Petition for Writ of Certiorari — The Coalition for Fairness in SoHo and NoHo, Inc., et al., Petitioners v. City of New York, New York, et al.
Supreme Court briefApr 13, 2026
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In the Supreme Court of the United States
_________
T HE C OALITION FOR F AIRNESS IN S OH O AND N OH O ,
I NC .; K AY P OWELL ; A MIT S OLOMON; I AN K ERNER;
L ISA R UBISCH ; SARA BERSHTEL ; J ENNIFER P ETTIT ;
L YNN S CHNITZER; ARTHUR S CHNITZER ;
CATERINA R OIATTI; R OBERT T RABOSCIA,
Petitioners,
v.
CITY OF N EW Y ORK, ET AL .,
Respondents.
_________
On Petition For A Writ Of Certiorari
To The New York Court of Appeals
_________
PETITION FOR A WRIT OF CERTIORARI
_________
J ACK L. L ESTER
41 Squaw Road
East Hampton, NY 11937
(631) 604-2228
DEBORAH J. LA FETRA
JONATHAN HOUGHTON
Pacific Legal Foundation
3100 Clarendon Blvd.,
Suite 1000
Arlington, VA 22201
(202) 888-6881
CHRISTOPHER M. K IESER
Counsel of Record
BRIAN T. H ODGES
Pacific Legal Foundation
555 Capitol Mall,
Suite 1290
Sacramento, CA 95814
(916) 419-7111
CKieser@pacificlegal.org
Counsel for Petitioners
i
QUESTION PRESENTED
The New York City neighborhoods of SoHo and
NoHo contain 1,636 lofts subject to a highly restrictive
and outdated zoning designation limiting occupancy
to City-certified artists. But few certified artists
remain, leaving the mostly non-artist current
residents bereft of qualified buyers.
Residents
seeking to transition to a standard residential zoning
designation must obtain a conversion permit. But to
apply for a permit, residents must pay more than $100
per square foot—hundreds of thousands of dollars per
home—into a City-administered “Arts Fund.”
Residents challenged the fee as an unconstitutional
permit condition. Under Nollan v. California Coastal
Commission, 483 U.S. 825 (1987), and Dolan v. City of
Tigard, 512 U.S. 374 (1994), the Fifth Amendment’s
Takings Clause limits the government’s power to
demand property from permit applicants in exchange
for approval. Koontz v. St. Johns River Water
Management District, 570 U.S. 595 (2013), recognized
that these limits extend to monetary demands. But
the New York Court of Appeals refused to apply
Nollan and Dolan. Conflicting with other state high
courts, it held that a monetary demand triggers the
unconstitutional conditions doctrine only where it is
imposed in lieu of a dedication of real property.
The question presented is:
Does the protection the Takings Clause provides to
land-use permit applicants encompass monetary
demands beyond those imposed in lieu of a dedication
of real property?
ii
PARTIES TO THE PROCEEDING AND
RULE 29.6 STATEMENT
Petitioners were petitioners in the Supreme Court
of New York, County of New York, appellants in the
Supreme Court of New York, Appellate Division, and
respondents in the New York Court of Appeals. The
case began in the trial court as an Article 78 petition.
This is a mechanism under New York law to challenge
decisions of local governments. Petitioners are the
Coalition for Fairness in SoHo and NoHo, Inc.; Kay
Powell; Amit Solomon; Ian Kerner; Lisa Rubisch; Sara
Bershtel; Jennifer Pettit; Lynn Schnitzer; Arthur
Schnitzer; Caterina Roiatti; and Robert Traboscia.
Respondents were Respondents in the Supreme
Court of New York. They are the City of New York;
New York City Department of City Planning; New
York City Planning Commission; New York City
Council; and Zohran Mamdani, in his official capacity
as Mayor of the City of New York. 1
The Coalition for Fairness in SoHo and NoHo, Inc.,
does not have a parent corporation, and no publicly
held corporation owns more than 10% of its stock. The
remaining Petitioners are natural persons.
Eric Adams was Mayor when the Article 78 petition was filed
in the Supreme Court of New York. Zohran Mamdani replaced
him on January 1, 2026.
1
iii
STATEMENT OF RELATED CASES
These proceedings are directly related to the abovecaptioned case under Rule 14.1(b)(iii):
Coalition for Fairness in SoHo & NoHo, Inc. v. City
of New York, No. 112 (N.Y. Jan. 13, 2026)
Coalition for Fairness in SoHo & NoHo, Inc. v. City
of New York, No. 2023-05338 (N.Y. App. Div.
Dec. 5, 2024)
Coalition for Fairness in SoHo & NoHo, Inc. v. City
of New York, No. 151255/2022 (N.Y. Sup. Ct. Oct. 6,
2023)
iv
TABLE OF CONTENTS
Petition for a writ of certiorari .................................. 1
Opinions below ........................................................... 5
Jurisdiction ................................................................ 5
Constitutional and statutory provisions involved .... 5
Statement of the case ................................................ 6
A. History of land use in SoHo and NoHo .......... 6
B. The rezoning and the Arts Fund fee .............. 8
C. The lawsuit .................................................... 10
Reasons for granting the petition ........................... 13
I. The decision below opens a split among state
high courts over whether monetary exactions
trigger the unconstitutional conditions
doctrine ............................................................... 13
II. The decision below conflicts with multiple
strands of this Court’s precedent and creates
an end run around Nollan and Dolan ............... 20
A. The decision below incorrectly assumed that
a monetary obligation can never be the
object of a takings claim ............................... 21
B. The decision below incorrectly assumed that
application of the unconstitutional
conditions doctrine depends upon the
owner’s entitlement to the land use ............. 25
III. This case is an excellent vehicle to address a
question of nationwide importance .................. 30
Conclusion ................................................................ 32
v
APPENDIX
Opinion, State of New York Court of Appeals,
No. APL-2025-00028, filed January 13, 2026 .... 1a
Opinion, Supreme Court of the State of New York,
Appellate Division, First Judicial Department,
Index No. 151255/2022, Case No. 2023-05338,
filed December 5, 2024 ...................................... 54a
Decision and Order on Motion, Supreme Court
of the State of New York, New York
County, Index No. 151255/2022,
filed October 9, 2023 ......................................... 58a
Zoning Resolution 143-13, Joint Living-Work
Quarters for Artists........................................... 81a
vi
TABLE OF AUTHORITIES
Page(s)
Cases
225 Northport, LLC v. Vill. of Northport,
No. 24-CV-2967, 2025 WL 2782360
(E.D.N.Y. Sep. 30, 2025)...................................... 19
Agency for Int’l Dev. v. All. for Open
Soc’y Int’l, Inc.,
570 U.S. 205 (2013) ............................................. 27
All. for Responsible Plan. v. Taylor,
63 Cal. App. 5th 1072 (2021)............................... 18
Alpine Homes, Inc. v. City of W. Jordan,
424 P.3d 95 (Utah 2017)................................. 15-16
Anderson Creek Partners, L.P. v. Cnty.
of Hartnett,
876 S.E.2d 476 (N.C. 2022) ............. 3, 13-14, 16-20
Ark. Game & Fish Comm’n v. United States,
568 U.S. 23 (2012) ............................................... 20
Armstrong v. United States,
364 U.S. 40 (1960) ....................................... 2, 4, 22
In re Black Diamond Min. Co., LLC,
507 B.R. 209 (E.D. Ky. 2014) .............................. 30
Brown v. Legal Found. of Wash.,
538 U.S. 216 (2003) .................................... 4, 21-23
Charter Twp. of Canton v. 44650, Inc.,
12 N.W.3d 56 (Mich. Ct. App. 2023) ................... 16
Connick v. Myers,
461 U.S. 138 (1983) ............................................. 26
Dolan v. City of Tigard,
512 U.S. 374 (1994) ..................... 1-4, 10-12, 14-17,
19-20, 23-25, 27, 29-31
vii
Doyle v. Cont’l Ins. Co.,
94 U.S. (4 Otto.) 535 (1876) ................................ 26
Eastern Enterprises v. Apfel,
524 U.S. 498 (1998) ........................................ 22-24
Ehrlich v. City of Culver City,
12 Cal. 4th 854 (1996) ................................... 14, 19
Graham v. Richardson,
403 U.S. 365 (1971) ............................................. 27
Hollywood, Inc. v. Broward Cnty.,
431 So. 2d 606
(Fla. Dist. Ct. App. 1983) .................................... 18
Home Builders Ass’n of Cent. Ariz. v.
