Monday, April 11, 2011

Hybrid Communities with Public-Private Rules

This weekend at the American Planning Association's National Planning Conference I suggested in my presentation during the "Land, Covenants, and Law" panel (organized and led by Professor David L. Callies) that municipalities increasingly apply a combination of private covenants and zoning to form unique communities, which I call "hybrid communities."  Hybrid communities typically arise when a municipal development authority decides to redevelop an area--often a brownfield or a blighted section of a city--into a mixed-use residential/commercial neighborhood.  To form this hybrid community, the municipality initiates a lengthy and open public process to create a master plan, which the municipality's city council or similar legislative body eventually approves or rejects .  If the council approves the plan, the developer of the community forms a private homeowners' association and records a set of covenants, conditions, and restrictions that also govern the community. 

Most traditional "private" common interest communities (those with homeowners' associations and recorded covenants, conditions, and restrictions) operate under both zoning codes and servitudes, but there is not usually an explicit interaction between the public zoning rules and the private servitudes.  Rather, those in the private community know (hopefully) that they must follow the zoning rules and also the servitudes, which are typically more detailed and restrictive than the zoning rules.  The zoning rules typically require minimum setbacks and provide basic use restrictions, while the servitudes and associated design guidelines and rules add more use restrictions and include detailed aesthetic and design restrictions. 

In a hybrid community, unlike a traditional private community, there is often more of an explicit relationship between the public zoning and the private servitudes, and the zoning itself often contains detailed design requirements.  In the Lowry Redevelopment in Denver, for example, the redevelopment authority has aimed to create a green community through its public zoning work, and the private Lowry Community Master Association Rules and Regulations similarly reflect these "green" goals.  They provide, for example, that "rocks used in landscaping should be material native to Colorado" and that "planting concepts, plant varieties, and irrigation techniques which minimize water consumption (xeriscape) are encouraged," referring residents to Denver Water Department publications for more information. 

Other hybrid communities use a similar mix of private servitudes and detailed public zoning to create green, mixed-use living spaces, and these provide interesting case studies in what I argue is a relatively new public-private land use model.  For examples beyond Lowry, see Playa Vista in Los Angeles, Symphony Park in Las Vegas, and the Mueller redevelopment in Austin, among others.  It appears that all of these communities operate under both a public master plan and private servitudes.  In some cases, the municipality might even serve as the "backstop" enforcement authority when a homeowners' association in the redevelopment fails to enforce one of the private rules; according to one conversation at the National Planning Conference this weekend, Missouri City, Texas follows this type of enforcement scheme in its Planned Development Districts.  Professor Marc B. Mihaly describes these types of public-private developments--and the process of forming them--in his excellent article Living in the Past:  The Kelo Court and Public-Private Economic Redevelopment

Will public zoning and private land use controls eventually merge?  Likely not.  As attorney Jo Anne Stubblefield points out, cities have been slow to develop "traditional neighborhood design" districts that allow for mixed-use communities.  But the growth of hybrid communities suggests that new, creative relationships between the public and private land use realms will continue to expand. These communities are not perfect, of course; they may displace low-income populations despite typically requiring a certain percentage of new affordable housing.  And all communities with detailed design and aesthetic restrictions, whether public or private or hybrid, must ensure that those moving in are notified of the restrictions prior to purchase.  These communities do, however, provide interesting food for thought--and possibly good case studies for the classroom, too.  

Hannah Wiseman

April 11, 2011 in Aesthetic Regulation, Common Interest Communities, Community Design, Servitudes | Permalink | Comments (0) | TrackBack (0)

Monday, March 28, 2011

Martinez on Judicial Takings for Private Necessity

John Martinez (Utah) has posted No More Free Easements: Judicial Takings for Private Necessity.  The abstract:

This article bridges the fields of constitutional judicial takings and the common law of easements that arise because of private necessity. The article suggests that the law of takings requires payment when a court declares that an easement should be established because of private necessity.

Matt Festa

March 28, 2011 in Houston, Property, Scholarship, Servitudes, Subdivision Regulations | Permalink | Comments (0) | TrackBack (0)

Tuesday, February 22, 2011

Virtual Speaker Series

One of the many exciting things I am engaged in this month is Mercer's Environmental Law Virtual Guest Speaker Series. Students at Mercer and elsewhere listen to recorded presentations on different topics by law professors across the country. Unsurprisingly, my presentation is about conservation easements. Starting Monday February 21, my lecture was available to the students. All week students are asking me questions in an online discussion format. This is a great project by Mercer, giving students access to law professors across the country with different specialties and creating a flexible learning environment that takes advantages of new technologies.  [I gave my presentation using powerpoint's new narration function which I found alternatively straightforward and infuriating.]

