WILLIAM A. DABBS, JR., et al.
ANNE ARUNDEL COUNTY
Argued: November 3, 2017
Circuit Court for Anne Arundel County Case No. 02-C-11-165251
Adkins, McDonald, Watts, Hotten, Getty, Harrell, Glenn T.,
Jr., (Senior Judge, Specially Assigned) Cathell, Dale R.,
(Senior Judge, Specially Assigned), JJ.
reams of papers being filed, it is[, still to this day, ] 
difficult to tease out [precisely what the Dabbs
Class'] specific contentions are except for the assertion
that they should receive a refund of some unspecified
Opinion (at 14), Senior Judge Dennis Sweeney (ret.),
Dabbs, et al. v. Anne Arundel County,
Circuit Court for Anne Arundel County, Case No.
02-C-11-165251 (14 January 2016).
the latest installment of a litigation saga (although perhaps
we are nearing its end) traveling two quite kindred paths
over more than fifteen years, (Halle, et al. v. Anne
Arundel County ("Halle") and
Dabbs, et al. v. Anne Arundel County
("Dabbs")) in Maryland's courts.
Pursuant to the power vested in the government of Anne
Arundel County, Maryland ("the County") through
1986 Md. Laws, ch. 350, the County imposed road and school
impact fees according to County districts beginning in
1987. These fees were paid usually by land
developers and builders. Those who paid impact fees (like the
Dabbs Class) might become eligible, under certain
circumstances, for refunds of those fees. See Anne
Arundel County Code § 17-11-210. Refunds were contingent upon
the County's failure to utilize or encumber within a
specified time the collected fees for present or future
eligible capital improvements, i.e., projects for the
"expansion of the capacity of public schools, roads, and
public safety facilities and not for replacement,
maintenance, or operations." §
17-11-209(a). The Dabbs Class' claims are a
demand for refunds of an unspecified amount of impact fees
collected by the County between fiscal years (FY) 1997-2003.
AND PROCEDURAL BACKGROUND
The Halle Chronicles.
of 12 reported and unreported opinions, orders, and
memorandum opinions have been issued to date collectively by
this Court, the Court of Special Appeals, and the Circuit
Court for Anne Arundel County, in the Halle
litigation (the older sibling to the present
case). The core contention in Halle is
relevant to the present case. In 2001, the Halle
Class asserted that they were entitled to refunds of impact
fees collected during FY 1988-1996 that were expended on what
was ultimately determined to be ineligible capital
improvements. In Halle, the circuit court, on
15 December 2006, found $4, 719, 359 in refunds were
"due to the current owners of specified fee paying
properties, " plus five-percent interest from the date
of the payment of each initial fee. The circuit court based its
ruling in favor of the payors on its determination that the
§ 17-11-210(e) extensiondecisions made by the County's
Planning and Zoning Officer (PZO) were invalid. The
Halle Class and the County cross-appealed. The
County, on appeal,
argued that the circuit court erred by refusing to permit the
County to count the encumbrances in calculating the refund.
In their cross-appeal, the [Halle Class] contended
that (1) the circuit court improperly calculated the amount
of impact fees available for refund by excluding funds that
were spent on ineligible development projects; and (2)
counsel for the property owners were entitled to the 40
[percent] contingency fee provided by their fee agreement
with the named class representatives.
Halle Dev., Inc. v. Anne Arundel County, No. 1299,
Sept. Term, 2016 at 6 (Md. Ct. Spec. App. Nov. 22,
2017). The intermediate appellate court, in 2008,
held, inter alia in an unreported opinion, that the
circuit court erred in its formulation of the mathematical
formula used to calculate that $4, 719, 359 in refunds were
due. The County was entitled, in fact, to count impact fee
encumbrances when determining impact fees available
for refund. Halle Development v. Anne Arundel
County, No. 2552, Sept. Term, 2006 at 8-9 (Md. Ct. Spec.
App. May. 5, 2008) (the appellate court granted a motion for
reconsideration to clarify its 7 February 2008 remand
instruction); Halle Development v. Anne Arundel
County, No. 2552, Sept. Term, 2006 at 52 (Md. Ct. Spec.
