TWIN LAKES DEV. v. Monroe

• Decision Date: 20 November 2003
• Citation: 769 N.Y.S.2d 445,801 N.E.2d 821,1 N.Y.3d 98
• Parties: TWIN LAKES DEVELOPMENT CORP., Appellant, v. TOWN OF MONROE, Respondent.
• Court: New York Court of Appeals Court of Appeals

1 N.Y.3d 98

801 N.E.2d 821

769 N.Y.S.2d 445

TWIN LAKES DEVELOPMENT CORP., Appellant, v. TOWN OF MONROE, Respondent.

Court of Appeals of the State of New York.

Argued October 21, 2003.

Decided November 20, 2003.

James G. Sweeney, P.C., Goshen (James G. Sweeney of counsel), for appellant.

Drake, Sommers, Loeb, Tarshis, Catania & Liberth, PLLC, Newburgh (Stephen J. Gaba of counsel), for respondent.

Chief Judge KAYE and Judges G.B. SMITH, CIPARICK, ROSENBLATT and READ concur.

OPINION OF THE COURT

GRAFFEO, J.

The Town of Monroe requires applicants for residential subdivision permits to pay fees in lieu of dedicating a portion of their property for recreational purposes and to reimburse the Town for consulting costs incurred in processing the application. In this declaratory judgment action, plaintiff claims that these requirements equated to a taking of its property without just compensation and violated due process. Because plaintiff has failed to establish any constitutional infirmities, we affirm the Appellate Division order granting defendant summary judgment dismissing the complaint.

Plaintiff Twin Lakes Development Corp. is a real estate developer and the owner of a 28-acre parcel in the Town of Monroe. In March 1999, plaintiff applied to the Town Planning Board for approval to subdivide its property into 22 residential lots. The Board considered the application, undertaking a State Environmental Quality Review Act analysis that culminated in a final environmental impact statement. As required by Monroe Town Code § 26B-2 (A) (11), plaintiff periodically deposited funds into an escrow account from which the Town paid consulting costs it incurred in conjunction with the application.

When the review was completed, the Board adopted a "Resolution of Conditional Final Approval," imposing several conditions on plaintiff. In particular, citing section 277 of the Town Law, the Board mandated a "payment in lieu of parkland dedication to the Town of Monroe" for each of the lots created and reimbursement for any outstanding consulting fees. The "in lieu of" payments are set forth in Monroe Town Code § 26B-2 (A) (7), which establishes a $1,500 per-lot fee for proposed subdivisions of five or more lots where the Board has determined parkland dedication is not appropriate.

To obtain the necessary approvals to proceed with its project, plaintiff paid $33,000 for "in lieu of parkland" fees ($1,500 × 22 lots) and a total of $22,000 in consulting costs, all apparently "under protest." However, plaintiff did not bring a proceeding challenging the Board's determination that the project fell within the parkland dedication provision or request an audit of the consulting fees the Town contended it had incurred. Instead, in February 2001, plaintiff commenced this declaratory judgment action seeking to invalidate the two fee provisions on constitutional grounds and to obtain a refund of the fees it paid, as well as attorney's fees. The Town moved, and plaintiff cross-moved, for summary judgment. Supreme Court granted the Town's motion, dismissing the complaint, and the Appellate Division affirmed. Plaintiff now appeals as of right (CPLR 5601 [b] [1]) and we also affirm.

Per-Lot Recreation Fee

Town Law § 277 (4) permits a town planning board, where it has made necessary preliminary findings, to require that developers of residential subdivisions include in their plans land for parks or other recreational purposes. "The section represents a legislative reaction to the threatened loss of open land available for park and recreational purposes resulting from the process of development in suburban areas and the continuing demands of the growing populations in such areas for additional park and recreational facilities" (Matter of Bayswater Realty & Capital Corp. v Planning Bd. of Town of Lewisboro, 76 NY2d 460, 468 [1990] [discussing earlier version of statute]). Specifically, the statute conditions a town's power to mandate a parkland set-aside on

"a finding [by the planning board] that a proper case exists for requiring that a park or parks be suitably located for playgrounds or other recreational purposes within the town. Such findings shall include an evaluation of the present and anticipated future needs for park and recreational facilities in the town based on projected future population growth to which the particular subdivision plat will contribute" (Town Law § 277 [4] [b]).

