On October 5, the United States Supreme Court granted a petition for certiorari filed on behalf of the plaintiff in Koontz v. St. Johns Water Management District. Oral arguments will be scheduled in the coming months. The case involves Coy Koontz, a landowner who owned 15 acres of land, the majority of which fell within a riparian habitat-protection zone in the Econlockhatchee River hydrological basin and contained protected wetlands. The development of the land was under the jurisdiction of the St. Johns River Water Management District.
Koontz wanted to develop 3.7 acres of his 15-acre property with a shopping center. The 3.7 acres was nearly 90% wetlands, which he conceded was undevelopable and was not entitled to receive permits under the law. He requested permits from the District under Section 373.414(1), Florida Statutes, which allowed development only where there is negligible adverse impact to wetlands or that impact is offset by mitigation. The District proposed to approve the permit application with conditions, including the requirement for off-site mitigation of the proposed destruction of wetlands within the same drainage basin, along with a conservation easement on the remaining acres of his property. Koontz agreed mitigation was necessary. His single offer of mitigation was less than a third of the mitigation required by state guidelines, and was therefore deemed inadequate by the District. The District offered several options, including ones that did not require offsite mitigation, and invited Koontz to propose additional options. This negotiation process is common to the administration of this statute, and occurs throughout Florida when owners of protected lands seek to develop. Koontz chose not to negotiate beyond his initial proposed mitigation offer.
When Koontz refused to accept any of the District’s proposed options for conditions of approval, the District denied the permit as required by Section 373.414 and the mitigation guidelines. Instead of appealing the permit denial or exhausting his administrative remedies, as was available under the District’s permitting laws and required by precedent, Koontz brought an inverse condemnation claim against the District, claiming that the proposed conditions were improper exactions, and that the permit denial constituted a regulatory taking. The lower Florida courts found that the District had taken Koontz’s real property, despite the fact that no taking of real property had ever in fact occurred, and awarded $376,154 in damages. The District then issued the permit to Koontz.
In 2011, the Florida Supreme Court reversed, and held that the permit denial was not a regulatory taking, because the conditions did not require the conveyance of an interest in land and only involved the payment of money. The Court recognized that potential liability for a regulatory taking under U.S. Supreme Court caselaw arises only in cases involving conditions impacting a real property interest, not a personal property interest or a permit denial. The remedy for an invalid condition involving personal property interests or a permit denial is to challenge and invalidate that permitting decision, not to file an inverse condemnation claim for damages. The Florida Supreme Court further concluded that government agencies must have the authority and flexibility to independently evaluate applications and negotiate conditions with property owners in order to avoid undue harm to the community or the environment, noting that any alternative approach would have negative policy consequences. First, it would render all land use and environmental regulation prohibitively expensive. Second, it would perversely incentivize government to deny applications outright where they have a basis to do so, and refuse to negotiate reasonable conditional approvals that could result in expensive litigation, thereby bringing much land development in Florida to a standstill.
Earlier this year, the Pacific Legal Foundation filed a petition for certiorari with the Court on the landowner’s behalf. The question presented in Koontz is whether a governmental entity’s denial of a permit can be the basis for a regulatory taking claim when it is denied solely because the landowner refused to agree to proposed conditions to the permit. The question presented in Koontz is whether a governmental entity’s denial of a permit constitutes a regulatory taking when it is denied solely because the landowner refused to agree to proposed conditions to the permit. The Court will also determine whether the decisions reached in Nollan v. California Coastal Commission, 483 U.S. 825, 107 S. Ct. 3141, 97 L.Ed. 2d 677 (1987) (holding that there must be an “essential nexus” between the permitted activity and the condition imposed on the permit), and Dolan v. City of Tigard, 512 U.S. 374, 114 S. Ct. 2309, 129 L.Ed. 2d 304 (1994) (requiring “rough proportionality” between the condition placed on the land and the extent of the impact of the proposed development”) are applicable to the present case, which involved no requirement to dedicate an interest in real property. In its 2011 decision, the Florida Supreme Court held that the Nollan/Dolan cases both involved the grant of permits rather than permit denials, and were only applicable where the condition imposed on the permit involves a dedication of the owner’s real property interest.
Using a problem-solving, team approach and working with the Firm’s Litigation Division, led by Matthew H. Mandel, and Appellate Practice Group, led by Edward G. Guedes, the seasoned attorneys at WSH have extensive experience representing both local governments and private citizens in land use matters. Our Public Land Use and Zoning Group, led by Susan L. Trevarthen, includes attorneys who are certified planners and Board-Certified experts in the field of planning and zoning. The Group has extensive experience representing local governments in all aspects of land use, planning and zoning. In addition, the Group counsels local governments when they act as developers, either alone or in partnership with a private developer. The Firm also represents private property owners, developers, investors and lenders in land use and zoning matters throughout various South Florida jurisdictions. Our Private Land Use and Zoning Practice Group, led by Gilberto Pastoriza, represent numerous commercial, market rate, and affordable housing residential developers, outdoor media companies, churches and telecommunication tower builders. Our Eminent Domain Group, led by Mitchell J. Burnstein, represents private property and business owners, as well as dozens of governmental entities, in all aspects of eminent domain litigation and trial work.
Author(s): Susan L. Trevarthen & Brooke P. Dolara
