Can a Washington State Statute Cure Florida’s Local Government Exposure Under Koontz v. St. Johns River Water Management District?
The Supreme Court’s recently issued decision in Koontz v. St. Johns River Water Management District, 133 S. Ct. 2586 (2013), confirms that money is property, that money can be taken, and that no one agrees what happens next. Koontz took 20 years winding through the St. Johns River Water Management District and various courts. At different times, the parties argued whether varying kinds of takings occurred, or even what test applied. In a 5-4 decision, the Supreme Court held the district’s request that Koontz consider paying for certain district improvements in his basin might have constituted a coercive exaction. The majority held that monetary exactions were subject to the “rough proportionality” and “essential nexus” tests established for other development exactions by Nollan v. California Coastal Commission, 483 U.S. 825 (1987), and Dolan v. City of Tigard, 512 U.S. 374 (1994) ( Nollan/Dolan ). The district gave that payment option as possible mitigation for expected wetlands impacts of Koontz’s proposed development of his property. The Court remanded the matter to the Florida Supreme Court to sort out.
That court remanded in turn to the Fifth District Court of Appeal. A sharply divided panel decided 2-1 in St. Johns River Water Management District v. Koontz, 2014 WL 1703942 (Fla. 5th DCA 2014), that Koontz mandated an exactions takings determination. The Florida district sought review of this at the Florida Supreme Court in SC09-713 and SC14-1092. As of the writing of this article, the case lies in limbo.
This article proposes that Florida follow a Washington state statute to minimize Koontz’s impact.1 We emphasize Koontz’s impact on the level of government most likely to be hit with Koontz claims, and least equipped to address them — local government. The Washington state statutory test provides them a promising model for responding to Koontz.
Florida amended its wetlands mitigation and impact standards after Koontz began his sojourn through the administrative process. The 2002 Florida Legislature adopted the Uniform Mitigation Assessment Method, or UMAM, which it codified at F.S. §373.414(18). That statute required a standardized methodology to evaluate how much mitigation was required to offset impacts on wetlands and other surface water. The state developed UMAM to replace less exact ranges of ratios of mitigation to impacts that state and regional permitting authorities applied in wildly differing ways during the period when Koontz first applied for his permit.2
The state legislature commissioned a report in 2000 that found existing ratios standards did not provide adequate guidance to permit reviewers.3 They provided no adequate measurement of whether, and how much, wetland function was lost. The state’s own assessment of its mitigation ratios program shows the shortcomings that Koontz faced. UMAM should substantially reduce the likelihood of a future Koontz issue befalling the Florida Department of Environmental Protection (FDEP) or a water management district.
Additionally, the various Florida water management districts have dramatically altered the boundaries and number of drainage basins they regulate since Koontz applied two decades ago. The new basins more closely align hydrogeological connectivity and similar functions. For example, the St. Johns River Water Management District published a Notice of Proposed Rulemaking, and approved new rules on February 12, 2002, and July 9, 2002, respectively. The amendments revised drainage basins in the Applicant’s Handbook at Figures 12.2.8-1 and Appendix M, respectively titled, “Drainage Impacts for Cumulative Impacts Evaluation” and “Regional Watersheds for Mitigation Banking.” The new basins are incorporated into F.A.C.R. 40C-4.09(1)(a). The purpose of the amendment was to reduce the size and increase the number of drainage basins the district regulated to increase the likelihood that mitigation would more closely connect to impacts.4
The OPPAGA Report and Ch. 2000-133, Laws of Florida, led to the tightening of regulatory basins. The legislation amended F.S. §373.414 to provide that a proposed project’s impacts may be met either in the same drainage basin or outside, if the mitigation would offset the adverse impacts of cumulative impacts in the same drainage basin. The legislative mandate required the various districts to focus on both the actual impacts and mitigating “like for like.” This, combined with UMAM, reduced the chances of a future Koontz by strictly constraining the scientific and geographic scope of impacts analyzed, together with better tying mitigation to those impacts.