City of Scottsdale,
187 Ariz. 479 (1997)............................................. 14
Home Builders Ass’n of Dayton & the
Miami Valley v. Beavercreek,
89 Ohio St. 3d 121 (2000) .................................... 14
Koontz v. St. Johns River Water Mgmt. Dist.,
570 U.S. 595 (2013) .... 1-4, 12, 15, 18, 22-24, 27-29
Krupp v. Breckenridge Sanitation Dist.,
19 P.3d 687 (Colo. 2001) ...................................... 14
Levin v. City & Cnty. of San Francisco,
71 F. Supp. 3d 1072 (N.D. Cal. 2014) ............ 16-17
Lingle v. Chevron U.S.A. Inc.,
544 U.S. 528 (2005) ............................................. 27
Loretto v. Teleprompter Manhattan
CATV Corp.,
458 U.S. 419 (1982) ............................................. 21
Louisville Joint Stock Land Bank v. Radford,
295 U.S. 555 (1935) ......................................... 4, 22
McAuliffe v. City of New Bedford,
29 N.E. 517 (Mass. 1892) .................................... 26
viii
McCarthy v. City of Leawood,
257 Kan. 566 (1995)............................................. 14
Mem’l Hosp. v. Maricopa Cnty.,
415 U.S. 250 (1974) ............................................. 27
N. Ill. Home Builders Ass’n, Inc. v.
Cnty. of Du Page,
165 Ill. 2d 25 (1995) ............................................. 14
Nollan v. Cal. Coastal Comm’n,
483 U.S. 825 (1987) ..................... 1-4, 10-12, 14-17,
19-20, 23-25, 27-31
Palazzolo v. Rhode Island,
533 U.S. 606 (2001) ............................................. 27
Shapiro v. Thompson,
394 U.S. 618 (1969) ............................................. 27
Sheetz v. Cnty. of El Dorado,
84 Cal. App. 5th 394 (2022)................................. 18
Sheetz v. Cnty. of El Dorado,
335 Cal. Rptr. 3d 316
(Ct. App. 2025) ................................ 4, 17-19, 27, 29
Sheetz v. El Dorado Cnty.,
601 U.S. 267 (2024) ........................2, 11, 17, 24, 29
St. Johns River Water Mgmt. Dist. v. Koontz,
183 So. 3d 396 (Fla. Dist. Ct. App. 2014) ........... 31
St. Johns River Water Mgmt. Dist. v. Koontz,
5 So. 3d 8 (Fla. Dist. Ct. App. 2009) ................... 18
St. Johns River Water Mgmt. Dist. v. Koontz,
77 So. 3d 1220 (Fla. 2011) ................................... 15
Suffolk Cnty. Builders Ass’n, Inc. v.
Suffolk Cnty.,
46 N.Y.2d 613 (1979) ........................................... 25
ix
Tap House Real Est., LLC v. City of
Rochester,
No. 22-cv-492, 2024 WL 3470824
(D. Minn. Jul. 19, 2024)....................................... 19
Town of Flower Mound v. Stafford
Estates Ltd. P’ship,
135 S.W.3d 620 (Tex. 2004) ................................. 14
United States v. Sec. Indust. Bank,
459 U.S. 70 (1982) ............................................... 22
Vill. of Euclid v. Ambler Realty,
272 U.S. 365 (1926) ............................................. 24
Vill. of Norwood v. Baker,
172 U.S. 269 (1898) ............................................. 21
Webb’s Fabulous Pharmacies v.
Beckwith,
449 U.S. 155 (1980) .................................... 4, 21-22
Whitfield v. City of New York,
96 F.4th 504 (2d Cir. 2024) ................................. 10
Constitutional Provisions
U.S. Const amend. I .................................................. 26
U.S. Const amend. V....................................... 5, 13, 27
Statutes
28 U.S.C. § 1257 .......................................................... 5
N.Y. Mult. Dwell. §§ 275-278 ..................................... 6
N.Y. Mult. Dwell. §§ 280-287 ..................................... 6
Other Authorities
Brief for Amici Curiae City & Cnty. of
San Francisco, et al., Sheetz v. Cnty.
of El Dorado, No. 22-1074, 2023 WL
8869700 (U.S. Dec. 19, 2023) .............................. 30
x
County of El Dorado Response Br.,
Sheetz v. Cnty. of El Dorado,
No. C093682, 2022 WL 1570886
(Cal. Ct. App. Apr. 14, 2022) ............................... 18
Dana, David A., Land Use Regulation in
an Age of Heightened Scrutiny,
75 N.C. L. Rev. 1243 (1997) .................................. 3
Friedman, Lawrence M., et al., State
Supreme Courts: A Century of Style
and Citation,
33 Stan. L. Rev. 773 (1981) ................................. 30
Nat’l Ass’n of Home Builders, Building
Permits by State and Metro Areas,
https://tinyurl.com/562wfmbv
(last visited Apr. 6, 2026) .................................... 30
New York City Dep’t of Buildings,
Converting from JLWQA to
Residential Use,
https://tinyurl.com/3wa3j2xm
(last visited Apr. 6, 2026) ...................................... 9
New York City Dep’t of City Planning,
Rules for Special Areas,
https://tinyurl.com/3ymyv2yw
(last visited Apr. 6, 2026) ...................................... 9
Petition for Writ of Certiorari, Koontz v.
St. Johns River Water Mgmt. Dist.,
No. 11-1447, 2012 WL 1961402 (U.S.
May 30, 2012) ...................................................... 15
Van Alstyne, William W., The Demise of
the Right-Privilege Distinction in
Constitutional Law,
81 Harv. L. Rev. 1439 (1968) ......................... 25-26
Zoning Resolution § 143-002 .................................... 10
xi
Zoning Resolution 41-11 (1971),
https://tinyurl.com/3r9npb78 ................................ 7
1
PETITION FOR A WRIT OF CERTIORARI
New York City is withholding permits for a
necessary zoning change to force a group of private
property owners in Lower Manhattan to fund public
art. App. 81a-82a. Artist-restricted housing in the
SoHo and NoHo neighborhoods is an outdated relic of
the area’s manufacturing history. App. 56a. That is
why the City rezoned the area to encourage general
residential use, banning the restrictive zoning going
forward. App. 81a. But the rezoning comes with a
price levied only on the residents of designated artist
housing. Under the challenged Zoning Resolution, a
resident seeking to convert a loft to residential use
must obtain a conversion permit. App. 81-82a. Even
to apply for this permit, each owner must pay more
than $100 per square foot—more than $250,000 for
the typical home—into the City’s “Arts Fund.” Ibid.;
see also App. 28a. When multiplied by the 1,636
artist-restricted homes, the City demands more than
$450 million from residents in exchange for a zoning
change that is consistent with its general plan.
Because the City demands that residents
surrender their property—money—as a condition to
obtain a land-use permit, the state intermediate
appellate court applied this Court’s land-use exactions
precedents, Nollan v. California Coastal Commission,
483 U.S. 825 (1987), and Dolan v. City of Tigard, 512
U.S. 374 (1994). App. 55a-57a. Those cases make
clear that the Constitution permits the government to
demand property in exchange for a land-use permit
only if “there is a ‘nexus’ and ‘rough proportionality’
between the property that the government demands
and the social costs of the applicant’s proposal.”
Koontz v. St. Johns River Water Mgmt. Dist., 570 U.S.
2
595, 605-06 (2013). Under this standard, the New
York Supreme Court, Appellate Division, unanimously concluded that the Arts Fund fee is an
unconstitutional condition on the residents’ permit
applications because it is unrelated to any legitimate
City interest in denying conversions and does not
mitigate any actual impact of the conversions. App.
