Amicus Curiae Brief — Commercial Builders v. City of Sacramento

aa Supreme Court, U.S

( 2) FILED

No. 91-1556 APR 22 1992

OFFICE THE CLERK

IN THE OFFICE OF

Supreme Court of the Anited States

OCTOBER TERM, 1991

COMMERCIAL BUILDERS OF NORTHERN CALIFORNIA,

and its affected members,

Petitioner,

Vs

City OF SACRAMENTO, CALIFORNIA, et al.,

Respondents.

On Petition for Writ of Certiorari to the

United States Court of Appeals for the Ninth Circuit

NATIONAL ASSOCIATION OF HOME BUILDERS,

INTERNATIONAL COUNCIL OF SHOPPING CENTERS,

ASSOCIATION FOR COMMERCIAL REAL ESTATE,

NATIONAL REALTY COMMITTEE,

NATIONAL MULTI HOUSING COUNCIL, AND

NATIONAL APARTMENT ASSOCIATION

MOTION FOR LEAVE TO FILE A BRIEF

AMICI CURIAE

AND BRIEF IN SUPPORT OF THE PETITION

WILLIAM H. ETHIER

CoHN & BIRNBAUM, P.C.

100 Pearl Street

Hartford, CT 06103-4500

(203) 493-2200

Counsel of Record

April 22, 1992

Silicate mination eetnenendenienaetenene eeemeemenmnctnenedimeennneaeaianaenennetaneaneeneeee

PRESS OF BYRON S. ADAMS, WASHINGTON, D.C. (202) 347-8203

IN THE

Supreme Court of the GAnited States

OCTOBER TERM, 1991

No. 91-1556

COMMERCIAL BUILDERS OF NORTHERN CALIFORNIA,

and its affected members,

Petitioner,

¥e

CITY OF SACRAMENTO, CALIFORNIA, et al.,

Respondents.

On Petition for Writ of Certiorari to the

United States Court of Appeals for the Ninth Circuit

NATIONAL ASSOCIATION OF HOME BUILDERS,

INTERNATIONAL COUNCIL OF SHOPPING CENTERS,

ASSOCIATION FOR COMMERCIAL REAL ESTATE,

NATIONAL REALTY COMMITTEE,

NATIONAL MULTI HOUSING COUNCIL, AND

NATIONAL APARTMENT ASSOCIATION

MOTION FOR LEAVE TO FILE A BRIEF AMICI

CURIAE

The National Association of Home Builders (NAHB),

et al., respectfully move this Court for leave to file

the accompanying brief amici curiae in support of

Petitioners.

These amici curiae have received the petitioner’s

written consent to file this brief in support of

petitioner and have filed the letter of consent with

the Clerk of this Court. The respondent city has not

responded to our request for consent to file a brief

in support of the petition.

The NAHB represents 157,000 builder and associ-

ate members organized in approximately 850 affiliated

state and local associations in all fifty states, the Dis-

trict of Columbia, and Puerto Rico. Its members in-

clude not only people and firms that construct and

supply single-family homes but also apartment, con-

dominium, commercial and industrial builders, as well

as land developers and remodelers. It is the voice of

the American shelter industry.

The International Council of Shopping Centers

(ICSC) is the trade association of the shopping center

industry. It has approximately 24,000 members world-

wide and approximately 22,000 in the United States.

Its members, including developers, owners, retailers,

lenders and all others having a professional interest

in the shopping center industry, are engaged in the

day-to-day activities of designing, planning, construct-

ing, managing, financing, developing, leasing and

owning shopping centers and their retail stores. It

represents almost all of the 37,000 shopping centers

in this country and is the only U.S. trade association

specific to shopping centers.

The Association for Commercial Real Estate, for-

merly the National Association of Industrial & Office

Parks, is a professional organization of more than

6,000 individuals engaged in owning, managing and

developing office and industrial buildings in the United

States and internationally. Its members include not

only the nation’s leading commercial real estate de-

velopers but als» architects, brokers, master planners,

engineers, property managers, banks, insurance com-

panies and other real estate financial groups.

The National Realty Committee represents the na-

tion’s leading developers, owners and financiers of

income-producing real property. Its members include

individuals and firms that design, plan, develop, lease,

own, operate and finance income-producing real prop-

erty, including office buildings, shopping centers, in-

dustrial buildings, warehouses and apartment

buildings.

The National Multi Housing Council (NMHC) rep-

resents the country’s larger and most respected mul-

tifamily rental housing firms. Its members are

engaged in all aspects of the development and op-

eration of rental housing including the ownership,

building, financing, management, and conversion to

condominium of such properties. The National Apart-

ment Association (NAA) is an organization of local

and state associations representing owners, builders,

investors, developers and managers of multifamily

properties. The NAA represents the interests of more

than 200,000 multifamily professionals and the mem-

bers of the NMHC and NAA together own and man-

age about one third of the nation’s approximately 24

million rental housing units.

