Also known as: monetary exaction
Written by attorneys — see sources below.
2 senses
A monetary payment whose character as a tax or penalty for constitutional purposes turns on its practical operation and effect rather than its statutory label. The payment functions as a tax when it is collected through the tax system, varies with income or filing status, and is expected to raise substantial revenue.
A monetary payment whose character as a tax or penalty for constitutional purposes turns on its practical operation and effect rather than its statutory label. The payment functions as a tax when it is collected through the tax system, varies with income or filing status, and is expected to raise substantial revenue.
A demand for money imposed as a condition of land-use permit approval. Such demands are subject to the Nollan/Dolan requirements of an essential nexus and rough proportionality to the impacts of the proposed development.
A demand for money imposed as a condition of land-use permit approval. Such demands are subject to the Nollan/Dolan requirements of an essential nexus and rough proportionality to the impacts of the proposed development.
Each sense below has its own examples, sources, and questions.
Malcolm McKinley, a federal employee, declined to join a new wellness program. The agency withheld a benefit adjustment penalty from his paycheck that varied by salary bracket and filing status and was deposited into the general fund. Because the charge was collected through payroll withholding in the same manner as income tax and scaled to income, it operated as a tax for constitutional purposes even though the statute called it a penalty.
1 common questions
A court examines the exaction's practical operation and effect rather than its label. Key indicators include collection through the tax system, variation with income or filing status, and substantial revenue-raising potential.
Supporting sources
Mosaic Retail sought a building permit to expand its store. The city demanded either dedication of an easement or an equivalent monetary payment. When Mosaic refused both options, the city denied the permit. The refusal triggered scrutiny under the exactions doctrine because the monetary demand lacked the required nexus and rough proportionality to the project's impacts.
2 common questions
Yes. The standards govern monetary exactions imposed as permit conditions because such payments function as substitutes for property dedications and trigger the same unconstitutional conditions analysis.
Supporting sources
The government's denial of the permit on that basis constitutes a taking subject to scrutiny under the exactions doctrine.
Supporting sources
…540 (Kennedy, J., concurring in judgment and dissenting in part). The Court’s decisions in Nollan and Dolan thus apply to monetary exactions. Pp. 12–18. (1) The Court has repeatedly treated land-use exactions as a special application of the doctrine of unconstitutional conditions. That doctrine holds that “the government may…