass’n of Ga. v. City of Atlanta, 515 U.S. 1116, 1117 (1995) (Thomas,
J., dissenting).
151. Id.
676 The Urban Lawyer Vol. 46, No. 3 Summer 2014
today’s majority accepts [a] distinction; or then again, maybe
not.”152 In light of the surrounding uncertainty, the Koontz majority
had an ample opportunity to endorse different treatment of legislative
exactions. Yet since it declined to do so, it is conceivable,
maybe even quite likely, that the Court deemed the distinction
completely irrelevant to its constitutional analysis; the omission implicitly
reveals the Court’s refusal to endorse a novel and unsound
proposition.153
B. An Expansive Application of Koontz Remains
Faithful to the Court’s Current Agenda
It is difficult to deny that Koontz provides an expansive interpretation of
the Fifth Amendment’s taking provision.154 It is this sort of expansive
analysis that has prompted vehement criticism.155 As mentioned
above, the Supreme Court reengaged with land use issues in the
1970s, crafting “a new course for land use law, by attempting to halt
the expansion of regulatory government.”156 If one traces the Court’s
takings jurisprudence over the past several decades, it is evident that
the Court has set forth a conservative agenda of vindicating private
land use rights.157 Consistent with its previous jurisprudence, the
Koontz Court remained faithful to that agenda in its expansive interpretation
of the Fifth Amendment. In light of this private property rights
agenda, it is entirely plausible that the Court intended for its Koontz
opinion to convey disaffection toward a non-universal application of
Dolan.
With no definitive answer on the issue, at least outside of California,
lower courts are, theoretically, at liberty to employ different approaches.
152. Koontz, 133 S. Ct. at 2608 (Kagan, J., dissenting).
153. See Echeverria, supra note 14, at 46 (arguing that “the Court’s language [suggests
that it has] . . . reserved the question of whether Nollan and Dolan can or should
extend beyond ad hoc exactions.”).
154. See supra, pp. 20-1.
155. See Echeverria, supra note 14, at 1 (“The case of Koontz v. St. Johns Water
Management District is one of the worst—if not the worst—decision in the pantheon
of Supreme Court takings decisions.”).
156. SKOURAS, supra note 21, at 59; see, e.g., First English Evangelical Church v.
Cnty. of L.A., 482 U.S. 304 (1987); Nollan, 483 U.S. 825; Dolan, 512 U.S. 374;
Lucas, 505 U.S. at 1019.
157. For example, see Arkansas Game & Fish Comm’n v. United States, 133 S. Ct.
511 for an additional example of the Court’s expansive, conservative agenda. The
Court held that government-induced temporary flooding is not categorically exempt
from the scope of the Fifth Amendment. It provided a “unanimous victory for property
rights.” See Brian T. Hodges, Arkansas Game & Fish Commission v. United States: A
Temporary Fix for Temporary Takings, 14 ENGAGE: J. FEDERALIST SOC’Y PRAC. GROUPS
38, 38 (2013).
The Struggle Against Government Extortion 677
Yet under its state constitution, California appears to have settled this
issue. In two separate opinions, the California Supreme Court has conveyed
its preference for a bifurcated approach. One might cite to California
Building Industry Association v. City of San Jose158 as a prophetic
indication of change on the “Golden Coast.” This litigation
was triggered by an inclusionary housing ordinance requiring developers
to set aside fifteen percent of their dwelling units as affordable housing.
The trial court declared the ordinance invalid under a Nollan/Dolan
analysis,159 and the appellate court reversed.160 In a disjointed and
flawed opinion, the appellate court demonstrated great deference to
the municipality—despite the ordinance’s resemblance to a quintessential
exaction, the court declined to analyze it as such.161 Remarkably,
the court opined that “the Ordinance should be reviewed as an exercise
of the City’s police power,”162 and accordingly framed the issue as
whether the ordinance was “arbitrary, discriminatory, and without a reasonable
relationship to a legitimate public interest.”163 This analysis—a
typical substantive due process analysis—is far more deferential than an
exactions analysis.164 The case is currently pending resolution by the
California Supreme Court; perhaps the court is preparing to seize the
opportunity to signal a revolutionary change in judicial policy.