The just compensation clause serves as a vital shield

against oppressive governmental land use regulation.

It is, therefore, of paramount importance to these

amici, all non-profit trade associations, and our mem-

bers. The actual availability of an appropriate remedy

for the occasional government action that results in

a taking is critical to the livelihood of private land-

owners who either 1) have lost all reasonable eco-

nomic use of their property solely in order to serve

the broader public (i.e., governmental) interests, or 2)

are otherwise faced with overreaching governmental

requirements including those that fail to substantially

advance legitimate governmental interests. The latter

type of governmental requirement is presented in this

case by the city’s demand that individual private prop-

erty owners pay for society’s costs of providing hous-

ing to low income persons. That affordable housing

is needed by persons with low incomes is not the

question. The question is whether this housing must

be paid for by individual private property owners who

happen to provide employment opportunities for low

income people.

The NAHB has been before this Court as an amicus

curvae or as of counsel on behalf of the property

owner in prior “takings” cases involving govern-

ments’ land use decisions.. The NAHB and ICSC

joined to file an amici curiae brief in Lucas v. South

Carolina Coastal Council, No. 91-453, currently be-

fore the Court. The NAHB’s brief was favorably cited

in this Court’s Nollan opinion, 483 U.S. at 840.

Nollan is at the heart of the present controversy.

The attached brief is submitted to show the need to

resolve the question of whether a fee exacted by the

government from an individual, as a condition for

using its own private property, is an unconstitutional

' Nollan v. California Coastal Commission, 483 U.S. 825 (1987):

First English Evangelical Lutheran Church of Glendale v. County

of Los Angeles, 482 U.S. 304 (1987); MacDonald, Sommer &

Frrates v. County of Yolo, 477 U.S. 340, reh’g denied, 478 U.S.

1035 (1986); Williamson County Regional Planning Commission

v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985); San

Diego Gas & Electric Co. v. City of San Diego, 450 U.S. 621

(1981); Agins v. City of Tiburon, 447 U.S. 255 (1980).

taking of private property when the fee is used for

a legitimate public purpose but the individual does

not directly, substantially or in any other reasonable

and essential way contribute to the public’s need to

further such a purpose. These amici sincerely believe

that the accompanying brief will assist the Court be-

cause our concerns are much broader than those of

petitioners. Our members across the nation are faced

with countless regulatory decisions on a daily basis

that affect the use of privately held land. The vast

majority of these decisions come from local govern-

ments and, as pointed out in the accompanying brief,

some of these decisions do not respect the constitu-

tionally protected property rights of individuals. While

petitioner focuses its arguments on the harm the City

of Sacramento inflicts on its concerns, our brief ad-

dresses the broader mandates of takings law that

should be applied against those government decisions

that abuse private rights and cites authorities differ-

ent from those in petitioner’s brief.

For the above reasons, this Motion should be

granted.

Respectfully submitted,

WILLIAM H. ETHIER

CoHN & BIRNBAUM, P.C.

100 Pearl Street

Hartford, CT 06103-4500

(293) 493-2200

Counsel for Amici

April 22, 1992

TABLE OF CONTENTS

TAA OE RU TERED cvncncsncesssscesscensnesscssvencseses ill

INTEREST OF THE AMICI CURIAE .........cccceeeeeeeees 1

WHEREL scvndinenssansoennssseneasensontenerasepnesonevensseceonesseooncssseess 1

REASONS FOR GRANTING THE WRIT ................... 4

I. THE QUESTION BEFORE THE COURT IS A

SUBSTANTIAL FEDERAL QUESTION DE-

SERVING OF THIS COURT’S

PRE BEES VMIEAIEY xacvnccencesconenanccsaninvasncaseassnaccoasees +

A. The Fifth Amendment’s Takings Clause,

Which Ostensibly Prohibits Permit Con-

ditions That Do Not Substantially Ad-

vance Legitimate Government Interests,

Is In Jeopardy Of Becoming A Useless

Limitation On Government Power ......... 4

B. Sacramento’s Linkage Fee Requirement

Does Not Meet The Essential Nexus Re-

quirement This Court Established In Nol-

lan v. California Coastal Commission, 483

Biss Se MITE thdavckiseatiincealcekntsenbarninsouns 6

Il. THIS CASE REFLECTS A LOCAL LAND USE

PRACTICE THAT CLAMORS FOR THIS

COURT TO REITERATE ITS ADMONITION .