While exaction issues still result in developer complaints, UMAM combines with more tightly drawn hydrologic basins to substantially reduce the likelihood of state and regional water district exaction-based takings exposure as in Koontz. The bigger exposure will be at the local level, where counties and municipalities lack the tools to adequately weigh wetlands impacts of development.
This article urges Florida to examine Washington’s long-established developer exaction statute at 82.02.020, Revised Code of Washington (R.C.W.), as a template to guide exactions decisions. In combination with provisions in Washington’s Growth Management Act (GMA), the statute requires local government to use best available science in limiting wetlands exactions to mitigate direct impacts and proportionate to those impacts. While the Washington statute limits local government taxes and fees against development, its bright-line test and established interpreting caselaw might minimize Florida’s governments, courts, and private parties’ uncertainty about how to implement Koontz. This is particularly true because Florida’s UMAM statute governs local governments’ regulation of wetlands mitigation and Florida’s growth management laws mandate local government to regulate and to protect natural resources.
F.S. §163.3177(6)(d) (emphasis added) requires every local government’s comprehensive land use plan to contain a “conservation element”:
(6) In addition to the requirements of subsections (1)-(5), the comprehensive plan shall include the following elements:***
(d) A conservation element for the conservation use, and protection of natural resources, in the area, including air, water, water recharge areas, wetlands, water wells, estuarine marshes, soils, beaches, shores, flood plains, rivers, bays, lakes, harbors, forests, fisheries and wildlife, marine habitat, minerals, and other natural and environmental resources, including factors that affect energy conservation.
1. The following natural resources where present within the local government’s boundaries, shall be identified and analyzed and existing recreational or conservation uses, known pollution problems, including hazardous wastes, and the potential for conservation, recreation, use or protection shall also be identified:
a. Rivers, bays, lakes, wetlands including estuarine marshes , groundwaters, and springs, including information or quality of the resource available.
e. Areas that are the location of recreationally and commercially important fish or shellfish, wildlife and marine habitats and vegetation communities, including forests.***
2. The element must contain principles, guidelines and standards for conservation that provide long-term goals and which:***
j. Protects and conserves wetlands and the natural functions of wetlands.
k. Directs future land uses that are incompatible with the protection and conservation of wetlands and wetland functions away from wetlands . The type, intensity or density, extent, distribution. and location of allowable land uses and the types, values, functions, sites, conditions, and locations of wetlands are land use factors that shall be considered when directing incompatible land uses away from wetlands. Land uses shall be distributed in a manner that minimizes the effect and impact on wetlands. The protection and conservation of wetlands by the direction of incompatible land uses away from wetlands shall occur in combination with other principles, guidelines, standards, and strategies in the comprehensive plan. Where incompatible uses are allowed to occur, mitigation shall be considered as one means to compensate for wetlands function.
Florida’s growth management laws, thus, force local government to protect wetlands in their comprehensive plans. They require detailed and scientific analysis that few local governments can muster. The statute mandates mitigation where wetlands are affected. Koontz shows that even one of Florida’s most sophisticated and scientifically stocked regional water management districts can face takings exposure if mitigation goes too far. Washington’s statute, or something like it, might protect much smaller and less equipped local governments against Koontz liability.
This analysis is particularly significant in light of modern efforts to incorporate environmental protections in land use regulation. Professor Dan Tarlock focused on this issue in his forceful 2007 essay, “Land Use Regulation: The Weak Link in Environmental Protection.”5 Tarlock stated: “As environmental protection once again rises on the political agenda, the need to address the gap between land use regulation and environmental protection is becoming more critical; the regulatory gap impedes or cancels much of the progress that we have made to improve the conditions of our air sheds and watersheds….”6 He emphasized the “incomplete federal program of ‘sensitive land’ protection,” including protection of wetlands.7
Florida should consider a bright-line test similar to Washington’s to provide predictability. Otherwise, Florida’s local governments will struggle as they attempt to protect wetlands under the state’s growth management statutes. UMAM makes mitigation easier than the ratio standards that tripped the district in Koontz. Regardless, UMAM requires more technical capacity than most local governments possess. Without a template similar to Washington’s, Florida’s local governments have no real guidance in how to avoid Koontz exposure every time they seek to protect wetlands.
