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Hoffert Law Attorney Comments on the Supreme Court Extending Fifth Amendment Protections to Land Use Exactions

Recently, the United States Supreme Court announced its decision in Koontz v. St. John’s River Water Management District, in which it was called upon to decide whether or not its decisions in the important Taking Clause cases of Nollan v. California Coastal Commission, and Dolan v. City of Tigard, extend to a situation where a) a land use permit was denied and, more significantly, b) it would have been approved subject to a condition requiring the land owner to expend funds to improve publicly-owned lands (i.e. a monetary exaction).

Commenting on the decision, Hoffert Law attorney Gregory M. Elliott, who handles land use matters for the firm, noted, “the Nollan and Dolan cases established the doctrine that ‘a unit of government may not condition the approval of a land-use permit on the owner’s relinquish­ment of a portion of his property unless there is a nexus and rough proportionality between the government’s demand and the effects of the proposed land use.’ The Court in Koontz found that this analysis could also be applied to the case at bar. The Court held that ‘the government’s demand for property from a land-use permit applicant must satisfy the re­quirements of Nollan and Dolan even when the government denies the permit and even when its demand is for money.’”

Writing for the majority in Koontz, Justice Alito noted the direct link between the government’s demand for a monetary exaction and Mr. Koontz’s ability to use a specific parcel of real property. He stated that, “Because of that direct link, this case implicates the central concern of Nollan and Dolan: the risk that the government may use its substantial power and discretion in land-use permitting to pursue governmental ends that lack an essential nexus and rough proportionality to the effects of the proposed new use of the specific property at issue, thereby diminishing without justification the value of the property.”

Michigan’s Attorney General had joined with those of a number of other jurisdictions in opposing the extension of this Takings Clause analysis to monetary exactions in the land-use permitting context. One wonders why this should be so. Regardless, as Elliott noted, “property owners now have a clear, constitutional right to be free of impact fees, donations, and other forms of monetary exactions, that a unit of government might seek to coerce people into giving up as a condition of approval, when those exactions lack a sufficient connection to the impacts caused by a land use or are out of proportion to those impacts. As the Court held, such demands frustrate the Fifth Amendment right to just compensation and are unconstitutional.”

Hoffert & Associates, P.C. helps clients throughout the state of Michigan resolve their personal, residential, and commercial property tax disputes. The firm also assists its clients with estate planning, business transactions, litigation, land use issues, and other real estate matters. Based in Farmington Hills, Michigan, the Hoffert Law attorneys have more than 100 years of combined legal experience.




Representative Clients:


IBM Corp.; Comerica Bank; Standard Federal Bank; Hughes Electronics; Toll Brothers, Inc.; Detroit Edison; Cargill Corporation; Detroit Lions, Inc.' Pep Boys; Hilton Hotels, Corporation.

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Phone: 248-702-6100
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  Hoffert & Associates

Located in Farmington Hills, Hoffert & Associates, P.C., represents clients throughout Michigan, in cities including: Traverse City, Grand Rapids,

Lansing, Ann Arbor, Detroit, Kalamazoo, Portage, Dearborn, Troy, Warren, West Bloomfield, Novi, Birmingham, Northfield, Brighton, Jackson, Battle Creek,

Flint and Saginaw. Our firm also represents clients in Oakland County, Wayne County, Macomb County,

Washtenaw County, Livingston County and Grand Traverse County.