Land Use Prof Blog

More on Scalia's Land Use Legacy

Yesterday our fearless leader, Stephen R. Miller, blogged about Justice Scalia's three most important land-use-related decisions.  I agree with his assessment that Nollan and Lucas are two of the most influential takings cases ever decided, and certainly Rapanos' change in wetlands regulation are had a dramatic effect on the development industry and control of water quality (although arguably Justice Kennedy's concurrence with its "significant nexus" test is more relied upon by regulators).

Inspired by Stephen, I perused the list of Scalia-authored opinions and found a couple more of interest.  In the vein of my previous post about how Scalia's passing will likely result in the survival of President Obama's Clean Power Plan, I also think Scalia's decision in Michigan v. EPA was highly influential. It held that the EPA must consider cost when deciding whether regulations under the Clean Air Act is "appropriate and necessary." (Bob Sussman wrote about the impact of Michigan v. EPA for the Brookings last summer.)

Also, a somewhat lesser known but important Scalia-authored case was City of Columbia v. Omni Outdoor Advertising (1991), in which the court upheld anti-trust immunity for local governments enacting zoning restrictions - in this case, those that regulated signs. (Linda Greenhouse covered the case for The New York Times.) Although this case lacks the colorful language of some of Scalia's more recent opinions (primarily dissents), it is interesting reading for those of us who care about the limits of local government police power.

Jamie Baker Roskie

 

 

Fennell and Peñalver on Exactions Creep

Lee Fennell (Chicago)  and Eduardo Peñalver (Chicago) have posted Exactions Creep, 2013 Sup. Ct. Rev. ___ (forthcoming).  Here's the abstract:

How can the Constitution protect landowners from government exploitation without disabling the machinery that protects landowners from each other? The Supreme Court left this central question unanswered — and indeed unasked — in Koontz v St. Johns River Water Management District. The Court’s exactions jurisprudence, set forth in Nollan v. California Coastal Commission, Dolan v. City of Tigard, and now Koontz, requires the government to satisfy demanding criteria for certain bargains — or proposed bargains — implicating the use of land. Yet because virtually every restriction, fee, or tax associated with the ownership or use of land can be cast as a bargain, the Court must find some way to hive off the domain of exactions from garden variety land use regulations. This it refused to do in Koontz, opting instead to reject boundary principles that it found normatively unstable. By beating back one form of exactions creep — the possibility that local governments will circumvent a too-narrowly drawn circle of heightened scrutiny — the Court left land use regulation vulnerable to the creeping expansion of heightened scrutiny under the auspices of its exactions jurisprudence. In this paper, we lay out this dilemma and suggest that it should lead the Court to rethink its exactions jurisprudence, and especially its grounding in the Takings Clause, rather than the Due Process Clause. The sort of skepticism about bargaining reflected in the Court’s exactions cases, we suggest, finds its most plausible roots in rule-of-law concerns implicated by land use dealmaking. With those concerns in mind, we consider alternatives that would attempt to reconcile the Court’s twin interests in reining in governmental power over property owners and in keeping the gears of ordinary land use regulation running in ways that protect the property interests of those owners.

 

Jim K.

Fennell on Lee's Eminent Domain as Just Undercompensation

Lee Fennell (Chicago) critiques and enhances Brian Lee's Columbia Law review article entitled Just Undercompensation: The Idiosyncratic Premium in Eminent Domain, blogged about here earlier this summer.  In her concise on-line response, Just Enough, 133 Colum. L. Rev. Sidebar 109 (2013) (pdf here), Fennell moves through the positive and normative aspects of the tripartite analysis of how Fair Market Value (FMV) purportedly fails to fully compensate property owners whose interests are liquidated through eminent domain proceedings.  As she lays it out in her intro:

Like other scholars, I have previously observed that the FMV measure of compensation leaves an increment of value uncompensated:

The uncompensated increment is made up of three distinct components: (1) the increment by which the property owner’s subjective value exceeds fair market value; (2) the chance of reaping a surplus from trade (that is, of obtaining an amount larger than one’s own true subjective valuation); and (3) the autonomy of choosing for oneself when to sell.

