What Can Fees Internalize?
Consideration of impact fees over the past several decades has developed a robust and somewhat inconsistent body of case law. The [*PG673]doctrine that emerges from the existing state and federal cases illustrates the primary legal challenges faced by impact fees: (1) lack of authority; (2) illegal tax; and (3) uncompensated, regulatory takings.284 Where the Nollan/Dolan analysis is applied, the test requires a nexus between the impact and the fee demanded, and a rough proportionality between the fee and the impact.285 In a regulatory takings analysis, if the Nollan/Dolan test is inapplicable, the deferential Agins standard applies and most exactions would pass constitutional muster.286 However, as in the state cases discussed earlier, even where the Nollan/Dolan test is not applied, most state courts supplement their traditional analysis with a test based on the principles articulated in Nollan v. California Coastal Commission and Dolan v. City of Tigard: essential nexus and rough pro
