June 10, 2025 • 11 mins
Austin Walsanen is an attorney at the Pacific Legal Foundation who is suing Denver over zoning fees.
Austin Waisanen
Denver’s inclusionary zoning extortion scheme challenged in court
Austin Waisanen
Denver’s inclusionary zoning extortion scheme challenged in court
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
We are actually going to stick with Denver, and we
are going to stick with an issue that relates to
housing in a way in Denver. And I think you
probably know that I am a big fan of the
Pacific Legal of Pacific Legal Foundation, and I love these guys,
guys and gals, and I have their guests frequently, and
(00:22):
sometimes they're doing stuff that actually involves Colorado. A lot
of times it's national stuff that I find interesting too,
but this one is about Colorado and joining us talk
about it is Austin walson In. He's an attorney at
Pacific Legal Foundation and if you need it, their website
is Pacific Legal dot org. And Austin is suing Denver
(00:42):
on an issue that I think is on the one hand,
kind of in the weeds and on the other hand
interesting and important. So Austin, welcome to Kaway and thanks
for being here.
Speaker 2 (00:52):
Good morning, Ross, thanks for having me.
Speaker 1 (00:54):
And I think I put an L in your last
name that isn't there? Wisson In? Is that? Why is
that finish?
Speaker 2 (01:02):
Yep?
Speaker 1 (01:03):
Very good? All right, tell us why you're suing Denver.
Speaker 3 (01:08):
Yeah, So, my colleagues and I represent Red Tea Homes,
a Denver home builder and red T Homes is applied
to build several homes in the Denver area, and the
City and County of Denver told red T Homes that
they have to pay a seventy thousand dollars a combined
fees of seventy thousand dollars meant to offset their project's
(01:31):
supposed impact on affordable housing. Now, the Constitution places strict
limits on the ability of local governments to impose these
types of fees. They have to be supported by an
actual impact of development, and so Denver's request fails this
constitutional test because red T Homes, by building new housing,
(01:54):
is increasing the supply of housing in Denver, and therefore
the project tends to solve the affordable housing crisis that
the city and county has identified.
Speaker 1 (02:04):
And I note in your press release and Pacific Legal
press release it sounds like it's seventy thousand dollars in
fees for a total of a total of six units
or four single family homes and two duplexes. So I
guess that would be a total of eight units, but
sort of like six buildings.
Speaker 2 (02:25):
That's right.
Speaker 3 (02:26):
The fees come down to between four and eight bucks
a square foot on average, depending on the size of
each project.
Speaker 1 (02:32):
So you said that this violates the constitution. Are we
talking the Federal Constitution, the state constitution or both?
Speaker 3 (02:41):
Yeah, the Federal Constitution, the Fifth Amendment provides that the
government shall not take private property except upon payment of
just compensation. And so this protection, the taking's clause and
the right to just compensation has been interpreted by the
Supreme Court over decades to mean that when local governments
(03:04):
demand of a property owner a property interest set aside
or a fee meant to offset some supposed impact of
the development, that it has to be the impact that
they've identified. It has to be real, it has to
be traceable to the development, and otherwise the request is just.
(03:24):
It's a it's an unconstitutional burdening of the property owner's
right to just compensation. Because the government can always take
private property, it just has to pay for it. When
they need to take it for private uses or for
public uses, they have to pay for it.
Speaker 1 (03:38):
So what are we claiming? What are we claiming would
be the taking here of the actual cash amount of
the fee, or or making it so expensive to do
something with property that you bought that you were the
government is effectively taking peaceful enjoyment of the property or what.
Speaker 2 (03:59):
Yeah, your question kind of gets that.
Speaker 3 (04:01):
One of the nuances of this area of law and
the area of law and the claimer bringing is called
unconstitutional conditions. And so that the taking is is really
the burdening of Red Tea's right to just compensation for
property taken for public uses. So the City and County
of Denver is telling Red Tea that they have to
pay this money in lieu of dedicating property that the
(04:22):
city and county will use for these uh, you know,
suppose it or apparent public purposes of building affordable housing. Uh.
Red Tea Holmes has a right under the United States
Constitution to receive just compensation. It's a little bit wonky
in the fee context because just compensation would be the
amount of the fee.
Speaker 2 (04:39):
But but that's that's the that's the real issue.
