Add to the end of Note 7 Part b, NOTES AND QUESTIONS, P. 722:
In Hillcrest Property LLP v. Pasco County, 2013 WL1502627 (M.D. Fla.), the court discussed the difference between a takings claim and a due process issue. The court explained that the substantive due process inquiry “asks whether a regulation of private property is effective in achieving some legitimate government purpose.” In contrast, the Takings Clause “asks whether the government forces some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole.”
The court applied this reasoning to Pasco County’s “Right of Way Ordinance.” The ordinance directs the County to forbid development of land adjoining a new transportation corridor unless the landowner dedicates, without compensation, the land within the corridor. The court found that the Ordinance “leverages the police power to compel a landowner to relinquish rights guaranteed by the Takings Clause,” and that the Ordinance “fails to advance a legitimate governmental purpose.” As a result the Ordinance was struck down for violating due process principles.
Add to the end of “Legislative vs. adjudicative,” P. 724-25 See also St. Clair County Home Builders Association v. City of Pell City, 61 So. 3d 992, 2010 ALA. LEXIS 161. The Alabama Supreme Court upheld service fees imposed by the City to improve its municipal water and sewer systems, and to defray the costs of providing services to new development, holding that the fees were not unauthorized taxes. The court also rejected the argument that the U.S. Supreme Court’s rulings in the Dolan and Nollan cases applied to these fees. The 1994 decision in Dolan v. City of Tigard required the city of Tigard to show the reasonableness of the dedication requirement. However, the current case involves a legislative action, not an individual judicative determination. Thus the burden falls on the home builders to demonstrate that the fees are unreasonable.
Dedications of Land
Sparks v. Douglas County
NOTES AND QUESTIONS
Add After Note 3, as Note 4, P. 734: St. John’s River Update: The Florida Supreme Court subsequently reviewed the decision of the Fifth District Court of Appeals in St. Johns River Water Mgmt. Dist. v. Koontz, 77 So. 3d 1220 (Fla. 2011), specifically deciding the much-debated question whether the United States Constitution and the Florida Constitution recognize an exactions taking where “there is no compelled dedication of any interest in real property to the public use and the alleged exaction is a non land-use monetary condition for permit approval which never occurs and no permit is ever issued.” The Florida Supreme Court declined to interpret the U.S. Supreme Court’s silence on the issue as a decision on the merits stating that the U.S. Supreme Court has specifically stated that denial of certiorari review “imports no expression of opinion upon the merits of the case.”
The Florida Supreme Court recognized the differing interpretations of both state and federal courts in that some apply Nollan and Dolan solely to exactions cases involving land-use dedications while others extend the test beyond those involving real property. In deciding the case, the court looked to the decisions of the U.S. Supreme Court cases involving the scope of exactions takings, Nollan and Dolan, finding that both involved exactions which require the property owner to dedicate real property in exchange for approval of a permit. Additionally, in both Nollan and Dolan the regulatory agencies actually issued the permits with the objected to exactions attached. The Florida Supreme Court stated, “Absent a more limiting or expanding statement from the United States Supreme Court with regard to the scope of Nollan and Dolan, we decline to expand this doctrine beyond the express parameters for which it has been applied by the High Court.” As such, the Florida Supreme Court found that the Nollan and Dolan rules are only applicable when the condition or exaction involves a dedication of or over the owner’s interest in real property in exchange for permit approval, and only when the regulatory agency actually issues the permit sought.
The Florida Supreme Court called the narrow interpretation both “necessary and logical,” explaining that the opposite finding would result in two very “undesirable” outcomes. First, the ability to regulate land-use would become prohibitively expensive, and as a result, agencies would simply deny permits rather than negotiate with applicants to avoid the potentially high costs of litigation.
In 2012, the U.S. Supreme Court granted certiorari based on the St. Johns property owners appeal asking: (1) whether governmental refusal of a land-use permit solely because the applicant did not accede to a permit condition that, if applied, would violate Nollan and Dolan essential nexus and rough proportionality tests, amounts to an exactions taking; and (2) whether Nolan and Dolan tests apply to land-use exactions that demand that a permit applicant dedicate money, services, labor, or any other type of personal property to public use. A decision is expected in June, 2013 (Follow.) See also W. Linn Corporate Park, LLC v. City of w. Linn, 428 F.App’x 700 (9th Cir. 2011) (Providing that the U.S. Supreme Court has not extended Nollan and Dolan beyond situations involving dedication of real property and refusing to apply the tests to off-site road improvements).