It would be disingenuous to suggest that the argument in favor of
universal application is an easy sell. Quite frankly, it is not. The general
consensus among courts is that Nollan and Dolan’s exaction
framework is inapplicable to legislatively imposed exactions.165 For
sure, as discussed above, California leads the way in advancing this
anti-property-right philosophy.166 A recently published memorandum
158. 157 Cal. Rptr. 3d 813 (Cal. Ct. App. 2013).
159. Id. at 816.
160. Id. at 825.
161. Id. at 823 n.8 (“The case before us involves neither an asserted taking nor a
land-use challenge governed by Nollan and Dolan.”).
162. Id. at 824.
163. Id.
164. The United States Supreme Court has explained that a substantive due process
analysis is separate and distinct from a takings analysis. Lingle, 544 U.S. 528, 545-548
(2005). See Steven Eagle’s suggestion that while an ordinance passes constitutional
muster under a substantive due process analysis, it does not necessarily pass constitutional
muster under a takings analysis. Eagle, supra note 10, at 20 (“While the court of
appeal viewed the [Housing Ordinance] as a legitimate way of effectuating the state’s
policy of furthering affordable housing, that holding goes to the [ordinance’s] legitimacy,
and not whether it constitutes a taking.”).
165. See supra Part V.
166. According to some academics, California has had the greatest role in takings
jurisprudence over the past two decades, even shadowing the United States Supreme
Court. Thus, perhaps California’s approach is indicative of the “correct” approach. See
678 The Urban Lawyer Vol. 46, No. 3 Summer 2014
from the deputy city attorney of San Diego accurately captures
the harmful overture for California property owners.167 Attorney
Keely Halsey, responding to a request by the San Diego Housing
Commission, was asked this question: is a legislative fee proposal
for non-residential developers subject to heightened review, in light
of Koontz?168 Her response is as follows.
Not likely. In Koontz, the Court did not specifically state a legal standard for the
adoption of legislatively enacted fees. Parties may raise this issue in future litigation.
Unless the question is further addressed by the courts, however, it is reasonable
to conclude that the state of the law in California with respect to legislatively enacted
fees remains as it existed prior to Koontz, under which heightened scrutiny
would not apply to the Fee.169
Citing to San Remo Hotel and Ehrlich,170 the memorandum advanced
the classic rhetoric alluded to above—that legislative exactions
are less deserving of exacting scrutiny given the availability of a democratic
political process.171 The deputy city attorney acknowledged
that “[i]n failing to specifically address the issue of whether Nollan/
Dolan applies to generally applicable legislatively enacted fees,
Koontz opened the door for future litigation on that issue.”172
VII. Any Distinction between Legislative
and Adjudicative Acts is Artificial,
Unworkable, and Illogical
Notwithstanding Koontz, attempts to apply differential treatment to
legislative and adjudicative decisions defy two essential pillars of
sound legal theory: logic and historical underpinnings. As discussed
above, those courts adopting a narrow reading of Dolan view the Supreme
Court’s opinion as truly indicative of its intent to limit its analysis
to ad hoc exactions.173 Yet this proposition is problematic due to
two fundamental failings of such a narrow reading.
An oft-cited justification for a bifurcated approach is that “extortion
[is] more likely when the exaction is imposed on an individual
Ann E. Carlson & Daniel Pollak, Takings on the Ground: How the Supreme Court’s
Takings Jurisprudence Affects Local Land Use Decisions, 35 U.C. DAVIS. L. REV. 103,
108 (2001).
167. Memorandum from the Office of the City Attorney of the City of San Diego
(Oct. 25, 2013), available at http://docs.sandiego.gov/memooflaw/MS-2013-13.pdf.