Speaker 1 (04:42):
Interesting. I'm I'm fascinated by constitutional law, and I love
thinking about this stuff and reading this stuff, and but
it sounds to me like you're claiming that this is
really settled law. I mean, I realize you're not an
objec dejective observer of this, but you're talking about it
(05:03):
as if at this point the Supreme Court interpretation or
interpretations if there have been more than one, and you
made it sound like there was more than one, are
so clear that you think this is a slam dunk case.
So do you think it's a slam dunk case? And
if you think it's a slam dunk case, why do
you think Denver has fees that they should know are illegal?
Speaker 3 (05:29):
Well, I'll say I think it's pretty close to a
slam dunk case. I'll knock on wood. The issue here
is whether in affordable housing shortage is traceable to building
new housing. And so if you read Denver's studies that
purport to justify the fee, they engage in this complicated
(05:49):
chain of causation where new construction creates new jobs and
new housing creates new households that are occupied by people
people who can't afford housing at the going rate, and
that this creation of economic activity.
Speaker 2 (06:09):
Results in a shortage, a.
Speaker 3 (06:13):
Increase in population of people who can't afford housing, and
therefore it's developers responsibility to provide that housing.
Speaker 2 (06:19):
So it's yeah.
Speaker 3 (06:21):
It's it's multi step, it's it's pretty attenuated. It's uh,
you know, kind of close to a butterfly effect.
Speaker 1 (06:29):
Yeah, So let me just let me jump in. Let
just to make sure I understand what you're saying. So,
developers create jobs, and because they create jobs, they have
employees who might not be able to afford to live,
for example, in the homes that are being built. And
(06:50):
therefore the developer is creating a creating but not satisfying
a demand for lower price housing. And therefore the developer
either has to pay the city a bunch of money
to go towards or at least we're gonna claim it
goes towards affordable housing, or they have to donate property
that would be used towards affordable housing.
Speaker 3 (07:13):
Yeah, that's the idea, except for a lad that it's
not only that development and self creates jobs. The idea
put forth by the city and counties also that the
people who live in these housing by virtue of their
economic spending or they're spending in the local economy, they'll
they'll create.
Speaker 2 (07:27):
Jobs as well.
Speaker 3 (07:28):
And yeah, and you know, so a person in building
a home or a developer like Red Tea is you
know thinking, well, you know, I don't set the wages
that people on the local economy it can charge. You know,
It's the problem, isn't you know, it's it's it's definitely
we recognize the problem. You know, the affordable housing is
(07:48):
a serious problem at yeah country, Sure, this ain't this
ain't the fix there to make.
Speaker 1 (07:53):
This is penalizing people who are creating homes and jobs.
And by the way, even if you're building, you know,
homes that are not quote unquote affordable, you would think
that on the margin, any increase in housing supply would
tend to make housing overall more affordable. That is, I
got to say, even for a Democrat run city that
(08:14):
their Rube Goldberg machine of a of a way to
get to saying that these fees should be just fiable
is pretty nuts.
Speaker 2 (08:24):
Yeah, it really is.
Speaker 3 (08:25):
I think it's uh, it's slightly humorous when you look
at it, you think, well, uh, you know, I think
under the city and counties reasoning, we could probably connect
a new housing development with basically any evil in the.
Speaker 2 (08:36):
World, right, right, enough steps, But I think the.
Speaker 3 (08:40):
Way you said it is is right and and and
reflects more of an economic consensus. And that's that increasing
supply tends to lower prices, and then that's a that's
an economist disagree about many things.
Speaker 2 (08:53):
But that's not one of them.
Speaker 3 (08:53):
Supplies effect on pricing, and so yeah, it's hard to
understand how it's it's read to he's.
Speaker 2 (09:01):
A fair impact of their development.
Speaker 3 (09:04):
One in fact, the economics suggests that the impact is
actually the opposite.
Speaker 1 (09:08):
Sure, yeah, it's really backwards. We're talking with Austin weisson
In from Pacific Legal Foundation. He is suing on behalf
of clients. He is suing Denver for their what Pacific
Legal calls their inclusionary zoning extortion scheme. Okay, last quick
thing for you, Austin. Is this in federal court in
(09:29):
Federal District Court in Denver or where's this happening?
Speaker 3 (09:33):
Yeah, that's right, the Federal District Court in de Winly,
United States District Court for the District of Colorado.