56a-57a.
The New York Court of Appeals reversed. App.
26a. In sustaining the Arts Fund fee, the Court of
Appeals did not challenge the lower court’s Nollan and
Dolan analysis. Instead, it adopted a categorical rule
excluding monetary exactions from heightened
scrutiny altogether. Although Koontz held that “the
government’s demand for property from a land-use
permit applicant must satisfy the requirements of
Nollan and Dolan . . . even when its demand is for
money,” 570 U.S. at 619, the Court of Appeals limited
this holding to money demanded in lieu of a
requirement that the applicant dedicate real property.
App. 20a-25a.
Because the City demanded a
monetary contribution to the Arts Fund rather than
an interest in real property, the Court of Appeals held
that the demand did not trigger the protections of
Nollan and Dolan. App. 24a-25a.
Nollan, Dolan, Koontz, and Sheetz v. El Dorado
County, 601 U.S. 267 (2024), recognized important
limits on the government’s power to use its leverage
over a land-use permit applicant to force a property
owner “to bear public burdens which, in all fairness
and justice, should be borne by the public as a whole.”
Armstrong v. United States, 364 U.S. 40, 49 (1960). By
excluding monetary exactions from these protections,
the decision below creates a roadmap for permitting
authorities to evade Nollan and Dolan. Under its
3
logic, instead of demanding real property or in-lieu
fees to purchase offsite property, governments could
simply impose an extortionate fee to support any
public purpose—even condemnation of public easements otherwise unlawful under Nollan and Dolan.
See Koontz, 570 U.S. at 612 (without heightened
scrutiny for monetary exactions, “it would be very
easy for land-use permitting officials to evade the
limitations of Nollan and Dolan”); David A. Dana,
Land Use Regulation in an Age of Heightened Scrutiny, 75 N.C. L. Rev. 1243, 1260 n.88 (1997) (if Nollan
and Dolan do not extend to monetary conditions,
governments “could rely on monetary conditions to
reach the same objectives they previously achieved by
means of non-monetary conditions”). Consequently,
Nollan and Dolan would cease to be effective limits on
the government’s permitting power.
The Court covered much of this ground in Koontz,
which applied the logic of Nollan and Dolan to
monetary exactions. But the Court of Appeals’
decision opened a split over whether Koontz applies
broadly to all monetary exactions, or, as the Court of
Appeals held, only to those monetary exactions
explicitly imposed in lieu of a demand for real
property. Compare App. 20a-25a with Anderson Creek
Partners, L.P. v. Cnty. of Hartnett, 876 S.E.2d 476, 496
(N.C. 2022) (concluding that “the ‘monetary exactions’
with which Koontz was concerned were not limited to
‘in lieu of’ fees and, instead, encompassed a broader
range of governmental demands for the payment of
money as a precondition for the approval of a land-use
permit”). Certiorari is warranted to resolve this
conflict, which has implications for land-use
permitting nationwide.
4
Certiorari is also warranted because the Court of
Appeals’ analysis conflicts with this Court’s
traditional understanding of the unconstitutional
conditions doctrine. Specifically, the Court of Appeals’
assumption that the Arts Fund fee could not trigger
the doctrine because it is a mere financial obligation
cannot be reconciled with this Court’s consistent
recognition that the government violates the Takings
Clause when it seizes money tied to a particular
property interest. See, e.g., Webb’s Fabulous Pharmacies v. Beckwith, 449 U.S. 155, 163-65 (1980); Brown
v. Legal Found. of Wash., 538 U.S. 216, 236, 240
(2003). Indeed, Koontz cited these precedents, along
with cases recognizing the seizure of a lien as a taking,
for the proposition that a monetary obligation may
trigger Nollan and Dolan. 570 U.S. at 613, 616-17
(citing Armstrong, 364 U.S. at 44-49, and Louisville
Joint Stock Land Bank v. Radford, 295 U.S. 555, 60102 (1935)). Relatedly, the court below mistakenly
focused on the residents’ lack of entitlement to
conversion, App. 18a-19a, something that is never
relevant in this Court’s unconstitutional conditions
precedent because there is no need to apply for
something to which one is automatically entitled.
This case presents a clean vehicle to resolve these
important conflicts. The New York Court of Appeals
addressed only whether Nollan and Dolan apply
where the permitting agency demands money not in
lieu of a demand that the applicant cede a real
property interest. There is no credible argument that
the Arts Fund fee is a tax or user fee. So, much like
Koontz and Sheetz, this petition presents only the
predicate question of law: whether the City must
satisfy the nexus and proportionality tests before it
can force selected residents to subsidize public art in
5
exchange for a conversion permit. Whether the Arts
Fund fee can satisfy these tests will be left to the lower
courts on remand. Here, the Court need only answer
a pure question of law that has percolated in the lower
courts for more than a decade. A clear answer would
provide much-needed certainty to landowners and
permitting authorities confronted with monetary
conditions applied to millions of land-use permits
sought each year across America.
OPINIONS BELOW
The opinion of the New York Court of Appeals
(App. 1a) will be reported and is currently available at
2026 WL 88133. The opinion of the Appellate Division
(App. 54a) is reported at 233 A.D. 3d 433. The opinion
of the Supreme Court of New York (App. 58a) is
unpublished, but available at 2023 WL 6535289.
JURISDICTION
The judgment of the New York Court of Appeals
was entered on January 13, 2026. This Court has
jurisdiction under 28 U.S.C. § 1257.
CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED
The Fifth Amendment to the United States
Constitution provides, in relevant part, “nor shall
private property be taken for public use, without just
compensation.”
New York City Zoning Resolution 143-13, in
relevant part, is reprinted at App. 81a.
6
STATEMENT OF THE CASE
A. History of Land Use in SoHo and NoHo
SoHo and NoHo are lower Manhattan neighborhoods centered around Houston Street. 1 Between the
Civil War and World War II, both neighborhoods were
important manufacturing centers. App. 4a. But
manufacturing began to decline in the postwar years,
and by the 1960s the neighborhoods contained many
vacant buildings. Ibid. These abandoned cast-iron
lofts, with their large floor plans, high ceilings, and
sturdy floors, attracted many artists to the area. Ibid.
But SoHo and NoHo were still zoned for
manufacturing use, so artists living and working in
the lofts were engaged in a nonconforming use. See
App. 4a, 50a.
To rectify this situation, in 1971 the state
legislature enacted Article 7-B of the Multiple
Dwelling Law.
The law established a new
designation—“joint living-work quarters for artists,”
or JLWQA—and allowed artists to convert manufacturing lofts to JLWQA to legalize their occupancy
as long as they met certain health and safety
standards. N.Y. Mult. Dwell. §§ 275-278. Gradually,
the legislature allowed conversion of different types of
manufacturing units to JLWQA. See, e.g., id. §§ 280287.
New York City continued to zone the areas for
manufacturing use, prohibiting general residential
SoHo is short for “South of Houston Street;” NoHo for “North
of Houston Street.” See App. 3a.
1
7
and retail use. Envision at 36. 2 City zoning law
permitted only those who were certified as artists by
the Department of Cultural Affairs, and their
families, to occupy JLWQA homes. App. 4a-5a, 60a.
The JLWQA restriction was legally designated as a
manufacturing use. 3 It sought to balance legalizing
the artists’ residences with the City’s desire to protect
the neighborhoods’ remaining manufacturing jobs
from large-scale residential and retail development.
Envision at 40.
Yet the City never effectively enforced the artist
restriction. By 1983, a Department of City Planning
survey showed that certified artists occupied only 30%
of JLWQA units. Envision at 39. In 1986 the City
passed an “interim” measure that allowed non-artists
to remain in their homes and permitted family
members of certified artists to remain there when the
artists moved out or died. See App. 6a. Meanwhile,
the number of artists the City certified each year
plunged, effectively eliminating any legal market for
JLWQA-designated homes. Envision at 39. The
City’s non-enforcement of the JLWQA restriction
combined with a lack of eligible artist-buyers rendered
the JLWQA designation obsolete. App. 56a (acknowledging the Envision Report’s conclusion that the
JLWQA restriction is “outdated”). Consequently,
2 The Department of City Planning’s November 2019
“Envision SoHo/NoHo” Report was part of the record below and
referenced in the court’s opinions. See, e.g., App. 4a-6a. It is cited
as “Envision” here for clarity.