THAT THE GOVERNMENT MUST RESPECT

THE CONSTITUTIONAL RIGHTS OF INDI-

VIDUALS WHEN REGULATING PRIVATE

ACTIONS PURSUANT TO ITS POLICE

PUFUE MEUEED vesnsccsesnveendasesnenssissatesnassentsavesscabsascess 9

ii

III. THE PROPER CONSTITUTIONAL BALANCE

BETWEEN LEGISLATIVE POWER AND JU-

DICIAL DEFENSE OF INDIVIDUAL RIGHTS

DEMANDS THAT THIS CASE RECEIVE

PLENARY CONSIDERATION BY THE

SET shtsmincaminnamigntncite tia 14

\UMTTTTE. seciensnrnonstiepnsapathisisdhusinicedcisiecuasseacncs... 17

a

iii

TABLE OF AUTHORITIES

CASES: Page

Agins v. City of Tiburon, 447 U.S. 255 (1980) ..... 4

Andrus v. Allard, 444 U.S. 51 (1979) ........ ee. 5

Armstrong v. United States, 364 U.S. 40 (1960) ... 5

Berman v. Parker, 348 U.S. 26 (1954) ......... ee. 15

Collis v. City of Bloomington, 246 N.W.2d 19 (Minn.

icekalicitarcrsnunseiaiedealacabulinnliaaccudbesseereiies 11

Commercial Builders of Northern California v. City

of Sacramento, 941 F.2d 872 (9th Cir. 1991). 7,8

First English Evangelical Lutheran Church of Glen-

dale v. County of Los Angeles, 482 U.S. 304

SPIT a icautink ciccdtmsaniaiidetnaseiedaulidianienatincuareaes 16

Florida Rock Industries, Inc. v. United States, 21

Sie es IE sctseniutsichentitslicawatiqusiaianténiaavenseves 4 _

Frank Ansuini, Inc. v. City of Cranston, 264 A.2d

EEG UTEE 'coshaiotentinsssenniinntinabedetentiaeieusatecson 7

J.E.D. Associates, Inc. v. Town of Atkinson, 432

Sie Se ES FED Ubicrhantecscanphtadébentencenssnriesess 12

Keystone Bituminous Coal Association v. De-

Benedictis, 480 U.S. 470 (1987) ........ce eee 4

Loveladies Harbor, Inc. v. United States, 21 Cl. Ct.

Be IIIT ca lonicnaaslatlsscinahuconetinknciuonencemeumenieneatsinsss 4,5

Nollan v. California Coastal Commission, 483 U.S.

EE ITD cuhsinaciusdiehincudinshiaorenaslancanstnaatannensiniages passim

Penn Central Transportation Co. v. City of New

York, 488 U.S. 104, 147 (1978) .........c.ccccccceees 16

Pennell v. City of San Jose, 485 U.S. 1 (1988) ..... 15

Pennsylvania Coal Co. v. Mahon, 260 U.S. 393

SIU: sisicsciabbivtrahichdaheiaigiseiunibiieinssleibmenabeananielaaneananes 3,16

Pioneer Trust and Savings Bank v. Village of Mount

Prospect, 176 N.E.2d 799 (Ill. 1961) .............. 7

Rosen v. Village of Downers Grove, 167 N.E.2d 230

Stes EE (Subaumcsacanen th lscadaateicmanbulpatonesedussdsnaabadian 7

ita eiaile

a

iv

Table of Authorities Continued

Page

Seawall Associates v. City of New York, 542 N.E.2d

1059, 544 N.Y.S.2d 542, cert. denied, ___ U.S.

mm» SIO S. Ct. GOO (19BB) n.ccccccccccccccccccccceceee 5

Surfside Colony. Ltd. v. California Coastal Com-

mission, 226 Cal. App. 3d 1260 (1991) .......... 5

United States v. Riverside Bayview Homes, 474 U.S.

SUPE MUTED Sctsissihitenanstesicnticnisininttietendasaniibiceiaesiiiantnees. 4

West Park Avenue, Inc. v. Township of Ocean, 224

oe Fe ne eee 12

Yee v. City of Escondido, CA, No. 90-1947, slip op.

(U.S. April 1, 1992) cccccccccscsscccsceeees.. 4

MISCELLANEOUS:

Petition for Certiorari ..............ccccccccccscsscsoseososeees... 9

Babcock, Forward to Exactions: A Controversial

New Source For Municipal Funds, 50 Law &

Contemp. Probiems 1, 2 (1987) o.ccccccccccoscose-s.. 10

Bauman & Ethier, Deve t Exactions and Im-

pact Fees: A Survey Of American Practices, 50

Law & Contemp. Problems 51 i, a 9

Ethier & Weiss, Development Excise Taxes: An Ex-

ercise In Cleverness And Imagination, 42 Land

Use L. & Zoning Digest 3 (No. 2 Feb.