The property owner in St. Johns has since sought U.S. Supreme Court review asking: (1) whether governmental refusal of a land-use permit solely because the applicant did not accede to a permit condition that, if applied, would violate the Nollan and Dolan essential nexus and rough proportionality tests, amounts to an exactions taking; and (2) whether the Nollan and Dolan tests apply to land-use exactions that demand that a permit applicant dedicate money, services, labor, or any other type of personal property to public use. U.S. Supreme Court acceptance is not yet known. See alsoW. Linn Corporate Park, LLC v. City of W. Linn, 428 F. App'x 700 (9th Cir. 2011) (providing that the U.S. Supreme Court has not extended Nollan and Dolan beyond situations involving dedication of real property and refusing to apply the tests to off-site road improvements).
Add to Note 4, NOTES AND QUESTIONS, P. 734: St. John’s River Update 2013: The U.S. Supreme Court granted certiorari on October 5, 2012, and heard oral argument on January 15, 2013. Koontz v. St. Johns River Water Mgmt. Dist., 133 S. Ct. 420 (2012). For continued updates and a list of the proceedings and orders visit the Supreme Court’s website at: http://www.supremecourt.gov/Search.aspx?FileName=/docketfiles/11-1447.htm.
For a helpful discussion of the possible outcomes in the case considering the Court’s reasoning in Nollan and Dolan, the facts of the case, and the questions at oral argument, see John M. Baker & Katherine M. Swenson, Koontz v. St. Johns River Water Management District: Trudging Through a Florida Wetland with Nine U.S. Supreme Court Justices, 36 No. 5 Zoning and Planning L. Report 1 (May 2013).
Add to p.734 after the second paragraph discussion of Joy Builders: In Koontz v. St. Johns River Water Mgmt. Dist., the U.S. Supreme Court held that a government’s demand for property from a permit applicant must satisfy the Nollan/Dolan requirements even when the demand is for money. Koontz v. St. Johns River Water Mgmt. Dist., No. 11-1447, 2013 LEXIS 4918, at *14. Koontz was denied a permit to develop an area of wetlands after he refused to comply with the district’s condition that Koontz reserve part of his property as a conservation area or pay for offsite mitigation. Id at *12. The Court noted that under the Nollan/Dollan standards, the government must only provide one alternative that satisfies the nexus and rough proportionality standards. Id. at *30. The Court noted that municipalities commonly suggest an alternative fee equal to the requested easement’s value when a property owner objects to accepting a negative easement on their land. Id. Such “in lieu of” fees should be treated as other forms of exactions under the Nollan/Dollan standard, the Court concluded. Id. Furthermore, the Court declined to apply Penn Central’s “already difficult and uncertain rule” to situations where an individual believes a regulation is too costly. Id. at *31-2. Specifically, when the government commands the payment of funds linked to a specific, identifiable property interest like a bank account or real property, a “per se takings approach” is the form of analysis that should be done. Id. at *33-4.
Justice Kagan, in dissent, expressed concern that the Court’s conclusion “threatens to subject a vast array of land-use regulations, applied daily in States and localities throughout the country, to heightened constitutional scrutiny.” Id. at *43.
Impact Fees
NOTES AND QUESTIONS
Add to the end of Note 2 “Park and school fees” at p. 737 In Matter of Legacy at Fairways, LLC v. Zoning Board of Appeals of Town of Victor, 2010 N.Y. App. Div. LEXIS 6558, the owners of a parcel of property on which an assisted living center is located, sought to terminate the “per unit recreation fee” that had been imposed on their property. The Town Code authorized such a fee to be established by the Town board “in lieu of parkland.” The appellate court struck down the fee because the Planning Board had not made the necessary findings in order to impose the per unit recreation fee and an assisted living facility did not qualify as a “‘proper case’ for such a fee.”
