A Failure of Fairness? the Property Rights Movement Is Reborn at the Ballot Box

Article excerpt

Every once in a while a state voter initiative catches people's attention, and it takes the center stage nationally. Examples include creating term limits, setting property tax caps, and banning same-sex marriages. The next big trend is all about property rights, and it is well under way in 23 states.

This national movement about citizens' property rights is driven by two events. The first was the passage in Oregon in November 2004 of a property rights initiative called Ballot Measure 37. The second was the June 2005 U.S. Supreme Court decision, Kelo v. City of New London.

The American Planning Association says, "Radical property rights organizations have seized on the passage of Measure 37 to promote similar ballot measures in other states." These voter initiatives are described by opponents as the most draconian property compensation laws in the United States.

On the other side, proponents love measure 37 because it has brought new life to the property rights movement. Property rights initiatives have one thing in common: they exceed previous U.S. Supreme Court rulings in terms of what constitutes a property taking. In addition, they present the prospect of unraveling local and state laws regarding the environment and land use.

EARLIER CASE LAW AND LEGISLATION

The Fifth Amendment to the U.S. Constitution protects a private landowner from the government "taking" of property without fair compensation, and the case law on compensation for government takings has been widely accepted for more than 70 years.

In the late 1800s, the U.S. Supreme Court ruled in several cases (Mugler v. Kansas and Lawton v. Steet) that in order for a landowner to get compensation, the land use regulations must be so restrictive as to completely deprive the landowner of the land's economic value. In other words, the government has had to compensate landowners for taking all the land's value, but it has not needed to compensate landowners for partial takings.

Some states--Louisiana, Texas, Mississippi, and Florida--have passed laws regulating compensation for partial property takings. The first three states essentially created partial takings thresholds at which a government must pay compensation. The thresholds are 20 percent for Louisiana, 25 percent for Texas, and 40 percent for Mississippi.

The Harris Act, passed in Florida in 1995, went farther than the laws in Louisiana, Texas, and Mississippi and was the first real precursor to the Oregon voter initiative. The act affords landowners the right to sue local governments should their property value be "inordinately burdened" or "restricted" by government regulations. It also applies only to government regulation that happened after the act was implemented. Many of the property rights initiatives passed since the Harris Act go further in that they are retroactive.

OREGON LEADS THE WAY--FOR AND AGAINST

It is ironic that the state where the property rights movement has now been reborn is Oregon. In the early 1970s, the state of Oregon legislated state-mandated land use planning, which was touted as cutting-edge public policy and hailed by some as a grand experiment in land use planning.

In 1973, a bipartisan Oregon legislature and a progressive Republican governor named Tom McCall approved the first statewide land use planning program in the nation. The program required the use of comprehensive plans and urban growth boundaries, all in the name of saving farms and forests. For more than a quarter century, Oregon has received much national media attention for its innovative land use planning program.

On November 2, 2004, however, the very citizens who were purportedly served by this vaunted planning program permanently crippled and politically rejected the program with the passage of Ballot Measure 37. After 30 years, and by a decisive 61 percent to 39 percent margin, the voters essentially terminated the grand experiment by passing the severest property compensation law in the United States. …