Speaker 1 (09:38):
And what's the timeline here? What has already been heard
or briefed or anything. What's next?
Speaker 2 (09:46):
Well, we filed a complaint within the last ten days.
Speaker 3 (09:49):
The city and county has twenty one days after filing
to respond, So we'll be looking for an answer from
them within the next couple of weeks, and then it'll
proceed like ordinary civil litigation, somewhat slowly, but we'll be
looking forward to a decision in the matter.
Speaker 1 (10:06):
You'd have a hard time convincing Denver to just say, ah,
you're right, we're not going to do this anymore, even
on the best of days. But this isn't the best
of days for Denver because Denver has some massive, massive
budgetary problems right now, and they're going to fight tooth
and nail to keep every dollar that they can steal
from anybody. And I don't see them. I don't see
(10:30):
them giving in. And I have no idea whether your
your case is strong enough to win at the level
of immediate injunction by a judge who says this is
so obvious that it doesn't even need to go to trial.
God willing that'll be the case. But we'll see.
Speaker 3 (10:47):
Yeah, thanks for the wish of good luck, Ross And yeah,
I'll say that we've had a brought similar cases against
other jurisdictions in the past few months, and some of
these jurisdictions have chosen to settle. And I was actually
just talking to some Colorado lawyers this morning who settled
some cases recently.
Speaker 1 (11:03):
Wow.
Speaker 2 (11:04):
And so there is a.
Speaker 3 (11:07):
Recognition I think by some cities across the country that actually,
these policies they may not withstand judicial scrutiny, and so
there is kind of an impetus to make our clients
go away rather than test.
Speaker 1 (11:19):
These Well, you're right. I mean, the argument against the
argument that I just made is maybe they wouldn't want
it to go to trial if they think the decision
in that in the trial would impact other outrageous extortion
schemes that they have or that other cities have. But
we'll see exactly.
Speaker 3 (11:38):
In any event, we'll look forward to getting a decision
on the merits in this case if it reaches that.
Speaker 1 (11:44):
Austin Weisen an attorney at Pacific Legal Foundation. The website
is Pacific Legal dot org. Thanks for your time, good
luck in the trial. We'll keep in touch.
Speaker 2 (11:53):
Thank you.
Speaker 1 (11:53):
Rosk
We are actually going to stick with Denver, and we
are going to stick with an issue that relates to
housing in a way in Denver. And I think you
probably know that I am a big fan of the
Pacific Legal of Pacific Legal Foundation, and I love these guys,
guys and gals, and I have their guests frequently, and
(00:22):
sometimes they're doing stuff that actually involves Colorado. A lot
of times it's national stuff that I find interesting too,
but this one is about Colorado and joining us talk
about it is Austin walson In. He's an attorney at
Pacific Legal Foundation and if you need it, their website
is Pacific Legal dot org. And Austin is suing Denver
(00:42):
on an issue that I think is on the one hand,
kind of in the weeds and on the other hand
interesting and important. So Austin, welcome to Kaway and thanks
for being here.
Speaker 2 (00:52):
Good morning, Ross, thanks for having me.
Speaker 1 (00:54):
And I think I put an L in your last
name that isn't there? Wisson In? Is that? Why is
that finish?
Speaker 2 (01:02):
Yep?
Speaker 1 (01:03):
Very good? All right, tell us why you're suing Denver.
Speaker 3 (01:08):
Yeah, So, my colleagues and I represent Red Tea Homes,
a Denver home builder and red T Homes is applied
to build several homes in the Denver area, and the
City and County of Denver told red T Homes that
they have to pay a seventy thousand dollars a combined
fees of seventy thousand dollars meant to offset their project's
(01:31):
supposed impact on affordable housing. Now, the Constitution places strict
limits on the ability of local governments to impose these
types of fees. They have to be supported by an
actual impact of development, and so Denver's request fails this
constitutional test because red T Homes, by building new housing,
(01:54):
is increasing the supply of housing in Denver, and therefore
the project tends to solve the affordable housing crisis that
the city and county has identified.
Speaker 1 (02:04):
And I note in your press release and Pacific Legal
press release it sounds like it's seventy thousand dollars in
fees for a total of a total of six units
or four single family homes and two duplexes. So I
guess that would be a total of eight units, but
sort of like six buildings.