App. Feb. 7, 2008) (the intermediate appellate court found
that the circuit court erred by refusing to allow the County
to count impact fee encumbrances in determining the amount of
impact fee refunds to which Owners are entitled under §
17-11-210(b)). The intermediate appellate court, on remand,
instructed the circuit court to recalculate appropriately the
refunds with consideration given to the encumbered impact
fees. See id. The County sought successfully a writ
of certiorari from this Court to review that judgment. We
affirmed, on 6 May 2009, the intermediate appellate court
regarding its decision as to the encumbrances, and directed a
remand to the circuit court to calculate available impact fee
refunds. See Anne Arundel County v. Halle Dev.,
Inc., 408 Md. 539, 971 A.2d 214 (2009).
March 2011, the circuit court reduced the refunds for which
the payors were eligible from $4, 719, 359 to $1, 342, 360,
plus interest. The Halle Class, in response, filed a
petition for a writ of certiorari with this Court. We denied
the Halle Class' attempt to pole-vault over
review by the intermediate appellate court. The
Halle Class appealed then to the intermediate
appellate court. In a 29 July 2013 unreported opinion, the
Court of Special Appeals affirmed the circuit court's 25
March 2011 order. The Halle Class petitioned again
for a writ of certiorari. We denied that petition also. The
circuit court awarded, on remand on 13 May 2014, counsel fees
in the amount of 39 percent of the $1, 342, 360 in refunds,
plus five-percent interest on each refund, and, on 8 August
2016, issued its final judgment. The owners appealed to the
intermediate appellate court, which, in an unreported opinion
on 22 November 2017, affirmed the circuit court's 8
August 2016 order, explaining, "in prior opinions, [the
intermediate appellate court and this Court] have already
addressed all but one of the arguments raised by the
[Halle Class]." Halle Development v. Anne
Arundel County, No. 1299, Sept. Term, 2016 at 1 (Md. Ct.
Spec. App. Nov. 22, 2017).
The Dabbs trilogy.
adopt, supplementing as needed, the intermediate appellate
court's recitation of the procedural posture of this case
as rendered in Dabbs v. Anne Arundel County, 232
Md.App. 314, 328-31, 157 A.3d 381, 389-91 (2017), cert.
granted Dabbs v. Anne Arundel County, 454 Md. 677, 165
A.3d 473 (2017):
In the present case, involving impact fees collected in FYs
1997-2002, [the Dabbs Class] sought refunds on the
ground that the impact fees were not expended or encumbered
in a timely manner under § 17-11-210(b). [The
Dabbs Class] also argued that the amendments to the
Impact Fee Ordinance in Bill No. 27-07 and Bill No. 71-08
unconstitutionally interfered with their vested rights in
refunds. After hearing from the parties, [the circuit court
entered, ultimately, a declaratory judgment in favor of the
County as to all issues raised in the proceeding.] [T]he
circuit court ruled that the County had applied the Impact
Fee Ordinance as required by this Court's 2008 opinion
and found that there are no impact fees available for refund
under § 17-11-210. Further, the circuit court rejected
[the Dabbs Class'] constitutional and state law
challenges to the Impact Fee Ordinance, finding that most of
the challenges had already been resolved against the class
plaintiffs in Halle.
More specifically, the circuit court found that the County
prepared the six FY charts in the format approved by the
Halle courts, properly comparing the amount of
impact fees collected in each FY and district under review to
the amount of impact fees expended (disbursed) and encumbered
as of the end of the sixth FY following the FY of collection.