168. Id. at 4.
169. Id.
170. San Remo Hotel, 41 P.3d 87; Ehrlich, 911 P.2d 429.
171. Memorandum, supra note 167, at 10.
172. Id. at 13.
173. See Needleman, supra note 10, at 1574.
The Struggle Against Government Extortion 679
basis. . . . [and] abusive behavior is more likely in an adjudicative
setting because the decision-making process is discretionary in nature.”
174 Essentially, proponents of that thesis view the underlying
democratic political process as an adequate safety mechanism against
abuse.
[T]hey consider heightened scrutiny for adjudicative exactions a solution to the “extortion”
problem because it forces local governments to “improve the substantive
formulation of standards for discretionary review.” Legislative enactments, on the
other hand, which affect many people, are less likely to violate the Takings Clause
because the legislative and political processes will protect landowners.175
While worthy of consideration, this proposition fatally assumes that
all communities function according to the representative democracy
model, naturally applicable to larger governments.176 Yet, as recognized
by one author, smaller, local governments are inherently incapable
of true representative democracy177—a lack of electoral diversity
inhibits the “coalition-building safeguard” inherent in larger governments,
and thus minorities are not protected from majoritarian oppression.
178 Those interests that Dolan seeks to protect belong to “precisely
the kind of minority whose interests might actually be ignored.”179
For example, consider a small town, located in an extremely affluent
suburb. The town, a commuter town, is home to many influential corporate
personalities, and upper-echelon employees of a nearby energy
conglomerate. The town boasts low-density zoning and, unsurprisingly,
its poorer residents are confined to a small area. In light of a
shortage of affordable housing, some residents are pushing for the
local legislature to encourage developers to build more affordable
housing. Yet wealthier residents are opposed to such plans. A local legislature
that recognizes the value of affluence will undoubtedly cater to
174. Reznik, supra note 103, at 268; see also San Remo Hotel, 41 P.3d at 105.
175. See Reznik, supra note 103, at 270; see also San Remo Hotel, 41 P.3d at 105
(acknowledging that “[w]hile legislatively mandated fees do present some danger of
improper leveraging, such generally applicable legislation is subject to the ordinary
restraints of the democratic political process”); Craig R. Habicht, Dolan v. City of Tigard,
45 CATH. U. L. REV. 221, 265 (1995).
176. See Reznik, supra note 103, 270-72; see also Breemer, supra note 12, at 401-
04 (“[P]rocedural mechanisms designed to protect the minority often break down in
the legislature as well as in the administrative context. Indeed, as the branch most accountable,
and thus most responsive, to the majority, the legislature may be especially
prone to extort disproportionate amounts of property from under-represented
groups.”).
177. Reznik, supra note 103, 271.
178. Id.; see also Robert C. Ellickson, Suburban Growth Controls: An Economic
and Legal Analysis, 86 YALE L.J. 385, 405-07 (1977).
179. Reznik, supra note 103, 271; see also Needleman, supra note 10, at 1586.
680 The Urban Lawyer Vol. 46, No. 3 Summer 2014
the majority’s interests, without appearing to overtly discriminate
against poorer communities. This town passes an ordinance that decreases
density requirements, but in an effort to dissuade low density
development, it imposes a relatively large exaction upon new affordable
housing development. Alas, legislative exactions are similarly
prone to political abuse.180 Ironically, an application of Dolan181
that hinges upon the character of the government action may only exacerbate
the evil of government overreaching: legislative bodies are
just as capable of extortion as adjudicative bodies. Moreover, in
light of the protections afforded by procedural due process, adjudicative
decision-making, in contrast, is subject to an inherent safeguard
that decreases the possibility of extortion.
