Sunday, May 17, 2015

Back in Blog!

After a significant hiatus, I'm back posting blog entries. 

I'm now back to being a sole practitioner, with a focus on litigation involving land use and local government law issues.    

If there's a case you want me to cover, email me a link or the opinion at 


Charter Amendment was Not a Plan Amendment: City of Riviera Beach v. Riviera Beach Citizens Task Force et al, 87 So. 3d 18 (Fla. 4th DCA 2012).

In a case challenging a charter amendment that would put specific restrictions on the use of certain publicly owned upland and submerged land, the circuit court found the proposed ballot language was not ambiguous, the amendment was not placed on the ballot in violation of the governing statute, and the ballot did not violate the “anti-referendum” provision of § 163.3167(12), Fla. Stat.  The District Court upheld the circuit court on all points. 

With respect to the final matter, the City and the Redevelopment Agency that owned the land argued that the prohibitions eliminated uses permitted under the comprehensive plan and zoning, and therefore would require amendments to the plan and zoning.  The circuit court and district court disagreed, and the district court found there were still uses for the affected property, that were consistent with the Comprehensive Plan.

Given the findings, the result was not surprising.  For whatever reason, the City did not challenge the amendment as an LDR that required hearings under § 163.3194.   This points out a problematic hole in     § 163.3167(12), even after recent amendments - while plan amendments and development orders are not subject to referenda, land development code changes are subject to referenda.  We’ll see if the statute is expanded to include LDRs after some decisions like this which still leave the development of specific sites subject to referenda.

The United States Supreme Court Clarifies Nolan and Dolan to Include Cash Payment Demands and Demands that Result in a Denial of the Development Order: C. Koontz v. St. Johns River Water Management District, 133 S. Ct. 2586 (2013), and St. Johns River Water Management District v. Koontz, 77 So. 3d 1220 (Fla. 2012).

In a divided 5-4 opinion, the U.S. Supreme Court (“SCOTUS”) overturned the Florida Supreme Court (“SCOF”) decision in Koontz.  The core and critical holdings: the “unconstitutional conditions” doctrine underlying the Nollan and Dolan decisions applies in the land use regulatory context to cash exactions as well as demands for a direct interest in land (land or easements), and also can apply (but may not always) where no cash or exaction changes hands because the government agency denies the application at hand.  I will let the majority opinion speak for the Court’s logic:
Nollan and Dolan …. allow[] the government to condition approval of a permit on the dedication of property to the public so long as there is a “nexus” and “rough proportionality” between the property that the government demands and the social costs of the applicant's proposal. Dolan, supra, at 391, 114 S.Ct. 2309; Nollan, 483 U.S., at 837, 107 S.Ct. 3141.  Our precedents thus enable permitting authorities to insist that applicants bear the full costs of their proposals while still forbidding the government from engaging in “out-and-out ... extortion” that would thwart the Fifth Amendment right to just compensation. Ibid. (internal quotation marks omitted). Under Nollan and Dolan the government may choose whether and how a permit applicant is required to mitigate the impacts of a proposed development, but it may not leverage its legitimate interest in mitigation to pursue governmental ends that lack an essential nexus and rough proportionality to those impacts.
The full complexity and ramifications of the decision will be debated for years and cases to come, so I will touch only on a few brief and important points. 

First, the full application of the decision on the case itself will not be resolved until the Florida Supreme Court addresses it on remand because SCOTUS refused to address or resolve the large number of Florida procedural and statutory law issues the SCOF dodged by (incorrectly) interpreting the federal takings issues.  These include when and whether a plaintiff may proceed under special statutory “compensation” provisions (like the one at play here) without going through the full APA process to challenge the validity of the administrative action.  This was also mangled by everyone in the Save Our Beaches case.  The particular Florida statute created the damages remedy that was at issue here - SCOTUS left open the remedy for an illegal exaction in cases where there is not a statutory damages remedy.