Kurt Svendsen, the County's Assistant Budget Officer, who
had been employed by the County since September 1, 1997, was
responsible for (a) the preparation of the County's
Capital Budget portion of the Annual Budget and Appropriation
Ordinance, and (b) the monitoring of encumbrances and
expenditures recorded in connection with appropriations for
capital projects. Because Svendsen monitored expenditures and
encumbrances recorded against appropriations of capital
projects on an almost daily basis, he was delegated the
responsibility for conducting the six FY test under §
In the present case, the County prepared six FY charts for
FYs 1997-2002 in the same manner as the charts prepared in
Halle for FYs 1988-2002, but also included impact
fee expenditures on temporary classrooms. The charts
indicated that all impact fees collected in FYs 1997-2002
were expended or encumbered within six FYs following the FY
of collection and, thus, no impact fees collected in these
FYs were available for refund.
the circuit court found that, in applying the six FY test,
the County properly interpreted the term "impact fees
encumbered" in § 17-11- 210(b) to mean:
(1) the amount of impact fees collected in a district account
in a FY which have not been expended on June 30 of the sixth
FY following the FY of collection, for which there is
(2) as of the same date, an encumbrance (purchase order) on
an impact fee eligible capital project in the district.
to the circuit court, this definition is the only logical one
based on [generally accepted accounting principles (GAAP)],
the applicable provisions of the County Charter, and Annual
Budget and Appropriation Ordinances. Under GAAP, an
appropriation states the legal authority to spend or
otherwise commit a government's resources. See
Stephen Gauthier, Governmental Accounting Auditing and
Financial Reporting at 305 (Government Finance Officers
Ass'n 2001). Meanwhile, § 715(a) of the County
Charter provides that County officials and employees may not
spend or commit funds in excess of appropriations, and §
17-11-201(2) defines an encumbrance as "a legal
commitment for the expenditure of funds, chargeable against
the applicable appropriation for the expenditure, that is
documented by a contract or purchase order." Thus, the
court concluded that when determining the amount of
"impact fees encumbered, " the County was correct
in comparing the amount of unexpended impact fees in the
district account at the end of the relevant FY to the
encumbrances entered in relation to capital projects in the
district that have been determined by the [Planning and
Zoning Office] to be eligible in the district. As pertinent
to the certiorari questions for which we granted the petition
in this case, the intermediate appellate court - in reliance
on Waters Landing, Ltd. P'ship v. Montgomery
Cnty., 337 Md. 15, 650 A.2d 712 (1994) - held
unfounded the Dabbs Class' arguments that the
County's Impact Fee Ordinance is subject to the
"rational nexus/rough proportionality test" of
Dolan v. City of Tigard, 512 U.S. 374, 114 S.Ct.
2309 (1994), and Nollan v. California Coastal
Comm'n, 483 U.S. 825, 837, 107 S.Ct. 3141
intermediate appellate court held, moreover, that Bill No.
27-07 had legitimate retrospective applicability. The court,
although professing not to be bound by the law of the case
doctrine,  explained it was unable to reach a
different conclusion in this regard than that reached in its
2008, 2011, and 2013 Halle opinions and this
Court's 2009 Halle opinion. Specifically, given
the close identity between the Halle Class'
assertions and many of those advanced in the Dabbs
Class action, the court "fail[ed] to see how [it could]
reach a different conclusion." Dabbs, 232
Md.App. at 336, 157 A.3d at 394.
court held valid also the prospective application of Bill No.
71-08, reasoning that "the repeal of a statute creating
a right purely of statutory origin, such as [the right to a
refund via] § 17-11-210, wipes out the right unless [it]
is vested." Dabbs, 232 Md.App. at 341, 157 A.3d
at 397. In so holding, the court rejected the Dabbs
Class' argument that Bill No. 71-08 impaired their
contractual and legal relationship with the County, also
violating the rough proportionality/rational nexus
the court held valid also Bill No. 96-01, "which,
effective February 3, 2002, authorized the County to use
impact fees for temporary classroom structures provided they
expanded the capacity of the schools to serve new
development." Dabbs, 232 Md.App. at 338, 157
A.3d at 395. The court found that neither the rational nexus
doctrine nor the takings clause applied to Bill No. 96-01.
Id. The court noted further that "[t]he
County's definition of [school] capacity is consistent
with the enabling law for impact fees (1986 Md. Laws, ch.
350, § 1, codified at § 17-11-214), and it is the
County, not the State [Board of Education], that determines
the scope of its Impact Fee Ordinance." Id.