Washington Requirements for Development Limitations and Exactions
Washington has adopted several statutes that require local governments to weigh fact-specific, scientifically sound grounds for limits to development. The most sweeping is R.C.W. §82.02.020, which provides in pertinent part:
State preempts certain tax fields — Fees prohibited for the development of land or buildings — Voluntary payments by developers authorized — Limitations — Exceptions***
Except as expressly provided in RCW 64.34.3440 and 82.02.050 through 82.02.090, no county, city, town, or other municipal corporation shall impose any tax, fee, or charge, either direct or indirect, on the construction or reconstruction of residential buildings, commercial buildings, industrial buildings, or on any other building or building space or appurtenance thereto, or on the development, subdivision, classification, or reclassification of land. However, this section does not preclude dedications of land or easements within the proposed development or plat which the county, city, town, or other municipal corporation can demonstrate are reasonably necessary as a direct result of the proposed development or plat to which the dedication of land or easement is to apply .
This section does not prohibit voluntary agreements with counties, cities, towns, or other municipal corporations that allow a payment in lieu of a dedication of land or to mitigate a direct impact that has been identified as a consequence of a proposed development, subdivision, or plat….***
This section does not limit the existing authority of any county, city, town or other municipal corporation to impose special assessments on property specifically benefited thereby in the manner prescribed by law.
This statute has two prongs. First, it presumes that local governments cannot impose a “tax, fee, or charge, direct or indirect” on development except as stated expressly in other enabling authority. This part is consistent with home rule authority in many other states. For example, the rationale for the Standard State Zoning Enabling Act in 1924 and 1926 was the determination that local governments do not enjoy the inherent authority to zone lands. Home rule authority law limits that application as to certain local governments in some states. Regardless, this prong is not the subject of our analysis.
The other prong concerns us. The local government may only impose exactions that “are reasonably necessary as a direct result of the proposed development or plat to which the dedication of land or easement [exaction] is to apply.” This prong parallels Nollan/Dolan.
The statute originally confirmed state preemption of various general taxes, including sin taxes on wagering and cigarettes.8 The 1982 Legislature amended the statute in response to an issue that was before the Washington Supreme Court that same year.9 The court held in Hillis Homes v. Snohomish County, 97 Wash. 2d 804, 810 (1982), that a local government may impose a fee for a legitimate regulatory purpose. If the fee is intended to raise revenue, however, it constitutes an unlawful tax.10
The 1982 Washington Legislature responded to this issue by amending §82.02.020 to impose development exactions. The amendments limited developer fee exactions to those that the development made “reasonably necessary” and which “direct[ly] resulted from the development’s impacts.” One commentator summarized: “Put simply, the legislature allowed local governments to recoup costs they would incur because of a development, but forbade them from inflating their balance sheets by using their authority to approve developments to extort money from developers.”11
The 1990 Washington Legislature passed the state’s GMA and a related amendment to §82.02.020.12 The GMA modernized a balkanized, outdated, and disjointed set of land use laws dating back over a century.13 The GMA was similar to Oregon’s and Florida’s growth management acts in setting various goals that each jurisdiction’s comprehensive plan must meet.14 Unlike Florida, which mandates virtually all local governments adopt a plan, §36.70A.040 applies to local governments in “each county that has both a population of fifty thousand or more and, until May 16, 1995, has had its population increased by more than  percent in the previous  years, or, on or after May 16, 1995, has had its population increase by more than  percent in the previous ten years,” and any other county that has a population increase of over 20 percent in the previous 10 years. Other jurisdictions may adopt a plan.15
Sections 36.70A.060 and 36.70A.170 require covered jurisdictions to implement their plans through land development regulations that “protect critical areas.”16 This requirement is further implemented in Washington Administrative Code §§365-190-040 through -080.17 S ection 36.70A.030(5) defines “critical areas” as including “(a) wetlands.”18 This parallels Florida’s §163.3177. The GMA at §36.07A.172(1) requires a local government to utilize “best available science” to determine critical areas, and to protect their “functions and values.”19 This parallels Florida’s requirement at §163.3177 that comprehensive plans and amendments be based on best and latest available data and analysis.
