Just back from a talk with the Land Use Research Foundation of Hawaii. I posted the outline of my talk earlier, but we will be watching this case, so I thought a post appropriate (bear with me - I know this is an ocean law blog, but I do practice a lot of land use).
Does a municipality have unfettered ability to condition discretionary permits for real estate development on the payment of some fee? And if not, then does the Fifth Amendment constrain government's ability to impose such fees?
The case is West Linn Corporate Park v. City of West Linn and that is the question put to the U.S. Supreme Court. The briefs and history below can be found at www.inversecondemnation.com, so I'll just summarize them here.
A developer sought a discretionary permit to develop a business park. The City required several on and off-site improvements, as well as a fee of over $800,000. The developer brought a suit in Oregon state court challenging the amount of that fee. The City removed the case to federal court, where, after a trial, went up to the Ninth Circuit Court of Appeals, over the Oregon Supreme Court, then back to the Ninth Circuit.
The Ninth Circuit held that the constraints of Nollan and Dolan only apply to exactions of real property, ergo, since the City of West Linn was exacting personal property - cash - there was no constitutional bar to such an exaction.
The decision conflicts with the Texas Supreme Court and the California Supreme Court, so we think it likely that the U.S. Supreme Court will take the case. Why is this case important in Hawaii? Many of the governmental regulatory agencies assess monetary charges for real estate development under the names of fair share, impact fee, in lieu fees. The biggest is probably the affordable housing or workforce housing exactions. My partner, Robert Thomas, has many posts about these exactions at www.inversecondemnation.com.
Stay tuned.
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