A legal form of extortion in land use decisions.

Property owner Coy A. Koontz, Jr. knows this issue all too well in what has now turned into an eleven-year battle.  In an effort to have Koontz bear the costs of 50 off-site wetland enhancements by replacing culverts and plunging ditches—located miles away from his property—rather than bear the expense itself the St. Johns River Water Management District placed these conditions on a permit request to develop Koontz’s property.

On October 5, 2012, the United States Supreme Court granted a writ of certiorari to revisit the Nollan-Dollan’s essential nexus and proportionality test for conditions placed on permit approvals.[1]  In what seems like a legal form of extortion developers are often required to bear the burden of the perceived adverse impacts that their development will place on the community.  The purpose of the Nollan-Dollan two-prong test is to prevent an out-and-out extortion.[2]  First, the essential nexus prong requires that there exist a reasonable causal connection between the prevention of the perceived adverse impacts of the development project and the health, safety, and welfare of the condition(s) that the government has placed on the permit.  The second prong, is whather a reasonable proportionality of the degree of the exaction must bear a reasonable relationship to the projected impact of the proposed development.  However, the issue is not a settled one, because the question remains at what point the exactions go too far and constitutes a taking.

In Koontz, the trial court held that the agency’s refusal to issue the permits was invalid and effected a temporary taking of Koontz’s property, and awarded just compensation, a decision that was affirmed on appeal.[3]  The Florida Supreme Court, however, reversed and announced another rule of law that a landowner can never state a claim for a taking where a permit approval is withheld based on a landowner’s objection to an excessive exaction, and the exaction demands dedication of personal property to the public.[4]

Although, the community is effected with each new development of land and each development should pay for those adverse effects on the community.  There should also be a limit to the number of ripples in the water one landowner must bear.  The results could be a scary one for developers in Florida, subjecting them to additional conditions on development.  For now, Florida must wait and see what the Supreme Court will hold.

[1] Koontz v. St. Johns River Water Mgmt. Dist., 2012 U.S. LEXIS 7808 (U.S. Oct. 5, 2012).

[2] Nollan v. Cal. Coastal Com, 483 U.S. 825, 837 (U.S. 1987).

[3] St. Johns River Water Mgmt. Dist. v. Koontz, 5 So. 3d 8, 2009 Fla. App. LEXIS 91 (Fla. Dist. Ct. App. 5th Dist., 2009).

[4] St. Johns River Water Mgmt. Dist. v. Koontz, 77 So. 3d 1220 (Fla. 2011).