Small-business legal group urges Supreme Court to hear property case

By Lydia Wheeler – 10/19/15 11:23 AM EDT

The National Federation of Independent Business (NFIB) Small Business Legal Center is urging the Supreme Court to take a case out of California that questions whether a city can constitutionally force developers to sell certain housing units below market rates.

The case, California Building Industry Association v. City of San Jose, Calif., centers on a city rule that requires developers to set aside 15 percent of all newly constructed residential units for the city to use as affordable housing stock or opt out by paying a fee.

NFIB Small Business Legal Center is asking the Supreme Court to hear the case and reverse the California Supreme Court decision upholding the housing rule.

“Here we have the city of San Jose trying to use its power to bully landowners,” Karen Harned, the group’s executive director said in a news release. “Clearly, the constitution protects private property and the right of landowners to exercise their right to use and sell their property at market rate. The court should stop San Jose and other cities with similar schemes.”

The legal arm of the nation’s leading small-business association said the court should settle the lower court split and follow the legal precedence it set in Nollan v. California Coastal Commission. In that case, the court held that the government couldn’t require a landowner to dedicate property as a condition of a permit approval.

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