[00:00:00] Speaker 03: My name is Su Ranjan Sen. [00:00:04] Speaker 03: I'm here today representing plaintiff appellant Miss Anita Adams. [00:00:07] Speaker 03: I'd like to reserve five minutes for rebuttal. [00:00:10] Speaker 01: Please do. [00:00:12] Speaker 01: But also, you should watch the clock. [00:00:15] Speaker 01: I'll try to remind you if you forget. [00:00:19] Speaker 01: But it's the advocate's responsibility. [00:00:23] Speaker 03: Thank you very much, Your Honor. [00:00:24] Speaker 03: I appreciate that. [00:00:28] Speaker 03: Just last year, the Supreme Court held that legislative land use permit conditions must be tailored to mitigating project impacts. [00:00:37] Speaker 03: But Seattle admits that its MHA condition was never designed to be a mitigation program. [00:00:44] Speaker 03: Instead, it is the city's attempt to capture the value of recent upzoning. [00:00:51] Speaker 03: For this reason, as well as others, its enforcement can never satisfy the Nolan-Dolan tests for land use permit conditions. [00:00:58] Speaker 03: Now this case raises a number of issues. [00:01:02] Speaker 03: But the most straightforward path to resolution is via Ms. [00:01:06] Speaker 03: Adams's facial challenge. [00:01:08] Speaker 03: The district court held that the Nolan-Dolan tests categorically can never support a facial challenge. [00:01:16] Speaker 03: That's incorrect. [00:01:17] Speaker 03: The court relied entirely on one judge's opinion in a case that involved only Dolan's rough proportionality test. [00:01:25] Speaker 03: Ms. [00:01:25] Speaker 03: Adams's briefing explains why that opinion has been abrogated by subsequent Supreme Court precedent, but even accepting it. [00:01:33] Speaker 03: it would not preclude facial application of Nolan's essential nexus test. [00:01:37] Speaker 03: And the reason is quite simple. [00:01:39] Speaker 03: If a condition just has nothing to do with impact mitigation, that is a problem inherent to the condition. [00:01:46] Speaker 03: Perhaps for this reason, the city does not dispute that at the very least, Nolan's essential nexus test can support a facial challenge. [00:01:56] Speaker 03: So it appears the parties agree that the district court's rationale for dismissing Ms. [00:02:01] Speaker 03: Adams' facial challenge was error. [00:02:04] Speaker 03: The city offers two alternative grounds for dismissing Ms. [00:02:08] Speaker 03: Adams' facial challenge. [00:02:10] Speaker 03: Both of those are incorrect. [00:02:12] Speaker 03: First, it suggests that there is a special statute of limitations problem unique to Ms. [00:02:18] Speaker 03: Adams' facial challenge, where supposedly the limitations period began on the day of MHA's enactment. [00:02:27] Speaker 03: That's wrong. [00:02:28] Speaker 03: That rule applies only to a narrow category of cases where a law's very enactment caused a one-time harm such as a single transfer of a property interest from one person to another. [00:02:41] Speaker 03: That's not this case. [00:02:42] Speaker 03: Ms. [00:02:42] Speaker 03: Adams' facial challenge and her as-applied challenge both reflect the same injury, the same harm that flows from the city's ongoing enforcement of the MHA. [00:02:50] Speaker 02: So if we're talking facial challenge, that means to succeed, your client has to show that the statute is incapable of a constitutionally permissible application. [00:03:01] Speaker 02: That is correct, Your Honor. [00:03:03] Speaker 02: So we've got in the statute, just built into the statute, [00:03:07] Speaker 02: The possibility of a waiver either a reduction or waiver of this performant or payment option when an applicant I'm just reading from the ordinance quote can demonstrate facts supporting a determination of severe economic impact at such a level that a property owners constitutional rights may be at risk Why doesn't that save it from a from a facial challenge? [00:03:30] Speaker 02: Yes, your honor [00:03:31] Speaker 03: It doesn't save it because the facial inquiry looks to whether this restriction can ever be enforced. [00:03:39] Speaker 03: Why can't it be? [00:03:40] Speaker 03: Well, it can't be enforced. [00:03:41] Speaker 02: It's right there in the ordinance. [00:03:43] Speaker 03: Well, if the only way that this ordinance can be constitutionally applied is by waiving... Let me rephrase that. [00:03:50] Speaker 03: If the only way a restriction can be constitutionally applied is by waiving it, that means it's facially unconstitutional. [00:03:58] Speaker 02: No, wait a minute. [00:03:59] Speaker 02: If it's going to be waived, it's not going to be applied, therefore it's not applied, and therefore what's the objection? [00:04:04] Speaker 03: Well, then, when it's waived, that doesn't count as an application of the ordinance for purposes of the facial analysis. [00:04:11] Speaker 03: This is the Supreme Court's decision. [00:04:12] Speaker 02: Are you reading that language that I just read to you? [00:04:15] Speaker 02: Are you reading that out of the ordinance? [00:04:17] Speaker 02: I mean, why doesn't this save the ordinance? [00:04:20] Speaker 03: What I'm saying is, if you look at the Supreme Court case of Los Angeles versus Patel, [00:04:24] Speaker 03: The Supreme Court explains that in any facial challenge, the inquiry is on the group for whom the law is a restriction, meaning, can the law be enforced? [00:04:35] Speaker 03: So let me put it to you this way, Your Honor. [00:04:37] Speaker 03: We say this in our briefing. [00:04:39] Speaker 03: If the MHA condition were to, let's say something, [00:04:44] Speaker 03: more clearly unconstitutional. [00:04:46] Speaker 03: Let's say that if it applied only to people from the black community like Ms. [00:04:51] Speaker 03: Adams, it wouldn't save the ordinance from facial review merely because someone like Ms. [00:04:56] Speaker 03: Adams could seek a waiver. [00:04:57] Speaker 03: The point is that this restriction could never be constitutionally