B.A.M. Development v. Salt Lake County

• Decision Date: 10 January 2006
• Docket Number: No. 20040365.,No. 20040373.,20040365.,20040373.
• Citation: 128 P.3d 1161,2006 UT 2
• Parties: B.A.M. DEVELOPMENT, L.L.C., a Utah limited liability company, Plaintiff, Respondent, and Cross-Petitioner, v. SALT LAKE COUNTY, a body politic and a political subdivision of the State of Utah, Defendant, Petitioner, and Cross-Respondent.
• Court: Utah Supreme Court

128 P.3d 1161

2006 UT 2

B.A.M. DEVELOPMENT, L.L.C., a Utah limited liability company, Plaintiff, Respondent, and Cross-Petitioner, v. SALT LAKE COUNTY, a body politic and a political subdivision of the State of Utah, Defendant, Petitioner, and Cross-Respondent.

No. 20040365.

No. 20040373.

Supreme Court of Utah.

January 10, 2006.

COPYRIGHT MATERIAL OMITTED

Stephen G. Homer, West Jordan, for respondent.

Donald H. Hansen, David E. Yocom, Salt Lake City, for petitioner.

Craig M. Call, Salt Lake City, for amicus Department of Natural Resources.

AMENDED OPINION

On Certiorari to the Utah Court of Appeals

NEHRING, Justice:

INTRODUCTION

¶ 1 In this land-use dispute, Salt Lake County sought to exercise its police power to require B.A.M. Development, L.L.C., to dedicate property for the purpose of widening a major traffic artery adjacent to a residential subdivision from which B.A.M. sought County approval to build. The court of appeals held that the process used to review the propriety of the County's land dedication requirements before both the Salt Lake County Board of Commissioners and the trial court was flawed. It reversed the trial court and remanded to remedy the errors. The court of appeals also mandated that the review on remand be conducted using the standards embodied in what has come to be known as the Nollan/Dolan or "rough proportionality" test.

¶ 2 We granted certiorari to examine whether the court of appeals correctly determined that the Nollan/Dolan test is the proper tool to measure the lawfulness of the dedication of B.A.M.'s property to the County. We affirm.

¶ 3 We also granted certiorari to review two procedural issues, both of which are made moot by Senate Bill 60, which amended Utah Code section 17-27a-801, effective May 2, 2005, and details proper district court review of a county's land-use decision. This section operates retroactively because these two issues are procedural in nature.

FACTUAL AND PROCEDURAL BACKGROUND¹

¶ 4 Salt Lake County Ordinance 15.28.010 requires developers of land to dedicate property to the County to improve public streets that abut the proposed development. Salt Lake County has adopted a Transportation Master Plan to anticipate and prepare for the long-term highway capacity needs of Salt Lake County. The requirements imposed on developers under the Ordinance are directly tied to the elements of the Transportation Master Plan. In the parlance of takings clause jurisprudence, a mandate like that created by the County's ordinance is a "development exaction." We have defined development exactions as "contributions to a governmental entity imposed as a condition precedent to approving the developer's project." Salt Lake County v. Bd. of Educ., 808 P.2d 1056, 1058 (Utah 1991) (internal quotation marks and citations omitted).

¶ 5 B.A.M. Development, a Utah limited liability company, requested and received preliminary approval from the Salt Lake County Planning and Zoning Commission to develop a residential subdivision on fifteen acres of land located at 7755 West and 3500 South in Salt Lake County, Utah. In its original proposed subdivision plat, B.A.M. agreed, as a condition of development approval, to set aside a forty-foot-wide strip of land for the future widening of 3500 South. One year later, Salt Lake County informed B.A.M. that, after consulting with the Utah Department of Transportation, it had concluded that the Transportation Master Plan contemplated the eventual widening of 3500 South to fifty-three feet at the site of B.A.M.'s subdivision. Based on this information, the County revised the conditions imposed on B.A.M. to approve its development to include the requirement that B.A.M. dedicate an additional thirteen feet of its property to the County.

¶ 6 B.A.M. objected to this additional demand because the increased dedication would require reconfiguration of the subdivision resulting in further development expense. The planning and zoning commission turned away B.A.M.'s objection without receiving evidence and continued to condition B.A.M.'s license to build the subdivision on dedication of the fifty-three-foot parcel for road expansion.

