Sheetz v. El Dorado County

The Supreme Court unanimously ruled that the Fifth Amendment’s Takings Clause applies to land-use fees even if they are created by a legislature. George Sheetz challenged a traffic impact fee required for his building permit, arguing it was an unconstitutional taking of property. The Court held that whether a fee is set by a law or an agency, it must have a clear connection and be proportional to the project's impact.

This decision makes it easier for property owners to challenge expensive government fees required for building permits. It ensures that local governments cannot bypass constitutional protections simply by passing a broad law instead of making individual decisions. Homeowners and developers may now see more transparency and fairness in how impact fees are calculated.

For decades, the Court has required a 'nexus' (connection) and 'proportionality' for permit conditions to prevent the government from extorting property owners. Some state courts previously thought these rules only applied to specific administrative decisions, not general laws. This ruling clarifies that the entire government must follow the same constitutional rules when taking private property for public use.

In a 9-0 decision, Justice Amy Coney Barrett wrote the majority opinion, joined by all other justices, though several wrote separate concurrences to discuss specific details.

“The Fifth Amendment’s Takings Clause does not distinguish between legislative and administrative land-use permit conditions.”

The Supreme Court ruled that legislative fees for building permits must be fair and directly related to the project's impact.

The case returns to the lower courts to determine if El Dorado County's specific traffic fee actually meets the constitutional test. Local governments across the country may need to review their fee programs to ensure they are properly tailored to specific development impacts. Property owners might file new lawsuits if they believe their local permit fees are too high or unrelated to their projects.

Sheetz argued a $23,000 traffic fee for his manufactured home was an unconstitutional taking. The county claimed the fee was exempt from constitutional scrutiny because it was authorized by local legislation.

It could lower costs if courts find that certain mandatory fees are not proportional to a project's impact. However, local governments might find new ways to justify fees through more detailed studies.

The Court applied the Nollan/Dolan test. This requires an 'essential nexus' (connection) and 'rough proportionality' between a permit condition and the impact of the proposed development.

The case is vacated and remanded (sent back) to the California Court of Appeal. That court must now apply the constitutional test it previously ignored.

Yes, it shows the Court's commitment to protecting private property from government overreach. It reinforces the idea that constitutional rights apply to all branches of government equally.