POON <atsliciainnsnhannntkaliningadanas cbaabeaieabaaaianenas es 9

Taub, Exactions, Linkages, and Regulat Takings:

The Developer’s Perspective, 20 The Urban

Oe ETE SS 10,11

IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 1991

No. 91-1556

COMMERCIAL BUILDERS OF NORTHERN CALIFORNIA,

and its affected members,

Petitroner,

Vv.

City OF SACRAMENTO, CALIFORNIA, et al.,

Respondents.

BRIEF OF THE NATIONAL ASSOCIATION

OF HOME BUILDERS,

INTERNATIONAL COUNCIL OF SHOPPING CENTERS,

ASSOCIATION FOR COMMERCIAL REAL ESTATE,

NATIONAL REALTY COMMITTEE,

NATIONAL MULTI HOUSING COUNCIL, AND

NATIONAL APARTMENT ASSOCIATION

AS AMICI CURIAE IN SUPPORT OF THE PETITION

INTEREST OF THE AMICI CURIAE

The interest of the amici curiae is set forth in the

preceding motion for leave to file this brief.

SUMMARY OF THE REASONS FOR GRANTING THE

WRIT

This Court has repeatedly stated that a govern-

mental action violates the takings clause of the Fifth

Amendment if the action does not substantially ad-

vance legitimate government interests. The leading

application of this aspect of takings doctrine appears

in Nollan v. California Coastal Commission, 483 U.S.

825 (1987). This rule is essential to guard against

governmental acts that would impose on individuals

costs that properly belong with the public as a whole

even though the individual has not been denied eco-

nomically viable use of its property.

The City of Sacramento’s “linkage fee’ does not

substantially advance a legitimate government inter-

est. The city justifies its fee through a purported

nexus between office construction and the city’s af-

fordable housing needs. This justification, while clever

and imaginative, is far too tenuous to pass consti-

tutional scrutiny. If it is allowed to stand, local gov-

ernments will stampede to require payments of money

from new projects to fund any and all types of gov-

ernment purposes. Indeed, governments at all levels

would be free to contrive any nexus, no matter how

flimsy, between an individual’s proposed use of his

or her land and the furtherance of a legitimate public

purpose.

There is something horrific in the city’s position

that those who bring in businesses, create jobs and

provide employment to low income people thereby

create the burden that low income people admittedly

shoulder to find decent and affordable housing. Some-

thing more than this slim reed must be required.

Something more substantial is required by the Con-

stitution’s just compensation clause. -

Conditioning the use of private land to effectuate

a public purpose causes an irreparable harm when the

proposed land use has no “essential nexus’ to that

public purpose and the government does not compen-

sate the owner for his or her loss. This harm must

be redressed by the Constitution. Nollan, 483 U.S. at

837. Regardless of whether the unconstitutional con-

dition involves the payment of a fee or dedication of

land the condition should be struck down.

Planning for and acquiring the necessary land and

capital to build adequate public facilities to support

our cities and towns, such as affordable housing for

people of less financial means, is an important goal

in maintaining society’s quality of life. But proposi-

tions that further those ends must respect the prop-

erty rights of individuals. Anything short of that

proper respect, as has occurred here, is repugnant to

the higher considerations expressed in the Constitu-

tion. The Constitutional rights at issue in this case

must be confirmed by this Court.

These amici respectfully request the Court to grant

certiorari in order to evaluate, after plenary consid-

eration of the issues presented, the appropriate nexus

“required by the Constitution’s takings clause. It is :

our hope that after the Court reviews the case it will

send anew the message to all governments that ‘“‘a

strong public desire to improve the public condition

is not enough to warrant achieving the desire by a

shorter cut than the constitutional way of paying for

the change.”’ Pennsylvania Coal Co. v. Mahon, 260

U.S. 393, 416 (1922).

REASONS FOR GRANTING THE WRIT

I. THE QUESTION BEFORE THE COURT IS A SUBSTAN-

TIAL FEDERAL QUESTION DESERVING OF THIS

COURT’S SUPERVISION

A. The Fifth Amendment’s Takings Clause, Which Os-

tensibly Prohibits Permit Conditions That Do Not

Substantially Advance Legitimate Government Inter-

ests, Is In Jeopardy Of Becoming A Useless Limi-

tation On Government Power

This Court has reiterated that a regulatory taking

occurs if either the regulation or government action

denies a property owner economically viable use of

the property or the regulation or government act does

not substantially advance a legitimate government in-

terest. Yee v. Escondido, CA, No. 90-1947, slip op.

at 1 (U.S. April 1, 1992); Nollan, 483 U.S. at 834;

