Edited by James E. Frank and Robert M. Rhodes. Washington, D.C.: Planners Press, American Planning Association. 1987. Pp. 198. $29.95

Babcock, Richard F.

English

Florida State University College of Law

Florida State University Law ReviewVolume 16 | Issue 2 Article 7Summer 1988Development ExactionsRichard F. BabcockFlorida State University College of LawFollow this and additional works at: http://ir.law.fsu.edu/lrPart of the State and Local Government Law CommonsThis Book Review is brought to you for free and open access by Scholarship Repository. It has been accepted for inclusion in Florida State UniversityLaw Review by an authorized editor of Scholarship Repository. For more information, please contact bkaplan@law.fsu.edu.Recommended CitationRichard F. Babcock, Development Exactions, 16 Fla. St. U. L. Rev. 427 (2017) .http://ir.law.fsu.edu/lr/vol16/iss2/7BOOK REVIEWDEVELOPMENT EXACTIONS. Edited by James E. Frank* andRobert M. Rhodes.** Washington, D.C.:Planners Press, American Planning Association.1987. Pp. 198. $29.95.REVIEWED BY RICHARD F. BABCOCK'M OST people in this country are aware that many American citiesand towns are in a serious financial condition. The flow of fed-eral dollars has been substantially cut, and few state and local dollarscan be raised to help with the increasing demands for services. So themunicipalities have looked to another source of funds to finance theirneeds. And they have turned to the development community. If abuilder wants a subdivision approved or a permit for a shopping cen-ter, the city demands a site for a school, financial assistance in itshousing program, the widening of a highway, or a bundle of cash.These demands are commonly known as "exactions."I suspect the editors of the Law Review put me up to this BookReview because they knew I was the special editor of a "competing"publication on exactions, 2 and they hoped they could encourage agood old-fashioned response and rejoinder among the respective pub-lications. If that was their goal, they have failed. This is an excellentpublication with very few warts.The national survey of exaction practices is especially useful. It iscomprehensive and detailed, appropriately weighted for size of city or* Associate Professor of Urban and Regional Planning, Florida State University. B.A.,1960, Cornell University; M.S.P., 1967, New York University; Ph.D., 1971, New York Univer-sity.** Partner, Steel, Hector & Davis, Tallahassee, Florida. A.B., 1964, University of Cali-fornia; J.D., 1968, University of California at Berkeley School of Law (Boalt Hall); M.P.A.,1973, John F. Kennedy School of Government, Harvard University.1. Visiting Professor ofLaw, Florida State University. Partner (Retired), Ross & Har-dies, Chicago, Illinois. A.B., 1940, Dartmouth College; J.D., 1946, University of Chicago;M.B.A., 1949, University of Chicago.2. Exactions. A Controversial New Source for Municipal Funds, 50 LAW & CONTEMP.PROBS. 1 (1987).428 FLORIDA STATE UNIVERSITY LA WREVIEW [Vol. 16:427county. Out of 11,722 cities and counties, 1,166 were sampled, with aresponse rate of almost 39%.3 To me, the surprising responses werethose who answered that they made their demand on a case-by-casebasis-in other words, ad hoc. For example, in exactions involvingland dedication, 35.6% of the communities said they used such a tech-nique,4 and 30.1% replied they used standards but "with some flexi-bility." 5 However, we don't learn just what was meant by"flexibility." In the case of cash payments, 17.4% of the communitiesused a "case-by-case" basis, 6 and 7.9% had a formula, again, "withsome flexibility." ' 7 Because the survey is not intended to be judgmen-tal, it does not express an opinion on the fact that one quarter of thecash exactions involve discretion-how unbridled we are not told. Itwould have been useful to follow up on those discretionary practicesto find out just how the communities did make their decision on whatapplicants A and B should pay. Was there a denial of equal treat-ment?In the chapter entitled "Politics and Administration of Develop-ment Exactions," ' 8 the authors touch on what may be the next majorissue in the administration of land use controls: joint ventures be-tween cities or counties and private developers. First, the authors notethat "[e]xaction bargaining is a sufficiently powerful developmenttool that, once used, is likely to quickly become a major part of theland use controls of a community." 9 Then the authors go on to state:Second, officials tend to smooth the sharp edges of exactions andmove toward accommodation and the tradeoffs with the developers.Developers are no less adaptive. Especially in cities that wish togrow rapidly-Scottsdale, Fairfield, Chandler, Colorado Springs-developers have learned from engaging in negotiations aboutexactions that it is often necessary to become partners in whatamounts to joint ventures. 