CITY COUNCIL REGULAR MEETING SUPPLEMENTAL MATERIAL 7-21-26

5 Nollan v. California Coastal Comm’n, 483 U.S. 825 (1987), Dolan v. City of Tigard, 512 U.S. 374 (1994), Koontz v. St. Johns River Water Management District, 570 U.S. 595 (2013), Sheetz v. County of El Dorado, California, 601 U.S. 267 (2024), and Ehrlich v City of Culvert City, 12 Cal. 4th 854 (1996)). In Nollan, the U.S. Supreme Court ruled that requiring a public easement over private property as a condition of building permit issuance was unconstitutional unless there was an “essential nexus” between the condition imposed and the legitimate public purpose. Thi s essential nexus test requires the following conditions to be satisﬁed for an exaction to be constitutional: • There is a direct connection between the impact of the project and the condition being imposed; and • The condition helps to mitigate the speciﬁc public burden caused by the project. Thus, there must be a fundamental connection, or essential nexus, between the condition to be imposed and the speciﬁc impact of the development proposal at issue. In Dolan, the U.S. Supreme Court upheld the premise that some exactions are constitutional but further clariﬁed the nature of the nexus requirement: there must be "rough proportionality" between the exaction and a project's impact. Thus, read together, the Nollan/Dolan (and related line of cases) resulted in the following two-pronged test that reﬂects a heightened degree of scrutiny (as compared to the more deferential standard wherein a “reasonable relationship” alone is sufﬁcient): • Is there an essential nexus? • Is the exaction roughly proportional to the impact of the project, in both nature and extent? The Court emphasized that a generic or formulaic fee may not satisfy this test unless justiﬁed by quantitative analysis linking a project’s speciﬁc burden to the cost of mitigation. For the Court, rough proportionality means “no precise mathematical calculation is required but the city must make some sort of individualized determination that the required dedication is related both in nature and extent to the impact of the proposed development.” (Dolan v. City of Tigard, 512 U.S. 374, 391 (1994).) Following the Dolan decision, in 1996, the California Supreme Court adopted a test to address the lawfulness of exactions in Ehrlich v. City of Culver City, 12 Cal. 4th 854 (1996).4 In that case, the Court clariﬁed that the legal analysis is the same whether an exaction is in the form of a land dedication, a monetary fee, or the required construction of a public facility. However, the Court also held that different standards of review apply, depending on the nature of the exaction at issue. An exaction imposed pursuant to an ordinance or rule of general applicability — as compared to an ad hoc condition imposed on an individual project — is constitutionally permissible unless the landowner establishes that the exaction either 4 The holding and rationale in Erlich was reaffirmed in San Remo Hotel, L.P. v. City and County of San Francisco, 27 Cal. 4th 643 (2002).