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29 sent a strong signal that the stricter scrutiny of the essential nexus test applies to legislatively imposed impact fees as well as adjudicative exactions. Although the case did not involve exactions in exchange for development permits, the U.S. Court of Appeals for the Ninth Circuit nevertheless pur- ported to apply the essential nexus test to uphold monetary penalties assessed to landowners for fail- ing to comply with agricultural regulations.217 The Ninth Circuit, however, clearly evaluated the pen- alties in a deferential manner as opposed to the strict scrutiny required by the essential nexus test, concluding that the âindividualized determinationâ requirement of the essential nexus test is only applicable to adjudicative decisions, not to gener- ally applicable legislative requirements.218 The Ninth Circuit also stated that its decision to uphold the monetary penalties was âinformed by the Supreme Courtâs acknowledgment that govern- mental regulation of personal propertyââsuch as agricultural goods or moneyâis âless intrusive, than is the taking of real property.â219 The Supreme Court overturned the Ninth Circuit, rejecting the idea that a different level of constitutional scrutiny applies when the government exacts personal prop- erty rather than real property.220 The Court then summarily concluded that the penalty was âa clear physical taking,â221 without specifically analyzing the penalty according to the essential nexus test in any significant detail. The implication is that legis- latively imposed monetary fees, when tied to a particular parcel of real property, are subject to the heightened judicial scrutiny of the essential nexus test. IV. Conclusions In some ways, the legal environment regarding exactions has not changed much since a 1986 NCHRP Legal Research Digest concluded that state court decisions were âcontradictoryâ and âlacking in standards that are precise, easy to apply, and produc- tive of uniform results.â Despite two intervening U.S. Supreme Court decisions that imposed heightened judicial scrutiny to exactions, numerous jurisdictions found exceptions to the Courtâs essential nexus test in a broad variety of situations, including environ- mental regulations that did not amount to physical dedications of real property, requirements to con- struct off-site improvements, monetary fees, and generally applicable legislative impositions. In 2013, the Court appeared to foreclose most of these excep- tions with its Koontz decision, making it clear that heightened scrutiny applies in almost all cases in which a government agency imposes conditions as a result of approving a land-use permit. The Koontz decision is not expected to have a sig- nificant impact on current state transportation agency practice. When state transportation agencies exact conditions in exchange for highway access per- mits, such as improvements to the state highway sys- tem or dedications of a portion of the developerâs real property to mitigate impacts to the state highway system, the conditions typically satisfy the essential nexus test. The conditions tend to have a nexus to the state transportation agencyâs legitimate interests in regulating traffic and protecting public safety and, through the application of reliable engineering meth- ods such as traffic impact studies, tend to be limited to the anticipated impact of the development. Where the Koontz decision may have wider impact is in the context of environmental mitigation. To sat- isfy the rough proportionality element of the essen- tial nexus test, environmental agencies cannot impose conditions on developers that would exceed the anticipated adverse impact of the development. Environmental permitting agencies will be required to perform studies and make individualized determi- nations, quantifying both the adverse environmental impact of the development and the anticipated miti- gation effects of the permit conditions. In addition, the Koontz decision may have a sig- nificant influence on the growing use of impact fees, including impact fee programs designed to mitigate the adverse traffic and environmental impacts of development. If the Court follows its recent trend and expressly applies the essential nexus test to generally applicable legislative exactions such as impact fees, this could impact the financial mecha- nisms to fund improvements to the state highway system in the future. Impact fees will need to be imposed in such a way that government permitting authorities, such as state transportation agencies and environmental agencies, can demonstrate quan- titatively that the fee imposed on an individual developer is roughly proportional to the develop- mentâs burden on public infrastructure and the environment, and that the receipts are actually allo- cated to that purpose. 217 Horne v. U.S. Depât of Agric., 750 F.3d 1128 (9th Cir. 2014), revâd, 135 S. Ct. 2419 (2015). 218 Id. at 1144 (âIndividualized review makes sense in the land use context because the development of each parcel is considered on a case-by-case basis. But here, the use restriction is imposed evenly across the industry; all producers must contribute an equal percentage of their overall crop to the reserve pool.â). 219 Id. 220 Horne, 135 S. Ct. at 2425. 221 Id. at 2428.