The Drees Company v. Hamilton Township, Ohio
NOTES AND QUESTIONS
Add after Note 2, as Note 3, P. 743:The Reversal of Drees: In Drees Co. v. Hamilton Twp., 2012 Ohio LEXIS 1379, upon acceptance of a discretionary appeal, the Ohio Supreme Court reversed the judgment of the court of appeals. The primary issue before the court was whether the assessments sought were a tax or regulatory fee. Importantly, Ohio Code specifically prohibits limited home-rule townships, such as Hamilton Township, from enacting taxes other than those authorized by general law. There was no dispute that the impact fees Hamilton County sought did not meet the requirements of any of the taxing methods as authorized by Ohio general law, and therefore their classification as a tax would render them in violation of Ohio law. Among relevant factors central to the court’s decision was the determination that the impact fees were earmarked for police protection, fire protection, road improvement, and parks that benefit the entire community. Communitywide benefit absent a special benefit for those paying the fee is highly indicative of a tax.
After analyzing the impact fees in light of State ex rel. Petroleum Underground Storage Tank Release Comp. Bd. v. Withrow, 579 N.E.2d 705 (Ohio 1991) (deciding whether assessments imposed upon owners and operators of underground storage tanks were considered fees or taxes and providing factors to consider in such an analysis), Am. Landfill, Inc. v. Stark/Tuscarawas/Wayne Joint Solid Waste Mgt. Dist., 166 F.3d 835 (6th Cir.1999) (employing a similar analysis as Withrow to determine whether assessments on solid-waste-management districts on persons disposing of material constituted fees or taxes), and other state supreme court cases, the court ultimately concluded that the impact fees were taxes without authorization under general law. Among other relevant factors, central to the court’s decision was the determination that the impact fees were earmarked for police protection, fire protection, road improvement, and parks that benefit the entire community – communitywide benefit absent a special benefit for those paying the fee being highly indicative of a tax.
The lower court found persuasive a stipulation stating that the purpose of the fee was to benefit the targeted properties and the fact that the assessment funds were kept separately from the general fund as being determinative of a fee. However, the court rejected those arguments stating that what dominates is the “substance” of the assessment, rather than the “form.” The court concluded that the impact fees were actually intended to prevent any diminishment of service to anyone in the township, not just those subject to the assessment. The court also found the segregation of the assessment funds from the general fund irrelevant when analyzing the “substance” of the assessment; although the funds are segregated, the use of the funds was general in nature.
Add to Note 2, NOTES AND QUESTIONS, P. 743: One author has proposed a hybrid of a tax and a fee (called a “xat”) based on a combination of location and size of housing arguing that current impact fees act as taxes on a population rather than as a disincentive to suburban sprawl. The author contends that a “xat” would better encourage infill and discourage sprawl. Paul Boudreaux, The Impact Xat: A New Approach to Charging for Growth, 43 Univ. of Mem. L. Rev. 35 (2012).
Add after Note 2, as Note 3, P. 743:The Reversal of Drees: In Drees Co. v. Hamilton Twp., 2012 Ohio LEXIS 1379, upon acceptance of a discretionary appeal, the Ohio Supreme Court reversed the judgment of the court of appeals. The primary issue before the court was whether the assessments sought were a tax or regulatory fee. Importantly, Ohio Code specifically prohibits limited home-rule townships, such as Hamilton Township, from enacting taxes other than those authorized by general law. There was no dispute that the impact fees Hamilton County sought did not meet the requirements of any of the taxing methods as authorized by Ohio general law, and therefore their classification as a tax would render them in violation of Ohio law.
Add at the end of Note 3, NOTES AND QUESTIONS, P. 743: For a critique of the Ohio Supreme Court’s decision in Drees, see, Alan C. Weinstein, The Ohio Supreme Court’s Perverse Stance on Development Impact Fees and What to Do About It, 60 Clev. St. L. Rev. 655 (2012) (comparing the Drees decision to Homebuilders Association of Dayton and Miami Valley, discussed supra).
