Case of the Month – Sheetz v. County of El Dorado

In the heart of California’s El Dorado County lies a legal battle that has sparked discussions about the limits of government authority and property rights. The case revolves around the county’s Traffic Impact Mitigation (TIM) Fee Program, a policy that has stirred controversy over its imposition of fees on property owners seeking building permits, regardless of the actual impact of their projects on local roads.

The TIM Fee Program, implemented by the County of El Dorado, mandates property owners to pay a traffic-impact fee upon applying for a building permit. This fee comprises two components: the “Highway 50 Component” and the “Local Road Component,” determined by the project’s location and type of construction. Notably, the fee is obligatory, irrespective of the project’s real impact on existing or future roads. This policy places the burden of road construction and widening costs solely on new developments, even though existing residents and non-residents benefit from these infrastructure improvements.

George Sheetz found himself entangled in this system when he applied for a building permit in 2016 to construct a modest manufactured (prefabricated) house for his family. Despite no individualized assessment correlating the fee with his project’s actual impact on local or state roads, Sheetz was required to pay a substantial $23,420 in traffic-mitigation fees. Feeling aggrieved, Sheetz paid the fee under protest and initiated legal action against the County, contending that the fee amounted to an unconstitutional per se taking. The law prohibits the government from appropriation or regulation of private property for public use without just compensation, which is prohibited by the Fifth Amendment of the U.S. Constitution to protect property rights.

Central to Sheetz’s argument was the unconstitutional-conditions doctrine, which asserts that the government cannot withhold a benefit from an individual based on the exercise of a constitutional right. Citing precedents set by the U.S. Supreme Court in Nollan v. California Coastal Commission (1987) and Dolan v. City of Tigard (1994), Sheetz challenged the lack of an “essential nexus” and “rough proportionality” between the demanded fee and the impacts of his project.

Both the California Superior Court and the California Court of Appeal ruled against Sheetz. They held that legislative exactions, such as the TIM Fee Program, are exempt from Nollan/Dolan review, thereby affirming the County’s authority to impose the fees. Sheetz took his case to the U.S. Supreme Court, which has remanded the case for further review, holding that the Nollan/Dolan analysis must be done.

The implications of this case extend beyond the confines of this specific case. It raises broader questions about the balance between governmental powers to regulate land use and individual property rights. The debate over the constitutionality of mandatory fees and their impact on property owners continues to reverberate in legal and policy discussions.