enforced. [00:05:02] Speaker 03: And so the city, sure, the city may constitutionally choose not to enforce it, but if government could escape facial review merely by retaining enforcement discretion, [00:05:12] Speaker 03: that would effectively render facial review a complete nullity. [00:05:16] Speaker 03: The point is that every single time MHA is enforced, [00:05:20] Speaker 03: it fails to satisfy the Nolan-Dolan tests. [00:05:23] Speaker 03: And for that reason, it cannot be enforced. [00:05:27] Speaker 03: And likewise, it's well settled that a facial challenge is ripe even if the claimant hasn't undergone a waiver, a variance, or a permit application. [00:05:41] Speaker 03: And the reason for that that recognizes that the very existence of a waiver provision [00:05:46] Speaker 03: can't save a statute from facial review when anything other than waiver would be unconstitutional. [00:05:54] Speaker 03: Nobody's disputing that the city may constitutionally decide not to enforce MHA. [00:05:59] Speaker 03: The question is, can it constitutionally enforce it? [00:06:02] Speaker 02: But the waiver is not a discretionary thing. [00:06:04] Speaker 02: It's built into the statute that they're entitled to a waiver provided that condition specified is satisfied. [00:06:11] Speaker 03: Well, Your Honor, that may be. [00:06:13] Speaker 03: But firstly, the waivers criteria has nothing to do with Nolan-Dolan considerations. [00:06:19] Speaker 03: It only looks at the economic impact upon the property owner in what looks more like a pencentral regulatory takings test. [00:06:27] Speaker 03: But even aside, the fact is that [00:06:32] Speaker 03: For any project to which MHA applies, anything other than waiver would be constitutional. [00:06:40] Speaker 03: Our argument is not that the very enactment of MHA caused a taking. [00:06:44] Speaker 03: And so the possibility of waiver, that might be possible in the regulatory takings case, where the argument is the government is not allowing me to do anything with my property. [00:06:54] Speaker 03: Then your honor's concerns might make sense, because you say, well, they might waive it. [00:06:58] Speaker 03: Then they'd allow you to do something with your property. [00:07:00] Speaker 03: But this case has nothing to do with the extent to which the city would allow Ms. [00:07:05] Speaker 03: Adams to earn a profit from her property. [00:07:07] Speaker 03: This case is an attack on a specific condition, the MHA condition. [00:07:11] Speaker 03: And that condition cannot be enforced against anybody without violating no one's essential nexus test. [00:07:17] Speaker 03: And the reason for that is because it applies only to people who wish to add additional housing to Seattle. [00:07:24] Speaker 03: And the city admits that additional housing, quote, of all kinds [00:07:30] Speaker 03: makes housing more affordable generally. [00:07:32] Speaker 03: For that reason, the city has up-zoned areas of Seattle. [00:07:35] Speaker 03: The city has up-zoned these very areas because it recognizes that more housing makes housing more affordable. [00:07:39] Speaker 03: In fact, a key reason for the housing affordability crisis in Seattle is that there is a housing shortage. [00:07:45] Speaker 03: There is nobody on the face of the planet who is going to be substantially impeded from accessing housing in Seattle. [00:07:54] Speaker 03: because someone has built a home where yesterday it was an empty field. [00:07:58] Speaker 03: And so the fact is, this restriction just can't be enforced against anybody. [00:08:05] Speaker 03: So again, I would direct your honor to the City of Los Angeles versus Patel, which was though a Fourth Amendment case, it explains that the inquiry for the facial challenge looks at the people against whom this is being enforced. [00:08:20] Speaker 03: Ms. [00:08:20] Speaker 03: Adams shouldn't have to, and didn't have to under the case law, [00:08:23] Speaker 03: submit a waiver request so that the city may waive a condition that we already can observe right now can never be constitutionally enforced. [00:08:35] Speaker 00: Council, let me ask you about your statement earlier that, you know, any housing is good because, you know, that's what the city's trying to do is get, you know, make housing more affordable for folks. [00:08:48] Speaker 00: But I believe, and maybe I misunderstood it, but didn't the city make the argument that new market rate housing actually increases the need for affordable housing for the people who work to create that housing and sustain those [00:09:02] Speaker 00: those new units? [00:09:03] Speaker 03: They are suggesting that, Your Honor, but that is entirely, it's a highly attenuated chain of events where even at the end, what the city is saying is that if you build a new house, their X might do Y, might do Z, which could lead to new low income jobs, which would mean that, and I for the life of me don't know how contributing toward a low income person's job [00:09:26] Speaker 03: is going to impede them from accessing housing. [00:09:28] Speaker 03: If anything, it would help them access housing because you're helping to contribute toward their paycheck. [00:09:33] Speaker 03: More broadly, Your Honor, is that this Court doesn't have to find that more housing is the magic bullet for addressing a low-income housing crisis. [00:09:44] Speaker 03: The point is that, if anything, more housing helps people access housing. [00:09:50] Speaker 03: And it certainly doesn't substantially impede someone from accessing housing. [00:09:54] Speaker 03: If you're a low-income person, you're not gonna find it more difficult, certainly not substantially more difficult, to access housing in Seattle because somebody has built some new housing where yesterday there was an empty field. [00:10:06] Speaker 03: It'll either make it... Well, hold on. [00:10:07] Speaker 00: What if, in order to build that housing, they brought in workers