It is available at
https://tinyurl.com/3873s7ew (last visited Apr. 6, 2026).
3 The purpose of JLWQA was “to protect residences from an
undesirable environment and to ensure the reservation of
adequate areas for industrial development.” Zoning Resolution
41-11 (1971), https://tinyurl.com/3r9npb78.
8
SoHo and NoHo grew into
neighborhoods they are today.
the
mixed-use
B. The Rezoning and the Arts Fund Fee
This situation persisted until 2018, when the City
finally endeavored to update the zoning in SoHo and
NoHo. In the Envision SoHo/NoHo Report, the
Department of City Planning recognized that
“[p]olicies enshrined in zoning and other regulations
in the early 1970’s have become ineffective tools to
manage and support the vibrant mixed-use environments that define the neighborhoods today.” Envision
at 11. It recognized that “many residents who are not
certified artists are caught in legal limbo,” while
“residents who are themselves certified artists have a
limited ability to sell, rent, and grant units.” Envision
at 40. Particularly due to the dearth of certified
artists—fewer than five per year in some recent
years—“owners of market-rate rental buildings
struggle with finding certified artist tenants to comply
with legal requirements.” Ibid. The report concluded
that the JLWQA restriction was “outdated.” Envision
at 62.
But rather than simply permitting residential use
of JLWQA homes, the City proposed a “conversion”
process. To convert a JLWQA home to residential use,
an owner would have to apply for a permit and pay
into a City-administered Arts Fund.
Despite
overwhelming public opposition—including a 36-1 nay
vote from the local Community Board—the City
ultimately approved the rezoning conversion process
with the mandatory Arts Fund fee. See App. 30a-31a.
Under the 2021 Zoning Resolution, general
residential and retail uses are permitted as of right in
SoHo and NoHo except for existing JLWQA residents.
9
See App. 56a. The Zoning Resolution bans new
JLWQA units and effectively requires existing nonartist residents of such units to apply for a permit to
convert their homes to general residential use. App.
81a-82a. 4 Conversion serves no health and safety
purpose because JLWQA homes are already certified
as fit for occupation by the City’s Department of
Buildings. 5
Before applying for a conversion permit, applicants
must pay “a non-refundable contribution” to the
“SoHo-NoHo Arts Fund” in the amount of “$100 per
square foot of floor area to be converted.” App. 81a82a. 6 The City has no specific plans for its windfall
As written, the City’s rezoning effectively forced JLWQA
residents who are not certified artists (nearly all of them) to
convert or remain subject to fines or other enforcement for
maintaining a nonconforming use. See New York City Dep’t of
Buildings, Converting from JLWQA to Residential Use,
https://tinyurl.com/3wa3j2xm (last visited Apr. 6, 2026) (listing
potential enforcement mechanisms). State law now permits each
resident living in a JLWQA home on the date of the rezoning to
remain there as if he or she were a certified artist. See App. 62a.
This removed the immediate threat of displacement, but not the
eventual need to convert.
5 The parties stipulated in the trial court that conversions are
essentially ministerial undertakings because “the building
regulations applying to JLWQA and Residential UG2 are
similar.” Coalition for Fairness in SoHo & NoHo, Inc. v. City of
New York, Supreme Court, New York County, Index No.
151255/2022, NYSCEF Doc. No. 171, at 4 (June 16, 2023).
6 The amount increases annually to account for inflation.
Each additional dollar per square foot increases the overall fee
about $2,500. The current fee stands at $115.76 per square foot.
New York City Dep’t of City Planning, Rules for Special Areas,
https://tinyurl.com/3ymyv2yw (last visited Apr. 6, 2026). Thus,
the cost to apply for a conversion permit now approaches
$300,000 for most homes.
4
10
and only the vaguest constraints on how it is spent.
According to the City, the fee is designed to “support
arts programming, projects, organizations, and
facilities that promote the public presence of the arts”
in lower Manhattan and “extend[] the cultural legacy
of SoHo and NoHo generally.” App. 31a (quoting
Zoning Resolution § 143-002).
Conversions are theoretically voluntary. But in
practice, JLWQA residents have little choice but to
pay the fee and seek conversion eventually. See supra
n.4. Because so few certified artists remain, the
market for artist-restricted housing is extremely
limited. See Envision at 39-40. And the current
residents will not live forever—when a present
JLWQA owner dies, someone will have to pay the Arts
Fund fee. Eventually, all 1,636 units will have to be
converted. This will net the City a windfall of more
than $450 million, with nearly boundless discretion on
how to spend it.
C. The Lawsuit
Petitioners are JLWQA residents and a nonprofit
association representing them (“Residents”). They
challenged the Arts Fund fee in New York state
court. 7 Among other things, the Residents argued the
fee was an unconstitutional monetary exaction that
could not satisfy Nollan and Dolan. App. 71a. The
Supreme Court, New York County, upheld the Arts
Fund fee. In its view, a conversion permitting process
The Residents brought an Article 78 petition in the Supreme
Court of New York. See App. 59a-60a. An Article 78 petition is
a “special proceeding[] in which a petitioner may obtain speedy
review of state administrative action.” Whitfield v. City of New
York, 96 F.4th 504, 511 (2d Cir. 2024).
7
11
does not involve “a land use decision which
conditioned approval of development on the
dedication of property to public use.” App. 75a.
Characterizing the Arts Fund fee as a standalone
monetary exaction not related to a demand for real
property, the state trial court refused to apply Nollan
and Dolan. App. 77a.
The Appellate Division unanimously reversed. The
five-member intermediate appellate panel held that
“[t]he Arts Fund fee constitutes a permit condition for
which the ‘two-part test modeled on the unconstitutional conditions doctrine’ applies.” App. 55a-56a
(quoting Sheetz, 601 U.S. at 270-71, 274-76). It then
held that the Arts Fund fee could not satisfy either
Nollan or Dolan. As for Nollan’s nexus requirement,
the Appellate Division held that the Arts Fund fee “is
not related to any land use interest” and does not
“promote the asserted legitimate end of preserving
JLWQA stock for certified artists.” App. 56a-57a. And
the fee failed Dolan’s rough proportionality test
because “the conversion of [JLWQA] units imposes no
increased costs to the artistic community.” App. 57a.
Without evidence of impact flowing from the
conversions, no exaction could satisfy proportionality.
The City appealed to the New York Court of
Appeals, which reversed in a divided opinion. The
majority refused to apply Nollan and Dolan because it
found that the Residents “failed to identify any
compensable property interest within the meaning of
the Takings Clause that the [Arts Fund] Fee affects.”
App. 17a. According to the majority, the fee itself
could not trigger the unconstitutional conditions
doctrine as a categorical matter, because it “is not
requested ‘in lieu of’ a transfer of a private property
interest, and thus it would not constitute a
12
compensable taking if it were imposed directly rather
than as a condition of receiving a conversion permit.”
App. 17a-18a; see also App. 20a-25a (reading Koontz
to extend Nollan and Dolan only to fees demanded in
lieu of a dedication of real property).
Judge Halligan concurred. She agreed with the
majority’s reading of Koontz “as applying only to
monetary conditions which are offered as an alternative to a condition that would be a per se taking if
imposed directly.” App. 27a. But she recognized that
applying Nollan and Dolan to monetary exactions
“has some merit, and it may well eventually prevail.”
Ibid. And she cast doubt on some of the majority’s
rationales, writing that she was “not persuaded that
the lack of any entitlement to conversion or
diminishment in the value of a JLWQA unit resolves
the question before us.” App. 26a.