Leading land-use scholar Daniel Mandelker emphasizes Washington’s program in his recent article reviewing how various states implement their growth management programs.20 He focuses on the state’s requirement that local governments “designate and manage critical areas in compliance with statutory criteria implemented by state agency guidelines.”21 Mandelker says Washington follows the American Law Institute’s Model Land Development Code, for which Fred Bosselman developed the concept of critical area protection.22
Mandelker contrasts Washington with Oregon (and Florida, which follows the Oregon model, even after decentralization in 2011 legislation). “Washington did not adopt the top-down Oregon [land use regulation] model….”23 Instead, Washington relies on citizen enforcement through administrative appeal and ultimate recourse to the courts.24 Mandelker cites Washington caselaw, holding the GMA requires local government to use “best available science” when designating critical areas, as well as considering all critical habitats in the jurisdiction.25
The 1990 Washington Legislature also amended §82.02.020, and adopted §82.02.050. These statutes authorized local government to impose impact fees, but only for the actual impact of a development. The statute required a segregated account and time period to use such fees.
In Florida, a statute such as §82.02.020 would clearly apply to Koontz -like fees in lieu of mitigation done by local government. Washington courts have not hesitated to apply it as well to other development exactions. For example, Citizens’ Alliance for Property Rights v. Sims, 145 Wash. App. 649 (2008), rev. den., 165 Wash. 2d 1030, struck a county ordinance that limited clearing on property that was zoned rural area residential to a maximum of 35 percent. The county argued unsuccessfully that the Washington GMA26 mandated it adopt standards to protect natural resources and critical areas. The appellate court held the GMA did not require clearing limits.27 The court, thus, rejected the county’s contention that the GMA constituted state authority for the cap, which would have exempted the clearing limit from the §82.02.020 impact on local legislation.28
The Sims court emphasized a core component to the statute.29 It does not bar local exactions, but rather, the statute requires the local government to establish a rough proportionality between the impacts of the development and the exaction extracted.30 The conditions must mitigate the impacts of the development.31
Another Washington court struck a local ordinance that required an applicant for a preliminary plat to set aside 30 percent of the platted parcel for open space.32 The court emphasized the fact that this was a uniform standard.33 It did not vary based on actual open space needs the specific development generated.34 The court held that §82.02.020 required the local government to show the exaction was required by site-specific impacts.35
Brian Hodges and Daniel Himebaugh argued that Sims properly held that King County’s clearing cap violated both §82.02.020 and Dolan because the county failed to show “rough proportionality.”36 They questioned another aspect of Sims that would create a Koontz issue, particularly under the Roberts court.37 They claim the court applied the “precautionary principle,” which allows a government to apply generalized scientific evidence to avoid a perceived, general possibility that a use might harm the environment.38 This standard is closer to that espoused by Professor Tarlock in his critique of the modern Supreme Court’s site-specific regulatory takings jurisprudence.39
Hodges and Himebaugh argue that the precautionary principle is not consistent with modern Supreme Court authority.40 For good or ill, they are correct. They sum up accurately the Nollan/Dolan standard:
The United States Supreme Court has demanded heavier deference to private property rights than the precautionary principle is likely to afford. Nollan, in particular, requires the government to show a causal connection between the identified public problem it wants to control and the proposed development before placing limitations on a property owner’s ability to develop his or her own property. But Nollan stands in marked contrast to a popular statement of the precautionary principle, which says, “When an activity raises threats of harm to human health or the environment, precautionary measures should be taken even if some cause and effect relationships are not fully established.” Nollan’s essential nexus test and the precautionary principle are at clear odds because the former demands a causal link; the latter relies substantially less on cause-and-effect connections.41
This position comports with the thoughtful 1999 article by Alan Copsey on what constitutes best available science under the statute.42 He discussed the scientific method. Copsey suggested as a template the analysis of the Washington Department of Fish and Wildlife. That agency concluded that best available science “generally should exhibit peer review, reliable methodology, logical conclusions and reasonable inferences, a defined context, and adequate references.”43 Copsey continued to say that the statutory language stating local government must “include” best available science meant that “best available science be ‘included’ in the development of policies and regulations to protect the functions and values of critical areas, and the challenge is to give meaning to that requirement.”44
This parallels the data and analysis requirements under Florida’s Community Planning Act at F.S. Ch. 163. Former F.A.C. Ch. 9J-5, required, and F.S. §163.3177 still mandates local government to use data and analysis to perform “identification and analysis of natural resources and other areas with development constraints, the suitability of land for various uses, and the availability of facilities services and infrastructure.”45 Specifically, the authority “expressly requires local governments to direct development away from wetlands and other environmentally sensitive areas where such development is incompatible with their protection and conservation….”46 Additionally, F.S. §163.3177 states local government shall consider mitigation when it allows incompatible uses in wetlands.
