Coy Koontz, Sr., was a developer who sought a permit to dredge and fill more than three acres of protected wetlands in Florida. Under Florida law, Koontz was required to offset any harm to protected wetlands by either revising his development proposal to reduce its overall environmental impact or mitigating any remaining harm through creating, restoring, enhancing, or preserving other wetlands within the river basin. After Koontz rejected a series of mitigation measures suggested by the District and cut off any further negotiations, the District denied Koontz’s permit application. Koontz sued, alleging a “regulatory taking.” The trial court’s ruling in favor of Koontz was reversed by the Florida Supreme Court. The U.S. Supreme Court granted Koontz’s petition for a writ of certiorari.

On December 28, 2012, CAC filed a brief in the Supreme Court on behalf of the American Planning Association, the National Trust for Historic Preservation, and the City of New York. Our brief argued that Koontz’s claim was inconsistent with the text and history of the Takings Clause, as well as the Court’s takings jurisprudence. The text of the Takings Clause itself is narrow, and since the Court’s unanimous decision in Lingle v. Chevron (2005), regulatory takings have been limited to situations in which a regulation’s impact on a property owner is “functionally equivalent” to the “classic taking in which government directly appropriates private property.” Under this understanding, we made the case in our brief that Koontz’s takings claim was a non-starter – the District had taken absolutely nothing from him.

To avoid Lingle, Koontz reframed his claim as a challenge to the mitigation measures proposed by the District in order to take advantage of the specialized tests developed by the Court in Nollan v. California Coastal Commission (1987) and Dolan v. City of Tigard (1994). In our brief, we argued that Nollan and Dolan did not apply to Koontz’s challenge. Whereas both Nollan and Dolan involved finalized conditions – instances in which a permit was approved and specific conditions were attached – Koontz broke off negotiations before any particular condition was demanded by the District. CAC argued that extending these cases to cover failed negotiations such as Koontz’s would be unworkable both for public officials and judges. Furthermore, since both Nollan and Dolan were rooted in the doctrine of unconstitutional conditions, we explained that the specialized tests could only be applied when the challenged conditions were a per se taking if unilaterally imposed, such as a land dedication. However, none of the conditions suggested by the District constituted a per se taking.

On June 25, 2013, in an ideologically divided 5-4 decision, the U.S. Supreme Court reversed the Florida Supreme Court and ruled in favor of Koontz, expanding the ability of property owners to challenge permit conditions imposed on them by government land-use agencies. The Court held that a government’s demand for property from a land-use permit applicant must satisfy the Nollan/Dolan requirements even when the government denies the permit and even when it asks for money rather than an interest in land. The majority opinion authored by Justice Alito (and joined by Chief Justice Roberts and Justices Scalia, Kennedy, and Thomas) determined that the District had subjected Koontz to an “unconstitutional condition,” framing the Court’s decision as a safeguard against future “extortionate demands for property” in the context of land-use permits.

Justice Kagan, in a spirited dissent joined by Justices Ginsburg, Breyer, and Sotomayor, and echoing many of the key arguments in CAC’s brief, criticized the “uncertain” boundaries created by the majority’s decision, and pointed out that the decision “threatens to subject a vast array of land-use regulations, applied daily in States and localities throughout the country, to heightened constitutional scrutiny.” By injecting judges into the land-use planning process, the Koontz decision makes it more difficult for state and local officials to strike an appropriate balance between protecting the environment and promoting development.