Judge Garcia dissented. In his view, Koontz
requires that “such monetary exactions as conditions
on permit approvals be examined under the Nollan/
Dolan standard.” App. 41a. Judge Garcia explained
that Koontz itself did not involve an in-lieu fee and
nothing in the opinion limits it to such fees. App. 41a42a. Instead, a monetary exaction triggers the
unconstitutional conditions doctrine because the
demand is “linked to a specific identifiable property
interest such as . . . parcel of real property,” which
renders the fee itself the predicate taking. App. 44a
(quoting Koontz, 570 U.S. at 614). Proceeding to apply
Nollan and Dolan, Judge Garcia agreed with the
Appellate Division that the Arts Fund fee failed both
tests and is an unconstitutional condition. App. 51a53a.
13
REASONS FOR GRANTING THE PETITION
The New York Court of Appeals’ categorical
holding that the unconstitutional conditions doctrine
does not reach monetary exactions unless they are
imposed in lieu of a dedication of real property
squarely conflicts with the decisions of the North
Carolina Supreme Court and several other state
courts interpreting Koontz. It also diverges from preKoontz precedent applying heightened scrutiny to
monetary demands. Left uncorrected, the Court of
Appeals’ rule threatens to swallow the protections the
Fifth Amendment provides land-use permit applicants against extortionate government demands.
Clarity on this point is essential because land-use
permitting is ubiquitous across all jurisdictions,
affecting millions of landowners. This case presents a
clean vehicle to resolve the split. The Court should
grant the petition.
I.
The Decision Below Opens a Split Among
State High Courts Over Whether Monetary
Exactions Trigger the Unconstitutional
Conditions Doctrine
The New York Court of Appeals’ decision
exacerbates confusion in the lower courts as to which
monetary exactions are subject to Nollan/Dolan
scrutiny. The majority below held that the unconstitutional conditions doctrine provides land-use permit
applicants no protection against extortionate fees
unless the government imposes the fee in lieu of
requiring a dedication of real property. App. 17a-25a.
By contrast, the North Carolina Supreme Court in
Anderson Creek held that “the ‘monetary exactions’
with which Koontz was concerned were not limited to
‘in lieu of’ fees and, instead, encompassed a broader
14
range of governmental demands for the payment of
money as a precondition for the approval of a land-use
permit.” 876 S.E.2d at 496.
The existing split harkens back to the one this
Court addressed more than a decade ago in Koontz.
After Nollan and Dolan established limits on the
government’s power to use the permitting process to
extract property concessions from applicants, several
state high courts applied these protections to purely
monetary exactions. See N. Ill. Home Builders Ass’n,
Inc. v. Cnty. of Du Page, 165 Ill. 2d 25, 30-33 (1995)
(traffic impact fee); Ehrlich v. City of Culver City, 12
Cal. 4th 854, 859, 862, 874-76 (1996) (recreation and
art fees); Home Builders Ass’n of Dayton & the Miami
Valley v. Beavercreek, 89 Ohio St. 3d 121, 124, 128
(2000) (traffic impact fee); Town of Flower Mound v.
Stafford Estates Ltd. P’ship, 135 S.W.3d 620, 622, 63940 (Tex. 2004) (traffic impact fee). Others disagreed.
See Krupp v. Breckenridge Sanitation Dist., 19 P.3d
687, 691, 697 (Colo. 2001) (plant investment exaction
not subject to Nollan and Dolan); McCarthy v. City of
Leawood, 257 Kan. 566, 568, 580 (1995) (refusing to
apply Dolan to a traffic impact fee on the ground that
“[t]here is nothing in the opinion . . . which would
apply the same conclusion to Leawood’s conditioning
certain land uses on payment of a fee”); Home Builders
Ass’n of Cent. Ariz. v. City of Scottsdale, 187 Ariz. 479,
480, 486 (1997) (refusing to apply Dolan to a water
resources fee, distinguishing it on the ground that a
fee is a “considerably more benign form of regulation”
than a real property exaction).
Koontz also involved a purely monetary exaction.
The permitting agency refused to issue a development
permit unless Mr. Koontz agreed to finance improvements to government land miles away. 570 U.S. at
15
601-02. The Florida Supreme Court sided with those
courts that limited Nollan and Dolan to demands for
real property. It held the unconstitutional conditions
doctrine inapplicable because the government “did not
condition approval of the permits on Mr. Koontz
dedicating any portion of his interest in real property
in any way to public use.” St. Johns River Water
Mgmt. Dist. v. Koontz, 77 So. 3d 1220, 1231 (Fla.
2011). In short, the Florida Supreme Court held that
Mr. Koontz could not claim the protection of Nollan
and Dolan because the government demanded money,
not real property, in exchange for a permit grant.
This Court granted certiorari to resolve the split
among state high courts over whether Nollan and
Dolan “apply to a land-use exaction that takes the
form of a government demand that a permit applicant
dedicate money, services, labor, or any other type of
personal property to a public use.” Petition for Writ of
Certiorari, Koontz v. St. Johns River Water Mgmt.
Dist., No. 11-1447, 2012 WL 1961402, at *i-ii (U.S.
May 30, 2012). It answered yes, holding that Nollan
and Dolan protect land-use permit applicants against
extortionate demands “even when [the] demand is for
money.” Koontz, 570 U.S. at 619.
After Koontz, courts initially acknowledged that a
monetary demand could serve as the predicate taking
to trigger the protections of the unconstitutional
conditions doctrine. Describing Koontz, a unanimous
Utah Supreme Court wrote that “[u]ntil relatively
recently,” this Court applied Nollan and Dolan “only
where the government demanded a real property right
in exchange for a land-use permit.” Alpine Homes,
Inc. v. City of W. Jordan, 424 P.3d 95, 103 (Utah
16
2017). 8 “But in Koontz, the Court examined a fact
pattern in which the government essentially
demanded money in exchange for a land-use permit.”
Ibid. As a result, the court explained that Koontz held
“a demand for money in exchange for a land-use
permit is an unconstitutional condition under the
takings clause unless the government can show an
essential nexus and rough proportionality between
the amount of money requested and the social costs of
the proposed development.” Id. at 104.
But the story did not end there. Seeking to pare
back Nollan and Dolan, permitting authorities began
to argue that Koontz extended their protections only
to demands made in lieu of a required dedication of
real property. The government tried this in Anderson
Creek, defending an ordinance that required “developers to pay one-time water and sewer ‘capacity use’
fees associated with each lot that they wish to
develop” in exchange for the necessary permit
approvals. 876 S.E.2d at 479, 506; see id. at 491-92
(summarizing the government’s in-lieu argument).
But the North Carolina Supreme Court rejected it,
holding that “the ‘monetary exactions’ with which
Koontz was concerned were not limited to ‘in lieu of’
fees and, instead, encompassed a broader range of
governmental demands for the payment of money as
a precondition for the approval of a land-use permit.”
Id. at 496; see also Charter Twp. of Canton v. 44650,
Inc., 12 N.W.3d 56, 75 (Mich. Ct. App. 2023) (“Koontz
did not limit the applicability of the unconstitutionalconditions doctrine to money demands in lieu of
dedication”); Levin v. City & Cnty. of San Francisco,
The court ultimately ordered dismissal of the takings claims
on procedural grounds. Id. at 101.
8
17
71 F. Supp. 3d 1072, 1082-83 (N.D. Cal. 2014)
(applying Nollan and Dolan to a tenant relocation fee
charged in exchange for a permit to remove a unit
from the rental market).
Then came this Court’s decision in Sheetz. Like
many pre-Koontz exactions cases cited above, Sheetz
involved a traffic impact fee. The Court unanimously
reversed the California Court of Appeal’s holding that
Nollan and Dolan do not apply to legislativelyimposed permit conditions, 601 U.S. at 271, explaining that “there is no basis for affording property rights
less protection in the hands of legislators than
administrators.” Id. at 279. But Justice Sotomayor’s
concurrence observed that, in dismissing Mr. Sheetz’s
claim on the pleadings, the California courts had not
determined whether the County’s traffic impact fee
would be a taking if demanded outside the permitting
context—a necessary finding to trigger the
unconstitutional conditions doctrine. Id. at 280-81
(Sotomayor, J., concurring).