How Should Florida Apply §82.02.020?
The Florida Legislature should consider passing a statute similar to §82.02.020 within F.S. Ch. 70. That chapter contains the Bert J. Harris, Jr., Private Property Rights Protection Act at §70.001, and the Land Use and Environmental Dispute Resolution Act at §70.51. These statutes supplement Florida’s takings law by, respectively, creating a cause of action against governmental acts that do not take, but do inordinately burden property and establishing an alternative dispute resolution process for such alleged actions.
The Washington statute has been applied similarly to F.S. §373.617(4), which was addressed in Koontz. That statute states that when an FDEP or water management district decision constitutes an unreasonable exercise of the police power, the offending agency may choose among: 1) issuing the requested permit; 2) paying compensation; and 3) modifying the agency action to avoid a taking and issuing a report to the court of that modification. Such alternatives would allow the local government to first defend its action consistent with Nollan/Dolan, and then choose how much the resource protection is worth if it cannot establish an essential nexus and rough proportionality.
Granted, Koontz got a judgment for temporary taking between initial denial and ultimate issuance. Koontz did take a decade. What happens if the decision takes a less extraordinary amount of time?
A thorough note in the Pepperdine Law Review analyzed and critiqued the principal Supreme Court precedent on-point: First English Evangelical Lutheran Church of Glendale v. County of Los Angeles, 482 U.S. 304 (1987).47 First English held that “normal delays in obtaining building permits, changes in zoning ordinances, variances, and the like”48 did not constitute a temporary taking. The note explicated various factors courts have weighed in determining whether a taking occurred by permitting delay.49 Nothing precludes a Florida court from similar analysis.
In sum, Koontz is likely to hinder the FDEP and regional water management districts less than expected. This is due to the advent of UMAM, tighter basins determinations, and solid technical expertise. Florida should, however, consider whether a statute that incorporates R.C.W. 82.02.020 with F.S. §373.617 will require Florida’s local governments to provide adequate support on wetlands decisions, while minimizing the risk if they do not succeed. The Koontz court continued the Supreme Court’s refusal to provide bright-line takings tests. Florida can adopt Washington’s template to reduce Koontz’s sword of Damocles over local governments.
The author drafted H.B. 673 and S.B. 772, which were filed in the 2013 Florida Legislature. Those bills intentionally tracked the Washington statute. The bills’ text was tweaked and introduced as H.B. 1077 and S.B. 1310 in the 2014 Legislature. Once Koontz winds its way through the courts, the state might want to revisit this text.
1 R.C.W. §82.02.020.
2 Office of Program Policy Analysis and Government Accountability Report No. 99-40 at 13-18 (March 2000).
4 This is particularly significant in Florida, which requires wetlands permitting review to consider “secondary impacts,” or those activities that are “‘very closely linked or causally related to the proposed dredging and filling,’” Conservancy v. A. Vernon Builders, 580 So. 2d 772, 778 (Fla. 1st DCA 1991); and “cumulative impacts,” or “those projects which are existing, under construction, or reasonably expected in the future.” Id.