July 2017, we granted the Dabbs Class'
certiorari petition, Dabbs, et al., v. Anne
Arundel County, 454 Md. 677, 165 A.3d 473 (2017), to
consider only the following questions:
I. Did the lower courts err in determining that ". . .
the rough proportionality test [or the rational nexus test]
has no application to development impact fees . . . where
monetary exactions are imposed, " in contravention of
Howard County v. JJM, 301 Md. 256, 482 A.2d 908
II. Did the lower courts err in permitting the retroactive
application of legislation and not finding a taking under
Article III, section 40 of the Maryland Constitution?
Code (1973, 2006 Repl. Vol.), § 3-409(a) of the Courts
and Judicial Proceedings Article provides that a court
"may grant a declaratory judgment or decree in a civil
case, if it will serve to terminate the uncertainty or
controversy giving rise to the proceeding." We have made
clear that the decision to issue a declaratory judgment is
within the sound discretion of the trial court. Sprenger
v. Pub. Serv. Comm'n of Maryland, 400 Md. 1, 20, 926
A.2d 238, 249 (2007). Such discretionary matters are
"much better decided by the trial judges than by
appellate courts, and the decisions of such judges should
only be disturbed where it is apparent that some serious
error or abuse of discretion or autocratic action has
occurred." Northwestern Nat'l Ins. Co. v. Samuel
R. Rosoff, Ltd., 195 Md. 421, 436, 73 A.2d 461, 467
(1950). An abuse of discretion
occurs where no reasonable person would take the view adopted
by the [trial] court, or when the court acts "without
reference to any guiding rules or principles. We will find an
abuse of discretion when the ruling is clearly against the
logic and effect of facts and inferences before the court,
when the decision is clearly untenable, unfairly depriving a
litigant of a substantial right and denying a just result,
when the ruling is violative of fact and logic, or when it
constitutes an "untenable judicial act that defies
reason and works an injustice.
Powell v. Breslin, 430 Md. 52, 62, 59 A.3d 531, 537
(2013) (internal citations and quotation marks omitted).
Nollan and Dolan - Impact Fees & the
Rough Proportionality/Rational Nexus Test.
Dabbs Class argues that the intermediate appellate
court erred in concluding that the rough proportionality
test/rational nexus test of Nollan and
Dolan has no application to the present
case. As this argument goes, the County must
"demonstrate that its expenditure of impact fees was
attributable reasonably to new development and each such
expenditure reasonably benefitted 'new development'
and/or individual 'against whom the fee was
County responds, consistent with its position asserted in
Halle and the lower courts in Dabbs, that,
in Waters Landing, 337 Md. at 40-41, 650 A.2d at
724, we held that the individualized determination of rough
proportionality required by Dolan is not applicable
to development impact fees or taxes that are imposed
legislatively and set on a general basis across a
jurisdiction or district.
outset, it must be remembered that the Takings Clause of the
Fifth Amendment and Article III, § 40B of the Maryland
Constitution do not prohibit the government from taking
property for public use; rather, it requires the government
to pay "just compensation" for any property it
takes. U.S. Const. amend. V; MD Constitution, Art. 3, §
40. For "just compensation" to be paid, however, an
actual taking of property must occur. The Nollan and
Dolan line of cases was expanded recently to apply
to a narrow set of monetary exactions, i.e., a condition of
the payment of money for favorable governmental action on a
required permit application for a specific parcel of land.
See Koontz v. St. Johns River Water Mgmt. Dist., 570
U.S. 595, 599, 133 S.Ct. 2586, 2591 (2013).
Koontz, the Florida legislature enacted a regulation
making it illegal for anyone to "'dredge or fill in,
on, or over surface waters'" without a Wetlands
Resource Management (WRM) permit acquired from the St. Johns
River Water Management District (the District).
Koontz, 570 U.S. at 601, 133 S.Ct. at 2592.
Moreover, Florida enacted the Water Resources Act,
authorizing each district to regulate construction impacting
waterways in the state. Id. Under this regulation,
"a landowner wishing to undertake such construction must
obtain from the relevant district a Management and Storage of
Surface Water (MSSW) permit, which may impose 'such
reasonable conditions' on the permit as are
'necessary to assure' that construction will 'not
be harmful to the water resources of the district.'"
proposed to develop the northern 3.7 acres of his 14.9 acre
property, which would affect local waterways. Id. He
applied to the District for WRM and MSSW permits.