That observation caused further confusion, as some
read it to suggest that whether impact fees are subject
to Nollan and Dolan remains an open question.
Relying in part on that reading, the New York Court
of Appeals below diverged from Anderson Creek to
hold that the protections of Nollan and Dolan do not
apply to all monetary exactions, but only to those
imposed in lieu of a required dedication of real
property. See App. 16a-17a (relying on Justice
Sotomayor’s Sheetz concurrence). It read Koontz as a
case where “[t]he unconstitutional conditions doctrine
was invoked to prevent the government from coercing
the landowner into giving up not the money itself, but
instead the easement that the fee was demanded in
lieu of.” App. 21a. With this understanding, it
18
categorically limited Koontz to in-lieu fees. 9 Many
other courts have followed Anderson Creek’s
reasoning. Most prominently, after remand in Sheetz,
El Dorado County for the first time raised the
argument that Koontz applies only to in-lieu fees. 10
The Court of Appeals’ divergence was at least in part due to
its misunderstanding of the facts of Koontz. Koontz did not
involve an in-lieu fee. The Florida courts understood the demand
as a pure monetary exaction. St. Johns River Water Mgmt. Dist.
v. Koontz, 5 So. 3d 8, 12 (Fla. Dist. Ct. App. 2009) (observing that
the condition “did not involve a physical dedication of land but
instead a requirement that Mr. Koontz expend money to improve
land belonging to the District”). Had the exaction been an in-lieu
fee, it would have been subject to heightened scrutiny under
Florida’s long-established exactions doctrine.
See, e.g.,
Hollywood, Inc. v. Broward Cnty., 431 So. 2d 606, 611-12 (Fla.
Dist. Ct. App. 1983). Under those circumstances, the dispute
likely never would have reached the Florida Supreme Court.
Thus, this Court’s discussion of in-lieu fees in Koontz, 570 U.S.
at 612, is best understood not as “limiting the reach” of the
decision but “simply being a response to the Florida Supreme
Court’s conclusion that a governmental demand for money rather
than an interference in tangible property rights did not
constitute a taking.” Anderson Creek, 382 N.C. at 28.
10 The posture of Sheetz is another example of how Justice
Sotomayor’s concurrence triggered confusion. Before this Court’s
decision, the parties and the courts assumed the traffic impact
fee was an exaction that would trigger the unconstitutional
conditions doctrine if it had been imposed administratively.
Sheetz v. Cnty. of El Dorado, 84 Cal. App. 5th 394, 405 (2022) (“A
land use exaction occurs when the government demands real
property or money from a land use permit applicant as a
condition of obtaining a development permit.”); County of El
Dorado Response Br., Sheetz v. Cnty. of El Dorado, No. C093682,
2022 WL 1570886, at *31-39 (Cal. Ct. App. Apr. 14, 2022)
(acknowledging that “development fees” are exactions). That’s
because California precedent had long acknowledged impact fees
triggered Nollan and Dolan. See Ehrlich, 12 Cal. 4th at 874-76;
All. for Responsible Plan. v. Taylor, 63 Cal. App. 5th 1072, 1085,
1087 (2021).
9
19
The California Court of Appeal rejected it, instead
confirming that a government conditioning a building
permit on the payment of a traffic impact fee must
satisfy Nollan and Dolan. Sheetz v. Cnty. of El
Dorado, 335 Cal. Rptr. 3d 316, 331 (Ct. App. 2025)
(opinion on remand subsequently ordered depublished), petition for writ of certiorari pending, No. 25958. 11 Other courts agreed, whether explicitly or by
implication. See, e.g., 225 Northport, LLC v. Vill. of
Northport, No. 24-CV-2967, 2025 WL 2782360
(E.D.N.Y. Sep. 30, 2025) (“as Koontz makes clear,
building permit fees must satisfy Nollan and Dolan”);
Tap House Real Est., LLC v. City of Rochester, No. 22cv-492, 2024 WL 3470824 (D. Minn. Jul. 19, 2024)
(applying Nollan and Dolan to traffic-impact fee
permit condition and denying motion to dismiss).
Underscoring the stark divide that now exists, both
Anderson Creek and the decision below drew spirited
dissents.
The opinions debate whether Koontz
involved an in-lieu fee. Compare App. 40a-41a
(Garcia, J., dissenting), with Anderson Creek, 876
S.E.2d at 507-08 (Earls, J., dissenting). They also
delve into the implications of applying the limitations
of Nollan and Dolan to monetary exactions. See App.
23a (majority opinion) (expressing fear that “every fee
imposed by the government in connection with a landuse permit would constitute a taking and would need
to be ‘properly tailored to pass the Nollan/Dolan test.’”
(quoting App. 44a (Garcia, J., dissenting))); Anderson
Creek, 876 S.E.2d at 507 (Earls, J., dissenting) (calling
11 The court ultimately held the fee satisfied Nollan and Dolan.
See id. at 333. This demonstrates the difference between finding
a monetary exaction subject to Nollan and Dolan and actually
invalidating it as an unconstitutional condition.
20
the application of Nollan and Dolan to monetary
exactions “an unwarranted and unwise expansion of
the scope of the Takings Clause that will engender
frequent litigation and may ultimately diminish the
capacity of municipalities to recoup fees to offset the
costs of maintaining vital public infrastructure”).
Only this Court can resolve this conflict.
Ultimately, in diverging from the consensus and
limiting the reach of Nollan and Dolan, the New York
Court of Appeals decision echoes what the Florida
Supreme Court did in Koontz. The Court should
likewise grant this petition.
II. The Decision Below Conflicts with Multiple
Strands of This Court’s Precedent and
Creates an End Run Around Nollan and
Dolan
In holding that Nollan and Dolan do not apply to a
monetary demand in exchange for a permit, the New
York Court of Appeals misapplied two lines of this
Court’s precedent to create a new categorical defense
to unconstitutional conditions claims predicated on
the Takings Clause. Cf. Arkansas Game & Fish
Comm’n v. United States, 568 U.S. 23, 31-32 (2012)
(admonishing against such creation of new categorical
defenses).
If the majority’s reasoning below
proliferates, these mistakes will undermine the Fifth
Amendment’s vital protection against government
extortion in land-use permitting. The Court of
Appeals’ decision is a road map for permitting
authorities to avoid the constitutional limits on their
power—limits this Court has zealously guarded for
four decades.
21
A. The decision below incorrectly assumed
that a monetary obligation can never be
the object of a takings claim
Key to the Court of Appeals’ holding that a
monetary exaction cannot trigger the unconstitutional
conditions doctrine was the majority’s assumption,
contrary to Koontz, that a monetary obligation can
never be a taking. The majority correctly explained
that a landowner must demonstrate the challenged
permit condition would be a taking on its own to
trigger the doctrine. See App. 17a. But it was wrong
to conclude that a monetary exaction like the Arts
Fund fee can never be the predicate taking.
Outside the exactions context, it is well settled
that, in some circumstances, money can be the
property interest supporting a takings claim. In
Webb’s Fabulous Pharmacies, this Court unanimously
held that Florida could not take the interest from an
interpleader account simply by declaring the principal
to be public property because it was in the state court’s
possession. 449 U.S. at 164. In Brown, too, the Court
recognized that the transfer of interest in an IOLTA
account would be a per se physical taking “akin to the
occupation of a small amount of rooftop space in
Loretto [v. Teleprompter Manhattan CATV Corp., 458
U.S. 419 (1982)].” 538 U.S. at 217-18. And in Village
of Norwood v. Baker, the Court found a taking when
the government demanded money to pay the public’s
cost to condemn an owner’s property for new roads,
holding that “the exaction from the owner of private
property of the cost of a public improvement in
substantial excess of the special benefits accruing to
him is, to the extent of such excess, a taking.” 172
U.S. 269, 279 (1898).
22
On the other hand, in Eastern Enterprises v. Apfel,
the Court considered an Act of Congress that imposed
a “severe, disproportionate, and extremely retroactive
burden” on some coal companies to pay retirement
benefits for miners and their dependents. 524 U.S.