Second, it is very unclear how and when a landowner will be able to bring a Koontz-based claim of extortionate demands under the DRI (or more “standard” local government) development procedures.  Here, the District walked (or was walked) into a documented denial based on the demand for off-site improvements without any “formal” analysis or relationship between the impact on wetlands and the demand for off-site improvements.  I would note that the essential action occurred in 1993, and could not happen under the current wetland regulatory regime in Florida.  In fact, no demand for a valid impact fee or regulatory fee in Florida will fall afoul of Koontz.  

However, programs like Pasco County’s recently invalidated right-of-way dedication ordinance, that do not tie required dedications to any rational evaluation (by the government) of the impacts of the development, will either be invalidated, require compensation, or both.  And where local governments – openly or through “suggestive” review practices – demand things like parks, schools, sidewalks or other “contributions” in the rezoning or other process that are above, beyond or separate from established impact fees or exactions, those demands may subject the local government to claims – even (and perhaps especially) where the developer was successful in getting the development permit.

However, the majority opinion is clear:  like a “taking of all economic use” under Lucas, a violation of the Nollan/Dolan/Koontz prohibition on unconstitutional conditions is a per se taking.  Here’s the real warning and the potential problem for all sides:  there is no meaningful difference between treating development approvals like a benefit that has to be “bought” (what’s in it for the community) and engaging in “out-and-out extortion.”  Landowners are required to offset their legitimate impacts in order to develop – they are not required to provide benefits to the community. 

My final point (at least today) is this:  the parade of horribles in the SCOF opinion, the SCOTUS dissent, and the dissent of a large number of the land use commentators, all demonstrate an appalling lack of understanding of the day-to-day abuses that occur in the development process today, and how easily the Nollan/Dolan/Koontz test can be met by a government agency acting in good faith.  Methods for fairly evaluating the impacts of development on public facilities/infrastructure and environmental resources are readily available today.  The problems occur almost entirely from lack of planning and governmental over-reaching – and a culture of land use regulation that has become corrupted (in the general sense – but also leading to the specific) by the huge regulatory discretion enjoyed by local governments and the lack of effective judicial oversight on the use of that discretion.
On October 30, 2013, the Florida Supreme Court remanded the case to the Fifth DCA for further proceedings.  

The Case Below:  Florida Supreme Court Mangles a Difficult Takings Case.
I have condensed the background for this tangled, fifteen year plus odyssey through the administrative process and three trips for appellate review, as the complete story would take far too long to repeat.  Koontz owns a 14.7 acre property that includes a significant proportion of wetlands and is also largely within a “Riparian Habitat Protection Zone of the Econlockhatchee River Hydrological Basin.”  Koontz sought to fill 3.4 acres of wetlands for a project.  The SJRWMD staff recommended approval with many conditions, one of which was that Koontz pay to perform offsite mitigation by replacing culverts in systems four and a half miles from the property or plug drainage canals seven miles away.  The District never introduced any evidence that these actions would mitigate direct impacts created by the proposed development or that they were in any way proportionate to the impacts of the proposed development.  Koontz refused to accept the conditions, and the District denied the permit.  Koontz then sued under         § 373.617, which provides a statutory process and remedies for claims that a permitting action would constitute a taking.  In its first and second trips up and down the appellate chain to the Fifth DCA, the ripeness and other issues were addressed.  On remand after the second appeal, the circuit court found the condition would create a taking, and the District chose to grant Koontz the permit (after receiving additional evidence that the jurisdictional wetlands on the property were significantly less extensive than originally thought).  The circuit court then awarded Koontz $376,154 for a temporary taking by the District.

The 5th DCA upheld the circuit court, holding the demand for off-site mitigation was an exaction under Nolan and Dolan.  The Fifth rejected the District’s assertion that Nolan and Dolan did not apply to “cash” demands for mitigation, but only to conditions that require a grant or dedication of lands or easements.  The dissent objected to lack of ripeness based on Koontz’s failure to litigate its validity in an administrative challenge, and also asserted that a takings claim is not available for mitigation conditions that do not involve dedications of land or easements.

The Florida Supreme Court overturned the Fifth DCA.  It held that while Florida follows federal takings law, it was not clear under existing decisions that Nollan and Dolan apply to exactions that do not take the form of dedications of land or easements, and it would not “extend” those holdings to include such exactions.  It also held takings claims are available “only where the regulatory agency actually issues the permit sought, thereby rendering the owner’s interest in the property subject to the dedication imposed.”  Justice Polston, joined by Justice Canady, concurred in the result, and would have held the entire issue was an attack on the propriety of the agency action and should have been subject to exhaustion by a challenge to the permit action under the APA.