¶ 7 B.A.M. appealed the planning and zoning commission's decision to the Salt Lake County Board of Commissioners. It contended that the County's demand for the additional thirteen feet of property amounted to an unconstitutional taking.² B.A.M. requested that the Board find that the "uncompensated dedication and improvement of the additional roadway constitute[d] an unconstitutional `taking,' not reasonably justified by the actual impact created by the proposed development." The Board conducted no hearing on B.A.M.'s appeal, nor did it take evidence or issue legal or factual findings. It nevertheless affirmed the Commission's decision that the additional thirteen-foot strip was a lawful exercise of the County's police power and not a taking.

¶ 8 Dissatisfied with this outcome, B.A.M. filed a complaint in district court. In B.A.M.'s view, the dedication should have been tested under the more demanding "rough proportionality" standard created by the United States Supreme Court to assess whether a property exaction imposed by a government as a condition to authorizing a property owner's desired use of land amounted to a regulatory restriction on the use of its land that required no compensation, or amounted to a taking for which B.A.M. was entitled to compensation. Dolan v. City of Tigard, 512 U.S. 374, 114 S.Ct. 2309, 129 L.Ed.2d 304 (1994); Nollan v. Ca. Coastal Comm'n, 483 U.S. 825, 107 S.Ct. 3141, 97 L.Ed.2d 677 (1987).

¶ 9 The district court refused to apply the rough proportionality test. It reasoned that because the mandated dedication of property was made pursuant to an ordinance of general application, it fell outside the ambit of the rough proportionality test which, it concluded, applied only to "adjudicative" exactions that by their nature carried the risk of extortionate governmental conduct. The district court then affirmed the Board's conclusion that the thirteen-foot strip was not a taking. B.A.M. appealed to the Utah Court of Appeals.

¶ 10 The court of appeals' majority addressed two issues: whether the district court erred when it heard evidence on B.A.M.'s appeal and whether the thirteen-foot exaction was a taking.

¶ 11 Viewing the first issue as one of statutory interpretation, the court of appeals held that the district court was limited to reviewing the record made before the County—there was none—and erred when it took evidence. Based on this procedural defect, and because without the district court record there was no record at all to explain the basis for the denials of B.A.M.'s objections, the court of appeals remanded the matter to the district court. The court of appeals instructed the district court to find that the Board had acted arbitrarily and capriciously when it failed to hear B.A.M.'s appeal and to direct the appropriate county agency to grant B.A.M. an administrative hearing on its claim that the County's exaction was an unconstitutional taking.

¶ 12 As the discussion that follows will explain more fully, statutory modifications to the procedures governing judicial review of administrative land-use decisions enacted after we granted certiorari have displaced the court of appeals analysis and holding on the procedural issue.

¶ 13 The court of appeals also held that on remand the reviewing agency must apply the rough proportionality test. The court of appeals majority appeared to conclude that its determination that the County had imposed a development exaction on B.A.M. was sufficient reason to apply the rough proportionality test. Although Judge Orme's dissent would also have mandated application of the rough proportionality test, he correctly noted that it was by no means clear that the rough proportionality test must be applied to every development exaction. Nollan and Dolan did not satisfactorily define the class of exactions that would be subject to rough proportionality scrutiny. Within the general category of exactions, some, like zoning and other traditional land-use regulations, would not be required to undergo rough proportionality review. As the Dolan court explained:

Th[ose] sort of land use regulations ... however, differ in two relevant particulars from the present case. First, they involved essentially legislative determinations classifying entire areas of the city, whereas here the city made an adjudicative decision to condition petitioner's application for a building permit on an individual parcel. Second, the conditions imposed were not simply a limitation on the use petitioner might make of her own parcel, but a requirement that she deed portions of the property to the city.

512 U.S. at 385, 114 S.Ct. 2309.

¶ 14 At the time we granted certiorari, we had not had occasion to establish whether the rough proportionality test should be applied to all development exactions or just to those that are imposed through an adjudicative decision. As we shall see, just as legislative action undertaken after we granted certiorari shapes the outcome of the procedural issues we consented to take up on certiorari review, so the enactment of a statute making the rough proportionality test applicable to exactions generally influences substantially our answer to the question of whether the test should be applied here.

¶ 15 When reviewing cases under certiorari jurisdiction, we apply a standard of correctness to the decision made by the court of appeals rather than the trial court. Brigham City v. Stuart, 2005 UT 13, ¶ 7, 122 P.3d 506 (Utah 2005).

ANALYSIS

¶ 16 Two procedural issues are before us for review: (1) whether the district court was limited to review of the administrative record; and (2) whether section 63-90a-4 of the Utah Code permits review regardless of the state of the administrative record. We conclude that both are answered by the text of Utah Code...