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Could construction-permit fees be exempt…

U.S. Supreme Court Could construction-permit fees be exempt from takings analysis? Supreme Court to decide

By Debra Cassens Weiss

September 29, 2023, 2:40 pm CDT

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The U.S. Supreme Court has agreed to decide whether a legislatively imposed road-construction fee of more than $23,000—which was required for a building permit—may be an unconstitutional taking.

The court agreed Friday to decide the case of George Sheetz, who contends the fee required to build his manufactured home in Placerville, California, should not be exempted from a takings test just because it was authorized by legislation. SCOTUSblog has the story; its case page is here.

Sheetz’s cert petition says the fee was for “unrelated road improvements.”

The takings test for conditions on development permits was established in two prior decisions of the U.S. Supreme Court. Applied to Sheetz, the test would require an “essential nexus” and “rough proportionality” between his planned home’s effect on traffic and the $23,420 road fee imposed by El Dorado County. The county never made such a determination.

But development fees in California aren’t subjected to that test when they are adopted by legislation that applies to everyone, the California Court of Appeals ruled in Sheetz’s case.

For decades, some lower courts have agreed with that reasoning, according to Sheetz’s cert petition. They have reasoned that permit fees imposed by legislation are less likely to be used unfairly than discretionary fees.

But those decisions are at odds with the decisions of other state and federal courts, as well as more recent U.S Supreme Court precedent, the cert petition says.

The case concerns the “unconstitutional-conditions doctrine,” which holds the government can’t deny a benefit to a person who exercises a constitutional right. Sheetz’s case concerns application of the doctrine to the right to compensation under the Fifth and 14th Amendments for property taken for land-use permits, according to Sheet’s cert petition and an amicus brief by the Pacific Legal Foundation.

The cert petition asks the Supreme Court to “provide uniformity” on the issue and “finally put to rest perhaps the most vexing and disputed ‘takings’ question in land-use law.”

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