Keystone Bituminous Coal Association v. De-

Benedictis, 480 U.S. 470, 485 (1987); Agins v. City

of Tiburon, 447 U.S. 255, 260 (1980). The importance

of maintaining the distinction between these two tak-

ings tests is self-evident. There are occasions where

a government’s actions substantially advance legiti-

mate government interests but nonetheless deny a

particular landowner all economically viable use of the

private property.' Likewise, there are situations, such

' See, e.g., Florida Rock Industries, Inc. v. United States, 21

Cl. Ct. 161 (1990); Loveladies Harbor, Inc. v. United States, 21

Cl. Ct. 153 (1990); Cf United States v. Riverside Bayview Homes,

474 U.S. 121, 127 (1985) (While upholding the Clean Water Act’s

grant of jurisdiction to regulate certain wetlands, the Court noted

that a property owner can still bring a takings claim in U.S.

Claims Court if a dredge or fill permit is applied for and denied

and the ‘‘effect of the denial is to prevent ‘economically viable’

use of the land in question’’).

as in this case, where a government’s actions do not

deny a landowner economically viable use of the prop-

erty but nonetheless do not substantially advance a

legitimate government interest. Nollan, 483 U.S. 825;

Surfside Colony, Ltd. v. California Coastal Commis-

sion, 226 Cal. App. 3d 1260 (1991). These two tests

are an important part of this Court’s effort to protect

individuals in situations where it would be unfair to

impose costs on an individual that properly belong

with the public. Cf, Armstrong v. United States, 364

U.S. 40, 49 (1960) (the Just Compensation Clause bars

forcing on some people alone those ‘‘public burdens,

which, in all fairness and justice, should be borne by

the public as a whole.’’). See also, Seawall Associates

v. City of New York, 542 N.E.2d 1059, 1065-66 (N.Y.

1989).

The Court does not have before it an allegation

that the city’s actions will deny economically viable

use of property. The issue presented is whether the

city’s demand that the property owner pay for low

income housing (on the basis that the property owner

creates jobs for low income persons) substantially ad-

vances, in the Constitutional sense, the city’s legiti-

mate interest in providing such housing. “(T]he

determination that there has been a taking ‘ultimately

calls as much for the exercise of judgment as for the

application of logic.’’’ Loveladies Harbor, Inc. v.

United States, 21 Cl. Ct. 153, 160 (1990) (citing An-

drus v. Allard, 444 U.S. 51, 65 (1979)). Here, the

petitioner who uses its property in a way that creates

jobs is penalized by the forced payment of fees into

a public fund that supports the housing costs of those

who might fill these jobs. Can this be the concept of

fairness and justice embodied in the Fifth Amend-

ment? If it is, then this Court’s 1987 Nollan decision,

after only a few years, is collapsing under the weight

of lower court interpretations, and the “substantial

advancement of legitimate government interests” tak-

ings test has become meaningless.

B. Sacramento’s Linkage Fee Requirement Does Not

Meet The Essential Nexus Requirement This Court

Established In Nollan v. California Coastal Commis-

sion, 483 U.S. 825 (1987)

This case is very much like the Nollan case, where

the Court admonished the government for its attempt

to compel a property owner to contribute to the re-

alization of an easement, even though the government

“may well be right that [the easement] is a good

idea.” Id., 488 U.S. at 841. The Court stated in Nol-

lan, 483 U.S. at 842, that if the government ‘“‘wants

an easement across the Nollans’ property, it must pay

for it.”’ Similarly here, Sacramento may well be right

that providing assisted housing for low income per-

sons is a good idea. But, if the city wants to provide

such housing, it must pay for it.

These amici believe this Court’s opinions stating

that a government’s actions must “substantially ad-

vance a legitimate government interest’’ mandates, in

the takings context, a direct connection between the

government action and both the burden the individual

places on the community and the benefits the indi-

vidual will receive from the government action. In

reviewing this direct connection (the Court’s ‘“‘essen-

tial nexus,”’ Nollan, 483 U.S. at 837) the Court has

stated that it requires more than the standard applied

in due process or equal protection cases. Nollan, 483

U.S. at 834 n.3. The traditional due process standard

that says “the State ’could rationally have decided’

the measure adopted might achieve the State’s ob-

jective” is not sufficient when analyzing government

actions under the just compensation clause. Jd.

Where the government requires a property owner

to pay a fee that has little, if any, connection (and

certainly no direct, substantial or essential connection)

to the relevant burdens imposed on the community

by the owner’s proposed land use or a fee that will

not benefit the proposed land use in some direct,

substantial or essential way, the government fee must

be struck down as transgressing the limitations im-

posed upon it by the takings clause.