Lee argues that appropriate amounts of both subjective value and the chance of gains from trade are included in FMV, leaving only interference with autonomy categorically uncompensated in a manner that would implicate fairness concerns. This Part focuses only on the positive question of what does and does not get included in FMV, leaving the normative questions to the next Part. Part I.A considers subjective value and Part I.B turns to the last two components of the “uncompensated increment.”

Even after demonstrating, contra Lee, that existing owners' subjective attachments are not necessarily baked in to market valuations, she helps out by showing that a prevalence of rooted homeowners together with zoning-induced supply contraints might support the kind of extended sellers' market that diminishes the difference between market prices and the reservation prices of most homeowners. 

Jim  K.

 

Conservation Covenants in England and Wales

This summer, many of us conservation easement research types received emails from the Law Commission for England and Wales. The Law Commission is similar to the Uniform Law Commission here in the US in mission (researches potential legal reform and presents suggested statutory texts), but the British version is a body established by Parliament and the US version is a non-profit organization.

When considering changes to the law, the COmmission staff assemble consultation papers. The papers present research on the legal topic at issue, suggest statutory parameters and language, and solicit comments from "consultees." Anyone who visits the website and submits the form can comment, but the Commission also contacts specific people and organizations to solicit their views. There is even a form with specific questions on the issue to complete. I thought this was a very informative and interesting approach.

As you should have already gleaned from the title of this approach, the Law Commission is examining the case for introducing "conservation covenants" into the law of England and Wales. Now, while I read the consultation paper carefully and made lots of notes (several exclamation marks in the margins of this one), I just couldn't get my act together to submit comments  by the June 21st deadline. While this is just a proposal and not yet even a proposed bill, there are lots of interesting things going on in this british version of conservation easements. I thought I would highlight a few of them for you here:

(1) Specific choice not to use the word easement.

(2) No tax breaks associated with donating conservation covenants.

(3) All transactions must be voluntary, so presumably that means no exactions or eminent domain-like creations. However, the Commission contemplates widespread use for offsetting schemes.

(4) Conservation covenants are much easier to terminate or modify. With holders having power to unilaterally discharge obligations. Also suggests a judicial proceeding with specific factors that the tribunal should consider in modifying or terminating the covenants

(5) leaseholders with long leases can enter into conservation covenants for the term of their lease

Plus oh so much more.The differences between the proposed law and the US laws is significant.

I'd be really interested to hear both what consultees said in response to this paper and what you would change here in the US if we were to rewrite our conservation easement laws. (I have my own little wishlist of course).

- Jessica Owley

 

Stahl on Neighborhood Empowerment

Land Use Prof's own Ken Stahl (Chapman) has posted the final version of Neighborhood Empowerment and the Future of the City, 161 U. Pa. L. Rev. 939 (2013).  (Who says Zoning can't go Ivy?!?)  Matt notified us when the piece first was uploaded.  Here's the abstract for the finished piece:

In any given metropolitan region, scores of municipalities are locked in a zero-sum struggle for mobile sources of jobs and tax revenue. This competition appears to benefit small, homogeneous suburbs that can directly enact the uniform will of the electorate over large, diverse cities that are often ensnarled in conflict between competing interest groups. Cities can level the playing field with suburbs, however, by devolving municipal power to smaller, more homogeneous subgroups, such as neighborhoods. Indeed, many commentators have identified one such effort at neighborhood empowerment, the “business improvement district” (BID), as a key factor in the recent revitalization of many cities. The BID and the related “special assessment district” devolve the financing of infrastructure and services to landowners within a territorially designated area. Courts have widely upheld BIDs and special assessment districts against constitutional challenges.

Cities remain hamstrung in competing with suburbs, however, because courts prohibit cities from delegating what is perhaps the most coveted power of all to neighborhood groups: zoning. Since an unusual series of Supreme Court cases in the early twentieth century, it has been largely settled that cities may not constitutionally delegate the zoning power to sub-municipal groups, at least where the power is delegated specifically to landowners within a certain distance from a proposed land use change (a scheme I designate a “neighborhood zoning district”).