498, 538 (1998) (plurality opinion). Four justices
would have held that such a burden effected a taking.
Id. But Justice Kennedy’s controlling opinion held
that even the imposition of a “staggering financial
burden” is not a taking if it “does not operate upon or
alter an identified property interest.” Id. at 540
(Kennedy, J., concurring in the judgment and
dissenting in part). He instead found the Act’s
retroactive liability violated the Due Process Clause,
providing the fifth vote to invalidate it. Id. at 547.
Koontz reconciled these disparate strands. It held
that a permit condition demanding money is different
than a stand-alone monetary obligation because the
permit condition “operate[s] upon . . . an identified
property interest” when it “direct[s] the owner of a
particular piece of property to make a monetary
payment” as a condition of receiving a permit. Koontz,
570 U.S. at 613-14. The Koontz Court viewed the
monetary demand in exchange for a permit as a taking
just like the money from the specific accounts in
Brown and Webb’s, or “cases holding that the
government must pay just compensation when it
takes a lien—a right to receive money that is secured
by a particular piece of property.” Id. at 612-13 (citing
Armstrong, 364 U.S. at 44-49; Louisville Joint Stock
Land Bank, 295 U.S. at 601-02; United States v. Sec.
Indust. Bank, 459 U.S. 70, 77-78 (1982).
In short, “when the government commands the
relinquishment of funds linked to a specific, identifiable property interest such as a bank account or
23
parcel of real property, a ‘per se [takings] approach’ is
the proper mode of analysis under the Court’s
precedent.” Koontz, 570 U.S. at 614 (quoting Brown,
538 U.S. at 235). This is the key characteristic that
connects the dots; the reason why a pure monetary
exaction may be the predicate taking supporting an
unconstitutional conditions claim.
“[U]nlike in
Eastern Enterprises,” a monetary exaction “burden[s]
. . . ownership of a specific piece of land.” Id. at 613.
Unconstitutional conditions scrutiny attaches because
of “the direct link between the government’s demand
and a specific parcel of real property.” Id. at 614. It
is this link that “implicates the central concern of
Nollan and Dolan”—that the government will abuse
its discretion over permitting to extort property from
the permit applicant unrelated to the government’s
legitimate interest in mitigating the impact of the
applicant’s land use. Ibid.
Despite this, the New York Court of Appeals
adopted a categorical rule that a monetary permit
demand can never serve as the predicate taking
unless it operates in lieu of a demand for real
property. The bright line rule allowed the Arts Fund
fee to sidestep Nollan/Dolan scrutiny even though the
intermediate appellate court unanimously found the
fee lacks any connection to a legitimate land-use
interest. App. 56a-57a. And the fee avoided scrutiny
despite the substantial impact it has on the Residents’
ownership of their homes. Put simply, the connection
between the monetary demand and the use and
ownership of the burdened property exists whether
the demand is for money or real property. Both are
subject to the coercive, extortionate demands that the
unconstitutional conditions doctrine protects against.
Nollan, 483 U.S. at 837 (California Coastal Commis-
24
sion’s exaction requirement was an “out-and-out plan
of extortion”) (citation omitted); Koontz, 570 U.S. at
606 (majority opinion) (same); Sheetz, 601 U.S. at 275
(“Our decisions in Nollan and Dolan address this
potential abuse of the permitting process.”).
The Court of Appeals’ failure to recognize these key
principles led it to embrace a categorical rule that
threatens to eviscerate the Fifth Amendment’s
protections for land-use permit applicants and upend
decades of precedent in many jurisdictions holding
fees subject to Nollan and Dolan. The majority below
recognized no practical limit on how much money the
government may demand in exchange for a land-use
permit. 12 But money is property. That it is fungible
does not remove it from the protection of the Takings
Clause. There is no practical difference between this
result and the outcomes the Court sought to prevent
in Nollan, Dolan, and Koontz. 13 This Court’s review
12 The
concurring opinion below gestured towards potential
limits imposed by the Due Process Clause. But as the opinion
itself recognized, prevailing on a due process theory would
require a showing that the fee is “wholly arbitrary.” App. 28a;
see also Koontz, 570 U.S. at 629 n.3 (Kagan, J., dissenting) (“[T]he
Due Process Clause provides an additional backstop against
excessive permitting fees by preventing a government from
conditioning a land-use permit on a monetary requirement that
is ‘basically arbitrary.’” (quoting Eastern Enterprises, 524 U.S. at
557-58 (Breyer, J., dissenting))). This is not a meaningful limit
on the government’s permitting leverage. Very rarely will a court
find that an ordinance is “clearly arbitrary and unreasonable,
having no substantial relation to the public health, safety,
morals, or general welfare.” Vill. of Euclid v. Ambler Realty, 272
U.S. 365, 395 (1926).
13 This doesn’t mean that permit review fees would trigger
Nollan/Dolan scrutiny. Unlike exactions ostensibly designed to
mitigate some impact of the permitted land use, application fees
25
is necessary to ensure the continuing vitality of its
land-use exactions precedent.
B. The decision below incorrectly assumed
that application of the unconstitutional
conditions doctrine depends upon the
owner’s entitlement to the land use
The Court of Appeal's decision also rests on a
fundamental “misunderstanding of how the unconstitutional conditions doctrine operates.” App. 48a
(Garcia, J., dissenting). The majority defends limiting
Nollan and Dolan with an observation that
“Petitioners knowingly assumed a property interest in
JLWQA-restricted spaces.” App. 18a. The crux of this
point is that the Residents are not entitled to
conversion. See also App. 26a (Halligan, J., concurring) (“I am not persuaded that the lack of any
entitlement to conversion . . . resolves the question
before us”). But lack of entitlement does not matter
in the unconstitutional-conditions analysis. This was
true long before this Court applied the doctrine to
land-use permitting in Nollan.
By design, the
doctrine protects those who had no preexisting right
to the permit, license, or benefit they sought from
being coerced into surrendering a constitutional right.
See William W. Van Alstyne, The Demise of the Right-
are user fees calculated to offset the administrative costs of
processing a permit. Under New York law, these fees “must be
. . . reasonably necessary to the accomplishment of the regulatory
program.” Suffolk Cnty. Builders Ass’n, Inc. v. Suffolk Cnty., 46
N.Y.2d 613, 619 (1979). New York City, of course, does not claim
that the six-figure fees demanded in this case were necessary to
defray the cost of administering conversion permits. Nollan and
Dolan apply only to conditions relating to the proposed land use.
26
Privilege Distinction in Constitutional Law, 81 Harv.
L. Rev. 1439, 1445-47 (1968) (collecting cases).
The roots of the unconstitutional conditions
doctrine stretch back more than a century. In the
nineteenth century, it was generally accepted that if
one had no right to a particular benefit, the government could condition receipt of the benefit on anything
it would like. In one famous case, Justice Holmes
wrote that a policeman fired for his political speech
“may have a constitutional right to talk politics, but
he has no constitutional right to be a policeman.”
McAuliffe v. City of New Bedford, 29 N.E. 517, 517
(Mass. 1892). But even then, some began to argue
that “[t]he argument used, that the greater always
includes the less, and, therefore, if the State may
exclude the appellees without any cause, it may
exclude them for a bad cause, is not sound.” Doyle v.
Cont’l Ins. Co., 94 U.S. (4 Otto.) 535, 543-44 (1876)
(Bradley, J., dissenting).
This view eventually won out. Since then, the
Court has applied the unconstitutional conditions
doctrine to protect the exercise of many constitutional
rights. For example, even though individuals have no
right to continued government employment, they
generally cannot be fired for exercising their First
Amendment right to speak on a matter of public
concern. See Connick v. Myers, 461 U.S. 138, 142
(1983) (“For at least 15 years, it has been settled that
a state cannot condition public employment on a basis
that infringes the employee’s constitutionally
protected interest in freedom of expression.”). Even
though nonprofit organizations have no right to
government funding, the government cannot “seek to
leverage funding” it provides to a nonprofit organization “to regulate speech outside the contours of the
27
program itself.” Agency for Int’l Dev. v. All. for Open
Soc’y Int’l, Inc., 570 U.S. 205, 214-15 (2013). And
although there is no federal right to receive public
assistance, this Court has long held that the
government cannot leverage an applicant’s benefits
application by requiring the applicant to give up his
constitutional right to travel. Shapiro v. Thompson,
394 U.S. 618 (1969) (invalidating one-year waiting
period for new residents of a jurisdiction to receive
public assistance); Graham v. Richardson, 403 U.S.