from... [00:10:12] Speaker 00: I don't know. [00:10:13] Speaker 00: I don't know Washington that will say Bellevue or some other part of town to create that housing. [00:10:18] Speaker 00: And so for at least a short time, they need housing in Seattle. [00:10:22] Speaker 00: So I as a low income person and then now having to compete with a new group of people for this housing. [00:10:28] Speaker 00: Does that make sense? [00:10:29] Speaker 03: I understand what you're saying, Your Honor, but I believe that it would still be too attenuated, and I would draw this Court's attention to Nolan itself. [00:10:37] Speaker 03: In the Nolan case, the Nolans wanted to build a beach house, and the California Coastal Commission said that, okay, we'll let you do that under the condition that you cede an easement allowing people to walk across your property. [00:10:47] Speaker 03: And their stated rationale was, if you build this house, it could give the impression to people in front of the house that there's not public beaches behind the house. [00:10:55] Speaker 03: And if they see people walking across the property, that would alleviate that misimpression and therefore help people access the public beaches. [00:11:04] Speaker 03: And the court said that this is not a rational basis test. [00:11:07] Speaker 03: Your Honor, the burden is on the city to show that the project would substantially impede its low income housing interest. [00:11:17] Speaker 03: And the city has proffered a highly attenuated set of circumstances, which it's not a conceivable nexus. [00:11:26] Speaker 03: It's not a possible nexus. [00:11:27] Speaker 03: It's an essential one. [00:11:29] Speaker 03: And there is nothing essential. [00:11:32] Speaker 03: relating someone who wants to add housing to the city of Seattle, and substantially impeding anyone from accessing Seattle. [00:11:40] Speaker 03: And if there were, then it would make no sense why the city has upzoned wide swaths of Seattle in an effort to obtain 30,000, 40,000 more market rate units in the name of housing affordability. [00:11:53] Speaker 03: And let me give you an example, Your Honor, stepping back just a moment. [00:11:58] Speaker 03: This whole scheme just has nothing to do with impact mitigation. [00:12:02] Speaker 03: Let's say, for the sake of argument, Your Honor, that there could be some program that's tailored to what Your Honor just described. [00:12:09] Speaker 03: That's not this program. [00:12:11] Speaker 03: This program is tied to the economic value of recent upzoning in the area. [00:12:16] Speaker 03: Let me give you an example. [00:12:18] Speaker 03: Right now, Ms. [00:12:18] Speaker 03: Adams' MHA fees for a four-bedroom home [00:12:22] Speaker 03: would be roughly $92,000. [00:12:25] Speaker 03: If tomorrow the city were to up zone her area allowing taller, denser building, the MHA fees for the exact same project [00:12:34] Speaker 03: would increase from $92,000 to $101,000 for the same dimensions, the same people living there. [00:12:43] Speaker 03: This just has nothing to do with impact mitigation. [00:12:46] Speaker 03: It was never designed to have anything to do with impact mitigation, and that's understandable because the city was operating under a pre-sheets, pre-Ballinger world, where it didn't think that MHA condition would be subject to no-and-no scrutiny. [00:12:59] Speaker 03: But we are now in a post sheets world and this this condition just can't survive. [00:13:04] Speaker 03: We're not saying that Can I ask you a question? [00:13:06] Speaker 02: That's not really this case. [00:13:08] Speaker 02: It's not this case But it may help me understand or think about this case with the city of Seattle be able to say any apartment building with more than 50 units any new apartment with more than 50 units has to include within those 50 units five units available for low-income people [00:13:29] Speaker 02: Could it constitutionally do that? [00:13:31] Speaker 02: As Your Honor recognizes, that would certainly be a different case. [00:13:35] Speaker 02: Yes, it is, but I'm asking you, would that be unconstitutional? [00:13:37] Speaker 03: And I would need to look at what is, well, the city would then, whichever city that does that, whether it's Seattle or another city, [00:13:44] Speaker 03: The city would have a burden of trying to show why that would satisfy the Nolan-Dolan tests. [00:13:51] Speaker 03: And maybe another city could proffer different arguments to try to meet its burden. [00:13:56] Speaker 03: And the city would show how it came up with this formula of X number of units per Y structure. [00:14:06] Speaker 03: But the fact is, in this case, there's just nothing. [00:14:09] Speaker 03: The city has... So you don't really want to answer my question. [00:14:12] Speaker 03: Well, Your Honor, to answer your question directly, I think it would be very difficult for a city to meet its burden because, again, more housing makes housing more affordable for everybody. [00:14:21] Speaker 02: Now, that doesn't mean that a city... It's fairly common for cities or various governmental entities to require as a condition for sort of permit to build a very large project that some of it be for a low income. [00:14:34] Speaker 02: I mean, that happens a lot. [00:14:35] Speaker 02: It is a certain... And you're saying you're not sure whether that's constitutional. [00:14:38] Speaker 03: Well, Your Honor, it's common, but it's only arisen really within the last 15 years. [00:14:43] Speaker 03: And, Your Honor, frankly, I think that is one small part of the larger puzzle as to why cities on both coasts are experiencing terrific housing shortages. [00:14:54] Speaker 03: The right way of going about this, Your Honor, we're not suggesting that cities are straight-jacketed in their ability to assist low-income people in accessing housing. [00:15:01] Speaker 03: If the city wants to subsidize low-income housing, they can do so through taxation. [00:15:06] Speaker 