In a unanimous decision today in Sheetz v. County of El Dorado, the Supreme Court ruled that there is no “legislative exception” to the Takings Clause. This decision overturns previous cases such as Nollan v. California Coastal Commission and Dolan v. City of Tigard, where the Court found that state and local governments can violate the Takings Clause by imposing “exactions” on property owners seeking to develop their land.
The case at hand involved a landowner in El Dorado County who was required to pay a $23,420 “traffic impact mitigation” fee in order to build a new home on his property. The Court rejected the argument that there is any legislative exception to the Takings Clause, with Justice Amy Coney Barrett’s opinion stating that there is no textual justification for exempting legislatures from ordinary takings rules.
While the Court did not address whether the fee imposed in this case constituted a taking, the issue will be remanded back to the California state courts for further consideration. Justice Sotomayor, in a concurring opinion, emphasized that takings liability only applies if the fee would be considered a taking if imposed outside the permitting process.
Justice Kavanaugh, in a separate concurrence, highlighted that the Court did not prohibit the common practice of imposing permit conditions, such as impact fees, on new developments through reasonable formulas that assess the impact of classes of development. Justice Gorsuch also weighed in, arguing that Takings Clause standards should not vary based on whether the challenged regulation applies to a narrow class of properties or a broad one.
Overall, while today’s decision does not provide a definitive resolution on when regulatory exactions and permit requirements constitute takings, the Court did unanimously agree on the legislative exception issue. This marks another victory for property rights advocates, following last year’s ruling in Tyler v. Hennepin County. The property owner in this case was represented by the Pacific Legal Foundation, which has been successful in winning property rights cases at the Supreme Court.
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