George Sheetz applied for a permit to build a home on his California property. Under a new El Dorado County ordinance, Mr. Sheetz was forced to pay a $23,420 impact fee to finance unrelated road improvements in order to receive his permit. The amount of the impact fee was not tied or proportional to the impact of Mr. Sheetz’s specific home but was set by a legislatively approved fee schedule.
Mr. Sheetz sued, arguing that the County’s exaction was an unconstitutional condition on his use of his of property. But both a California state court and an appellate court upheld the County’s ordinance. The California courts specifically held that the fee could not be reviewed as an unconstitutional condition under the Supreme Court’s decisions of Nollan v. Cal. Coastal Comm’n, 483 U.S. 825, 837 (1987) and Dolan v. City of Tigard, 512 U.S. 374, 391 (1994), because the fee was legislatively enacted. Under Nollan and Dolan, there must be a “nexus” and “rough proportionality” between a government’s fee demand and the impact of the proposed land use.
The United States Supreme Court then agreed to review the case. The Supreme Court took the case only to answer the specific question of whether a land use permit exaction is exempt from the unconstitutional-conditions doctrine simply because it is authorized by legislation.
Yesterday, January 9, 2024, the Supreme Court heard oral argument in the case. The justices questioned both attorneys about many of the complex issues that are at the center of the growing conflict between local government powers and the private property rights protected by the Constitution. If the Supreme Court decides in the County’s favor, many other local governments could follow suit and enact similar legislation. As local governments look to increase revenue without raising taxes, they may look to use their permitting powers to exact money from property owners like Mr. Sheetz.
As we have seen at Dalton & Tomich, it is not uncommon for local governments to leverage their permitting powers to exact significant sums and restrictive land use conditions during the permitting process. In one infamous religious land use case out of New York, a town told a church that it needed to pay for a new firetruck for the town if it wanted zoning approval. More recently in Illinois, we have seen how local governments try to pressure religious institutions into waiving their right to property tax exemption.
If your religious institution is running into similar treatment or struggling to obtain land use approvals, please contact the attorneys at Dalton & Tomich.