Speaker 2 (02:25):
That's right.
Speaker 3 (02:26):
The fees come down to between four and eight bucks
a square foot on average, depending on the size of
each project.
Speaker 1 (02:32):
So you said that this violates the constitution. Are we
talking the Federal Constitution, the state constitution or both?
Speaker 3 (02:41):
Yeah, the Federal Constitution, the Fifth Amendment provides that the
government shall not take private property except upon payment of
just compensation. And so this protection, the taking's clause and
the right to just compensation has been interpreted by the
Supreme Court over decades to mean that when local governments
(03:04):
demand of a property owner a property interest set aside
or a fee meant to offset some supposed impact of
the development, that it has to be the impact that
they've identified. It has to be real, it has to
be traceable to the development, and otherwise the request is just.
(03:24):
It's a it's an unconstitutional burdening of the property owner's
right to just compensation. Because the government can always take
private property, it just has to pay for it. When
they need to take it for private uses or for
public uses, they have to pay for it.
Speaker 1 (03:38):
So what are we claiming? What are we claiming would
be the taking here of the actual cash amount of
the fee, or or making it so expensive to do
something with property that you bought that you were the
government is effectively taking peaceful enjoyment of the property or what.
Speaker 2 (03:59):
Yeah, your question kind of gets that.
Speaker 3 (04:01):
One of the nuances of this area of law and
the area of law and the claimer bringing is called
unconstitutional conditions. And so that the taking is is really
the burdening of Red Tea's right to just compensation for
property taken for public uses. So the City and County
of Denver is telling Red Tea that they have to
pay this money in lieu of dedicating property that the
(04:22):
city and county will use for these uh, you know,
suppose it or apparent public purposes of building affordable housing. Uh.
Red Tea Holmes has a right under the United States
Constitution to receive just compensation. It's a little bit wonky
in the fee context because just compensation would be the
amount of the fee.
Speaker 2 (04:39):
But but that's that's the that's the real issue.
Speaker 1 (04:42):
Interesting. I'm I'm fascinated by constitutional law, and I love
thinking about this stuff and reading this stuff, and but
it sounds to me like you're claiming that this is
really settled law. I mean, I realize you're not an
objec dejective observer of this, but you're talking about it
(05:03):
as if at this point the Supreme Court interpretation or
interpretations if there have been more than one, and you
made it sound like there was more than one, are
so clear that you think this is a slam dunk case.
So do you think it's a slam dunk case? And
if you think it's a slam dunk case, why do
you think Denver has fees that they should know are illegal?
Speaker 3 (05:29):
Well, I'll say I think it's pretty close to a
slam dunk case. I'll knock on wood. The issue here
is whether in affordable housing shortage is traceable to building
new housing. And so if you read Denver's studies that
purport to justify the fee, they engage in this complicated
(05:49):
chain of causation where new construction creates new jobs and
new housing creates new households that are occupied by people
people who can't afford housing at the going rate, and
that this creation of economic activity.
Speaker 2 (06:09):
Results in a shortage, a.
Speaker 3 (06:13):
Increase in population of people who can't afford housing, and
therefore it's developers responsibility to provide that housing.
Speaker 2 (06:19):
So it's yeah.
Speaker 3 (06:21):
It's it's multi step, it's it's pretty attenuated. It's uh,
you know, kind of close to a butterfly effect.
Speaker 1 (06:29):
Yeah, So let me just let me jump in. Let
just to make sure I understand what you're saying. So,
developers create jobs, and because they create jobs, they have
employees who might not be able to afford to live,
for example, in the homes that are being built. And
(06:50):
therefore the developer is creating a creating but not satisfying
a demand for lower price housing. And therefore the developer
either has to pay the city a bunch of money
to go towards or at least we're gonna claim it
goes towards affordable housing, or they have to donate property
that would be used towards affordable housing.
Speaker 3 (07:13):
Yeah, that's the idea, except for a lad that it's
not only that development and self creates jobs. The idea
put forth by the city and counties also that the
people who live in these housing by virtue of their
economic spending or they're spending in the local economy, they'll
they'll create.
Speaker 2 (07:27):
Jobs as well.