The discussion is a bit harder than answering questions after a talk because writing down answers in a public forum always requires a bit more thinking than the off-the-cuff answers we give when answering live questions immediately following a talk. BUT the format also lends itself to a higher caliber of questions. When students have the opportunity to think about a presentation and write questions at their leisure, the questions are intriguing and thoughtful. Almost every questions so far has pushed me more than I generally expect from students. Kudos to Mercer  and Steve Johnson for this annual program.

- Jessica Owley

February 22, 2011 in Conferences, Conservation Easements, Environmental Law, Land Trust, Property, Property Theory, Scholarship, Servitudes, Teaching | Permalink | Comments (0) | TrackBack (0)

Saturday, February 19, 2011

Landowners Ignorant About Encumberances on Their Land

It is perhaps not surprising to many of us that landowners don't understand the encumberances on their land. If someone has never heard the term "conservation easement" before, it's not surprising that they don't understand what it means when they see it with their deed. One would hope, however, that you would find out before buying the property.

An article in yesterday's Washington Post gives examples of landowners who are uninformed about the nature of the restrictions on their land. Although the Post writer doesn't place blame, the official at the County Planning Office quoted in the article is not hesitant about pointing the finger at real estate agents.

Although this article doesn't present heartening news for the land conservation community, I was glad to see this in print. I have been hearing stories like this from landowners for a few years now (folks who just didn't realize there were encumberances on their land). While our land recording systems appear to ensure landowners will get notice of the restrictions on their land, we see that it doesn't always happen. This article highlights that such notice may not be meaningful if purchasers don't understand the deeds they are reading.

Not sure what the answer is to concerns like this. Fewer deed restrictions perhaps, but that is not very satisfying. We could require real estate agents to clearly explain all the provisions in a deed, but it doesn't look like it would have helped here. The couple that the story focuses on read and signed the conservation easement indicating that they had reviewed it. Looks like this couple may turn to the courts for relief. Hope their lawyer is better than their real estate agent.

UPDATE ON 02/21:

The Washington Post has added (or maybe it was there all along but I didn't see it) a great graphic showing where the conserevation easement was. This case has sparked an interesting debate in the land conservation community about the appropriateness of protecting backyards in this way.

 

- Jessica Owley

February 19, 2011 in Conservation Easements, Land Trust, Planning, Real Estate Transactions, Servitudes | Permalink | Comments (0) | TrackBack (0)

Thursday, February 17, 2011

Tax Breaks For Conservation Easements May Get Even Sweeter

As some of you may know, I am obsessed with intrigued by conservation easements. A strong motivator for some conservation easements (but not all or even necessarily most) is the availability of federal income tax deductions. A current bill in the senate would make such donations even more alluring. 

The Rural Heritage Conservation Extension Act of 2011 would allow landowners to deduct up to 50% of the adjusted gross income for such donations (right now it is only a mere 30%).

- Jessica Owley

February 17, 2011 in Agriculture, Conservation Easements, Federal Government, Historic Preservation, Land Trust, Servitudes | Permalink | Comments (0) | TrackBack (0)

Tuesday, January 25, 2011

Owley on Conservation Easements at the Climate Change Crossroads

Jessica Owley (Buffalo) has posted Conservation Easements at the Climate Change Crossroads, forthcoming in Law and Contemporary Problems.  The abstract:

The essence of a conservation easement as a static perpetual restriction is coming to a head with the understanding that the world is a changing place. This demonstration is nowhere more dramatic than in the context of global climate change. In response to this conflict, users of conservation easements face the decision of either (1) changing conservation easement agreements to fit the landscape or (2) changing the landscape to fit the conservation easements. Both of these options present benefits and challenges in implementation. Where conservation easement holders’ ultimate goal is to keep a maximum number of acres under protection from development, flexible conservation easements may present a viable and attractive method of protection. Where a specific conservation value or habitat is the concern, active management of the land may be more appropriate. As a further complication, both of these options are at odds with the essential nature of conservation easements. These conflicts lead to a third option: making different decisions about where and how to use conservation easements. This would likely lead to the conclusion that conservation easements are only desirable in a narrower category of purposes. This is, of course, dismaying to champions of conservation easements. Unfortunately, ensuring the long-term viability of conservation easements may entail omitting the very features that give conservation easements their strength.