Thus, “if legislative decisions are shielded from the ‘rough proportionality’
standard and adjudicative decisions are subjected to it, the result
may be that extortionate behavior is granted deference, while fair
processes are overscrutinized.”182 To further illustrate this unwarranted
paradox, consider a legislative ordinance that is overbroad. In an effort
to abate a relatively minor nuisance, a local government might employ
overindulgent, non-tailored measures that negatively impact a majority
of the populace. Such legislative action ought not to be afforded deference
by virtue of its legislative nature; to do so oversimplifies the
issue. Other academics have similarly suggested that a legislative/
adjudicative distinction may be “under and over inclusive.”183 Specifically,
they suggest—following research on the subject—that excessive
exactions are most likely to be exercised in “communities with large,
unmet infrastructure needs who have failed to spread costs among earlier
developments, especially nearly built out communities. In addition,
municipalities with unique amenities, such as beach towns, and perhaps
communities that have adopted strong growth control measures
fall into the ‘likely to demand excessive exactions category.’ ”184 By
contrast, they posit, “communities with available developable land
that is somewhat fungible and that are now engaged in long-term
180. See also Eagle, supra note 10, at 6.
181. Dolan, 512 U.S. 374.
182. Reznik, supra note 103, 270. Also, consider that legislative exactions—by virtue
of their universal application—may effectuate a completely disproportionate response
to a relatively small problem, i.e., the legislative action might unnecessarily
affect the rights of private property owners. The protections afforded by the takings
clause must be utilized to lessen this risk. This consideration raises further doubts
about the plausibility of a distinction.
183. Carlson & Pollak, supra note 166, at 131.
184. Id.
The Struggle Against Government Extortion 681
planning to spread anticipated infrastructure costs” are less likely to indulge
in excessive exactions.185 Thus, it follows that in the former context
the risk of extortion ostensibly affects both ad hoc and legislative
exactions; while in the latter context, the lower risk of extortion renders
heightened scrutiny superfluous. Once again, we see the doctrinal
flaws of a legislative/adjudicative distinction.
Quite simply, a legislative label must not be afforded a protective
“presumption of validity” because even in the legislative context,
there still exists a grave and real risk that local governments may
abuse the privilege of public governance.186 Thus, any suggestion
that legislative decision-making is unworthy of the judicial protection
afforded under Dolan’s analysis is indefensible and illogical. “It is unclear
why courts believe human nature or legislators have changed so
much that an invasion of property rights by ‘men and women of our
choice’ should be scrutinized with more ‘confidence’ today.”187
Justices Thomas and O’Connor have expressed their disapproval of
different treatment of legislative and adjudicative decision-making in
the land use context. In Parking Association of Georgia Inc., v. City of
Atlanta, both Justices voiced their discontent in their respective dissents
to certiorari denial.188 In Parking Association of Georgia, the
Georgia Supreme Court declined to invalidate a zoning ordinance
that imposed an exaction upon parking lot owners; characterizing
the exaction as “legislative,” the court refused to apply Dolan.189 In
the United States Supreme Court’s denial of certiorari, Justice Thomas
questioned the logic of why a Fifth Amendment takings analysis
should depend on “the type of government responsible for the taking.”
190 Expressing his frustration, he declared:
It is not clear why the existence of a taking should turn on the type of governmental
entity responsible for the taking. A city council can take property just as well as a
planning commission can. Moreover, the general applicability of the ordinance should
not be relevant in a takings analysis. If Atlanta had seized several hundred homes in
order to build a freeway, there would be no doubt that Atlanta had taken property.191
185. Id.
186. Breemer, supra note 12, at 394.
187. Id. at 404.
188. 515 U.S. at 1117.
189. Parking Ass’n of Ga., Inc. v. City of Atlanta, 450 S.E.2d 200, 203 n.3 (Ga.
1994) (applying substantive due process analysis instead of takings analysis).