This Article argues that the judicial prohibition on neighborhood zoning districts is inconsistent with the judiciary’s permissive attitude toward BIDs and special assessment districts. As I demonstrate, the neighborhood zoning district is conceptually identical to the special assessment district/BID. Both devices are designed to enable large, diverse cities to capture some of the governance advantages of small, homogeneous suburbs by providing landowners with the direct ability to manage local externalities. This Article attempts to make sense of the disparate treatment accorded these devices by examining several grounds upon which they could potentially be, and have been, distinguished. I find, however, that the only meaningful distinction between these mechanisms is that special assessment districts/BIDs actually raise far more troubling public policy concerns than neighborhood zoning districts, thus calling into question why the judiciary has been so much more deferential toward the former than the latter. I conclude that courts should broadly defer to municipal delegations of power to sub-local groups, so that cities can work out their own strategies for surviving in an era of intense interlocal competition. 

Congratulations, Ken!

Jim K.

Stern on State Legislative Checks and Judicial Takings

Here's another recently-posted paper from Stephanie Stern (Chicago-Kent): Protecting Property Through Politics: State Legislative Checks and Judicial Takings, forthcoming in the Minnesota Law Review.  The abstract:

In the 2010 Supreme Court case Stop the Beach Renourishment v. Florida Department of Environmental Protection, a plurality of the Court launched judicial takings in political and scholarly debate and laid the groundwork for expanding the Fifth Amendment to encompass court decisions. This Article explores a neglected institution in the debate over judicial takings — state legislatures. In the comparatively rare instances when state courts overreach, state legislatures can revise state court decisions and restore private property rights. Through case studies of state legislative checks of judicial activism, I examine the comparative institutional advantages, and the potential gaps, of situating primary responsibility for state court revision in state legislatures. In view of takings federalism and the costs of judicial takings, I contend that the existing balance of state legislative checks and state court restraint works well enough to police against state court property activism.

Matt Festa

Police Powers, Free Speech, and the Chick-fil-A Land Use Controversy

The Chick-fil-A land use controversy has mostly focused on freedom of speech, but I think there is a larger point about the police-power basis of land use regulation that has been overlooked.  In the wake of the Chick-fil-A CEO's comments on gay marriage, and the subsequent statements of public officials in Chicago and Boston indicating their opposition to building new Chick-fil-A franchises in their jurisdictions, there seems to be a general agreement that it would be illegal to deny building rights on the basis of the CEO's speech.  Ken Stahl and Stephen Miller have offered additional insights on the political, tax, and other potential motivations behind this controversy, with which I completely agree.  In this post, I want to expand on Ken's point about a potential Fourteenth Amendment violation of basing a land use decision on "animus" against the owner, and to peel back the onion a little bit and consider what might be the primary legal basis to a challenge to such a land use denial.

The general agreement seems to focus on the First Amendment free speech issue.  Eugene Volokh seems to have the definitive analysis that, whether or not one agrees with the CEO's opinions, it would be a First Amendment violation to deny a building permit on that basis (h/t Property Prof).  Viewed through the general prism of free speech and the Bill of Rights, this is entirely correct, and is probably sufficient for the public understanding of the issue.  As Prof. Volokh's caselaw indicates, there can be a First Amendment violation in denying a permit based on the property owner's speech.  But I think that's actually a secondary issue when it comes down to hypothetical litigation here.  What's really the primary issue, as I see it, is whether or not such a denial would be a violation of the police power itself.

The Chick-fil-A hypothetical permit denial does not on its face regulate speech: neither the CEO's personal remarks, nor the official speech of the corporation are being suppressed.  While there is a colorable as-applied claim of retaliation through the land use process in this hypo, the way I see it is that the primary cause of action would be that the permit denial was a violation of the statutory zoning/regulatory power itself.  In other words, Chick-fil-A would start by arguing that the city's denial of permission to build is not legitimately related to the purposes for which the state legislature granted the power to regulate.