We recognize that the takings clause does not re-

quire that development exactions and fees be precisely

tailored to the burdens and benefits attributable to

the property being assessed. See, for example, the

specifically and uniquely attributable test employed by

some courts to evaluate impact fees. Rosen v. Village

of Downers Grove, 167 N.E.2d 230 (Ill. 1960); Pioneer

Trust and Savings Bank v. Village of Mount Prospect,

176 N.E.2d 799 (Ill. 1961); Frank Ansuini, Inc. v.

City of Cranston, 264 A.2d 910 (R.I. 1970). But, the

decision below, which equates the takings analysis

with the extremely deferential due process level of

scrutiny, is the other extreme. In disputing the

petitioner’s claim that Nollan requires more than a

“due process” basis to support the city’s asserted

nexus, the Ninth Circuit below states that ‘‘Nollan

holds that where there is no evidence of a nexus be-

tween the development and the problem that the ex-

action seeks to address, the exaction cannot be

upheld.” Commercial Builders of Northern California

v. City of Sacramento, 941 F.2d 872, 875 (9th Cir.

1991) (emphasis added). In other words, according to

8

the Ninth Circuit’s reading of Nollan, only a scintilla

of evidence is necessary to Support a constitutional _

nexus. We find this remarkable. How can the Ninth

Circuit rationalize its statement with this Court’s

words?

“{Ojur opinions do not establish that these

standards are the same as those applied to

due process or equal-protection claims. To the

contrary, our verbal formulations in the tak-

ings field have generally been quite different.

We have required that the regulation ‘sub-

stantially advance’ the ‘legitimate state in-

terest’ sought to be achieved, ... not that

the ‘State ‘‘could rationally have decided” the

measure adopted might achieve the State’s

objective.’ ”’

Nollan, 483 U.S. at 835 n.3 (citing cases). Yet, the

Ninth Circuit says it is “not persuaded that Nollan

materially changes the level of scrutiny”’ that must

be applied to the ordinance at issue. Commercial

Builders, 941 F.2d at 874. With respect, the nexus

required in a ‘‘substantial advancement”’ takings case

is something more than the Ninth Circuit would have

us believe. Our view does not make the due process

clause meaningless. There will be situations where the

nexus tied to a regulatory requirement is sufficient

to withstand the higher level of scrutiny demanded

by the takings clause yet, nonetheless and for -non-

nexus reasons, the regulation is otherwise arbitrary,

capricious or unreasonable and subject to a due proc-

ess claim.

—

Il. THIS CASE REFLECTS A LOCAL LAND USE PRAC-

TICE THAT CLAMORS FOR THIS COURT TO REITER-

ATE ITS ADMONITION THAT THE GOVERNMENT

MUST RESPECT THE CONSTITUTIONAL RIGHTS OF

INDIVIDUAL CITIZENS WHEN REGULATING PRI-

VATE ACTIONS PURSUANT TO ITS POLICE POWERS

It has been a long-standing governmental practice

to demand land (e.g., development exactions and land

dedications) or money (e.g., impact fees and fees in

lieu of dedications) from property owners who propose

to build on their land. See, for example, Bauman &

Ethier,Development Exactions and Impact Fees: A

Survey Of American Practices, 50 Law & Contemp.

Problems 51 (1987), and authorities cited therein. Lin-

kage fees, see Petition for Certiorari at 7 - 12, are

the next step beyond impact fees in the evolution of

charges on new development.” But few developers and

builders litigate when municipal governments unfairly

and unconstitutionally exact fees and property that

have little relation to the services or benefits provided

to a proposed project or the burdens placed on the

community by the project. These entities are entre-

preneurs and businesses that simply find it impractical

in almost all cases to challenge unconstitutional gov-

ernment requirements. It does not take a rocket sci-

entist, therefore, to understand why much of the

* Sadly, linkage fees are not the latest step in this evolutionary

process. Most recently, ‘“‘development excise taxes’’ have been

enacted and proposed in several towns across America where

the fee to be used for public uses is imposed on the alleged

privilege of pursuing development. These governments assert

that no nexus, not even a rational nexus, is required to support

these fees. See Ethier & Weiss, Development Excise Taxes: An

Exercise In Cleverness And Imagination, 42 Land Use L. &

Zoning Digest 3 (No. 2 Feb. 1990).

SE ————

10

impact fee and exaction litigation nationwide has been

brought by their organized membership trade asso-

ciations rather than the individual property owners.

However, these associations with their limited re-

sources must pick their fights carefully. Consequently,

many of the demands and exactions imposed on in-

dividuals by local governments go unchallenged.

In a national symposium on development exactions,

Professor Babcock, the dean of American land use

law, cited examples of abusive exactions and followed

with this discussion:

In each of these cases one can imagine the

initial reaction of the “extractee”’ - outrage.

