Regulating Land Use in a Constitutional Shadow: The Institutional Contexts of Exactions

In a refreshingly clear and comprehensive decision issued towards the end of its 2004 Term, the Supreme Court explained in Lingle v. Chevron (2005) that the Takings Clause requires compensation only for the effects of a regulation on an individual's property rights. Under the substantive due process doctrine, by contrast, courts engage in a deferential inquiry into both a regulation's validity and the means by which the regulation attempts to meet the government's objective. Lingle's explanation appeared to cast doubt on the doctrinal foundation and reach of Nollan v. California Coastal Commission (1987) and Dolan v. City of Tigard (1994), two regulatory takings decisions that reviewed "exactions," regulatory conditions placed on proposals to develop land. These decisions required courts to apply the heightened scrutiny of their "nexus" and "proportionality" tests to review not only the challenged condition's effects but also its validity and means. In a somewhat oblique final section of Lingle that could be dismissed as non-binding dicta, the Court characterized its exactions jurisprudence as a limited effort to protect owners from extortionate exactions that single out individual property owners and confiscate their land and right to exclude the public. Lingle explained that the Court's rigorous tests for exactions, and their focus on regulatory means, apply only when an exaction's effects constitute a clear taking of property. Lingle's description of its exactions decisions left important matters open for debate - matters that this Article attempts to resolve. Lingle's narrow characterization of its exactions decisions is not dicta because Lingle aimed to provide a comprehensive, unifying explication of the entirety of the Court's takings jurisprudence; and even if dicta, Lingle repeats similar statements in recent decisions about the limited nature of Nollan and Dolan and therefore makes plain what the Court assumes it has already settled. Furthermore, when read as Lingle requires, Nollan and Dolan fit within the broader approach to the Takings Clause that the Court articulated in Lingle and its other Takings Clause decisions from the same term, San Remo Hotel v. City and County of San Francisco (2005) and Kelo v. City of New London (2005). A narrow understanding of Nollan and Dolan is thoroughly consistent with the Court's effort to establish an institutionalist approach to the Takings Clause that defers to the properly derived decisions of competent, settled institutions. Nollan and Dolan can be read narrowly because judicial enforcement of the federal constitution is merely one institutional check among a web of public and private institutions that constrain local regulatory discretion. The powerful constitutional protection that "nexus" and "proportionality" provide may be limited, but in their shadow public actors in state courts and legislatures and in local governments, as well as voters, property owners, developers, and homebuyers offer a more complex, responsive, and locally sensitive web of legal, political, and market controls than the broad, formal rules established in Nollan and Dolan.