The power of local governments to engage in planning, zoning, and building regulations comes from the police powers--the state legislature's plenary authority to regulate.  The Standard State Zoning Enabling Act, promulgated by Secretary Hoover's Commerce Department in 1926, starts with the standard description of the police-power font of authority for all modern land use regulation, which is "[f]or the purpose of promoting health, safety, morals, or the general welfare of the community . . . ."  This means that in theory, as long as there is a legitimate reason for regulating on those broad bases, a local government can be empowered to regulate land use in its political discretion.  Therefore there is a "presumption of constitutionality" granted to land use regulations (see Mandelker & Tarlock 1992 for a nuanced analysis of the presumption in judicial review).  Judicial review--again, in theory--has generally centered on whether the regulation itself (whether a use restriction, site requirement, etc.) is legitimately related to one of the police-power purposes.  A classic Euclidean example would be restriction of industrial uses from a residential area, for health and safety purposes.  

While the courts have given broad interpretation to the police power justifications of land use regulations, the outer limit is supposed to be--again, in theory--that the nature of the restriction is itself somehow related to the objective.  What it can't be is an arbitrary and capricious restriction based on considerations outside the police power. It's very similar to the "rational basis" standard of scrutinty that all lawyers learn about in consitutional law.

The reason this is important is because the presumption of constitutionality usually holds, the police powers usually win, and "arbitrary and capricious" challenges to land use decisions are hard to prove and usually lose.  Steve Clowney noted Matt Yglesias' insight that almost any seemingly-legitimate content-neutral reason could give a police-power justification to regulate despte ulterior motives (though I think his example of a Sunday-opening requirement isn't the best one--just about anything involving traffic, for example, would be much easier to justify), and this is obviously a longstanding issue in land use law.  But if I were trying to prove that a negative land use decision was outside the bounds of the police power basis of government regulation, I couldn't ask for a better piece of evidence than a published statement by a City Alderman like this:

"Because of this man's ignorance, I will now be denying Chick-fil-A's permit to open a restaurant in the 1st Ward."

(emphasis added).  In other words, the primary reason for the negative land use decision does not have anything to do with the actual use of the land itself, but instead is based primarily on the government official's opinion about the property owner's opinions about topics extraneous to the land use (again, the decision is not based on any discriminatory practice, or on speech taking place on the site).  This may in fact be a decision that is not rationally related to the police power basis for regulation, and could be struck down for that reason alone.  This is important because while the First Amendment angle that had dominated the discussion of the issue could apply "strict scrutiny" to the decision, this situation could be the much rarer case where a court could find a government decision to be arbitrary and capricous, and therefore to flunk the rational basis test itself.   Which means that this is potentially much more than just a case of an individual right trumping the regulatory power; it means that the city didn't have the power to do it in the first place.

This way of looking at the controversy allows us to consider the larger issue of what are the outer bounds of legitimate land use regulation, in a way that we don't often get to see in the real world.  I'm still no fan of the substance of the CEO's remarks on gay marriage, but as a land use specialist, I'm also very disturbed by what Ken identified as an attitude of "entitlement" to near-absolute discretion over land use decisions by government officials in informal systems such as Chicago's traditional "aldermanic privilege," which is apparently so ingrained that it can lead an elected official to say things like:

"You have the right to say what you want to say, but zoning is not a right."

Well, maybe not, but the latter certainly can't depend on what a government official thinks of the former.  Zoning still has to comport with the rule of law.

Matt Festa

Nolon on Regulatory Takings, Property Rights, and Sea Level Rise

John R. Nolon (Pace) has posted Regulatory Takings and Property Rights Confront Sea Level Rise: How Do They Roll.  The abstract:

