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8 BuildersOutlook 2024Issue1
LEGAL
Supreme Court Hears Arguments in Landmark Impact Fees Case
The U . S . Supreme Court heard arguments Tuesday in a case brought by a California home owner regarding a $ 23,000 traffic impact fee required to put a manufactured home on a small parcel of land . The case directly addresses jurisdictions trying to skirt the Takings Clause when seeking impact fees . The case , Sheetz v . El Dorado County , involved George Sheetz , a California resident who in 2016 applied for a permit to build an 1,800- square-foot manufactured home on a residential-zoned lot he owned . The county imposed a $ 23,420 “ traffic mitigation fee ” on the permit . Sheetz protested the fee but ultimately paid it , and then immediately sued the county arguing the fee was improper . At state court , Sheetz argued that the fee was not closely connected to or proportional to the actual impact his new residence would have on the roads , key tests laid out by precedent in two prior Supreme Court cases ( commonly called the Nollan / Dolan test ). The county countered that the test does not apply because the impact fee was authorized by legislation — from the county council in this case — rather than by bureaucracy . A small number of state courts , including California ’ s , have carved out legal exceptions to the proportionality test if the fees in question are authorized by a legislative body . The Sheetz case directly addresses the constitutionality of such carve outs . California state courts agreed with the county in this case , writing that the Nollan / Dolan test only applies to fees imposed on an individual basis , rather than fees — such as the traffic impact mitigation fee — authorized by legislation . Sheetz further appealed the
decision to the Supreme Court , noting there was disagreement on the question across states . NAHB and the California Building Industry Association ( CBIA ) supported Sheetz with an amicus brief urging the Supreme Court to take the case . After the Court agreed to hear it , NAHB and CBIA submitted a second brief supporting Sheetz on the merits of the case . At oral arguments Tuesday , the justices — and even defendant ’ s council —
EQUAL HOUSING
LENDER
Courtney Yeatman , VP 915.747.1671
seemed to agree with NAHB and CBIA on the pertinent question of legislative action shielding a government from the Takings Clause . NAHB and CBIA wrote that the Supreme Court has an opportunity to “ make clear that there is no such ‘ loophole ’ in the prohibition against governmental demands for unconstitutional conditions .” Justice Gorsuch noted that with such uniform agreement on the question , the case
Henry Tinajero , SVP 915.747.1663 should simply be remanded to the lower courts so they can determine if the traffic fee falls under the Takings Clause . An opinion is expected this spring . NAHB VP of Legal Advocacy Tom Ward also discusses the case and the Supreme Court arguments in the latest episode of NAHB ’ s podcast , Housing Developments .
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Robert Spencer , AVP 915.747.1013
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