PropertyProf Blog

Zoning Makes Brooklyn Expensive

Stephen Smith argues that zoning rules have kept Brooklyn expensive:

[N]orthern Brooklyn is underdeveloped. The hip neighborhoods around the L train, the main vehicle of gentrification in Williamsburg and Bushwick, are less than half as dense as Brooklyn neighborhoods like Crown Heights and Bed-Stuy.

Because the amount of housing in the neighborhood is effectively capped through zoning, demand has spilled out of the neighborhood much faster than it would have if Williamsburg had been allowed to grow.

Steve Clowney

Caron & Repetti on the Estate Tax & Inequality

Paul Caron (Cincinnati) and James Repetti (Boston College) have posted Occupy the Tax Code: Using the Estate Tax to Reduce Inequality (Pepperdine Law Review) on SSRN. Here's the abstract:

Inequality has been increasing in the United States. We should care about this increase because inequality contributes to a variety of adverse social consequences that persist across generations. There is also substantial empirical evidence that inequality has a long-term negative impact on economic growth.

For many decades, federal tax policy has played an important role in reducing inequality, although the impact of federal taxes on inequality has waxed and waned depending on the focus of elected officials. We argue that the estate tax is a particularly apt vehicle to reduce inequality because inheritances are a major source of wealth among the rich, and studies suggest that inherited wealth has a more deleterious impact on economic growth than inequality caused by self-made wealth. Although there are loopholes in the estate tax, it is still effective in moderating the amount of wealth that is passed within a family from generation to generation.

The major criticism about the estate tax — that it discourages savings — is inaccurate. Standard tax theory cannot predict the impact of the estate tax on savings and the empirical evidence is mixed. Moreover, the estate tax has a less harmful impact on savings than the income tax for two reasons. First, the event that triggers estate tax liability — death — is ignored by taxpayers during the period of life in which they are likely to be most productive. Second, the expected value of the estate tax’s effective rate is quite low during the period of life in which most taxpayers create wealth.

Steve Clowney

Preservation, Miami Style

The New York Times reports on a new push to tighten preservation laws in Miami:

When South Beach was little more than a forlorn chunk of beachfront property, preservationists clung to the idea that the faded, often derelict pastel buildings lining the streets were too precious to knock down.  Their campaign to preserve the area’s fanciful Art Deco buildings ushered in one of the country’s most successful urban revivals. Years later, South Beach is still a juggernaut.

Preservationists are now pushing hard to bolster historic preservation laws, a move that has ruffled wealthy property owners (and potential buyers) and stepped up pressure on local commissioners who are reluctant to wade into the politically precarious battle.

Steve Clowney

Miller on Area of City Impact Agreements

Stephen Miller (Idaho) has posted Area of City Impact Agreements on SSRN.  Here's the abstract:

Area of city impact agreements, or growth management tools negotiated between cities and counties, are required by Idaho Code section 67-6526 “to delineate areas of future contiguous growth in order to assure their orderly development and thereby reconcile potentially competing designs for boundary expansion with accepted land use planning principles.” City of Garden City v. City of Boise, 104 Idaho 512, 514 (1983).

In Fall, 2012, the University of Idaho College of Law’s Economic Development Clinic worked with a coalition of partners to review existing area of city impact agreements. The Clinic obtained 125 area of city impact agreements, one of the largest collections of local government agreements addressing growth management ever assembled in Idaho, and likely anywhere in the country. Based upon its research, the Clinic drafted this report with detailed guidance for Idaho cities and counties negotiating future area of city impact agreements. Outside of Idaho, this report will be of use to state and local government law and land use law scholars interested in growth management, smart growth, and extra-territorial powers of cities. The Clinic's guidance document and the original agreements are available in this file.

Steve Clowney

World's Largest Hole For Sale

And it will only set you back $24 million.

Steve Clowney

Kochan on Utah's “Transfer of Public Lands Act"

Donald Kochan (Chapman) has posted A Legal Overview of Utah's H.B. 148 – The Transfer of Public Lands Act on SSRN.  Here's the abstract:

Recent legislation passed in March 2012 in the State of Utah – the “Transfer of Public Lands Act and Related Study,” (“TPLA”) also commonly referred to House Bill 148 (“H.B. 148”) – has demanded that the federal government, by December 31, 2014, “extinguish title” to certain public lands that the federal government currently holds (totaling an estimated more than 20 million acres). It also calls for the transfer of such acreage to the State and establishes procedures for the development of a management regime for this increased state portfolio of land holdings resulting from the transfer.

The State of Utah claims that the federal government made promises to it (at statehood when the federal government obtained the lands) that the federal ownership would be of limited duration and that the bulk of those lands would be timely disposed of by the federal government into private ownership or otherwise returned to the State. Longstanding precedents support the theory that Utah’s Enabling Act is a bilateral compact between the State and the federal government that should be treated like it is, and interpreted as, a binding contractual agreement.

As Utah’s Governor Herbert has noted, the legal case for H.B. 148 may not be a “slam dunk,” but there are credible legal arguments supporting Utah’s demand that the federal government extinguish certain public lands within the State. At the very least, it seems clear that the law is not “clearly” unconstitutional as some opponents contend. Much of what is being discussed as “precedent” against the TPLA is dicta.