03: Ms. [00:15:06] Speaker 03: Adams pays her taxes, including her property taxes. [00:15:09] Speaker 03: If the city wants land where it can build and run affordable housing itself, it can exercise them in a domain and do so. [00:15:15] Speaker 03: But these are ways of the city trying to dump these public burdens on people who just happen to need a land use permit to build on their own property. [00:15:24] Speaker 03: And so frankly, your honor, I think though that's not this case, and this court need not go that far because of the specific facts of what this actually represents, which is the capture of recent economic value of upzoning, if the end result of these cases post sheets is that cities have to go about this the right way, the way that pays for public benefits through the public fisc, [00:15:48] Speaker 03: Then then that would that would in your to the public's benefit at large including people who would find it difficult to access housing Council council, I want to remind you he said you want us To reserve five minutes. [00:16:04] Speaker 03: Yes, your honor I was just about to say that unless your honors have any further questions reserve the rest of my time. [00:16:08] Speaker 03: Thank you [00:16:24] Speaker 04: Good afternoon and may it please the court. [00:16:26] Speaker 04: I am Roger Nguyen for the City of Seattle. [00:16:28] Speaker 04: Today with me is my colleague, Jeffrey Weber. [00:16:31] Speaker 04: I would like to address first why Ms. [00:16:33] Speaker 04: Adams' Nolan Dolan claim lacks the necessary predicate, a condition that would be a taking had it been imposed outside the permitting context. [00:16:42] Speaker 04: And we know that predicate is absent here for the reasons this court explained in Ballinger. [00:16:47] Speaker 04: Ballinger rejected a challenge to a fee imposed on landlords to reoccupy a unit. [00:16:52] Speaker 04: And first, this court held that the fee is not a taking because it is a regulation of the landlord-tenant relationship. [00:16:59] Speaker 04: And it is unlike the fee that was imposed in Coons [00:17:04] Speaker 04: which was in lieu of, thus this court said, functionally equivalent to a taking of an interest in the real property itself. [00:17:12] Speaker 04: And second, for the same reasons, this court said, the Nolan-Dolan claim failed. [00:17:18] Speaker 04: The court said that the predicate for such a claim is a condition, quote, such as the granting and easement, as in Nolan and Dolan, that would be a taking independent of the condition benefit. [00:17:31] Speaker 04: And because the challenge fee was not a taking, it could not constitute that necessary predicate. [00:17:38] Speaker 04: The reasoning of Ballinger controls this case. [00:17:41] Speaker 04: Just like the regulation there, the condition that MHA imposes regulates the landlord-tenant relationship. [00:17:47] Speaker 04: It imposes rent or price control. [00:17:50] Speaker 04: And Judge Fletcher, you're absolutely right. [00:17:52] Speaker 04: That is a common practice that courts have routinely and uniformly held never amount to a taking. [00:18:00] Speaker 04: Or MHA, in lieu of that, imposes a fee in lieu of that non-taking. [00:18:07] Speaker 04: So under Ballinger, the MHA fee cannot form the predicate of a Nolan-Dolan claim. [00:18:12] Speaker 04: Now, Ms. [00:18:13] Speaker 04: Adams in her reply misreads Ballinger. [00:18:16] Speaker 04: She says this court declined to apply Nolan-Dolan there because the fee there, quote, did not operate directly upon any parcel. [00:18:25] Speaker 04: But to the contrary, [00:18:28] Speaker 04: Ballinger conceded, quote, we cannot deny that the relocation fee here is linked to real property. [00:18:35] Speaker 04: The court just went on to say it's no more linked than a property tax is. [00:18:39] Speaker 04: And in the very next sentence, Ballinger turned to Koontz to say the holding of Koontz is that Nolan-Dolan review extends to a fee only where that fee is imposed in lieu of the taking of a physical interest in land. [00:18:54] Speaker 04: That is the key holding of Ballinger and that is what controls here. [00:18:58] Speaker 04: And Ballinger's reading of Koontz was correct. [00:19:00] Speaker 04: Again, Koontz extended Nolan-Dolan review [00:19:03] Speaker 04: to a fee only in the circumstance where that fee was demanded in lieu of the taking of a physical interest in land. [00:19:10] Speaker 04: And we know that from at least three parts of Kuntz. [00:19:13] Speaker 04: First is its facts. [00:19:14] Speaker 04: And the court went out of its way to say that the plaintiff there, throughout the litigation, maintained that the money that he was forced to pay there was a, quote, substitute for his deeding a public easement, close quote. [00:19:29] Speaker 04: Secondly, the reasoning of Kuntz matters. [00:19:32] Speaker 04: The court started by noting that the government needs to offer just one constitutional alternative. [00:19:39] Speaker 04: So if an in-loop payment gets an automatic pass from Nolan and Dolan, the government would just demand the interest in land, and then just to cover its tracks, throw in an alternative in the form of a payment option. [00:19:52] Speaker 04: The whole point of Kuntz's holding about the fee was to close that loophole. [00:19:57] Speaker 04: And third, we have to consider the case law that Kuntz said is the most closely analogous. [00:20:02] Speaker 04: And that's case law about liens. [00:20:05] Speaker 04: In those cases, the government might get your property instead of your money. [00:20:09] Speaker 04: The inverse is true for exactions. [00:20:11] Speaker 04: The government might get your money in lieu of the property. [00:20:14] Speaker 04: But the point that Kuntz was making was that, be it liens or exactions, the money and the property have to be linked in the sense that they are interchangeable. [00:20:23] Speaker 04: So from its facts and its reasoning and the case law it