The statute also provides that a planning board may require a monetary payment in an amount to be established by the town board if the planning board determines that, although the subdivision is a "proper case" for requiring park dedication, "a suitable park or parks of adequate size to meet the requirement cannot be properly located on such subdivision plat" (id. ¶ [c]). The town must deposit any monies paid "in lieu of" a parkland set-aside into a trust fund for use exclusively for recreational purposes (see id.).

As previously noted, the Monroe Town Code currently sets the "in lieu of" fee at $1,500 per lot for subdivisions consisting of five or more lots (see Monroe Town Code § 26B-2 [A] [7] [b]). The Town's graduated fee schedule was fixed by a 2000 amendment to the Code that increased the fees based, in part, on the "rapid growth" in the Town's population over the previous 15 years (Local Law No. 3 [2000] of Town of Monroe § 1). The Town Board justified the fee increase by explaining that "existing facilities for active recreation are severely limited and are inadequate to accommodate the needs of its residents," and that the Board's efforts to address increased demand for recreational facilities resulting from the population growth were "hampered by the constraints of the unavailability of suitable lands and upward-spiraling land costs" (id.). The additional fee income would enable the Town to "plan for the recreational needs of the residents in these new subdivisions and site plans and ameliorate the additional strain these new residents place on the already limited park and recreational facilities of the Town" (id.).

Plaintiff argues that the $1,500 per-lot recreation fee constitutes an unconstitutional taking because the amount of the fee is not based on an "individuated assessment" of the recreational needs generated by its subdivision plan and thus is not roughly proportional to those needs. Plaintiff further contends that the Code violates procedural due process because applicants cannot challenge the amount of the fee as excessive in relation to a particular subdivision plan. Plaintiff therefore challenges the Town's authority to impose a fixed, per-lot recreation fee on developers in lieu of requiring developers to set aside dedicated parkland.

The Takings Clause of the Fifth Amendment of the United States Constitution—applicable to states through the Fourteenth Amendment—provides, "nor shall private property be taken for public use, without just compensation" (see Dolan v City of Tigard, 512 US 374, 383-384 [1994]). We have observed that the "[e]lementary and strong constitutional principles protect[ing] private property rights . . . evolved to bar Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole" (Manocherian v Lenox Hill Hosp., 84 NY2d 385, 391 [1994], cert denied 514 US 1109 [1995] [quoting Penn Cent. Transp. Co. v City of New York, 438 US 104, 123 (1978) (internal quotation marks omitted)]).

The United States Supreme Court has developed a standard for evaluating takings claims arising in the "context of exactions—land-use decisions conditioning approval of development on the dedication of property to public use" (City of Monterey v Del Monte Dunes at Monterey, Ltd., 526 US 687, 702 [1999]). A reviewing court must assess whether an "essential nexus" exists between the "legitimate state interest" advanced as the justification for the restriction and the condition imposed on the property owner (see Dolan, 512 US at 386 [quoting Nollan v California Coastal Commn., 483 US 825, 837 (1987)]; Bonnie Briar Syndicate v Town of Mamaroneck, 94 NY2d 96, 105-106 [1999], cert denied 529 US 1094 [2000]). Where such a nexus is present, the "degree of the exactions demanded" must have "the required relationship to the projected impact of [the applicant's] proposed development" (Dolan, 512 US at 388).

In Dolan, the Supreme Court analyzed whether a municipality made sufficient findings to support its decision to condition the applicant's expansion permit on a dedication of property for flood control and recreational purposes. After considering the various standards adopted by states, the Court determined that a "rough proportionality" test would "best encapsulate[] what we hold to be the requirement of the Fifth Amendment" (id. at 391).¹ Thus, although "[n]o precise mathematical calculation is required," the dedication must be "related both in nature and extent to the impact of the proposed development" (id.).

Here, plaintiff failed to demonstrate that the Town's $1,500 per-lot fee constitutes a taking. When enacting the current fees, the Town made explicit findings that the demand for recreational facilities exceeded existing resources and that continued subdivision development, paired with the "upward-spiraling land costs," would exacerbate the problem. Additionally, the statute authorizing the Town to impose recreation fees mandates that fees collected in lieu of parkland set-asides be deposited into a trust fund to be used strictly for recreational purposes (see Town Law § 277 [4] [c]). Taken together, these factors clearly establish the essential nexus between the stated purpose of the condition and the fee (cf. Nollan, 483 US at 837).

With respect to plaintiff's application, the Town concluded:

"based on the present and anticipated future need for park and recreational opportunities in the town, and to which the future population of this

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