This is another article from Professor Owley that challenges some prevailing views on conservation easements.  On a side note, I can hint that we might be hearing more from her soon in this space!

Matt Festa

January 25, 2011 in Climate, Conservation Easements, Environmental Law, Property Theory, Scholarship, Servitudes | Permalink | Comments (0) | TrackBack (0)

Wednesday, December 8, 2010

Epstein on Property Rights in Land and Water

Richard A. Epstein (NYU, Chicago, and Stanford--Hoover Institution) has posted Playing by Different Rules? Property Rights in Land and Water, from EVOLUTION OF PROPERTY RIGHTS RELATED TO LAND AND NATURAL RESOURCES, Lincoln Institute, 2010.  The abstract:

This article examines both the similarities and differences between the law of land and water in both a private law and constitutional law setting. The first critical difference is that the nature of the two resources differs enough such that exclusive rights for occupation usually sets the right framework for analyzing land use disputes, while a system of shared, correlative duties work best for water. Once these baselines are established, it follows that an accurate rendition of the constitutional law issues necessarily rests on the proper articulation of private law rules of adjudication. Unless those efficient private rules are used as a baseline for constitutional adjudication, it becomes impossible to explain which government actions result simply in a "mere" loss of economic value and which government actions generate losses that require compensation. Parties can engage in wasteful political arbitrage without limitation.

In dealing with the private law issues, the first step is to develop principles of parity between private claimants, to the extent that this approach is physically possible. The second step then picks the set of rules that maximizes the overall utility of all parties concerned, subject to the parity constraint. This system must yield to reasonableness considerations when the conditions of physical parity cannot be satisfied, which covers all cases of dispute between upper and lower owners of land, as well as upstream and downstream riparians. In both these settings, the objective is to create, whenever possible, rules that treat the last element of loss to one party equal to the last element of gain of the next.

Using these natural law baselines produces by and large efficient results in private disputes. The rejection of these rules in the takings context in both land and water cases yields the opposite result, by conceding far too much power to state authorities in both land and water cases. It is no mistake that the modern law of regulatory takings for land, as developed in the 1978 Penn Central case, explicitly rests on the same intellectual confusions about property rights and economic losses that underlie the 1944 Willow River case, dealing with water rights. The only rationalization of both areas of law requires that the constitutional protection of private property start with the definitions of private property that have worked so well in practice under the natural law traditions of private law.

Matt Festa

December 8, 2010 in Books, Constitutional Law, Eminent Domain, Property Rights, Property Theory, Scholarship, Servitudes, Takings, Water | Permalink | Comments (0) | TrackBack (0)

Tuesday, November 9, 2010

Owley on Use of Conservation Easements by Local Governments

Jessica Owley (Buffalo) has posted another informative paper: Use of Conservation Easements by Local Governments, forthcoming in GREENING LOCAL GOVERNMENT, Patricia Salkin and Keith Hirokawa, eds., A.B.A. Publishing, 2011.  The abstract:

This chapter (which will be included in the forthcoming Greening Local Government book published by ABA Publishing and edited by Patty Salkin and Keith Hirokawa) briefly introduces conservation easements, explains how local governments can use them, and discusses the appropriate role and extent of their use. 

Conservation easements are nonpossessory interests in land restricting a landowner’s activities in a way that yields a conservation benefit. Local governments have been on the cutting edge of using conservation easements, engaging with them on multiple fronts. First, local governments hold conservation easements. This enables local governments to enforce individual agreements and prevent landowners from engaging in environmentally destructive practices. Second, as landowners, local governments encumber public land with conservation easements — affirming their commitments to land conservation. Finally, local governments promote conservation easements. By passing laws supporting and funding conservation easements as well as requiring exacted conservation easements for land-use permits, local governments employ mechanisms that increase the number of conservation easements in their communities. 

Conservation easements can protect environmental amenities and deserve praise for their individual nature and ease of establishment. However, conservation easements are static agreements locking in today’s land use preferences and understandings of the natural environment to the potential detriment of future generations with different goals or understandings of the natural world. Furthermore, although praised as an inexpensive method for governments to obtain land conservation, funding necessary for stewardship and enforcement could be significant. As development pressures and understandings of environmental degradation increase, the use of conservation easements by local governments is likely to continue to grow. Local governments should make use of this tool cautiously.

This paper is a helpful resource for practitioners and scholars in understanding the basics of conservation easements.  Along with Owley's forthcoming Stanford Environmental Law Journal piece, Changing Property in a Changing World: A Call for the End of Perpetual Conservation Easements, it cautions local government officials to be wary of the conservation easement as a panacea in pursuing environmental planning objectives.  