Utah’s TPLA presents fascinating issues for the areas of public lands, natural resources, federalism, contracts, and constitutional law. It represents a new chapter in the long book of wrangling between states in the west and the federal government over natural resources and public lands ownership, control, and management. The impact is potentially considerable – thirty-one percent of our nation’s lands are owned by the federal government and 63.9 percent of the lands in Utah are owned by the federal government.

This White Paper provides an overview of the legal arguments on both sides of the TPLA debate. In the end, there is a credible case that rules of construction favor an interpretation of the Utah Enabling Act that includes some form of a duty to dispose on the part of the federal government. Other theories may also support the TPLA. At a minimum, the legal arguments in favor of the TPLA are serious and, if taken seriously, the TPLA presents an opportunity for further clarification of public lands law and the relationship between the states and the federal government regarding those lands. Moreover, as other states are exploring similar avenues to assert their claims vis-à-vis the federal government and are in various stages of developing land transfer strategies that will model or learn from the TPLA. That fact further underscores the need for a renewed serious and informed legal discussion on the issues related to disposal obligations of the federal government. This White Paper takes a first step into that discussion.

Steve Clowney

Foreclosure Settlement Announced

Last week, the government announced that ten of the country's largest banks have agreed to pay $8.5 billion to settle claims that they improperly foreclosed on homeowners during the height of the housing crisis. The settlement stems from the way that companies like  J.P. Morgan, Bank of America, and Wells Fargo improperly foreclosured on homes during 2009 and 2010. A little more than $3 billion will go be paid to borrowers who were foreclosed on during those years. Another $5 billion is set aside for other assistance to homeowners who are currently having trouble.

Steve Clowney

Property Movies!

Here are a few more property movies suggested by readers of the blog.  Special thanks to University of Kentucky law librarian, Ryan Valentin, for digging most of these up:

Battle for Brooklyn: Battle for Brooklyn' follows the story of reluctant activist Daniel Goldstein as he struggles to save his home and community from being demolished to make way for the densest real estate development in U.S. history.
 
Begging for Billionaires: Explores the erosion of private property rights in United States and exposes how municipal governments use tax money and abusive eminent domain policies to aid private developers and corporations.
 
Urbanized: A documentary about the design of cities, which looks at the issues and strategies behind urban design and features some of the world's foremost architects, planners, policymakers, builders, and thinkers.
 
Blueprint America: Road to the Future: An original documentary part of a PBS multi-platform series on the country's aging and changing infrastructure, goes to three very different American cities - Denver, New York and Portland, and their surrounding suburbs - to look at each as an example of the challenges and possibilities the country faces as citizens, local and federal officials, and planners struggle to manage a growing America with innovative transportation and sustainable land use policies.
 
Making Sense of Place – Portland: Quest for the Livable City: As cities across the country today attempt to reduce greenhouse gas emissions, invest in transit, and focus on infill redevelopment as an alternative to car-dependent sprawl, the experience of Portland provides a cautionary tale for planning in the 21st century, involving issues of economic development, gentrification, local food and farming, property rights, and civic participation.
 
Land and how it gets that way: LAND presents a subtle story of competing interests in the conflict over conversion of rural land to suburban  housing developments.  By allowing the characters to speak for themselves, Brock engagingly presents land use conflict as human drama, not dry policy and planning decisions.

The Dust Bowl: Ken Burns film that chronicles the worst man-made ecological disaster in American history, in which the frenzied wheat boom of the "Great Plow-Up," followed by a decade-long drought during the 1930s nearly swept away the breadbasket of the nation.
 
The Next Best West: Tells the story of how the conventional American concept of progress has steered our exploitation of the Western landscape, and takes you to three places – Colorado’s San Luis Valley, the High Plains of Eastern Montana and the Elwha River on Washington’s Olympic Peninsula – where a vibrant new understanding of progress presages a better future.
 
We the Tiny House People: TV producer and Internet-video personality Kirsten Dirksen invites us on her journey into the tiny homes of people searching for simplicity
 
You’ve Been Trumped: In this David and Goliath story for the 21st century, a group of proud Scottish homeowners take on celebrity tycoon Donald Trump as he buys up one of Scotland's last wilderness areas to build a golf resort.

Steve Clowney

Map of the Day: How Far Can You Travel in a Day

Mother Nature reproduces four maps from the Atlas of Historical Geography that dramatically demonstrate how travel changed in the U.S. between 1800 and the mid-1900s.  The website hosts maps (from 1800, 1830, 1857, and 1930) that show how long it took a person, leaving from New York City, to travel across the country. 

Steve Clowney

A Quick Foreclosure Process: The Secret to a Housing Recovery?

The Wall Street Journal looks at the link between efficient real estate foreclosures and the rebound of the housing market:

[T]he rebound is strongest in states that let lenders enforce contracts. We're referring to the difference between "nonjudicial" states that have streamlined foreclosure procedures and the 23 "judicial" states that force lenders to go to court to enforce mortgage contracts. Prices are stabilizing in the former but still faltering in much of the latter, which isn't surprising, except to politicians. Housing markets can't clear until lenders can foreclose on delinquent borrowers and prices fall far enough to attract buyers who can afford the mortgage payments.

Steve Clowney