The Court (and other courts that reached the same conclusion) was simply wrong in holding that the takings analysis does not reach “cash” mitigation.  The “unconstitutional conditions” doctrine on which this branch of takings jurisprudence is based, prohibits the government from conditioning a license, permit or benefit on the relinquishment of a constitutional right or protected interest.  The doctrine protects against regulatory over-reaching in any context - government employment (which is otherwise wholly discretionary), welfare (you can’t condition receipt), other forms of licenses (you can’t be required to swear allegiance to the United States in order to get a driver’s license), and the list goes on.

Furthermore, it is clear a regulation that requires a person to forego cash or its equivalent can be a taking.  This was the issue in Webb’s Fabulous Pharmacy v. Beckworth, 101 S. Ct. 446 (1980), which held a statute allowing the clerk to keep interest on private funds deposited into the registry of the court violated the takings clause.  Furthermore, (and directly on point) the Supreme Court characterized the statutory provision that awarded the interest to the clerk as an “exaction [that] is a forced contribution to general governmental revenues and is not reasonably related to the costs of using the courts.”  It went on to note that the Fifth Amendment “was designed to bar Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole.”  The Supreme Court went on to state that “the county’s appropriation of the beneficial use of the fund is analogous to the appropriation of the use of private property in United States v. Causby. . . .”

In addition, this case is a minefield for a number of reasons.  If the Court determined that the denial of a permit cannot cause a taking, why did it have to reach the other issue?  Moreover, if the denial could not have such effect, why did the majority not agree with Justice Polston that the issue was subject to exhaustion and avoid making a constitutional ruling?  The answer is very troubling:  the Court wanted to assert that regulatory agencies can, should, and must impose such conditions on permits without fear of takings claims.  The Court states:
It is both necessary and logical to limit land-use exactions doctrine to these narrow circumstances. Government agencies must have the authority and flexibility to independently evaluate permit applications and negotiate a permit award that will benefit a landowner without causing undue harm to the community of the environment.  If a property owner is authorized to file an inverse condemnation claim on the basis of the exactions theory any time regulatory negotiations are not successful and a permit is denied, two undesirable outcomes inevitably ensure.  First, the regulation of land use, deemed by the United States Supreme Court to be “peculiarly within the province of state and local legislative authorities,” would become prohibitively expensive.  . . .   Second, and as a result of the first consequence, agencies will opt simply to deny permits outright without discussion or negotiation rather than risk the crushing costs of litigation.  Property owners will have no chance to amend their applications or discuss mitigation options because the regulatory entity will be unwilling to subject itself to potential liability.  Land development in certain areas of Florida would come to a standstill.  We decline to approve a rule of law that would place Florida land-use regulation in such an unduly restrictive position.
I cannot understand how the Court allowed itself to take this extreme position, one that cannot be justified by evidence or the law.  The Supreme Court had previously held the public interest in the development process is protected by the “local regulations [or statutes], which must be uniformly administered.”  Broward County v. G.B.V. Intern’l, Inc, 787 So.  2d 838 (Fla. 2001).  Under Florida impact fee vs. tax, delegation of authority/rule adoption and similar requirements, most mitigation requirements are established by statute, rule or ordinance with respect to the extent and nature of required mitigation.  Is the Court really saying that government entities are and must be free to demand unauthorized, illegal exactions in order to protect the public interest?  The Court seemed frightened by a parade of horribles if it upheld the Fifth’s decision, and ignored the implications of overturning it in the way that it did:  Under this decision, agencies and local governments will feel that the Florida Supreme Court has expressly authorized them to demand whatever exactions they want during negotiations.  If they are smart, they won’t put those demands in writing.  They will simply inform developers that if they don’t “voluntarily donate” to whatever the local issue de jour may be, they won’t get a permit approval, and they will be secure in the inability of the developer to challenge the resulting condition.  It will be worse when “negotiating” with elected officials who may hear permit applications.