190. Parking Ass’n of Ga., 515 U.S. at 1117-18.
191. Id. at 1117-18 (Thomas, J., dissenting); see also Amoco Oil Co., 661 N.E.2d at
389 (“[A municipality could] skirt its obligation to pay compensation . . . merely by
having the Village Board of trustees pass an ‘ordinance’ rather than having a planning
682 The Urban Lawyer Vol. 46, No. 3 Summer 2014
This article has traced the historical underpinnings of the Court’s
exactions analysis to its affirmative obligation to adhere to the unconstitutional
conditions doctrine—a product of primary constitutional
jurisprudence. Given that the doctrine, in its original form, failed to
distinguish between adjudicative and legislative determinations, it
would be improper and disingenuous to read such a distinction as necessary
for an exactions analysis.192
VIII. Conclusion
The Supreme Court never intended to limit the outer boundaries of its
Dolan analysis to ad hoc exactions.193 Those advocates of disparate
treatment for legislative and adjudicative decision-making fail to recognize
the problematic import of their thesis: the distinction fatally fails to
identify, and protect against, unruly governmental overreaching. Furthermore,
that position disregards the historical underpinnings of the
Court’s exaction analysis. Consequently, “one may draw the conclusion
that the ‘rough proportionality’ standard should be applied to all exactions
without making the legislative/adjudicative distinction.”194
Koontz displays the Court’s most recent vindication of individual
rights. This article has suggested that the decision implicitly communicates
judicial intolerance toward an approach that discriminates between
legislative and ad hoc exactions. Moreover, as discussed above,
dissimilar treatment produces various inconsistencies and untenable
results. As the Supreme Court continues to weigh in on the classic
standoff between individual rights and the limits of the takings clause,
it has the ability to change its course. However, at least for the time
being, it has adhered to a Madisonian philosophy—revering individual
land rights. Koontz enabled the Court to clarify the outer limits of
Nollan and Dolan’s analysis, and its position on the unlawful exercise
of the police power by governmental units. Despite its critics, the
Court’s Koontz opinion is of monumental importance, and clearly signals
a robust intolerance for municipal racketeering.
commission issue a permit.”); James L. Huffman, Dolan v. City of Tigard: Another
Step in the Right Direction, 25 ENVTL. L. 143, 150 (1995).
192. DANA & MERRILL, supra note 12, at 227.
193. But cf. Reznik, supra note 103, at 274 (“However, such an extension of
heightened scrutiny would be inconsistent with the Dolan Court’s reasoning. The
Dolan Court itself explained its creation of the ‘rough proportionality’ standard,
which places the burden on the local government to justify the exaction, by limiting
it to adjudication, as opposed to legislation which carries a presumption of constitutional
validity.”).
194. Id.
The Struggle Against Government Extortion 683
Koontz’s significance should not be underestimated; its effect ought
to be felt in lower courts around the nation. As constitutional jurisprudence
often does, takings doctrine has come around full circle. The future
promises a new renaissance for individual rights—one that should
inhibit municipal extortion.195
195. Perhaps in direct response to Koontz, the Florida legislature has enacted a statute
that shall take effect in July, 2014. The statute—HB 1077—explicitly prohibits
municipalities from imposing “on or against any private property a tax, fee, charge,
or condition or require any other development exaction, either directly or indirectly. . .
that is unrelated to the direct impact of the proposed development, improvement project,
or the subject of an application for a development order or administrative approval.
. . . This section does not prohibit a county, municipality, or other local government
entity . . . from [i]mposing a tax, fee, charge, or condition or requiring any
other development exaction that serves to mitigate the direct impact of the proposed
development and that has an essential nexus to, and is roughly proportionate to, the
impacts of the proposed development upon the public, private, or public-private infrastructure
or facility that is maintained, owned, or controlled by the county, municipality,
or other local governmental entity.” H.B. 1077, 2014 H. of Reps, Reg. Sess. (Fla.
2014), available at http://www.myfloridahouse.gov/Sections/Documents/loaddoc.
aspx?FileName=_h1077__.docx&DocumentType=Bill&BillNumber=1077&Session
=2014 (emphasis added). Note there is absolutely no distinction made between legislative
and adjudicative exactions. The Florida legislature has appropriately suggested
its intolerance toward a bifurcated approach.