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In an opinion filed on April 19, and certified for publication on May 4, 2021, the Third Appellate District in Alliance for Responsible Planning v. Taylor (County of El Dorado) held that a citizen-sponsored ballot measure requiring new development to fund all cumulative traffic mitigation prior to construction violated the Takings Clause of the Constitution by requiring new development to pay more than its fair share. The Court’s ruling reaffirms the constitutional principles of nexus and proportionality as applied to general plan policies and mitigation under the California Environmental Quality Act (“CEQA”), and limits the ability of local agencies to burden new development with the costs of mitigating impacts beyond those of their project.

At issue was Measure E, which El Dorado County voters adopted in June 2016. Measure E was intended to end the practice of “paper roads,” whereby traffic-mitigating road improvements were not completed—and thus existed only on paper—at the time of project approval. Specifically, Measure E amended General Plan Policies TC-Xa 3 and TC-Xf (the “Policies”) to require construction of such road improvements before project approval, rather than simply requiring the payment of traffic-mitigation fees to cover the costs of future improvements. Measure E would have operated as a de facto moratorium on any new development involving cumulative traffic impacts relying on future, but unbuilt, traffic measures (e.g., installation of traffic calming measures or traffic lights).

After Measure E passed, the Alliance for Responsible Planning (“Alliance”), which is a nonprofit advocating on behalf of County business interests, filed a petition and complaint claiming, among other things, that the amended Policies were facially unconstitutional. The County Board of Supervisors had not adopted an implementation program proposed by its Chief Administrative Office, County Counsel, and Community Development Agency; and, on appeal, argued that the amendments were invalid. Supporters of the Measure E ballot initiative, Sue Taylor and Measure E proponents (“Taylor Intervenors”) intervened in the trial court to defend the amendments. Siding with the Alliance, the trial court invalidated the amended Policies, finding that they violated the Takings Clause by conditioning approval on payment of more than the development’s fair share for traffic mitigation. The Taylor Intervenors appealed.

The Third District Court of Appeal upheld the trial court’s ruling, finding that the amended Policies violated the Takings Clause on their face. Dolan v. City of Tigard (1994) 512 U.S. 374, Nollan v. California Coastal Com. (1987) 483 U.S. 825, and their progeny require: (1) an “essential nexus” between a permit condition and a legitimate state interest; and (2) a “rough proportionality” between the property demanded by the government and the social cost of the applicant’s proposal. The appellate court found that the amended Policies at least lacked “rough proportionality,” by requiring an applicant to construct road improvements to address traffic conditions beyond those created by the proposed project. The appellate court also rejected the Taylor Intervenors’ attempt to argue that the amended Policies were land-use controls. Unlike California Building Industry Assn. v. City of San Jose (2015) 61 Cal.4th 435, which found that requiring a certain percentage of units be sold to low- or moderate-income households merely placed a permissible restriction on property use, the amended Policies required a developer to construct road improvements and thus give up a property interest in order to proceed with development.

This decision affirms clear limits on imposing cumulative impact mitigation on new development, and puts greater emphasis on careful drafting of ballot measures designed to limit development.