People who ask for land use permits are sometimes viewed as juicy targets to be milked. It's not uncommon for the applicant to be required to pay for projects that have little connection with the permit.
But property owners have new protection thanks to the U.S. Supreme Court's recent ruling in the Florida case of Koontz v. St. Johns River Water Management District.
The Koontz decision says the permitting process can't be used as an opportunity to fund bureaucratic wish lists. Any financial demands on the property owner must be tied to, and mitigate for, real impacts from the land use proposal.
When Coy Koontz Sr., a small entrepreneur, asked for permission to develop 3.7 acres in Orange County in the 1990s, he and his family were treated like a cash cow. The St. Johns River Water Management District, which had jurisdiction because the property was in a state wetlands protection zone, tried to coerce the Koontzes into funding unrelated projects on the district's land.
It should be noted that the wetlands "zone" didn't reflect reality. The Koontzes' 3.7 acres, a mostly wooded area that's now between a convenience store and a car dealership along state Highway 50, had no standing water or protected species. The land simply wasn't "wetlands."
Nevertheless, the Koontzes offered to set aside their other 11 acres, also in the protected zone, for conservation. Although the family had the statutory right to seek a development permit for those 11 acres, they agreed never to do so.
But the district wanted more. The Koontzes were told to pay for "mitigation" projects, such as replacing culverts and plugging ditches, on district land, miles away - at a cost of up to $150,000.
What was supposed to be a process of negotiation was turning into an exercise in government confiscation. So the family headed to court, arguing they were being shaken down in violation of the Fifth Amendment's ban on uncompensated "takings" of private property.
Coy Koontz Sr. passed away during the early stage of the case. But his son, Coy Jr., has continued the battle, which has now spanned two decades. Florida's lower courts agreed with the family, recognizing that being ordered to pay for upgrades on 50 acres of district-owned wetlands couldn't be justified. (Indeed, in the course of the litigation, government officials finally acknowledged that the Koontzes' 3.7 acres weren't wetlands after all.)
But the Florida Supreme Court sided with the government on a somewhat technical ground. It held that the Fifth Amendment protects only against excessive demands for real property (such as a tract of land, or an easement), not demands for cash, whatever their size.
Represented by Pacific Legal Foundation (PLF), a property rights watchdog organization, the family appealed to the U.S. Supreme Court. The high court took their case - and has now handed all property owners a historic victory.
The five-justice majority held, for the first time, that money is "property" protected by the takings clause from shakedown schemes. The Constitution doesn't just prohibit land grabs by government, it also prohibits unjustified financial conditions on land use permits.
Showing how the ruling resonates from coast to coast, the Koontzes' story is reminiscent of a family in California that PLF previously represented. Jonette Banzon and her husband, Muhammed Ahmad sued the city of Elk Grove, near Sacramento, after it demanded $240,357 for road improvements if they wanted a permit to build an approximately $500,000 home.
The city backed down, dropping the fee to $9,750. If Elk Grove had remained defiant, who knows - the Supreme Court's landmark decision might have had that California city as the losing party instead of an agency in Florida.
The Koontz decision is a win for property rights, but it is also a plus for public officials who want to ensure credibility in the permitting process. Because of the clear standards that the Supreme Court has laid down, land use regulators now have objective guidelines for informed decision-making.
To summarize the new precedent: Negotiation and collaboration are encouraged. Mitigation requirements for environmental impacts are permitted. But strategies of extortion and confiscation aren't allowed, because they aren't professional, they aren't fair - and they aren't constitutional.
Paul Beard is a principal attorney with Pacific Legal Foundation, a nationwide property rights organization whose Florida office is in Palm Beach Gardens. He successfully represented Coy Koontz Jr. at the U.S. Supreme Court.