Under the Beach and Shore Preservation Act, the State of Florida is authorized to conduct extraordinarily expensive beach renourishment projects to restore damaged coastal properties. The statute advances the State’s interest in repairing the damage to the coastal ecosystem and economy caused by hurricanes, high winds, and storm surges. The effect of a renourishment project conducted under the statute is to fix the legal boundary of the littoral property owner at an Erosion Control Line. Plaintiffs in Walton County v. Stop the Beach Renourishment, Inc. claimed that the statute took their common law property rights to their boundary, which would, but for the Act, move gradually landward or seaward, maintaining contact with the water. The Florida Supreme Court disagreed and the U.S. Supreme Court granted certiorari in Stop the Beach Renourishment, Inc. v. Florida Department of Environmental Protection to determine whether the state court reinterpreted Florida’s common law as a pretext for upholding the statute against the plaintiffs’ taking claim and, if so, whether that reinterpretation constituted a “judicial taking.” The Court ultimately decided that the Florida court’s interpretation was correct and that there was no regulatory taking. A majority of the Court could not agree as to whether a state court’s interpretation of state common law could constitute a “judicial taking.”

This article discusses greenhouse gas emissions, global warming, sea level rise, and the ferocity of coastal storms associated with climate change. It explores the tension between these movements in nature and the policy of the State of Florida to fix property boundaries, which under common law would move landward as sea level rises. The property rights and title to land of littoral landowners are described and the effect of the Beach and Shore Preservation Act on them discussed. The article contrasts the Florida coastal policy regarding beach and shore protection with the policies and programs of federal, state, and local governments that use other approaches such as accommodating rolling easements, prohibiting shoreline armoring, requiring removal of buildings, purchasing development rights or the land itself, and imposing moratoria on rebuilding after storm events. These may be less expensive and more realistic approaches to long-term coastal erosion and avulsive events and the inevitability of sea level rise as the climate warms and worsens. The article concludes with a recommendation that the framework for federal, state, and local cooperation in coastal management be revisited and strengthened so that the critical resources and knowledge are brought to bear on this critical issue. It suggests that strengthening those ties, rather than radically restructuring the relationship between state and federal courts, is a more productive method of meeting the needs of a changing society.

This is the latest in a series of articles by Prof. Nolon addressing how local land use law can be used to manage climate change, including  The Land Use Stabilization Wedge Strategy: Shifting Ground to Mitigate Climate Change; Land Use for Energy Conservation: A Local Strategy for Climate Change Mitigation; and Managing Climate Change through Biological Sequestration: Open Space Law Redux.  The article also discusses Stop the Beach and our favorite Texas Open Beaches Act "rolling easement" case Severance v. Patterson, and offers some solutions toward an integrated federal-state-local framework for coastal management.

Matt Festa

Eagle on Judicial Takings and State Takings

Steven J. Eagle (George Mason) has posted Judicial Takings and State Takings, forthcoming in the Widener Law Journal.  The abstract:

In Stop the Beach Renourishment v. Florida Department of Environmental Protection, a Supreme Court plurality asserted that takings liability could arise from judicial acts, as well as from state or local legislation and executive agency decisions. The Plurality’s rationale supporting “judicial takings” was that the Just Compensation Clause of the Fifth Amendment applies to State acts, not to particular State actors.

This article starts by reviewing the doctrinal bases for the Stop the Beach plurality opinion. It provides prudential reasons why rulings affecting property rights might be legitimate under state law, but nevertheless constitute compensable takings under the federal constitution. It then analyzes the implications of the “state acts and not state actors” doctrine to existing regulatory takings law. Viewed through the lens of “state acts,” the rationales of the Supreme Court’s Williamson County “state litigation” prong and its Dolan “legislative vs. adjudicative” bifurcation are undermined. Similarly, takings distinctions pertaining to whether small-scale rezonings are “legislative” or “quasi-judicial” acts are drawn into question.

Matt Festa

Pipelines, Eminent Domain, and Property Rights

Up until now the Keystone Pipeline issue has been cast mainly as a contest between an economic development imperative and environmental conservation.  Legal commentators have analyzed it as an environmental issue.  As most people can infer, though, the notion of building an "infrastructure" project from Canada to the Gulf of Mexico will require some land rights.  Perhaps only in Texas can we see the underlying tension between two principles that are very often in direct conflict: the exploitation of oil and gas resources, and the property owner's rights to her land.  The New York Times last week did a fascinating story on one Texas landowner's fight against the eminent domain authority of the Keystone Pipeline, An Old Texas Tale Retold: The Farmer versus the Oil Company.

