A 2024 U.S. Supreme Court decision, Sheetz v. County of El Dorado, raises the possibility of increased legal challenges to impact fees charged by local governments. This memo, The Sheetz Decision and What It Means for Impact Fees, aims to clarify the potential consequences of the Supreme Court's Sheetz decision. It does so by first reviewing the foundational Nollan and Dolan cases, then explaining the Sheetz ruling and summarizing the key takeaways, and finally providing guidance on compliance with the Mitigation Fee Act.
This memo was originally published on June 17, 2025. It was updated on September 15, 2025 to reflect the outcome of the California Court of Appeal’s decision on remand and updated again on March 20, 2026.