deemed the most analogous, we know you need more than just a stand-alone fee to trigger Nolan and Dolan. [00:20:32] Speaker 04: That fee must be in lieu of the taking of a physical interest in land. [00:20:37] Speaker 04: Still, trying to find a predicate for her Nolan-Dolan claim, Ms. [00:20:41] Speaker 04: Adams makes four claims about what MHA forces her to do. [00:20:47] Speaker 04: None of them is accurate. [00:20:49] Speaker 04: First, she claims that MHA forces developers to construct units. [00:20:53] Speaker 04: It does not. [00:20:54] Speaker 04: It just limits the rent or sales price on a percentage of units that the developer chooses to construct. [00:21:00] Speaker 04: Second, Ms. [00:21:01] Speaker 04: Adams says that MHA forces developers to become landowners. [00:21:04] Speaker 04: Well, that's certainly not true in the context of those who build and then sell the units, so that undercuts her facial claim right there. [00:21:12] Speaker 04: And then in terms of her as-applied claim, [00:21:15] Speaker 04: Ms. [00:21:16] Speaker 04: Adams already is a landlord. [00:21:17] Speaker 04: Her project, if it were to be built, would merely expand her tenant base. [00:21:20] Speaker 04: So MHA does not force the status of landlord on her. [00:21:24] Speaker 04: Third, she says MHA forces landlords to stay landlords for 75 years. [00:21:29] Speaker 04: Again, that's not accurate. [00:21:31] Speaker 04: MHA allows for the demolition or the change of use of the building and the units. [00:21:37] Speaker 04: And finally, she says the units cannot remain vacant. [00:21:39] Speaker 04: She gets there by misreading the requirement that when you market, you have to market to certain groups. [00:21:45] Speaker 04: There is no requirement to fill vacancies. [00:21:48] Speaker 04: The only mention of vacancies that you can find at MHA is in a reporting requirement where the city wants to know how many units you have occupied and how many are vacant expressly for the purpose just of tracking [00:21:59] Speaker 04: program outcomes. [00:22:02] Speaker 04: Of course this court need not reach the question of whether there is a predicate for a Nolan Dolan claim if you agree with us for our other reasons for dismissing her as applied and her facial claims which I'd like to turn to now. [00:22:14] Speaker 04: In terms of her as applied claim, it is unripe because she didn't secure a permit decision. [00:22:21] Speaker 04: Case law is clear about the finality requirement. [00:22:24] Speaker 04: A plaintiff has to file at least one meaningful permit application, pursue any available waiver or variance, and crucially get a final decision. [00:22:34] Speaker 04: Because without that final decision, the court [00:22:37] Speaker 04: cannot assess whether a condition has even been imposed, thus whether a taking has occurred, let alone to assess its magnitude to apply the rough proportionality. [00:22:46] Speaker 00: Council, I want to ask you about the waiver. [00:22:48] Speaker 00: Does it cost any money to seek one? [00:22:53] Speaker 04: I believe it does, Your Honor. [00:22:54] Speaker 00: Do we know how much? [00:22:56] Speaker 04: If it is in the record, I can't recall. [00:22:58] Speaker 00: Okay. [00:22:59] Speaker 00: Can a layperson adequately request one, or would someone like Ms. [00:23:03] Speaker 00: Adams need to hire an architect or hire [00:23:06] Speaker 00: I don't know, a planner of some sort to help her seek this waiver? [00:23:10] Speaker 04: Again, not in the record, but in my experience working for the city, of course people can come essentially pro se and pursue permit applications and permit decisions. [00:23:22] Speaker 04: And as we explained, a standalone waiver request would be considered a permit decision. [00:23:26] Speaker 04: And staff there is there to help people through that decision, through that process. [00:23:31] Speaker 00: Okay. [00:23:31] Speaker 00: How far along do they have to be on their project to be able to get a waiver? [00:23:36] Speaker 00: How much information do you need to have already? [00:23:38] Speaker 00: Say, I want to go get a waiver. [00:23:39] Speaker 00: How much information do I already need to have to be able to get that? [00:23:42] Speaker 00: Can I just say, I happen to live in this area, I want to build an apartment, and I want a waiver? [00:23:50] Speaker 00: Do I need to have plans already? [00:23:52] Speaker 00: Do I need to know the square footage? [00:23:53] Speaker 00: Because is it tied to [00:23:56] Speaker 04: I am trying to recall the testimony of our staff person on that particular question. [00:24:00] Speaker 04: I'm afraid I don't know. [00:24:01] Speaker 04: But what I can say is that certainly the more detail, the better it would be, the more helpful it would be to help apply those criteria. [00:24:08] Speaker 04: But I'm certain again that the staff could work with the applicant to determine what it is they need for that. [00:24:15] Speaker 00: So they are, Ms. [00:24:17] Speaker 00: Adams would then probably have to incur some expense before she could get a waiver. [00:24:23] Speaker 04: That would be speculation, but she might need to incur some expense. [00:24:26] Speaker 02: I think I'm right, and you can correct me if I'm wrong, that the record shows us at least this, that she does not have to make a formal application for a permit in order to get a waiver. [00:24:40] Speaker 04: That is correct. [00:24:41] Speaker 04: We can entertain a standalone waiver application. [00:24:44] Speaker 02: Without without it being accompanied by a formal application for a permit. [00:24:48] Speaker 02: That's correct. [00:24:49] Speaker 00: Okay, so we at least that's an outer boundary Correct, okay, and I also wanted to ask you though It's my understanding and maybe this has changed since we were provided with this record that Only two waivers have been requested and only one was granted correct, correct So I don't know how to interpret that