ELR Citation: ELR 21083
No(s). 93-518 (U.S. Jun 24, 1994)

The U.S. Supreme Court holds that a city's exaction of land dedications as a condition to issuing a development permit does not constitute an uncompensated taking in violation of the Fifth Amendment to the U.S. Constitution if the city shows the existence of an essential nexus between a legitimate state interest and the permit condition and makes an individualized determination of "rough proportionality" between the condition and its impact on the proposed project. A city planning commission granted a store owner's petition for a redevelopment permit on the condition that the applicant dedicate a portion of her property lying within a 100-year floodplain for improvement of a storm drainage system and dedicate an additional 15-foot strip of land adjacent to the floodplain as a pedestrian/bicycle pathway. The Court first holds that it must determine whether an "essential nexus" exists between a "legitimate state interest" and the permit condition exacted by the city. The Court holds that the prevention of flooding along a creek running through the property and the reduction of traffic congestion in the city's central business district qualify as the type of legitimate public purposes the Court has upheld. Also, a nexus exists between preventing flooding along the creek and limiting development within the creek's 100-year floodplain. The same may be said for the city's attempt to reduce traffic congestion by providing for alternative means of transportation. The Court holds that it must next determine whether the degree of the exactions demanded by the city's permit conditions bears the required relationship to the projected impact of the applicant's proposed development. The Court examines representative state decisions on the sufficiency of findings to justify exactions. The Court holds that the "reasonable relationship" test adopted by a majority of the state courts is closer to the federal constitutional norm than a test requiring very generalized statements on the necessary connection between the required dedication and the proposed development, or a "specific and uniquely attributable" test. The Court adopts a "rough proportionality" test. The test does not require precise mathematical calculation, but the city must make some sort of individualized determination that the required dedication is related both in nature and extent to the impact of the proposed development.

Turning to the sufficiency of the city's findings, the Court holds that the city failed to make any individualized determination to support its request that the applicant dedicate a portion of her land to a city greenway. If the applicant's proposed development had somehow encroached on existing greenway space in the city, it would have been reasonable to require the applicant to provide some alternative greenway space for the public either on her property or elsewhere. The Court holds that the city's findings do not show the required reasonable relationship between the floodplain easement and the applicant's proposed new building. The Court also holds that the city failed to meet its burden of demonstrating that the additional number of vehicle and bicycle trips generated by the applicant's development reasonably relate to the city's requirement for a dedication of the pedestrian/bicycle pathway easement. The Court holds that the city must make some effort to quantify its findings in support of the dedication for the pedestrian/bicycle pathway beyond the conclusory statement that it could offset some of the traffic demand generated. The Court remands the case for further findings.

Dissenting, Justices Stevens, Blackmun, and Ginsburg would hold that conditions in a land use permit are presumptively constitutional if the government can demonstrate that they are rational, impartial, and conducive to fulfilling the aims of a valid land use plan. The party challenging the state action has the burden of showing that the conditions unreasonably impaired the economic value of the proposed improvement.

Also dissenting, Justice Souter would uphold the condition solely under the essential nexus test in Nollan v. California Coastal Commission, 17 ELR 20918 (U.S. 1987).

[The Oregon Supreme Court's decision is published at 24 ELR 20151. Briefs in this appeal are digested at ELR PEND. LIT. 66313.]

Counsel for Petitioner
David B. Smith
Oregonians In Action
P.O. Box 230637, Tigard OR 97281
(503) 620-0258

Counsel for Respondent
James M. Coleman
O'Donnell, Ramis, Crew & Corrigan
Ballow & Wright Bldg.
1727 NW Hoyt St., Portland OR 97209
(503) 222-4402