Colorado Legislative Council Staff

LOCAL

CONDITIONAL FISCAL IMPACT

No State General Fund Impact

TITLE:            CONCERNING PROCEDURES TO ALLEVIATE REGULATORY IMPAIRMENT OF PROPERTY RIGHTS.

Summary of Assessment

            The bill makes changes to current statutory provisions which grant local governments, in exercising their police powers, the authority to regulate the use of land within their respective jurisdictions. The bill allows a local government, under its authority to regulate the use of land, to require an owner of private property to dedicate real property or pay money in an amount that is determined on an individual and discretionary bases only when there is an essential nexus between the dedication or payment and a legitimate local government interest and the dedication or payment is roughly proportional to the proposed use of such property.

            The bill provides that within thirty days of such decision or action, the owner of such property may notify the local government in writing of an alleged violation of the dedication or payment requirements. Within sixty days after the date of notification, the property owner may file a petition in district court seeking relief from the action. The court is required to determine the case in the most expeditious manner. The provisions of the bill will create a new cause of action which could be filed in the courts. However, it is believed that most of these cases could currently be filed under Rule 106 in accordance with the Colorado Rules of Civil Procedure, and the likely increase in the number of cases could be absorbed. The actual number of additional cases is unknown, but is assumed to be minimal. The provisions of the bill would not impact any other agency of the state.

            The bill codifies existing United State Supreme Court decisions’ standards for evaluating whether or not a local government’s efforts to regulate existing and proposed land use is excessive and disproportionately burdens the private property owner for the public’s good. Even if local governments believe that they are substantially in compliance with United States' legal standards, this bill would allow a property owner to file notice with the local government and file suit in the courts. This will have a conditional fiscal impact on local governments.

Local Government Impact

            If a property owner seeks a court order relieving them of the duty of complying with a requirement for dedication of land or payment of money, the bill places the burden of proof on the local government entity to prove that the land use condition or exaction is justified. The bill allows a property owner to notify the local government in writing of an alleged violation of the dedication or payment requirements. The local government would then be required to inform each member of the governing body in writing of the notification; and within thirty days, the local government would be required to respond by informing the property owner whether the decision or action would proceed as proposed, be modified, or discontinued. Within sixty days after the date of notification, the property owner may file a petition in district court seeking relief from the action. This bill creates a potential for increased costs of local governments to: 1) defend against an increased number of claims; 2) produce the record, rather than the plaintiffs producing the record; and 3) pay the attorney fees in cases where the plaintiff prevails. The fiscal impact to local governments is conditional on property owners bringing suit against local governments. The costs to local governments cannot be accurately estimated at this time.

Departments Contacted

            Local Affairs              Judicial Branch