is does that tell me seeking a waiver is a project of futility or? [00:25:11] Speaker 00: That I have a 50-50 shot at getting one [00:25:14] Speaker 04: We of course view it as a 50-50 shot, but a set of two examples is not a statistically significant set. [00:25:25] Speaker 04: For the reasons, Judge Fletcher, you were exploring with Mr. Sen here. [00:25:33] Speaker 04: the existence of the waiver provision itself undercuts the facial claim. [00:25:39] Speaker 04: In a facial challenge, as Mr. Senn acknowledged, the plaintiff has to prove no set of circumstances under which the law can be applied validly. [00:25:48] Speaker 04: So we not only have the waiver provision, which you were exploring, but we've applied it. [00:25:53] Speaker 04: And so right there is at least one circumstance that we can point to where it has been applied to grant the waiver. [00:26:00] Speaker 04: Now, Mr. Sen invokes Patel. [00:26:04] Speaker 04: That case is distinguishable. [00:26:05] Speaker 04: In that case, plaintiffs challenged a law allowing for warrantless searches. [00:26:10] Speaker 04: And the government defended itself by saying, hey, sometimes we actually get a warrant, or other times we get consent. [00:26:19] Speaker 04: And the Supreme Court rejected that defense. [00:26:21] Speaker 04: Why? [00:26:21] Speaker 04: Because it didn't involve application of the actual [00:26:25] Speaker 04: the actual law itself. [00:26:27] Speaker 04: Here, as Judge Fletcher was exploring, the waiver results only by applying the terms of the statute itself. [00:26:34] Speaker 04: And Mr. Sen also brought up the hypothetical that they have in their briefing saying, well, a waiver here would allow the city to cover over a requirement that only people of certain races would have to go through the permitting process. [00:26:54] Speaker 04: A waiver there would not avoid the constitutional harm, because I think the constitutional harm there would likely be equal protection or something else other than a taking. [00:27:03] Speaker 04: If only people of certain race have to go through a process, that right there, whether there's a waiver or not, that's the constitutional violation. [00:27:09] Speaker 04: But where a waiver, as in this case, [00:27:12] Speaker 04: can avoid the constitutional harm here at taking, then it does undercut a facial challenge. [00:27:19] Speaker 00: I'm trying to figure out whether or not the fact that getting a waiver is probably time consuming and potentially costs money, whether or not that's going to be sufficient to give Article III standing injury. [00:27:36] Speaker 04: Just having to expend money? [00:27:38] Speaker 00: Well, expend money and time, right? [00:27:40] Speaker 00: I don't know what it takes to get a waiver. [00:27:42] Speaker 04: Well, first of all, I'll go to standing in just a minute, but in terms of the finality requirement and her as applied claim, that was addressed by this court in, I don't know if I'm pronouncing it correctly, Gutay, G-U-A-T-A-Y, where the court said, it's not a hardship. [00:28:01] Speaker 04: There is no hardship exception from the finality requirement. [00:28:04] Speaker 04: There was a church that said, we simply cannot afford to go through this permitting requirement. [00:28:09] Speaker 04: And the court respectfully said, [00:28:11] Speaker 04: we still have a finality requirement. [00:28:13] Speaker 04: You still have to do it. [00:28:14] Speaker 04: Also in Southern Pacific transportation, this court said there is no futility requirement. [00:28:19] Speaker 04: The only futility exception, there is only the exception if you are made to go through a multiple permit application. [00:28:30] Speaker 04: So even though that's not directly standing, I don't believe that that is [00:28:36] Speaker 04: I think it's informative to your question. [00:28:40] Speaker 04: But as for standing, the harm that you have to be able to allege is a harm [00:28:47] Speaker 04: that is legally protected by the constitutional provision at issue. [00:28:53] Speaker 04: And here it's the Takings Clause. [00:28:55] Speaker 04: The Takings Clause protects you against the government devaluing your property through a permit condition that takes the physical interest in land or perhaps denies you the permit because you refuse to accede to that or to a fee. [00:29:08] Speaker 04: in lieu. [00:29:09] Speaker 04: I'm unaware of any case saying that the takings clause protects you from having to incur expense going through the permitting process. [00:29:17] Speaker 04: So I can concede that the permitting process is not free and that it may involve a fee, but I don't think that is enough to support Article 3 standing here. [00:29:28] Speaker 04: The other problem, of course, with Ms. [00:29:31] Speaker 04: Adams' facial claim is that it's untimely. [00:29:35] Speaker 04: The three-year limitations period controls 1983 claims here in Washington. [00:29:39] Speaker 04: For a facial takings claim, that period starts to run upon the law's passage. [00:29:44] Speaker 04: And that's the holding from this court in Colony Cove and Shear. [00:29:49] Speaker 04: And what happened, Ms. [00:29:51] Speaker 04: Adams filed more than three years after the... You know, that can't be right. [00:29:56] Speaker 02: Meaning somebody passes... City of Seattle passes an ordinance five years ago. [00:30:01] Speaker 02: I moved to Seattle. [00:30:02] Speaker 02: I want to do something. [00:30:03] Speaker 02: I think the statute is unconstitutional. [00:30:06] Speaker 02: I can't challenge it because I wasn't here. [00:30:09] Speaker 04: Of course you can challenge it and as applied challenge Judge Fletcher, but not a facial one. [00:30:13] Speaker 02: Of course a facial claim... I just don't think that's the law. [00:30:17] Speaker 04: Well, I'll have to read some cases, but that does not seem that does not make sense to me Okay, colony Cove would be the first one to start with your honor. [00:30:24] Speaker 