Dolan v. City of Tigard (1994) is a landmark Supreme Court case that established the "rough proportionality" test for development exactions. Building on Nollan v. California Coastal Commission, the Court held that permit conditions must not only have an essential nexus to the government's interest but must also be roughly proportional to the projected impact of the proposed development.
Dolan v. City of Tigard, 512 U.S. 374 (1994)
Florence Dolan owned a plumbing and electric supply store in the Central Business District of Tigard, Oregon. The store was located on a 1.67-acre parcel that included a building and a gravel parking lot. Fanno Creek flowed through the southeastern corner of the lot and was prone to flooding.
Dolan applied for a permit to redevelop the site by demolishing the existing building and constructing a larger store, and to pave the gravel parking lot. The City Planning Commission granted the permit but imposed two conditions: (1) Dolan must dedicate the portion of her property lying within the 100-year floodplain for improvement of a storm drainage system, and (2) she must dedicate an additional 15-foot strip of land adjacent to the floodplain as a pedestrian/bicycle pathway.
The city justified these conditions by arguing that the larger store and paved parking lot would increase stormwater runoff and traffic congestion. The floodplain dedication would help manage drainage, while the pathway would provide alternative transportation and reduce traffic. Dolan challenged the conditions as an unconstitutional taking of her property.
What standard should courts apply to determine whether permit conditions that require property dedications are constitutional under the Fifth Amendment's Takings Clause, and do the conditions imposed on Dolan meet that standard?
Permit conditions requiring property dedications must satisfy two requirements: (1) an "essential nexus" must exist between the condition and the legitimate state interest (from Nollan), and (2) the condition must be "roughly proportional" in nature and extent to the projected impact of the proposed development. The government bears the burden of making an individualized determination of rough proportionality.
The Supreme Court held that the city's permit conditions violated the Fifth Amendment because they failed the rough proportionality test. While the conditions satisfied the essential nexus requirement, the city had not demonstrated that the extent of the dedications was roughly proportional to the projected impact of Dolan's development.
Chief Justice Rehnquist, writing for the majority, established the rough proportionality test through detailed analysis:
Applying the test to the facts, the Court found that while the city had established the nexus, it had failed to demonstrate proportionality. For the floodplain dedication, the city had not shown why a public greenway was required rather than simply prohibiting building in the floodplain. For the pathway, the city had not quantified the increased traffic or demonstrated that a pathway dedication was proportional to that increase.
The Court emphasized that the rough proportionality test requires more than conclusory statements but does not require precise mathematical calculations. The government must show some reasonable relationship between the required dedication and the impact of the development.
Dolan v. City of Tigard has had profound impact on land use law and development regulation:
Together with Nollan, Dolan forms the foundation of modern exactions law. The Nollan/Dolan test has been applied to various types of permit conditions and has led to more careful analysis of development requirements by local governments.
The rough proportionality test requires that permit conditions be proportional in nature and extent to the projected impact of the proposed development. It's more than a reasonable relationship but doesn't require precise mathematical calculations.
Nollan requires an "essential nexus" between the permit condition and the government interest, while Dolan adds that the condition must be "roughly proportional" to the development's impact. Both tests must be satisfied for a condition to be constitutional.
The government bears the burden of demonstrating that permit conditions satisfy both the essential nexus and rough proportionality tests. Property owners don't have to prove the conditions are unconstitutional; the government must prove they are constitutional.
Courts have applied Dolan principles to impact fees and other monetary exactions, though the Supreme Court has not definitively ruled on this. Many jurisdictions now apply similar nexus and proportionality analysis to various types of development conditions.
Explore more cases on land use regulation, development exactions, and the constitutional limits on government conditions.