Florida Inclusionary Zoning Case to Watch

At the end of February 2006, a coalition of builders and Realtors® filed suit in Florida’s Second Judicial Circuit Court in Leon County, Florida, challenging a mandatory inclusionary zoning ordinance adopted by the City of Tallahassee.  Tallahassee adopted the Ordinance with the goal of increasing the availability of affordable housing within the City.  Plaintiffs challenge Ordinance No. 04-O-90AA ("Ordinance") on the grounds that it violates substantive due process and is an unlawful taking, and constitutes an unlawful tax.  

Effective October 1, 2005, Tallahassee’s zoning Ordinance requires that 10% of new homes in a development with 50 or more single-family or multifamily homes be sold at or below the "maximum affordable sales price" (MASP) to "eligible households."  The Ordinance initially set the MASP at $125,378 — a price substantially below market value, and authorizes the City Commission to review and revise the MASP at least annually.  "Eligible households" are defined in the Ordinance as those households having earnings within a specified range.  The Ordinance identifies specific locations where mandatory inclusionary housing is to be developed, including areas with some of the highest land costs in the city.  Further, the Ordinance contains similar restrictions applicable to rental units within designated areas. 

The Ordinance has an in-lieu-of fee provision that allows an owner or developer to pay a fee ranging from $10,000 to $25,000 (depending on the sales price of the units) rather than complying with other requirements of the Ordinance.  Further restrictions in the Ordinance involve restrictions on selling or renting covered units within a specified time, providing the City with the right of first refusal to purchase covered units from the owner or developer under specific circumstances (and at restricted rates), and requiring that in-lieu-of fees be used by the City only in furtherance of the purposes of the Ordinance.

In their complaint, Plaintiffs identify three counts as the basis for seeking declaratory and injunctive relief.  First, Plaintiffs assert that the Ordinance raises substantive due process issues under the Fifth and Fourteenth Amendments to the U.S. Constitution, and Article I, Section 9 of the Florida State Constitution.  Plaintiffs assert that the Ordinance does not bear a reasonable relationship to public health, safety or welfare.  Further, Plaintiffs contend it is arbitrary and capricious in violation of the individual Plaintiffs' rights and the rights of the association members.

Second, Plaintiffs contend that the Ordinance results in unlawful takings  because it forces some developers alone to bear the burden of providing housing at restricted prices, which, Plaintiffs assert should be borne by the public as a whole.  In addition, the City failed to assert a connection between its interest in the Ordinance and the land use exaction it chose to address that interest. 

Finally, Plaintiffs assert that the Ordinance constitutes an unlawful tax in violation of the Florida Constitution because it is not an ad valorem tax on real property and is not expressly authorized by general law. 

Plaintiffs in the lawsuit include the Tallahassee Builders Association, the Florida Home Builders Association, the Tallahassee Board of Realtors®, DeVoe Moore and Ed Dion.
[ return to top ]