5 A. Dan Tarlock, Land Use Protection: The Weak Link in Environmental Protection, 82 Wash. L. Rev. 651 (2007).
6 Id. at 652.
7 Id. at 657.
8 Martha Lester, Subdivision Exactions in Washington: The Controversy Over Imposing Fees on Developers, 59 Wash. L. Rev. 289, 294 n. 40 (1984).
10 Hillis Homes, 97 Wash. 2d at 86.
11 Donya Williamson, Urbanites Versus Rural Rights: Contest of Local Government Land-Use Regulations Under Washington Preemption Statute 82.02.020, 84 Wash. L. Rev. 491, 502-03 (2009).
13 Id. at 495.
14 Ch. 17, 1990 Wash. Sess. Laws 1st Ex. Sess. 1972, codified at §36.70A, as amended.
15 R.C.W. §36.70A.040.
19 See, generally, Alan D. Copsey, Including Best Available Science in the Designation and Protection of Critical Areas Under the Growth Management Act, 23 Seattle U. L. Rev. 97 (1999).
20 Daniel R. Mandelker, Implementing State Growth Management Programs: Alternatives and Recommendations, 45 J. Marshall L. Rev. 307 (2012).
21 Id. at 308, n. 8 and accompanying text (citing R.C.W. §§36.70A.010 and 36.70A.060(2); citing also Swinomish Indian Tribal Cmty v. Western Wash. Growth Mgmt. Hearings Bd., 161 Wash. 2d 415 (2007), which found that using a “no harm” standard to preserve existing state satisfied the statutory mandate to protect critical areas).
22 Id. at n.6 and accompanying text (citing, inter alia, D. Mendelker, Fred Bosselman’s Legacy to Land Use Reform, 17 J. Land Use & Envtl. L. 11 (2002)).
23 Id. at 314.
24 Id. at 314-15.
25 Id. at 314, n. 32 and accompanying text (citing Stevens County v. Futurewise, 192 P.3d 1, 12 (Wash. App. Div. 3 2008)).
26 R.C.W. Ch. 36.70A.
27 Citizens’ Alliance, 145 Wash. App. at 649.
32 See Isla Verda Int’l Holdings, Inc. v. City of Camas, 146 Wash. 2d 740 (2002).
36 Brian T. Hodges & Daniel A. Himebaugh, Have Washington Courts Lost Essential Nexus to the Precautionary Principle? Citizens’ Alliance for Property Rights v. Sims, 40 Envtl. L. 829 (2010).
38 Id. at 830-31.
39 Tarlock, Land Use Protection: The Weak Link in Environmental Protection, 82 Wash. L. Rev. 651 (2007).
40 Hodges & Himebaugh, Have Washington Courts Lost Essential Nexus to the Precautionary Principle? Citizens’ Alliance for Property Rights v. Sims, 40
Envtl. L. 829 (2010).
41 Id. at 835.
42 Alan D. Copsey, Including Best Available Science in the Designation and Protection of Critical Areas Under the Growth Management Act, 23
Seattle U. L. Rev. 97, 119 (1999) (citing at n. 60 and n. 62 numerous WDFW and other materials, including WDFW, Management Recommendations for Washington’s Priority Habitats: Riparian at Part II.A.2 (1997)).
44 Id. at 121-22.
45 Richard Grosso & Jason Totoiu, Planning and Permitting to Protect Wetlands: The Different Roles and Powers of State and Local Government, 84 Fla. B. J. 39 (2010).
46 Id. (citing former 9J-5.013(a)-(b), but post-2011 legislative amendments, §163.3.177 still generally so requires).
47 First English, 482 U.S. at 304, cited in Kimberley Horsley, The Abnormalcy of Normal Delay, 28 Pepp. L. Rev. 415 (2001).
48 First English, 482 U.S. at 321.
Sidney F. Ansbacher practices in the Jacksonville office of Upchurch, Bailey & Upchurch. He is a former chair of the Environmental and Land Use Law Section.
This column is submitted on behalf of the Environmental and Land Use Law Section, Kelly Kathleen Samek, chair, Susan Roeder Martin, editor.