By Barbara Liston
ORLANDO, Florida (Reuters) - The U.S. Supreme Court will hear arguments on Tuesday in a property-rights case that could have national implications about what government can require landowners to do in exchange for allowing them to develop their property.
The plaintiff, Coy Koontz Jr., took over the case for his deceased father who in 1994 sued Florida's St. Johns River Water Management District after it denied him permits to dredge and fill in wetlands on his 15-acre (6-hectare) parcel because of concerns about possible environmental damage.
Koontz's original development plan called for destroying more than three acres of protected wetlands in the Econlockhatchee River Hydrologic Basin near Orlando, Florida.
Koontz offered to mitigate the damage by preserving about 11 acres of the site, but the water management district told him the law required him to do more.
The district offered several solutions, including reducing the size of his proposed building project to one acre, or making improvements to wetlands somewhere else in the Econ Basin. Koontz refused and sued.
Koontz won in trial court in 2002, and subsequently on appeal, with a lower court finding that the district failed to show a relationship between the harm that would be caused by Koontz's proposed development and the district's suggested improvement of wetlands a few miles away.
The court also found that the district's refusal to grant the permits was a "temporary taking" of his land, and awarded him $327,500 in damages.
However, the Florida Supreme Court reversed the decision.
Koontz's attorney, Paul Beard II, of the Pacific Legal Foundation called the district's suggestion that Koontz improve off-site wetlands in exchange for a permit "extortion."
"It happens every day all across the country," Beard said.
William Congdon Jr., who represents the district, said the case has the potential to impact the way that government regulators can negotiate with landowners.
"I consider it good government that if you're going to deny someone's application, you should tell them what they need to do to fix it," Congdon said. "The upshot of this is that by telling people what you can do, you set yourself up for this sort of exaction-taking claim that we have here."
The property remains undeveloped. During the initial trial, the wetlands on Koontz's property dried up for unknown reasons to the extent that only one acre of wetlands would be destroyed by Koontz's development plan, according to Congdon.
As such, the district granted the permits to Koontz who subsequently sold the property, Congdon said.
The case is Koontz v. St. Johns River Water Management District, U.S. Supreme Court, No. 11-1447.
(Editing by Kevin Gray and Lisa Shumaker)