Matt Festa

November 9, 2010 in Conservation Easements, Environmental Law, Local Government, Property, Scholarship, Servitudes, Sustainability | Permalink | Comments (0) | TrackBack (0)

Sunday, October 24, 2010

Saxer on Planning Gain, Exactions, and Impact Fees

Shelley Ross Saxer (Pepperdine) has posted Planning Gain, Exactions, and Impact Fees: A Comparative Study of Planning Law in England, Wales and the United States, from The Urban Lawyer, Vol. 32, No. 1, 2000.  The abstract:

Land development projects often involve external costs within the host community. For example, new retail space might generate more traffic, requiring improvements to roads. A new residential development might require new roads altogether as well as enhancements to police and fire services, schools, libraries and even sewers. Historically, these external costs fell on the community. However, increasingly, in both the United States and in England and Wales private land developers, rather than public agencies, are bearing these externalities. This article explores the issues that arise when governments shift the burden of these externalities back on the developer and compares the processes by which the United States and England and Wales have attempted to accomplish this shift in externalities. U.S. jurisdictions use exactions, impact fees and linkage fees to transfer the burden of adverse development impacts to the developer. England and Wales use the concept of planning gain to extract planning conditions or planning obligations from developers before granting development rights. Because of the high level of government involvement in this process of accounting for development externalities, public and private abuse is a concern in the U.S. and in England and Wales.

Part II of this Article identifies the different impacts that occur during land development, including the impacts on municipalities, their citizens, competing developers, competing communities and the environment. Part III compares how development rights are obtained in the U.S. with the approaches used in England and Wales to obtain planning permission and discusses how the respective countries compel developers to internalize the external costs of development. Part IV concludes by proposing the developers and local government use bargaining tools, such as the U.S. development agreements and the section 106 agreements in England and Wales, to distribute development burdens. Further, private and public abuses should be controlled by the market and the requirements that the government act for the benefit of the public, rather than be constrained by existing judicial, legislative and constitutional complexities.

Matt Festa

October 24, 2010 in Comparative Land Use, Local Government, Planning, Servitudes | Permalink | Comments (0) | TrackBack (0)

Sunday, August 8, 2010

Kelly on Homes Affordable for Good

James J. Kelly, Jr., of Baltimore Law and intrepid Land Use Prof guest blogger, has posted Homes Affordable for Good: Covenants and Ground Leases as Long-Term Resale Restriction Devices, a symposium piece in the St. Louis University Public Law Journal, Vol. 29, p. 9 (2009).  The abstract:

Covenants and ground leases have been, and continue to be, used to create shared spaces that are fundamentally, and often invidiously, exclusive. Famously made a dead letter in the case of Shelley v. Kraemer, covenants banning resale to nonwhite households put the force of law behind the segregated birth of America’s suburbs. Today, gated residential communities and shopping malls assure a degree of class exclusivity through covenants and commercial ground leases, respectively. These same legal mechanisms, however, are now deployed to assure long-term inclusion as well. 

Developers of affordable housing are creating homes that are not only beneficial to the original homeowners but also available for future generations of qualified home buyers. When selling the newly developed homes, they are having subsidized homeowners promise to pass the good deals on to future home buyers. These resale restrictions allow single-family homes to be sold, and later resold, to low and moderate-income households in neighborhoods that would otherwise be unavailable to them. Affordability protections of 15 years or less are relatively common and can be achieved through a number of legal arrangements. Common law and statutory hostility to long-term private arrangements that limit alienability, however, have made the search for perpetual affordability more challenging. Those seeking to sustain economic diversity in residential communities over multiple generations of homeowners have turned to covenants authorized by statute and ground leases as the vehicles by which these promises can be enforced. 

As stand-alone enforceable promises that run with land, covenants have become the primary vehicle for Inclusionary Zoning programs that seek to preserve the mixed-income nature of affected for-profit housing developments for the long haul. Community Land Trusts have generally preferred the ground lease, a standard device for shopping mall creation, to ensure that subsidized single-family homes developed by nonprofit housing organizations can remain affordable forever. As economic diversity in communities is given its proper place as a long-term goal for America’s metropolitan areas, 21st century real estate law will need to integrate both covenants and ground lease reversion interests as stable, effective means of enforcing affordability-preserving resale restrictions. In addition to arguing for the importance of both covenants and ground leases as affordability conservation mechanisms, this article will analyze and evaluate each device as to its effectiveness in achieving the development goal of creating and sustaining economically diverse communities of choice.
Matt Festa

