Today, the U.S. Supreme Court handed a victory to the Koontz family, which has been locked in a nearly 20-year battle with a Florida regulatory agency over a permit to develop 3.7 acres of their property.

It has long been unconstitutional for the government to deny a building permit to a property owner simply because the owner refuses to hand over an unreasonable portion of their property to the public, free of charge, in exchange. In 1987, the Supreme Court smacked down the California Coastal Commission for making that type of extortionate demand and followed it up with a similar decision against the City of Tigard, Ore., in 1992.

The Court said in those cases that cities can impose conditions on building permits, but only those that are “roughly proportional” to the public burdens of the proposed development. For instance, if a new building is going to increase traffic around it, a city could demand the owner give up a portion of his land to widen the street.

For years, government agencies have been trying to skirt those decisions by arguing that they limited how much land can be demanded of a property owner, but that they do not limit how much money can be required. The Florida water district opposing the Koontz family had indicated that, in lieu of giving up land, they could get their permit by paying money.

Today the Supreme Court said, no: It is unconstitutional to use the permit process as a tool of extortion, whether the government demands cash or land.

Land-use permit applicants are especially vulnerable to [this] type of coercion . . . because the government often has broad discretion to deny a permit that is worth far more than property it would like to take . . . and can pressure an owner into voluntarily giving up property for which the Fifth Amendment would otherwise require just compensation.

The government also made a technical argument that it wasn’t really engaged in extortion because it had denied the Koontzs’s permit first and only then asked for land or money, unlike some other cases in which the government approved a permit subject to receiving the land or money. In a model of judicial engagement, however, the Court saw through that subterfuge and held that no matter how the government accomplishes it, such extortion is unconstitutional.

— Larry Salzman is an attorney with the Institute for Justice. The Institute filed an amicus brief on behalf of itself and the Cato Institute in support of the Koontz family.