Speaker 3 (07:28):
And yeah, and you know, so a person in building
a home or a developer like Red Tea is you
know thinking, well, you know, I don't set the wages
that people on the local economy it can charge. You know,
It's the problem, isn't you know, it's it's it's definitely
we recognize the problem. You know, the affordable housing is
(07:48):
a serious problem at yeah country, Sure, this ain't this
ain't the fix there to make.
Speaker 1 (07:53):
This is penalizing people who are creating homes and jobs.
And by the way, even if you're building, you know,
homes that are not quote unquote affordable, you would think
that on the margin, any increase in housing supply would
tend to make housing overall more affordable. That is, I
got to say, even for a Democrat run city that
(08:14):
their Rube Goldberg machine of a of a way to
get to saying that these fees should be just fiable
is pretty nuts.
Speaker 2 (08:24):
Yeah, it really is.
Speaker 3 (08:25):
I think it's uh, it's slightly humorous when you look
at it, you think, well, uh, you know, I think
under the city and counties reasoning, we could probably connect
a new housing development with basically any evil in the.
Speaker 2 (08:36):
World, right, right, enough steps, But I think the.
Speaker 3 (08:40):
Way you said it is is right and and and
reflects more of an economic consensus. And that's that increasing
supply tends to lower prices, and then that's a that's
an economist disagree about many things.
Speaker 2 (08:53):
But that's not one of them.
Speaker 3 (08:53):
Supplies effect on pricing, and so yeah, it's hard to
understand how it's it's read to he's.
Speaker 2 (09:01):
A fair impact of their development.
Speaker 3 (09:04):
One in fact, the economics suggests that the impact is
actually the opposite.
Speaker 1 (09:08):
Sure, yeah, it's really backwards. We're talking with Austin weisson
In from Pacific Legal Foundation. He is suing on behalf
of clients. He is suing Denver for their what Pacific
Legal calls their inclusionary zoning extortion scheme. Okay, last quick
thing for you, Austin. Is this in federal court in
(09:29):
Federal District Court in Denver or where's this happening?
Speaker 3 (09:33):
Yeah, that's right, the Federal District Court in de Winly,
United States District Court for the District of Colorado.
Speaker 1 (09:38):
And what's the timeline here? What has already been heard
or briefed or anything. What's next?
Speaker 2 (09:46):
Well, we filed a complaint within the last ten days.
Speaker 3 (09:49):
The city and county has twenty one days after filing
to respond, So we'll be looking for an answer from
them within the next couple of weeks, and then it'll
proceed like ordinary civil litigation, somewhat slowly, but we'll be
looking forward to a decision in the matter.
Speaker 1 (10:06):
You'd have a hard time convincing Denver to just say, ah,
you're right, we're not going to do this anymore, even
on the best of days. But this isn't the best
of days for Denver because Denver has some massive, massive
budgetary problems right now, and they're going to fight tooth
and nail to keep every dollar that they can steal
from anybody. And I don't see them. I don't see
(10:30):
them giving in. And I have no idea whether your
your case is strong enough to win at the level
of immediate injunction by a judge who says this is
so obvious that it doesn't even need to go to trial.
God willing that'll be the case. But we'll see.
Speaker 3 (10:47):
Yeah, thanks for the wish of good luck, Ross And yeah,
I'll say that we've had a brought similar cases against
other jurisdictions in the past few months, and some of
these jurisdictions have chosen to settle. And I was actually
just talking to some Colorado lawyers this morning who settled
some cases recently.
Speaker 1 (11:03):
Wow.
Speaker 2 (11:04):
And so there is a.
Speaker 3 (11:07):
Recognition I think by some cities across the country that actually,
these policies they may not withstand judicial scrutiny, and so
there is kind of an impetus to make our clients
go away rather than test.
Speaker 1 (11:19):
These Well, you're right. I mean, the argument against the
argument that I just made is maybe they wouldn't want
it to go to trial if they think the decision
in that in the trial would impact other outrageous extortion
schemes that they have or that other cities have. But
we'll see exactly.
Speaker 3 (11:38):
In any event, we'll look forward to getting a decision
on the merits in this case if it reaches that.
Speaker 1 (11:44):
Austin Weisen an attorney at Pacific Legal Foundation. The website
is Pacific Legal dot org. Thanks for your time, good
luck in the trial. We'll keep in touch.
Speaker 2 (11:53):
Thank you.
Speaker 1 (11:53):
Rosk
The Ross Kaminsky Show News
Popular Podcasts
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.