August 8, 2010 in Affordable Housing, Housing, Inclusionary Zoning, Land Trust, Landlord-Tenant, Local Government, Real Estate Transactions, Scholarship, Servitudes, Zoning | Permalink | Comments (0) | TrackBack (0)

Friday, July 16, 2010

Hester & Wright on the Shifting Scope of Railroad Easements

Jeffrey Hester (William J. Tucker & Assocs.) and Danaya C. Wright (Florida) have posted Pipes, Wires, and Bicycles: Rails-to-Trails, Utility Licenses, and the Shifting Scope of Railroad Easements from the Nineteenth to the Twenty-First Centuries, published in Vol. 27, Ecology Law Quarterly.  The abstract:

This article responds to a series of class action suits filed against railroads, telecommunication companies, and the federal government claiming that once railroads abandon their corridors, all property rights shift to adjacent landowners. This article reviews the state law on this matter and offers a theory of how courts should handle these cases. After discussing the history of nineteenth-century railroad land acquisition practices, it analyzes the scope of the easement limited for railroad purposes, then discusses the role of abandonment in affecting the rights of third party users of these corridors as well as successor trail owners. The article concludes with a theory of railroad easements that interprets the railroad's powers based on the public participation that helped create and establish these corridors and the tenuous claims of adjacent landowners.

Matt Festa

July 16, 2010 in Federal Government, History, Property Rights, Scholarship, Servitudes, Transportation | Permalink | Comments (0) | TrackBack (0)

Friday, June 11, 2010

Barkehall-Thomas on Families Behaving Badly & the Granny Flat

Susan Barkehall-Thomas (Monash University) has posted Families Behaving Badly: What Happens When Grandma Gets Kicked Out of the Granny Flat?Australian Property Law Journal, Vol. 15, No. 2, p. 154, 2009.  The abstract:

There is a substantial body of case law dealing with disputes by members of an extended family over real property. In particular, the cases involve family arrangements where an older generation family member has contributed resources to property owned by a family member in the younger generation. For example, a father agrees with his adult daughter that he will pay for the costs of an extension to her family home and will live in the extension. Such an arrangement may have explicit terms for the care of the older family member and may involve explicit promises that the family member may live there for the duration of their life. Alternatively, the arrangement may be much less formal, with no promises or assurances regarding the older family member’s rights. When the family arrangement breaks down, the courts are frequently called upon to resolve the older family member’s entitlement.

This article will discuss these cases, with particular reference to the judicial methodology being applied to their resolution. It will demonstrate that the cases show a substantial variation in approach, both as to the appropriate course of action and to the appropriate remedy.

Matt Festa

June 11, 2010 in Caselaw, Comparative Land Use, Housing, Remedies, Scholarship, Servitudes | Permalink | Comments (0) | TrackBack (0)

Tuesday, June 1, 2010

Wiseman on Public Communities, Private Rules

Hannah J. Wiseman (Texas) has posted Public Communities, Private Rules, Georgetown Law Journal, Vol. 98, No. 3 (2010).  The abstract:

As the American population grows, communities are seeking creative property tools to control individual land uses and create defined community aesthetics, or distinctive “built environments.” In the past, private covenants were the primary mechanism to address this sort of need. Public communities, however, have begun to implement covenant-type “private” rules through zoning overlays, which place unusually detailed restrictions on individual property uses and, in so doing, have created new forms of “rule-bound” communities. This Article will argue that all types of rule-bound communities are uniquely important because they respond to resident consumers’ heightened demand for a community aesthetic. It will also highlight their problems, however. Many community consumers are marginally familiar with private covenants and traditional zoning, but they are largely unaware of the relatively new zoning overlays used to form public rule-bound communities. Yet the rules in overlays are extensive, are applied to existing landowners, and are not easily modified to meet changing community needs over time. And covenants, despite offering a more traditional tool for aesthetic control, create their own problems of incomplete consumer notice and barriers to effective modification. This Article will analyze the impact of these problems, as well as a lack of responsiveness to ongoing consumer demands for the maintenance of desired rules, on rule-bound communities’ ability to meet consumer demands for a community aesthetic. It will conclude that rule-bound communities should provide better visual notice of rules and should implement processes that allow for residents to better influence the initial content of rules and how rules are perpetuated or changed.

Matt Festa

June 1, 2010 in Community Design, Conservation Easements, Historic Preservation, Homeowners Associations, Housing, Local Government, Scholarship, Servitudes | Permalink | Comments (0) | TrackBack (0)