182 A.3d 798
Md.2018Background
- Anne Arundel County imposed legislatively-adopted development impact fees (Subtitle 2 of Title 11, Art. 17) for schools, roads, and public safety; fees collected could be refunded if not expended or encumbered within six fiscal years per §17-11-210.
- Plaintiffs (the “Dabbs Class”) sought refunds of unspecified impact fees collected in FYs 1997–2003, alleging the County failed to timely expend or encumber funds and that later ordinance amendments unlawfully denied refunds.
- Key county enactments: Bill No. 27-07 (codified procedures and defined “encumbrance,” effective May 22, 2007) and Bill No. 71-08 (prospectively repealed §17-11-210 refund provision effective Jan 1, 2009); Bill No. 96-01 authorized use of fees for temporary classrooms (2002).
- Prior related litigation (Halle) resolved many identical issues (calculation method, counting encumbrances vs. expenditures) and held owners’ rights to any specific refund were not vested.
- Lower courts found the County’s accounting (including counting encumbrances under GAAP) left no fees available for refund for FYs 1997–2002, that Bills 27-07 and 71-08 were valid as applied, and that Nollan/Dolan rough proportionality did not apply to legislatively-imposed, generally applicable impact fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicability of Nollan/Dolan (rough proportionality) to impact fees | Nollan/Dolan (or rational nexus) should apply to monetized exactions/impact fees; County must show expenditures reasonably attributable to and benefiting specific payors | Impact fees are legislatively-prescribed, district-wide, non-discretionary monetary obligations and thus not subject to Nollan/Dolan; Koontz is limited to individualized permit-linked exactions | Nollan/Dolan (and Koontz) do not apply to generally applicable, legislatively-imposed impact fees; Waters Landing reaffirmed |
| Validity/retroactivity of Bill No. 27-07 (definition/coding of encumbrance) | Bill 27-07 retroactive application altered substantive rights and improperly eliminated refund opportunities | Bill 27-07 codified preexisting administrative practice (GAAP definition of encumbrance) and was procedural, not substantive | Bill 27-07 did not impair vested rights; it codified prior practices and could be applied retrospectively |
| Effect of repeal of refund provision (Bill No. 71-08) on pending/unvested refund claims | Repeal cannot be applied to fees collected earlier; plaintiffs’ refund rights had vested before repeal | Rights created purely by statute do not vest unless consummated; repeal prospectively extinguishes unvested statutory claims | Repeal effective Jan 1, 2009 preceded the ripening (notice/application) date for FY 2003 fees; refund claims were unvested and barred by repeal |
| Accounting/counting of encumbrances vs expenditures for refund calculation | County improperly counted encumbrances or misallocated funds, creating need for refunds | County properly counted encumbrances consistent with GAAP and prior appellate instructions; no unexpended/unencumbered funds for FYs at issue | County’s accounting (including counting encumbrances) was proper; circuit court findings that no refunds were available were upheld |
Key Cases Cited
- Koontz v. St. Johns River Water Mgmt. Dist., 570 U.S. 595 (2013) (monetary exactions tied to a specific parcel must meet Nollan/Dolan nexus and rough proportionality)
- Nollan v. California Coastal Comm’n, 483 U.S. 825 (1987) (requirement of nexus for permit conditions that take property)
- Dolan v. City of Tigard, 512 U.S. 374 (1994) (requirement of rough proportionality for permit conditions that take property)
- Waters Landing, Ltd. P’ship v. Montgomery Cnty., 337 Md. 15 (1994) (Dolan inapplicable to legislatively-imposed development impact taxes/fees)
- Anne Arundel County v. Halle Dev., Inc., 408 Md. 539 (2009) (prior decisions on encumbrance counting and that owners’ rights to specific refunds are not vested)
- McComas v. Criminal Injuries Comp. Bd., 88 Md. App. 143 (1991) (statutory-created rights do not vest until claim ripens; repeal extinguishes unvested statutory rights)