Climate Exactions

Abstract

This essay presents a legal device by which local governments can put a price on climate emissions and loss of resiliency generated by new real estate development. Local governments commonly impose fees, a type of monetary exaction, on new development to offset public costs that such development will impose. This Essay argues that monetary fees offer significant potential as a tool to help local governments manage land development’s contribution to climate change. Such “climate exactions” can put a price on the carbon emissions from new development and also on development that reduces the natural resiliency of the jurisdiction to the effects of climate change, such as sea-level rise. In addition to describing how such climate exactions might work, the Essay argues that using exactions to address climate concerns is consistent with the United States Supreme Court’s constitutional takings framework.

Keywords: exaction, climate, mitigation

JEL Classification: K32