The Florida Supreme Court’s opinion could have an additional, unintended result that agencies and local governments may like less:  frustrated landowners and developers will be able to take claims of illegal “cash” mitigation demands direct to federal court, because Florida has construed its takings clause to exclude a remedy.

Expectation of a Future Plan Amendment Does Not Create “Existing Use” or “Vested Rights” that Are Compensable under the Bert Harris Act: A. Town of Ponce Inlet v. Pacetta, LLC et al, 38 Fla. L. Weekly D1481a (Fla. 5th DCA, July 5, 2013).

The Fifth District reversed a non-final order of the circuit court finding the Town of Ponce Inlet liable under the Bert Harris Act.  While it is not discussed in the District Court opinion, the circuit court’s order demonstrated that the trial judge was incensed by the pattern of the facts:  one set of Town officials had encouraged the plaintiff to assemble a set of parcels of waterfront land in order to come in with a comprehensive redevelopment plan and a comprehensive plan amendment to implement it; the project then attracted political opposition, and a later set of Town officials not only refused to amend the comprehensive plan to allow the project, but amended the charter and codes to prohibit future approvals.

The Fifth District, applying the earlier Halls’ River case and Florida law on vested rights, found that there was no basis under which the landowner could claim a “vested right” to the plan amendments necessary to allow the desired development, and therefore no right that was burdened by the Town’s action or inaction.  Therefore, there was no basis for liability under the Bert Harris Act.

City Cannot Levy Special Assessments Against Special District Absent Express Authority to Levy or Pay: B. North Port Road and Drainage District v. West Village Improvement District, 82 So. 3d 69 (Fla. 2012)

The City of North Port created a road improvement district to maintain and improve roads throughout the City.  The Court ruled that the City lacked home rule power to levy the assessments against various parcels of vacant land owned by West Villages, a CDD with special legislative powers:
In this case, NPRDD’s special assessments on West Village’s property fall within the limitations on home rule delineated in section 166.021(3) because (1) West Villages is not authorized by law to pass through the special assessments to property assessed separately by West Villages, and (ii) NPRDD is prohibited by the constitution from compelling payment by the Florida Legislature.  In other words, there is no way for West Villages to lawfully pay the assessments.

It is difficult to determine at this point whether the Court has created an exception that will swallow the more general rule that state agencies are liable to pay user fees and similar charges, unless specifically exempted by statute.  What is also interesting is that the fight here had to start as a certiorari challenge to the City’s levy of the special assessments under the Chapter 170 process.  This constrained West Village’s ability to argue that the assessments are patently unreasonable because West Villages (and the property within it) already maintains the roads within that area, and the funds would be used to improve roads in other areas of the City that would clearly not be used by, or benefit, the assessed parcels, or any lands within the West Villages.

County Could Impose Special Assessments for Recently Completed Projects Using Reassessment: A. Davis et al v. Marion County, 93 So. 3d 113 (Fla. 5th DCA 2012).

The Fifth District upheld the trial court determination that Marion County could impose a special assessment on property specially benefited by recently completed roadway improvements within MSBUs, through the reassessment process.

While not stated in the opinion, it appears that the County established the MSBUs or the assessment methodologies after making the road improvements.  Based on the opinion, it does not appear that the plaintiffs claimed there was no special benefit or that the benefits were unreasonably apportioned to the property.  Instead, the argument was that the County could not assess because it did not have “jurisdiction” to assess when the improvements were made.  The District Court rejected this argument based on earlier decisions allowing reassessment where benefitted property was not properly or fully assessed.

This decision could have significant impact and create new avenues for broad based funding for future improvements by confirming that local governments can recover from existing development the costs for improvements that benefit that development.  In other words, local governments can use special assessments to recover “sunk” costs in existing improvements, allowing them to use that revenue to maintain, replace or expand other improvements or to repay general obligation bonds and free up other funds.

Circuit Court Correctly Applied Rules of Construction and Did Not Reweigh Evidence in Overturning Town Commission Approval of PUD Amendment: B. Town of Longboat Key et al v. Islandside Property Owners Coalition, LLC et al, 95 So. 3d 1037 (Fla. 2d DCA 2012.

