The U.S. Supreme Court issued its decision today in Koontz v. St. Johns River Water Management District, ruling that a monetary exaction that is improperly imposed as a permit condition can amount to a taking in violation of the Fifth Amendment to the U.S. Constitution.  The decision is significant because it allows a takings claim based on a monetary exaction, whereas prior precedent has limited takings claims to exactions of interests in real property.

Local and state agencies often impose conditions on development permits to offset or mitigate impacts associated with the development.  The Supreme Court decisions in Nollan v. California Coastal Commission and Dolan v. City of Tigard (Nollan/Dolan) provide that where conditions require the provision of an interest in land, those conditions must be roughly proportionate to the impacts of the development.  This decision extends the limitations on permit exactions beyond interests in real property and confirms that a takings claim can arise when a permit is denied based on the applicant’s refusal to accept an improper condition.Continue Reading U.S. Supreme Court Ruling on Takings – Demand for Monetary Exaction as Permit Condition Can Be an Unconstitutional Taking