In his latest Daily Journal column, Manatt Appellate Senior Counsel Michael Berger discussed the ongoing issue of local governments imposing exactions on building permit fees despite Supreme Court precedents.
In the article, Berger detailed an ongoing case in which an association representing home builders sued two city government agencies in Minnesota for allegedly violating Supreme Court holdings when exacting building permit fees. In one argument, the association claimed that the excessive fees required to obtain a building permit constitutes a Fifth Amendment taking, as seen in Nollan v. Cal. Coastal Comm'n, where the Supreme Court considered requiring unreasonably large fees for a permit to be extortion. Yet the trial court decided that since the builders were issued permits in exchange for the fees paid, they received compensation, resulting in the court overlooking the rule that fees must be “roughly proportional" to the project's impact and granting summary judgment to the cities.
“For agencies to set themselves up to reap multimillion dollar profits from building permits is plainly beyond the pale. But it is worse when lower courts ignore such clear directives from the nation's highest court,” wrote Berger.
Daily Journal subscribers can read the full article here.