02: I'll go read the cases But that doesn't intuitively that seems to me just dead wrong. [00:30:28] Speaker 04: Well if I can if I can remember that a facial Facial relief is extraordinary relief. [00:30:34] Speaker 04: It sets a high bar. [00:30:35] Speaker 04: No, I get that it's hard to get and so if if someone is unable to bring a facial claim they still should be able to bring and as applied claim, but [00:30:44] Speaker 04: there's going to be a limit. [00:30:45] Speaker 04: There's a window of opportunity to bring a facial claim. [00:30:49] Speaker 04: But again, read the case line. [00:30:51] Speaker 02: I'll read your case. [00:30:52] Speaker 04: We'll go from there. [00:30:54] Speaker 04: One case you should read with skepticism is the one that Ms. [00:30:57] Speaker 04: Adams relies on in her reply, and that is Thomas versus County of Humboldt. [00:31:03] Speaker 04: She uses that to say that the limitations period starts when the plaintiff learns of the injury, but Thomas limited its holding to facial claims not based on injury to property rights. [00:31:13] Speaker 04: Thomas discussed sheer from this court in 2016 where this court made clear that the period starts upon the lost passage where the claimed injury is to property rights, namely takings and substantive due process. [00:31:28] Speaker 04: If this court gets to the point of thinking that Nolan Dolan should be applied to MHA, we ask that you remand the case. [00:31:36] Speaker 04: That is crucially so that the district court can have the first opportunity to consider the city's motion to exclude Ms. [00:31:43] Speaker 04: Adams' expert, which would be reviewable for an abuse of discretion, but also to take a shot at the fact-specific findings that would be needed for the rough proportionality test. [00:31:54] Speaker 04: But I would like to address the nexus issue just in case you disagree with me and you want to in the first instance take on application of Nolan Dolan to this case. [00:32:06] Speaker 04: The nexus test is an apples to apples test. [00:32:10] Speaker 04: It asks, does the permit condition serve the same governmental interest impinged by the project? [00:32:15] Speaker 04: So using the example that Nolan gave us, if the government banned shouting fire in a crowded theater, they can't allow the shouter to shout just by paying $100 to the government. [00:32:26] Speaker 04: Why? [00:32:27] Speaker 04: That would be apples to oranges, because enhancing the government's coffers does nothing to mitigate the impact on safety. [00:32:34] Speaker 04: Apples to apples test is a low bar, which MHA clears. [00:32:38] Speaker 04: Its conditions advance the City's asserted interest in addressing the housing needs of low-income households, as Judge DeAlba was exploring with Mr. Sen, because, as the Council found, residents of new market-rate housing need services from those who are low-income workers, and that increases the demand specific to low-income housing. [00:32:58] Speaker 04: Now, the test is not, as Mr. Sen said today, whether the proposal substantially impedes that interest. [00:33:07] Speaker 04: Nolan uttered that phrase, tying it to the substantially advances test from Agans, which, as you know, the Supreme Court overruled in Lingel. [00:33:18] Speaker 04: Nolan mentioned substantially impedes only in the context of assuming the veracity of the government's assertion that it could have in that case denied the permit for the House because of its impact and let's just say X. But when the court got to applying the apples to apples test, it found that the government failed that test because the [00:33:38] Speaker 04: easement that it wanted was addressing some other impact why. [00:33:43] Speaker 04: It was apples to oranges. [00:33:45] Speaker 04: So whether the impact is substantial doesn't matter. [00:33:48] Speaker 04: What matters is whether the condition advances the same interest as what is being impinged, and here it does. [00:33:54] Speaker 04: Ms. [00:33:54] Speaker 04: Adams and her amici want to reduce all of this to a policy debate. [00:33:59] Speaker 04: She says that the rising tide of housing supply generally lifts all housing boats, if you will. [00:34:08] Speaker 04: So they claim MHA is counterproductive because it suppresses that tide. [00:34:13] Speaker 04: Now let's set aside for a moment that they offer no Seattle-specific evidence on that. [00:34:19] Speaker 04: What is the real matter is that it mischaracterizes the city's interest. [00:34:23] Speaker 04: Again, as Judge de Alba was exploring with Mr. Sen, MHA addresses the particular boat, if you will, of low income housing. [00:34:30] Speaker 04: And our expert identifies a market failure where the rising tide of general housing fails to lift that low income housing boat. [00:34:41] Speaker 04: But again, the nexus question is not whether one strategy is better than another. [00:34:48] Speaker 04: All that matters is whether it [00:34:50] Speaker 04: whether the condition in that strategy addresses the interest that the government says is being impinged, and here it does. [00:34:59] Speaker 04: So unless the Court has any further questions, I would just like to close by saying we ask you, please, to affirm the grant of summary judgment to the city for the reasons that we've laid out. [00:35:09] Speaker 04: If you think that Noel and Dolan should be applied, we ask you, please, to remand. [00:35:13] Speaker 04: Thank you very much. [00:35:24] Speaker 03: Thank you, Your Honors. [00:35:25] Speaker 03: I'd like to start with Article 3 standing and waiver, as Judge Diop, you were asking about earlier. [00:35:32] Speaker 03: Waiver has nothing to do with Article 3 standing, and that's for two reasons. [00:35:37] Speaker 03: One, if you look at the case of Yee versus City of Escondido, it's well settled that claimants may present a facial challenge, regardless of the possibility of waiver, variance, et cetera, because the basis of the facial