Regulatory Takings and Smart Growth

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Regulatory Takings and Smart Growth

• Douglas T. Kendall
• Timothy J. Dowling
• Community Rights Counsel
• May 10, 2001
• Cobb County, Georgia

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Community Rights Counsel

• Nonprofit public interest law firm
• Assists counties and other local governments in
  defending land use controls and other community
  protections
• Emphasis on takings cases

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THE TAKINGS CLAUSE
U.S. Constitution Nor shall private property be
taken for public use, without just compensation.
(Fifth Amendment) Georgia Constitution Private
property shall not be taken or damaged for public
purposes without just and adequate compensation
bring first paid. (Article I, Section III, Par I)
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Community Rights Counsel Success Stories

• Lake Tahoe planning moratorium
• Washington, DC historic preservation laws
• Anchorage, AK fair housing laws
• Riverside, CA fire safety protections
• Pennsylvania mining restrictions
• Rhode Island wetland protections

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Bad News for Local Governments

• Many takings lawsuits
• Expensive and time-consuming to defend
• Many landowner victories in the U.S. Supreme Court

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Good News for Local Governments

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• Local governments win the vast majority of
  takings cases
• Landowner wins in U.S. Supreme Court are narrow
• Very strong arguments against an expansive
  interpretation of the Takings Clause

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Five Themes for Litigating Regulatory
Takings Cases

• 1. Narrow Text and Original Meaning
• 2. Judicial Respect for our Federal System
• 3. Judicial Deference to the Policymaking
• Branches
• 4. Avoiding Unduly Harsh Fiscal Impacts
• 5. The Government as Guardian of Property
• Rights and Property Values

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Palazzolo v. Rhode Island (U.S.)

• Review granted October 10, 2000
• Oral argument February 26, 2001
• Ruling by the end of June 2001

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Palazzolo Coastal Wetlands Picture 3
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Palazzolo v. Rhode Island (U.S.)

• Takings challenge to the denial of a permit to
  fill 18 acres of pristine coastal wetlands
• Palazzolo seeks 3,150,000 based on profits
  expected from building 74 single-family
  homes
• Rhode Island Supreme Court deemed the case
  unripe because
• (1) Palazzolo failed to apply for a permit to
  build the 74 homes and
• (2) Palazzolo failed to seek permission to
  fill less than 11 acres or to build on
  the upland portion of the property.

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Four Factual Wrinkles in Palazzolo
1. The Nature of the Takings Claim
Subdivision vs. Beach Club Proposal? 2. The
Number of Houses that May be Built One or
Several? 3. Palazzolos Acquisition Date 1978 or
1959? 4. The Trial Courts Nuisance Finding
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The Background-Principles Issue QUESTION
PRESENTED WHETHER A REGULATORY TAKINGS CLAIM
IS CATEGORICALLY BARRED WHENEVER THE ENACTMENT OF
THE REGULATION PREDATES THE CLAIMANTS
ACQUISITION OF THE PROPERTY."
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Palazzolo The Lucas Per Se Rule
Issue QUESTION PRESENTED WHETHER THE
REMAINING PERMISSIBLE USES OF REGULATED PROPERTY
ARE ECONOMICALLY VIABLE MERELY BECAUSE THE
PROPERTY RETAINS A VALUE GREATER THAN ZERO."
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TAHOE-SIERRA PRESERVATION COUNCIL V. TAHOE
REGIONAL PLANNING AUTHORITY

• Takings challenge to temporary planning moratoria
  in effect for 32 months
• Lake Tahoe is one of the purest, most pristine
  lakes in the world
• Nearby development causes the Lake to lose one
  
  foot of clarity every
  year
• Claimants consist of about 450 landowners
• Trial court found a taking
• Appeals court reversed and ruled for the
  government

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TAHOE-SIERRA PRESERVATION COUNCIL V. TAHOE
REGIONAL PLANNING AUTHORITY (continued)

• Parcel-as-a-whole rule Claimants cannot sever
  property rights into separate temporal
  dimensions.
• A reasonable temporary ban on development does
  not constitute a taking.

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MCQUEEN V. SOUTH CAROLINA COASTAL COUNCIL

• McQueen bought two oceanfront lots in the 1960s
• In 1977, South Carolina adopted rules that
  restrict the filling of coastal wetlands
• McQueen took no action for 30 years after his
  purchase the lots reverted to their natural
  condition
• In 1991, the State denied McQueen permission to
  fill and develop the lots
• It is undisputed that the permit denial
  extinguished all economically viable use of the
  land
• Issue Did McQueens inaction for thirty years
  reflect the lack of a reasonable expectation to
  develop that defeats his takings claim?