Ms. Crawford is worried about the possible contamination of her creek. She pointed out that the Keystone 1, TransCanada’s first pipeline, had a dozen spills in its first year of operation.

“I called my farm insurance agent and asked what happens if there’s a spill, I can’t water my crops, and my corn dies,” she said. “He said my insurance won’t cover that. I’d have to sue TransCanada for damages.”

The Crawfords are the last holdouts in Lamar County. (It is unclear how many are left in Texas; the company says it has 99 percent of the rights of way secured.) TransCanada asserts that it has used eminent domain only as “an absolute last resort” in an estimated 19 out of 1,452 land tracts in Texas. Critics dispute this number. . . .

Asked if she would take TransCanada’s offer now — if it meant the full $21,000, with all of her conditions met — she did not hesitate. “No,” she said. “There’s a $20,000 check sitting in the courthouse waiting for us,” she said. “But if we touch it, game over. We lose the use of our land, and we admit what they’re doing is right.”

This is a longstanding issue, both historically and today, but it often gets overlooked when people conflate Texas stereotypes about both property rights and solicitude for oil and gas.  Ilya Somin commented on the article at the Volokh Conspiracy, noting correctly that despite its pro-property rights reputation and cosmetic legislation, Texas law still empowers quite a bit of eminent domain for economic development purposes:

Such efforts are unlikely to succeed in Texas. As I described in this article, Texas is one of many states that have passed post-Kelo reform laws that pretend to constrain economic development takings without actually doing so. They might have a better chance in one of the other states through which the pipeline must pass.

The larger question that he poses is whether and how environmental concerns will play a part in future discussions about eminent domain and the never-ending debate over the essentially contested concepts of property rights and the common good.  In the real world of land use, the alignment of stakeholders, interests, policy preferences, and legal interpretations isn't always as easy to predict as the cartoon versions might imply.

Matt Festa

Fennell Helps us Picture Takings

One of my (few) disappointments this semester was that I was out of town the day Lee Fennell (Chicago) came to ND Law to present a really interesting paper broadening legal theory's view of resource-allocation-relevant costs beyond the conventional focus on "transaction costs."  I did have the consolation of hearing many terrific papers at the ALPS Conference at Georgetown on the day she presented here in South Bend. Hopefully, that paper, Resource Access Costs, will be finding its way to SSRN and this blog soon.  

In the meantime, she has posted Picturing Takings, 88 Notre Dame L. Rev ___ (forthcoming 2012), an article that makes visual sense of a doctrine that has so successfully defied textual explanatory efforts. Here's the abstract:

Takings doctrine, we are constantly reminded, is unclear to the point of incoherence. The task of finding our way through it has become more difficult, and yet more interesting, with the Supreme Court’s recent, inconclusive foray into the arena of judicial takings in Stop the Beach Renourishment. Following guideposts in Kelo, Lingle, and earlier cases, this essay uses a series of simple diagrams to examine how elements of takings jurisprudence fit together with each other and with other limits on governmental action. Visualizing takings in this manner yields surprising lessons for judicial takings and for takings law more generally. [Note: a PowerPoint version of the diagrams is available on the author's faculty webpage or can be obtained by emailing the author]. 

 I am very hopeful that this article will be helpful not only to my understanding of takings but also to my (first-time) teaching of Land Use Planning next spring. Here is a link to the PowerPoint presentation referred to at the end of the abstract.

Jim K.

Somin on What if Kelo had Gone the Other Way?

Ilya Somin (George Mason) has posted What if Kelo v. City of New London had Gone the Other Way?, published at Indiana Law Review, Vol. 45, No. 1, pp. 21-39, 2011 (What If Counterfactuals in Constitutional History Symposium) .  The abstract:

Kelo v. City of New London is one of the most controversial decisions in U.S. Supreme Court history. The Kelo Court held that the Public Use Clause of the Fifth Amendment allows government to condemn private property and transfer it to other private parties for purposes of “economic development.” This Article considers the question of what might have happened if the Supreme Court decided Kelo v. City of New London in favor of the property owners. Such counterfactual analysis may seem frivolous. But it is, in fact, useful in understanding constitutional history. Any assessment of the impact of a legal decision depends on at least an implicit judgment as to the likely consequences of a ruling the other way. Analysis can be improved by making these implicit counterfactual assumptions clear and systematically considering their implications.