In each case he surely went to his attorney

and asked two questions: (1) How long will

it take to get a final answer in court if we

challenge this condition?; and (2) How much

will it cost?

The answers probably were: (1) It will take

three to four years, with the possibility of

defeat; and (2) It will cost tens if not

hundreds of thousands of dollars.

By the time the developer approaches his

attorney, he has invested a large sum of

front-end money and has a great deal of in-

terest in obtaining a permit. Moreover, he

wants the permit immediately. He takes out

his pencil, does some calculating, and decides

to pay up. This example is a classic illustra-

tion of what I call ‘municipal leverage.”

Babcock, Foreword to Exactions: A Controversial New

Source For Municipal Funds, 50 Law & Contemp.

Problems 1, 2 (1987). See also Taub, Exactions, Link-

11

ages, and Regulatory Takings: The Developer’s Per-

spective, 20 The Urban Lawyer 515, 518 (1988) (‘‘The

fact that developers are willing to pay suggests the

power of the local government’s position, not the rea-

sonableness of the exaction.’’).

Local governments are often well aware of the

amount of time, money and other resources a builder

of a large development (or even, in relative terms,

of a single house) has invested in a project before the

first application for approval is submitted. Local gov-

ernments are usually free to exercise their municipal

leverage to extract all types of property interests and

money from project applicants. Only occasionally will

courts scrutinize the exercise of this municipal lever-

age in ringing terms:

While in general subdivision regulations are

a valid exercise of the police power, made

necessary by the problems subdivisions create

- 1e., greater needs for municipal services

and facilities -, the possibility of arbitrariness

and unfairness in their application is none-

theless substantial: A municipality could use

dedication regulations to exact land or fees

from a subdivider far out of proportion to

the needs Created by his subdivision in order

to avoid imposing the burden of paying for

additional services on all citizens via taxation.

To tolerate this situation would be to allow

an otherwise acceptable exercise of police

power to become grand theft.

Collis v. City of Bloomington, 246 N.W.2d 19, 26

(Minn. 1976);

12

We have no doubt the municipality was

conscious of the illegality of what it did and

for that reason refrained from adopting an

ordinance, seeking instead to achieve its ends

through the guise of “voluntary” contribu-

tions with spurious “agreements” to make

them stick.

Defendants argue that even if the pay-

ments were illegally extorted, as we think

they were, nonetheless plaintiff ought not re-

cover ....

Defendants’ position boils down to the

proposition that one who buys with notice of

municipal lawlessness thereby becomes bound

by it. Thus understood, defendants’ position .

is frivolous.

West Park Ave., Inc. v. Township of Ocean, 224 A.2d

1, 4-5 (N.J. 1966);

Regulation H requires the dedication of

seven-and-one-half per cent of the total land

comprising the subdivision without any con-

sideration of the town’s need for the land.

Moreover, there is evidence, that was im-

properly excluded, which indicates that some

developers would be permitted to pay the

town the value of the land in lieu of its ded-

ication. This appears to us to be an out-and-

out plan of extortion... .

J.E.D. Associates, Inc. v. Town of Atkinson, 482 A.2d

12, 14 (N.H. 1981); see also Nollan, 483 U.S. at 837.

13

The just compensation clause is one of the few con-

straints on the public’s use of its regulatory powers

over the use of an individual’s land. Its full application

is needed by property owners of all types to provide

some balance to weigh against a municipality’s le-

verage.

As difficult as a takings challenge is for the prop-

erty owner, the just compensation clause should re-

main a fundamental crutch to support the property

owner in fighting the heavy-handed leverage brought

to the table by the municipality. The Ninth Circuit’s

opinion below fatally damages this constitutional

crutch.

These amici do not mean to suggest that all local

governments—counties, cities and towns—are ruthless

and unreasonable in conducting the affairs of their

daily land use decision making processes, although at

times in the trenches of local planning board hearings

it appears so from the project applicant’s viewpoint.

Many, if not most, local governments are reasonable

and sincere in their efforts to promote the public’s

health, safety and welfare. But while it is our view

that too many communities disrespect Constitutional

considerations for the sake of political or financial

expediency, if only one community forsakes one of its

citizen’s rights, the Constitutional damage is done and

we are all worse off because of it. It is exactly be-

cause of these situations that Constitutional doctrine

must be developed to protect individual rights, in-

cluding property rights. The courts must step in to

correct the constitutional damage and restore fairness

and justice.