A NOTE ON STATUTORY AUTHORITY FOR DEDICATIONS, IN-LIEU FEES
AND IMPACT FEES
Add after discussion of the Texas statute on p. 744
A new law in Utah sets standards for development review fees. The new law requires local governments to provide justification for the fees that are charged as a general practice and to conform with existing provisions in state code. It also requires that upon request, local governments must provide the basis for any fee charged and an accounting of where fees go and what they are expended for. A local process for appeal of fees must also be established. See 2011 Utah New Laws, H.B. 78. (http://le.utah.gov/~2011/bills/hbillenr/hb0078.pdf)
A new Colorado law requires local governments who collect impact fees for capital expenditures as a condition of approval of land development to annually post on their official websites information about these fees. 2011 New Laws, H.B. 1113. The posted information must include the amount of each collected land development charge allocated to an account or accounts, the average annual interest rate on each account, and the total amount disbursed from each account during the most recent fiscal year. The bill also requires that the information be presented in a clear, concise and user-friendly format. Language in the new law specifically exempts municipal and county governments that do not have a web site.
(http://e-lobbyist.com/gaits/text/203853/203853.pdf )
Add to Note 1 “Review and Approval Process,” NOTES AND QUESTIONS, P.749: For an example of the stages of review for a master planned development, see Moab Local Green Party v. Moab City, 276 P.3d 1230 (Utah App. 2012) (upholding the City Board of Adjustment’s preliminary approval of a MPD).
Add to end of Note 1, NOTES AND QUESTIONS, P. 754: In Seminole Tribe of Florida v. Hendry County, 106 So. 3d 19 (Fla. Dist. Ct. App. 2013), the Seminole Tribe of Florida petitioned for a writ of certiorari seeking to challenge the rezoning of land for a PUD. The Seminole Tribe argued that the PUD violated the Local Development Code, was incompatible with the Big Cypress Seminole Indian Reservation, and was inconsistent with the County’s Comprehensive Plan. The court discusses the lower court’s application of Florida law to the Seminole Tribe’s arguments and denies the petition.
A NOTE ON OFFICE-HOUSING LINKAGE PROGRAMS
PLANNED UNIT DEVELOPMENTS (PUDs) AND PLANNED COMMUNITIES
PLANNED UNIT DEVELOPMENT AS A ZONING CONCEPT,
NOTES AND QUESTIONS
City Of Gig Harbor v. North Pacific Design, Inc.
NOTES AND QUESTIONS
Cheney v. Village 2 At New Hope, Inc.
NOTES AND QUESTIONS
A NOTE ON PUD PROJECT APPROVAL STANDARDS
Add to the end of subsection Project approval standards, immediately before subsection Design, P. 763: For an interesting discussion on standing to challenge the creation of a PUD, see Ray v. Mayor & City Council of Baltimore, 36 A.3d 521 (Md. App. 2012). There, the court analyzed whether the appellants met the condition under a Maryland statute that a party must be “aggrieved” by the decision of the board for zoning challenges. The court provided that presumptive prima facie aggrievement requires that the property owner must be “adjoining, confronting, or nearby” the affected property. Otherwise, a party whose property is far removed bears the burden of proving by “competent evidence” that his personal and property rights are “specially and adversely” affected.
Add to the end of “Project approval standards” on p. 764, before “Density”
For an interesting discussion on the approval standards for planned developments, see Tagliarini v New Haven Board of Alderman, 2011 Conn. Super. LEXIS 1022. A neighboring property owner appealed creation of a Planned Development District (PPD) for Yale University as “arbitrary and illegal substantively.” The Court upheld the approval, determining that it would not interfere with local legislative decisions unless an abuse of discretion or action contrary to law occurred, meaning that the zone change must be in accord with a comprehensive plan and it must be reasonably related to the normal police power purposes enumerated in the city’s enabling legislation. The court concluded that the Board acted in the best interests of the entire community and therefore met the first prong of the test since there was a comprehensive plan. The second prong was also met since the PPD zone change was related to the normal police power purposes found in the city’s enabling legislation. The court found that by granting the application, the Board was improving economic development, there was a positive environmental impact, and surrounding property values were not negatively impacted. Since both prongs of the test were met the court concluded that the Board did not act arbitrarily or illegally.