365 (1971) (invalidating state statute requiring
resident aliens to reside in the state for 15 years
before receiving public assistance); Mem’l Hosp. v.
Maricopa Cnty., 415 U.S. 250 (1974) (invalidating
state statute requiring an individual to reside in a
county for a year as a condition on the receipt of
nonemergency medical care at the county’s expense).
Nollan and Dolan are heirs to this tradition. The
exactions cases “‘involve a special application’ of this
doctrine that protects the Fifth Amendment right to
just compensation for property the government takes
when owners apply for land-use permits.” Koontz, 570
U.S. at 604 (quoting Lingle v. Chevron U.S.A. Inc., 544
U.S. 528, 547 (2005)). And just like the other
applications, Nollan, Dolan, Koontz, and Sheetz are
not concerned with whether a permit applicant is
otherwise entitled to the permit. Nor do they care
whether the permit applicant knew about the permitting limitation upon acquisition of the property. See
Palazzolo v. Rhode Island, 533 U.S. 606, 629 (2001)
(explaining that the Nollan Court rejected the
dissenting argument that the owner’s unconstitutional conditions claim should have failed because he
was on notice of the Coastal Commission’s policy
requiring permit applicants to dedicate a lateral
28
access easement). On the contrary, the entire premise
of these cases is that the government can deny the
permit. 14 It is the government’s power to say “no” that
gives it the leverage to impose conditions in the first
place.
Nor is there any support in this Court’s precedent
for the Court of Appeals’ related assumption that the
government may attach unrelated conditions to a
permit on the ground that receipt of the permit adds
substantial value to the applicant’s property. See App.
18a; but see Nollan, 483 U.S. at 837 & n.5 (“While a
ban on shouting fire can be a core exercise of the
State’s police power to protect the public safety, and
can thus meet even our stringent standards for
regulation of speech, adding the unrelated condition
alters the purpose to one which, while it may be
legitimate, is inadequate to sustain the ban.”). On the
contrary, Koontz understood that it is precisely
because “the government often has broad discretion to
deny a permit that is worth far more than property it
would like to take” that “applicants are especially
vulnerable to the type of coercion that the
unconstitutional conditions doctrine prohibits.” 570
U.S. at 604-05.
14 To be sure, “the right to build on one’s own property—even
though its exercise can be subjected to legitimate permitting
requirements—cannot remotely be described as a ‘governmental
benefit.’” Nollan, 483 U.S. at 833 n.2. But the Nollans took title
to the property subject to the Coastal Commission’s permitting
jurisdiction, and this Court assumed the Commission’s power to
deny the permit. Id. at 837. Under the City’s theory, by applying
for a permit the Nollans sought to extend their property rights
rather than exercise their existing rights. Cf. App. 18a-19a. Yet
the unconstitutional conditions doctrine protected them all the
same.
29
Of course, the high value of a land-use permit to
the applicant is also a strong indication that the
permit would confer upon the landowner the ability to
use his property in a way he couldn’t without a permit.
In all four of this Court’s exactions cases, the value of
the permitted activity far exceeded the cost of the
exaction. See Nollan, 483 U.S. at 827-29 (permit
approved for the improvement of a condemned
bungalow into a modern home); Dolan, 512 U.S. at 379
(permit approved to double the size of a hardware
store and expand the parking area); Koontz, 570 U.S.
at 601-02 (seeking a permit to improve a vacant parcel
of land for commercial use); Sheetz, 601 U.S. at 272
(granting a permit to build a family home on a vacant
parcel). Far from removing the urgency, it is because
the value of the permit on offer often exceeds the value
of a coercive and unconstitutional demand that
heightened scrutiny is necessary. Koontz, 570 U.S. at
604-05.
In short, the Court of Appeals’ categorical rule is
inconsistent with the nature of the unconstitutional
conditions doctrine. The conversion permits at the
center of this case are not meaningfully different from
the land-use permits sought in Nollan, Dolan, Koontz,
or Sheetz. If permit applicants had to show a preexisting entitlement to the permit to trigger the
unconstitutional conditions doctrine, the doctrine’s
protections for property owners would amount to
little.
30
III. This Case Is an Excellent Vehicle to Address
a Question of Nationwide Importance
More than a million building permits are issued
each year in the United States. 15 Monetary exactions
like impact fees are “ubiquitous.” See Brief for Amici
Curiae City & Cnty. of San Francisco, et al., Sheetz v.
Cnty. of El Dorado, No. 22-1074, 2023 WL 8869700, at
*8 (U.S. Dec. 19, 2023). Resolution of the question
presented will determine whether permitting authorities seeking these exactions must honor the
protections of Nollan and Dolan against extortionate
demands. This is outcome determinative in many
cases, including this one, where refusal to apply
Nollan and Dolan triggered reversal of a unanimous
Appellate Division ruling.
New York alone saw more than 46,000 building
permits issued in 2024. See supra n.15. Cash-hungry
localities now face only theoretical limits in imposing
extortionate fees. Without the protections of Nollan
and Dolan, little exists to stop them from demanding
more and more—say, rather than $100 per square foot
into an Arts Fund, $250 per square foot into the
general fund, which would amount to nearly
$1 billion. And the New York Court of Appeals has
always been one of the most influential state high
courts nationwide, influencing state and federal
courts alike. See Lawrence M. Friedman et al., State
Supreme Courts: A Century of Style and Citation, 33
Stan. L. Rev. 773, 804-06 (1981) (showing historical
influence); In re Black Diamond Min. Co., LLC, 507
B.R. 209, 217 (E.D. Ky. 2014) (“federal courts often
15 See Nat’l Ass’n of Home Builders, Building Permits by State
and Metro Areas, https://tinyurl.com/562wfmbv (last visited
Apr. 6, 2026).
31
look to the New York Court of Appeals’ influential
opinion in Sage Realty as persuasive authority on the
scope of federal privilege”). The decision below invites
permitting authorities to evade the Fifth Amendment’s protections in the many jurisdictions where the
law is unsettled. Only this Court’s intervention can
settle the law nationwide.
This case presents a clean vehicle to do so. The
contours of New York City’s permitting regime are
clear and undisputed. The case arrives from a final
judgment of the state’s highest court, after which 12
state appellate judges—five of the Appellate Division
and the seven Court of Appeals judges—divided 6-6 on
the question presented. Perhaps most importantly,
resolving the question presented would not require
the Court to delve into fact-intensive questions to
determine whether the Arts Fund fee could satisfy
Nollan and Dolan. Like in Koontz, that work would
be left for the state courts on remand. See St. Johns
River Water Mgmt. Dist. v. Koontz, 183 So. 3d 396
(Fla. Dist. Ct. App. 2014) (Florida Court of Appeals
ruling on remand after Koontz).
Courts across the country have weighed in on the
important question presented, including divided
opinions from the high courts of New York and North
Carolina. The time is ripe for this Court to decide it.
32
CONCLUSION
The petition for a writ of certiorari should be granted.
Respectfully submitted,
J ACK L. L ESTER
41 Squaw Road
East Hampton, NY 11937
(631) 604-2228
CHRISTOPHER M. K IESER
Counsel of Record
BRIAN T. H ODGES
Pacific Legal Foundation
555 Capitol Mall,
Suite 1290
Sacramento, CA 95814
(916) 419-7111
ckieser@pacificlegal.org
D EBORAH J. L A F ETRA
JONATHAN HOUGHTON
Pacific Legal Foundation
3100 Clarendon Blvd.,
Suite 1000
Arlington, VA 22201
(202) 888-6881
Counsel for Petitioners
APRIL 2026
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.