Part I briefly describes the Kelo case and its aftermath, focusing especially on the massive political backlash. That backlash led to numerous new reform laws. However, many of them turned out to be largely symbolic. Part II discusses the potential value of a counterfactual analysis of Kelo. It could help shed light on a longstanding debate over the effects of Supreme Court decisions on society. Some have argued that court decisions have little impact, mostly protecting only those rights that the political branches of government would protect of their own accord. Others contend that this pessimistic view underrates the potential effect of Supreme Court decisions.

Part III considers the possible legal effect of a ruling in favor of the property owners. Such a decision could have taken several potential forms. One possibility is that the Court could have adopted the view advocated by the four Kelo dissenters: that economic development condemnations are categorically forbidden by the Public Use Clause. This would have provided strong protection to property owners and significantly altered the legal landscape. On the other hand, the Court could easily have decided in favor of the property owners on one of two narrower grounds. Such a ruling would have led to much weaker protections for property owners.

Part IV weighs the potential political impact of a decision favoring the property owners. Such an outcome might have forestalled the massive political backlash that Kelo caused. Ironically, a narrow ruling in favor of the owners that did not significantly constrain future takings might have left the cause of property rights worse off than defeat did. On the other hand, a strong ruling categorically banning economic development takings would likely have done more for property rights than the backlash did, especially considering the uneven nature of the latter. Furthermore, political movements sometimes build on legal victories, as well as defeats, as happened in the case of the Civil Rights movement in the wake of Brown v. Board of Education. It is possible that property rights advocates could have similarly exploited a victory in Kelo.

Matt Festa

Stein on the Modest Impact of Palazzolo

Gregory M. Stein (Tennessee) has posted The Modest Impact of Palazzolo v. Rhode Island, forthcoming in the Vermont Law Review.  The abstract:

Before 2001, state and federal courts did not agree on the extent to which a property owner’s regulatory takings claim should be weakened by the existence of legal restrictions on her use of the property at the time she acquired it. The Palazzolo Court addressed this doctrinal confusion but did not completely resolve it, offering six opinions that partially contradict each other. Some of this discord has persisted, with Palazzolo already cited in nearly five hundred judicial opinions, and not always consistently.

This Article examines the impact Palazzolo has had on state and lower federal courts. After reviewing the law before Palazzolo and the Supreme Court’s decision in that case, the Article offers suggestions as to how courts ought to interpret the contradictory opinions in Palazzolo. More specifically, cases arising at different points in the ripening process should be treated differently, and only a small subset of takings claims should benefit from Palazzolo’s relaxation of the notice rule.

Next the Article assesses the evidence, in an effort to determine whether courts interpreting Palazzolo have actually been following these suggestions. First, it examines the small number of claims in which an owner that probably would have lost before 2001 prevailed. It then compares these results with the far more numerous cases in which an owner that probably would have lost before 2001 still lost even after that decision.

The Article closes by offering a more generalized assessment of the effects of Palazzolo. It concludes that nearly all of the courts to cite Palazzolo have heeded its requirements, but only a few cases have turned out differently than they would have before 2001. The Court’s ripeness rules dictate that few landowners should benefit from the holding in Palazzolo, and only a small number actually do benefit. Lower courts understand Palazzolo, they have been applying it correctly, and they should continue to do what they have been doing.

Matt Festa

Tear Down This Mansion?

A Michigan appellate court has ordered the owner to tear down what looks to be a fairly elaborate and presumably expensive home, because it is only 80 feet from the neighboring property, instead of the 100 feet required in the deed restrictions.  Talk about strict enforcement!  But as the neighbors say in the video, rules are rules. 

