Takings for Granted

By Morandi, Larry | State Legislatures, June 1995 | Go to article overview

Takings for Granted


Morandi, Larry, State Legislatures


Protection of the environment has run smack up against private property rights, and legislators are struggling to produce some sort of balance between them.

The framers of the Constitution didn't give states a whole lot of guidance when they crafted the Fifth Amendment. There's one phrase, less than a sentence, mentioned in tandem with capital crimes, double jeopardy, self-incrimination and due process. Maybe that's the genius of the Founding Fathers: Brevity, let the states decide.

Madison and Jefferson, and the early courts that interpreted their thoughts, viewed a "taking" as a physical invasion of private property, one that frequently accompanied the condemnation of land for a road, a reservoir or some other public need. In such instances, government - whether federal, state or local - had to pay the landowner the fair market value of the land. No argument.

The courts have recently broadened the application of the Fifth Amendment to include "regulatory takings." These are cases where rules adopted by government agencies restrict the use of private property to such a degree that the landowner is left with little or no economic value. Usually these regulations spring from environmental laws, the need for which Madison and Jefferson could not have foreseen.

People who want to protect private property rights through legislation argue that environmental rules restricting land use have the same effect on the property owner as a physical taking under eminent domain, which requires compensation. They ask why a landowner should bear the costs of environmental benefits enjoyed by everyone. Opponents counter that certain kinds of development may have harmful effects on public health and safety, and the developer should pay for it. They contend that the courts provide enough protection to property owners.

FINDING A BALANCE

In 1988, President Reagan signed an executive order asking federal agencies to review their regulations to avoid reaching that ill-defined threshold where a "taking" occurs. With that, states began to grapple for balance between private property rights and environmental protection. Washington passed the first new takings law in 1991 as part of its growth management act, requiring the attorney general to adopt guidelines to help state and local government agencies evaluate proposed regulations that might effect a taking. Delaware and Indiana followed in 1992, passing laws that call on the attorney general to review proposed agency rules for takings implications.

KEY COURT DECISIONS

Then came Lucas and Dolan, U.S. Supreme Court decisions, and the race to the statehouse was on.

Lucas vs. South Carolina Coastal Council, 112 S.Ct. 2886 (1992), involved beachfront property. South Carolina had a law that prohibited development in low-lying areas on barrier islands to protect the landowners from flooding and the shoreline from erosion. Lucas purchased property that was sometimes under water and planned to build a couple of houses there. (Home building in the area had been approved before passage of the law in 1988.) Denied a permit, Lucas went to court. Ultimately, the U.S. Supreme Court ruled that the state's action removed all economically beneficial use of the land, and that amounted to a taking.

Two years later, Dolan vs. City of Tigard, 114 S.Ct. 2309 (1994), dealt with increasing the size of a hardware store and its parking lot. A condition of the Oregon city of Tigard for issuance of the permit to expand the property was a dedication of 10 percent of Dolan's land for drainage and a bike path along the adjacent stream. The Court struck down the conditions, saying they did not bear a "rough proportionality," that is, they were not closely enough related to the impact of the development. The Court did not say what would pass the rough proportionality test, but it did say that governments must do a better job of justifying new regulations.

Both these decisions have implications for legislatures. …

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