Disclaimer – I was the attorney for the Islandside respondents.
This case involves an extended and torturous set of proceedings to approve a major amendment to a PUD, originally approved in 1976, to allow redevelopment of a small commercial parcel and two recreational parcels with 300 multifamily and hotel units, a spa, restaurant and conference facilities.  The Town amended the zoning code in the middle of the proceedings, and approved the amendment.  When it became obvious that both the amendments and the approval would violate the comprehensive plan, it amended the comprehensive plan and further amended the zoning code to try to “save” the approval retroactively.

The approval was challenged in both declaratory and certiorari actions.  In the certiorari action, the Circuit Court entered an order finding that the approval violated the clear and unambiguous language of zoning code in multiple ways, and that the Town applied an ambiguous provision in a way that was unreasonable and therefore illegal.  In the introduction to the opinion, the Circuit Court noted comments by the Town’s Planning Director, that were adverse to the project. 

The Town and the developer challenged the Circuit Court’s opinion to the Second District, claiming that (1) the Circuit Court reweighed the evidence, and (2) that the Circuit Court misapplied the law by failing to give deference to the Commission’s interpretation of the code and failing to construe the code broadly to favor the developer.

The District Court upheld the Circuit Court.   The District Court rejected the reweighing claim, finding that the Circuit Court’s analysis focused with precision on the specific words in the Code.  The District Court also found not merit in the Town’s claim that the Circuit Court decision was based on improper reweighing of the evidence.  In particular, the District Court rejected the Town’s argument that the Circuit Court’s mere recitation of negative comments in the record as part of the background section of the opinion established that the circuit court reweighed the evidence.  The District Court noted that “ the Town’s argument reaches too far and would encourage a judge to omit any meaningful background information in an order lest he or she be accused of impropriety.  This hardly promotes judicial transparency, sound explanation and rational analysis.”

The District Court also found that, given the language of the Code and the Circuit Court’s analysis, it was not required to defer to the Town’s interpretation.  It found that the Circuit Court had correctly focused on the language of the Code and applied dictionary definitions to interpret undefined terms.  

The District Court rejected the Town’s claim that the previous approval of other development under the same language demonstrated that the language was ambiguous and, therefore, required deference to the Town’s interpretation:
The Town’s longstanding interpretation of its Code cannot tie the circuit court’s hands.  To allow such a result would countenance a shifting sands approach to Code construction that would deny meaningful judicial review of local quasi-judicial decisions.  The meaning of a code would remain in flux.  Such an approach does not promote consistency in the application of law.  As the wording of its laws binds a legislature, the Town is bound by the wording of its Code.  This mounts a bulwark against the Town’s unfettered exercise of power.

This opinion (and practitioners should also review the circuit court opinion, which is available on Fla. L. Weekly Supp) provides ammunition to attorneys on both sides of an issue with a local government – the local zoning code (or comprehensive plan) is not “ambiguous” simply because the local government wants to reinterpret it in a particular case.  Local governments are obligated to apply the plain meaning of their codes, as are the circuit courts.  Failure to do so is a departure from the essential requirements of law. 

County Commission Could Not Grant a Variance that Did Not Meet the Published Criteria: A. Wolk v. Bd. of County Commissioners of Seminole County et al, 38 Fla. L. Weekly D1474a (Fla. 5th DCA July 5, 2013).

