Conditions requiring a developer to dedicate land, build improvements or pay fees are analysed under a heightened standard because they condition a benefit on relinquishing property.
Essential nexus. The condition must serve the same governmental purpose as the reason a permit could have been denied. A requirement unrelated to the project’s impacts fails at this step.
Rough proportionality. The condition must be roughly proportional in nature and extent to the impact of the proposed development, supported by an individualised determination. Precise mathematics is not required; a bare assertion is not enough.
Scope of the doctrine. It applies to monetary exactions as well as physical dedications, and courts have applied it to conditions imposed by legislation as well as by adjudication.
Impact fees must generally be authorised by statute, calculated from a study identifying the capital needs generated by new development, segregated in accounts by category, and spent within a defined period on facilities benefiting the payers, with refunds if not.
Documentation is the defence. A capital improvements plan, a fee study updated periodically, and a record connecting the project’s demand to the fee.
Protest and reservation. Developers should pay under written protest where required by statute to preserve a challenge, since payment without reservation can waive it.