Id. The District reviewed Koontz's permit
applications and approved them upon his agreement to either
of two conditions:
the District proposed that [Koontz] reduce the size of his
development to 1 acre and deed to the District a conservation
easement on the remaining 13.9 acres. To reduce the
development area, the District suggested that [Koontz] could
eliminate the dry-bed pond from his proposal and instead
install a more costly subsurface storm water management
system beneath the building site. The District also suggested
that [Koontz] install retaining walls rather than gradually
sloping the land from the building site down to the elevation
of the rest of his property to the south. In the alternative,
the District told [Koontz] that he could proceed with the
development as proposed, building on 3.7 acres and deeding a
conservation easement to the government on the remainder of
the property, if he also agreed to hire contractors to make
improvements to District-owned land several miles away.
Specifically, [Koontz] could pay to replace culverts on one
parcel or fill in ditches on another.
Koontz, 570 U.S. at 601-02, 133 S.Ct. at 2592-93.
Koontz argued that the District's mitigation demands were
excessive, and that he was entitled to money damages if the
state agency's actions constituted a taking without just
compensation. Koontz, 570 U.S. at 602, 133 S.Ct. at
2593. The Supreme Court held that a monetary exaction for
mitigation as a condition for issuing a land-use permit to
enable development of an individual property must meet the
nexus and rough proportionality requirements of
Nollan and Dolan. Koontz, 570 U.S.
at 612, 133 S.Ct. at 2599. The Supreme Court stressed that
the requirements of Nollan and Dolan were
the same for monetary exactions as for when "the
government approves a permit on the condition that the
applicant turn over property or denies a permit
because the applicant refuses to do so."
Koontz, 570 U.S. at 606, 133 S.Ct. at 2595 (emphasis
Koontz, the Supreme Court explained that its holding
was distinguished from Eastern Enterprises v. Apfel,
524 U.S. 498, 118 S.Ct. 2131 (1998) (plurality opinion),
explaining that "[u]nlike the
financial obligation in Eastern Enterprises, the
demand for money at issue here '[operated] upon . . . an
identified property interest' by directing the owner of a
particular piece of property to make a monetary
payment." Koontz, 570 U.S. at 613, 133 S.Ct. at
2599. Thus, the District's proposed monetary exaction
burdened Koontz's ownership and development of a
specific parcel of land. Id. (emphasis
added). The Court elaborated further that Koontz
resembled cases holding "that the government must pay
just compensation when it takes a lien-a right to receive
money that is secured by a particular piece of
property." Koontz, 570 U.S. at 613, 133 S.Ct.
at 2599. In holding that the proposed monetary exaction in
Koontz was subject to Nollan and
Dollan, the Court emphasized that "[t]he
fulcrum this case turns on [is] the direct link
between the government's demand and a specific parcel
of real property." Koontz, 570 U.S. at
613, 133 S.Ct. at 2599 (emphasis added).
Court affirmed that taxes and user fees, however, are not
takings subject to Nollan and Dolan, and
assured that its holding did not affect the authority of
governments to "impose property taxes, user fees, and
similar laws and regulations that may impose financial
burdens on property owners." Koontz, 570 U.S.
at 615, 133 S.Ct. at 2601.
Dabbs Class' surfeit of arguments relating to
Koontz's application to the County's
development impact fees does not convince us that they have a
sound jurisprudential basis. Koontz did not hold
that land-use regulations are generally subject to a takings
analysis under Nollan and Dolan; rather, it
held that challenges to governmental demands for money
(except application fees) in connection with the permit
review process for a specific property are subject to nexus
and rough proportionality analysis. Koontz, 570 U.S.
at 618-19, 133 S.Ct. at 2603. The Court went out of its way
to stress that it was not expanding Nollan and
Dolan much beyond its narrow confines:
[Koontz's] claim rests on the  limited
proposition that when the government commands the
relinquishment of funds linked to a specific, identifiable
property interest such as a bank account or parcel of real
property, a per se [takings] approach is ...