challenge is that this restriction cannot be enforced against anyone. [00:35:54] Speaker 03: And likewise, because having to go through a waiver process at all is a kind of injury. [00:36:00] Speaker 03: In fact, even if a small one, the Williamson County finality requirement, even if it could apply here to Ms. [00:36:05] Speaker 03: Adams' as applied claim, would be only a prudential, not a jurisdictional question. [00:36:10] Speaker 03: I'd like to discuss about the chances of waiver in this case, Your Honors. [00:36:16] Speaker 03: The city has only granted one waiver request. [00:36:19] Speaker 03: At the time it did so, which was shortly after MHA's enactment, the head of the city's waiver process [00:36:24] Speaker 03: stated and I quote this is not only the first but quote the only MHA modification likely to be granted. [00:36:33] Speaker 03: And that was because at that time, that applicant presented very unusual circumstances. [00:36:37] Speaker 03: He submitted a permit application. [00:36:39] Speaker 03: Then MHA came into force while the application was being considered. [00:36:44] Speaker 03: And MHA rendered his project economically unviable. [00:36:47] Speaker 03: There's no reason to expect that Ms. [00:36:49] Speaker 03: Adams would obtain a waiver in this case. [00:36:51] Speaker 03: The reason there's only been two waiver submissions is because the city's telling people that it's a very high burden. [00:36:57] Speaker 02: Do we have on the record evidence as to how many applications of waivers there have been? [00:37:01] Speaker 02: There have been two. [00:37:02] Speaker 02: There have been two. [00:37:03] Speaker 02: Only two. [00:37:04] Speaker 03: Only two, but I submit, Your Honor, it's because the city is telling the public that it's a very high burden. [00:37:08] Speaker 02: Well, how do you know that that's the because? [00:37:11] Speaker 02: I understand that the city said this. [00:37:12] Speaker 02: I understand that there are only two. [00:37:13] Speaker 02: That's what you just told me. [00:37:16] Speaker 02: But cause and effect? [00:37:17] Speaker 03: I presume. [00:37:18] Speaker 03: I think it's a fair presumption, Your Honor. [00:37:19] Speaker 03: The city told, in fact, Ms. [00:37:21] Speaker 03: Anita Adams, that it's a very high burden to obtain a waiver in her email conversation. [00:37:25] Speaker 03: And beyond that... And Ms. [00:37:27] Speaker 02: Adams, of course, did not actually follow through in applying for a waiver. [00:37:30] Speaker 03: Well, that's because she believed from her email conversation that there was no way the city would entertain a waiver request unless it accompanied a permit application, a full permit application. [00:37:42] Speaker 03: And by the way... Well, she was told to contact Mr. Van Skyck, which she didn't do. [00:37:46] Speaker 03: She was told to contact Mr. Van Skyck if she had further questions, which she did not. [00:37:50] Speaker 03: And the person told... She interpreted the person as saying there's no way of obtaining a waiver without submitting a formal permit application. [00:37:58] Speaker 02: I'll just read you what the email was to her. [00:38:00] Speaker 02: The application review process is led by David Vanskyke in our offices, and so he'd be the best person to contact you if you have questions, not further questions. [00:38:12] Speaker 02: Well, Your Honor, I... Then the email address is given and she did not follow through. [00:38:17] Speaker 03: I have the email in front of me as well, and she said, you have done a lot of research in the requirements and process, and unfortunately we can't give any assurance that your request to waive or modify the MHA requirements would be approved. [00:38:28] Speaker 02: And then that's followed by the sentence I just read to you. [00:38:31] Speaker 03: That's right, Your Honor. [00:38:32] Speaker 03: Regardless, we're talking about an email conversation on a statute, and the point is the city ordinance also states that any request for a waiver has to accompany a permit application. [00:38:41] Speaker 03: The city hadn't told anybody, hadn't hinted to anybody, that there was such a thing as a standalone waiver request. [00:38:45] Speaker 03: until over a year and a half into this litigation. [00:38:48] Speaker 03: It's never processed a standalone waiver request. [00:38:51] Speaker 03: And regardless, the waiver has nothing to do with Ms. [00:38:54] Speaker 03: Adams' standing to seek facial relief. [00:38:57] Speaker 03: And if it is affected, if it does to the extent it could affect her as applied claim, it would only present prudential concerns, which we submit in our briefing are satisfied here. [00:39:07] Speaker 03: Lastly, I would like to highlight the stakes of this case. [00:39:12] Speaker 03: The immediate stakes of this case, of course, involve Ms. [00:39:14] Speaker 03: Adams and her family. [00:39:15] Speaker 03: But the record shows that MHA is similarly preventing a host of other black families in Seattle Central District from becoming homeowners. [00:39:23] Speaker 03: MHA is disproportionately harming Seattle's lower income and historically marginalized populations, making it more difficult for people to add housing to Seattle in the middle of what the city recognizes as a devastating, ongoing housing shortage. [00:39:40] Speaker 03: This is not merely unconstitutional, Your Honors. [00:39:43] Speaker 03: This is profoundly unjust, and it is harming the citizens of Seattle right now. [00:39:48] Speaker 03: Thank you very much, Your Honors, unless you have any further questions. [00:39:52] Speaker 01: Any questions? [00:39:54] Speaker ?: Thank you. [00:39:55] Speaker 01: Thank you, Counsel. [00:39:58] Speaker 01: It's a very interesting and challenging case. [00:40:06] Speaker 01: I want to thank both counsel for their excellent arguments to the panel. [00:40:15] Speaker 01: That case will now be submitted, and the parties will hear from us in due course.