This case involved a variance from an ordinance that requires all fences or walls to be set back 25’ from the front/street lot line unless they are less than 3 feet tall or “see through.” 
At issue were portions of a side fence consisting of 6’ stockade fencing.  The applicants/owners originally wanted this fence to extend to 1’ from the road, but after seeing negative staff reports, they used permissible iron fencing along the side.  However, it was not clear that the permitted fencing actually met the 25’ setback.  The Board of Adjustment denied the application, finding that the requested variance did not meet the published criteria.  The owners appealed to the County Commission under a “de novo” appeal provision.  The Commission granted the variance, but also found it unnecessary despite the evidence that showed a 6’ stockade fence within 25’ of the front property line.  The circuit court upheld this decision, finding and upholding the Commission on the basis that it could find that the variance was not necessary, and paradoxically therefore, could be granted.
The Fifth District reversed, finding that the Board of Adjustment applied the right law, and that the County Commission and circuit court did not.  While the District Court did not say so, it clearly viewed the Commission’s action as an impermissible attempt to rewrite the zoning regulation through interpretation.  The Fifth District stated:
We believe that the methodology utilized by the Board and approved by the circuit court of granting a variance in violation of the Code provisions yet concurrently concluding that the variance is not necessary is wrong, and its use needs to stop. Otherwise, others will be encouraged to employ the same or similar methods to work their will without regard to applicable laws and ordinances. Such methods not only disregard valid laws, they deprive others living in the neighborhood and surrounding areas of the valid application of ordinances that ensure the landscape of the neighborhood is kept in conformity with orderly growth and development.

The District Court recognized what the circuit court did not:  that the County Commission was using the variance appeal process to simply reinterpret the code and apply it as it saw fit to individual cases.  The Commission clearly thought that the established setback requirement was somehow unreasonable under the circumstances, so refused to enforce it – and refused to apply the published variance criteria.  The District Court correctly found this process to be the application of the wrong law and a miscarriage of justice.

Development Order for Mine Did Not Violate Comprehensive Plan Where it Included Conditions for Other Permits that Would Require Compliance: A. W.A.R. Inc., v. Levy County, 93 So. 3d 1244 (Fla. 1st DCA 2012).

W.A.R. challenged a development order for a lime rock mine as inconsistent with plan policies that protected “high quality” wetlands from development and required the protection of environmentally sensitive lands from mining operations.  The development order at issue included a condition that prohibited mining excavation until all other regulatory permits had been granted, including an excavation and fill permit.

Both the circuit court and the district court agreed with the developer that this condition was sufficient to require compliance with the comprehensive plan, and that the development order was therefore consistent with the plan.   

“Early” development orders such as rezonings, DRI development orders, or general site plans are frequently challenged for compliance with policies that can only be evaluated based on more specific plans and programs.  This case demonstrates that these “general” development orders can be granted without doing all of the comprehensive studies that may be required prior to actual development, by including appropriate conditions requiring later development orders that will require compliance. 

Refusal to Maintain Road Could Create Cause of Action for Taking - Jordan et. al. v. St. John’s County, 36 Fla. L. Weekly D1095 (Fla. 5th DCA 2011).

The plaintiffs/appellants own lots that are accessible only by an “Old A1A,” which is a County road that runs along the beach.  Old A1A was originally a state road; the state deeded the road to the County when it relocated US 1A further west.  Given its location, the road was frequently damaged or washed out by storms and erosions.  The County’s answer to the problem was to limit maintenance of the road and to adopt an ordinance imposing a temporary moratorium on residential building permits for lands served by the road.  A group of landowners filed suit:  (1) asking for a declaration that the County had the obligation to maintain the road, (2) requesting an injunction to require the County to maintain the road, (3) inverse condemnation for loss of access, and (4) for declaratory relief and inverse condemnation for the moratorium.  The circuit court entered summary judgment for the County on all counts and the landowners appealed.
The District Court found that the circuit court erred in granting summary judgment to the County on the claims for declaratory relief and inverse condemnation that were based on the failure to maintain the road.  The District Court agreed with the First District’s opinion in Ecological Development Inc. v. Walton County, 548 So.2d 1069 (Fla. 1st DCA 1990), that a local government cannot accept ownership of a road and then refuse to repair or maintain it, but cannot be ordered to repair or maintain it in a specific manner.  The District Court held that “the County must provide a reasonable level of maintenance that affords meaningful access, unless or until the County formally abandons the road.”  The District Court went on to hold that “government inaction – in the face of an affirmative duty to act – can support a claim for inverse condemnation.”  These issues were then remanded to the circuit court to determine: (1) whether the County had, de facto, abandoned the road, (2) whether the County’s maintenance of the road was reasonable, and (3) to determine damages if the County had failed to provide reasonable maintenance.  The holding of this case should have been predictable and in my opinion it is lamentable that the case was necessary