Property owners and builders are loathe to sue the

government because the costs of litigation and delay

nS

14

outweigh the costs of complying with the govern-

ment’s unconstitutional demands. Also, the same gov-

ernmental agency a builder sues today has to provide

the necessary permits on the next project the builder

wants to undertake tomorrow—a very uncomfortable

position in which to put yourself. Another compelling

reason property owners refrain from litigating is that

most are financially incapable of sustaining such a

lawsuit. Therefore, it is vitally important that this

Court grant certiorari rather than wait and see how

the issue develops in future cases. Practically speak-

ing, there very well may be no future “‘linkage’’ fee

cases if the Ninth Circuit’s decision is allowed to

stand. Counsel would be hard pressed to advise any

permit applicant to pursue any linkage fee litigation

and these unconstitutional permit conditions will crush

merrily forward.

III. THE PROPER CONSTITUTIONAL BALANCE BE-

TWEEN LEGISLATIVE POWER AND JUDICIAL DE-

FENSE OF INDIVIDUAL RIGHTS DEMANDS THAT

THIS CASE RECEIVE PLENARY CONSIDERATION

BY THE COURT

This Court has eloquently stated that the legislature

is the domain for identifying the public’s interest in

legislation.

An attempt to define [the police power’s]

reach or trace its outer limits is fruitless, for

each case must turn on its own facts. ...

Subject to specific constitutional limitations,

when the legislature has spoken, the public

interest has been declared in terms well-nigh

conclusive. In such cases the legislature, not

the judiciary, is the main guardian of the

15

public needs to be served by social legislation

Berman v. Parker, 348 U.S. 26, 32 (1954). With equal,

if not greater force, however, the judiciary must re-

main the guardian of individual and property rights.

The legislature defines the scope of the public’s in-

terest, but when individual property rights are de-

stroyed to further those interests, the courts must

step in. The role of the courts is to define when the

government has gone too far and insure that adequate

remedies exist to redress the individual’s loss. The

Ninth Circuit failed to exercise its duty of supervision

in the conflict between the public’s interest and the

private property owner’s rights.

While the takings clause in general does not act to

prohibit transfers of wealth deemed appropriate by

the majoritarian branches of government, courts ought

to be suspicious of governmental actions that affect

a narrow class of individuals as such actions can be

taken without the usual political constraints. Justice

Scalia recognized this danger in Pennell v. City of

San Jose, 485 U.S. 1, 21-23 (1988) (Scalia, J., dis-

senting). Thus, when wealth is exacted from a narrow

class of individuals, as here, the takings clause should

wield its power to limit governmental actions.

This Court warned that it would be particularly

careful about the adjective “‘substantial” in the sub-

stantial advancement takings test where “the actual

conveyance of property is made a condition to the

lifting of a land-use restriction, since in that context

there is heightened risk that the purpose is avoidance

of the compensation requirement, rather than the

stated police power objective.” Nollan, 483 U.S. at

841. Similarly here, to admonish the cleverness and

16

imagination of local governments, this Court should

demand that lower courts be particularly careful about

the level of nexus allowed to justify a project fee

where the payment of the fee is made a condition to

the lifting of a land-use restriction or the issuance of

a permit. In this context too there is heightened risk

that the government’s intent is to avoid placing pay-

ment for its police power purpose on the public as a

whole. “‘It is exactly this imposition of general costs

on a few individuals at which the ‘taking’ protection

is directed.’’ Penn Central Transportation Co. v. City

of New York, 488 U.S. 104, 147 (1978) (Rehnquist,

J., dissenting).

The Court has noted that

many of the provisions of the Constitution

are designed to limit the flexibility and free-

dom of governmental authorities, and the

Just Compensation Clause of the Fifth

Amendment is one of them. As_ Justice

Holmes aptly noted more than 50 years ago,

‘“‘a strong public desire to improve the public

condition is not enough to warrant achieving

the desire by a shorter cut than the consti-

tutional way of paying for the change.’

Pennsylvania Coal Co. v. Mahon, 260 U.S.,

at 416.

First English Evangelical Lutheran Church of Glen-

dale v. County of Los Angeles, 482 U.S. 304, 321- 22

(1987). The context of the present case is a perfect

vehicle within which the Co:rt may elaborate on and

reaffirm these just compensation clause principles.

Local government decisions, such as those below,

that vitiate federal Constitutional guarantees must be

17

reversed. Property owners and builders, who are in

an excruciating minority position when it comes to

local government land use controls, have nowhere else

to turn. The regulated and, we presume, most of the

regulators await with hope for more United States

Supreme Court guidance on this critical issue.

CONCLUSION

For the reasons stated above and in the Petition

for Certiorari, this Court is urged to issue a writ of

certiorari to review the judgment and opinion of the

United States Court of Appeals for the Ninth Circuit.

Respectfully Submitted,

WILLIAM H. ETHIER

CoHN & BIRNBAUM, P.C.

100 Pearl Street

Hartford, CT 06103-4500

(203) 493-2200

Counsel for Amici

April 22, 1992