How Far Can A Municipality Go In Imposing Conditions To Approvals?

When property owners want to build anything, they need to get a building permit. For many projects, they often also need to get a potentially wide range of discretionary approvals from municipal authorities. Those permits and approvals often require a developer to deliver a range of “community benefits” in exchange, which can entail a protracted negotiation. The municipality tries to extract as much as possible – parks, traffic improvements, roads, other infrastructure upgrades – while the developer tries to figure out how to still have a project that might make money.

Along these lines, a few years ago the Nashville municipal government passed a law that said anyone who wants a permit to build a house or certain other buildings must build a sidewalk along the edge of their lot next to the street. In addition, the permit applicant must grant the municipality an easement allowing the public to use the sidewalk. In some cases, the permit applicant could skip the sidewalk construction by paying the municipality the estimated cost of sidewalk construction on the applicant’s property – around $200 per linear foot – so the municipality could build a sidewalk somewhere else.