103. Bosselman & Stroud, Legal Aspects of Development Exactions, in DEVELOPMENT Ex-ACTIONS 70-103 (1. Frank & R. Rhodes eds. 1987).4. Id. at 126.5. Id.6. Id. at 141.7. Id.8. Weschler, Mushkatel & Frank, Politics and Administration of Development Exac-tions, in DEVELOPMENT EXACTIONS, supra note 3, at 15-41.9. Id. at 38.10. Id. at 38-39 (emphasis added).BOOK REVIEWJust what those joint ventures involved, we are not told. Does thecity take a cut of the equity? We do know there are some communitiessuch as San Diego which have taken a share of the gross leases."This raises the nice question of whether a city can be both a regula-tor and an entrepreneur. Is there an inherent conflict of interest? Sup-pose a city has a share of the equity in a shopping center and anapplication comes to the city for a second shopping center within acompetitive area. What decision? Or suppose a city stands to pocketan extra $57 million in the sale of its land if it grants a buyer a bonusin floor area ratio, but that added height and bulk will have an allegedadverse impact on a neighboring park. 2 Is that the selling of zoning asone New York court has said?" And this raises the question whetherwe should stop kidding ourselves and openly acknowledge that zoningchanges are for sale. If so, what does this mean insofar as comprehen-sive planning is concerned?Bosselman and Stroud's chapter, "Legal Aspects of DevelopmentExactions,' ' 4 and their addendum after Nollan v. California CoastalCommission, 5 is a respectable (and predictable) analysis of the law inthis confused field. Of course, no aficionado of the land use field isgoing to forego writing on Nollan, First English Evangelical LutheranChurch v. County of Los Angeles, 6 and Keystone Bituminous.CoalAssociation v. DeBenedictis.17 Critiques will overwhelm the law jour-nals, ad nauseum.The truth is that all of these cases raise as many questions as theyprovide answers. Is Nollan simply an obvious extension of Loretto v.Teleprompter Manhattan CA TV Corp.?'8 Or does it go beyond merephysical invasion and suggest a new more rigid test for exactions? Wehaven't yet had a definitive answer on the impact of First English onmoratoria, although it may be ventured that customary moratoria willbe upheld if set for a fixed period of time. Nor are we yet certain justwhen a "taking" begins. Is it when the original zoning went into11. 19 URB. LAND INST. PROJECT REFERENCE FILE, Oct.-Dec. 1986, at 5. See R. Babcock,The City as Entrepreneur: Folly or Wisdom? 6.(Sept. 9, 1988)(draft of unpublished manuscriptprepared for the Urban Land Institute's Forum on Public/Private Partnership, Washington,D.C., Sept. 30, 1988).12. Municipal Art Soc'y v. City of New York, 137 Misc. 2d 832, 834-35, 522 N.Y.S.2d800, 801 (Sup. Ct. 1987).13. Id. at 838, 522 N.Y.S.2d at 804.14. Bosselman & Stroud, supra note 3.15. 107 S. Ct. 3141 (1987).16. 107 S. Ct. 2378 (1987).17. 107 S. Ct. 1232 (1987).18. 458 U.S. 419 (1982).1988]430 FLORIDA STATE UNIVERSITYLAWREVIEW [Vol. 16:427effect or when, five years later, the landowner makes an applicationfor a change and is turned down? And on and on.One area that Bosselman and Stroud do not touch on, probablybecause they felt obliged to stick strictly to the decided cases, is thelarge number of people who do not challenge exactions because of thecost of litigation and the years of delay in obtaining a permit. I callthis municipal leverage. One of the interesting facts in the Nollan caseis that the Commission had "similarly conditioned 43 out of 60coastal development permits along the same tract of land, and that ofthe 17 not so conditioned, 14 had been approved when the Commis-sion did not have administrative regulations in place allowing imposi-tion of the condition, and the remaining 3 had not involvedshorefront property."' 9 So essentially, all shorefront properties hadgranted an easement to the public to cross their property. I wouldhave to assume that most, if not all, of them were equally unhappyabout the condition. Unfortunately, unlike Mr. & Mrs. Nollan, theydid not have pro bono attorneys to carry their case through the Cali-fornia Supreme Court and to the United States Supreme Court. 20Municipalities may be poor but they are not fools. They know thevagaries of the market most often will compel developers to get theirpermits now and not take the risk and cost of litigation. For this rea-son, cities should not go into a death dance over these decisions.On the whole, this is a superb publication useful to those who arestruggling with this new force in land use regulation.19. Nollan v. California Coastal Comm'n, 107 S. Ct. 3141, 3144 (1987) (citation omit-ted).20. The Pacific Legal Foundation represented the Nollans throughout their suit with theCalifornia Coastal Commission. Telephone interview with Timothy A. Bittle, Staff Att'y, Pa-cific Legal Foundation, Sacramento, California (Oct. 24, 1988).

Development Exactions

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