The news story is here at msnbc.com.  Might be an interesting clip to show for servitudes, land use, or real estate transactions.  Thanks to Helen Jenkins for the pointer.

Matt Festa

City Journal's take on the California Redevlopment decision

I've been enjoying the outstanding posts on last week's landmark California Supreme Court ruling by Ken Stahl (here and here) and guest-blogger Stephen Miller (here and here) (I smell a great panel or symposium topic in the making).  Just now I came a cross an early analysis by Stephen Greenhut at City Journal, the always-interesting center-right urban affairs journal.  Greenhut has a strongly positive take on the decision in Crony Capitalism Rebuked California’s supreme court strikes a blow for property rights and fiscal sanity:

On December 29, the California Supreme Court handed down what the state’s urban redevelopment agencies (RDAs) and their supporters called a “worst of all worlds” ruling—first upholding a law that eliminates the agencies, then striking down a second law that would have allowed them to buy their way back into power. This was great news for critics who had spent years calling attention to the ways modern urban-renewal projects distorted city land-use decisions, abused eminent-domain policies, and diverted about 12 percent of the state budget from traditional public services to subsidies for developers, who would build tax-producing shopping centers and other projects sought by city bureaucrats. As of now, the agencies are history, though the redevelopment industry is working to craft new legislation that would resurrect them in some limited form.

Matt Festa

Wolf on the Supreme Court and the Environment

Michael Allan Wolf (Florida) has a new book out called The Supreme Court and the Environment: The Reluctant Protector (CQ Press, 2012).  Here's the Amazon blurb:

Silent Spring (1962) can arguable be cited as one of the most influential books of the modern era. This book, along with 1960's rampant activism reacting to high-profile ecological calamities, helped create the modern environmental movement. The Supreme Court and the Environment, written by Michael Wolf, discusses one of this movement's most important legacies, namely the body of federal statutory law amassed to fight pollution and conserve natural resources that began with the enactment of the National Environmental Policy Act of 1969. Instead of taking the more traditional route of listing court decisions, The Supreme Court and the Environment puts the actual cases in a subsidiary position, as part of a larger set of documents paired with incisive introductions that illustrate the fascinating and sometimes surprising give-and-take with Congress, federal administrative agencies, state and local governments, environmental organizations and private companies and industry trade groups that have helped define modern environmental policy.

And for a preview, Prof. Wolf has posted the introduction on SSRN.  The abstract:

This document contains the Introduction and Contents for The Supreme Court and the Environment: The Reluctant Protector (CQ Press/Sage 2012). When one views the body of modern environmental law — the decisions and the other key documents — the picture that emerges is not one of Supreme Court dominance. In this legal drama, the justices have most often played supporting roles. While we can find the occasional, memorable soliloquy in a Supreme Court majority, concurring, or dissenting opinion, the leading men and women are more likely found in Congress, administrative agencies, state and local legislatures, nongovernmental organizations, private industry, and state and lower federal courts.

What one learns from studying the Supreme Court’s environmental law output is that the justices for the most part seem more concerned about more general issues of deference to administrative agencies, the rules of statutory interpretation, the role of legislative history, the requisites for standing, and the nature of the Takings Clause than the narrow issues of entitlement to a clean environment, the notion of an environmental ethic that underlies written statutes and regulations, and concerns about ecological diversity and other environmental values. When we widen the lens, however, and focus on the other documents that make up essential parts of the story of the Supreme Court and the environment — complaints by litigants, briefs by parties and by friends of the court, oral argument transcripts, the occasional stirring dissent, lower court decisions, presidential signing statements and press conference transcripts, media reports and editorials, and legislative responses to high court decisions — we discover what is often missing in the body of Supreme Court decisions.

 Looks fascinating, and is a very original take that situates the cases themselves within a broader context of Supreme Court jurisprudence and goes beyond to the larger networks of actors that shape law.

Matt Festa

Sterk and Brunelle on Zoning and Res Judicata

Stewart Sterk (Cardozo) and Kimberly Brunelle have posted Zoning Finality: Reconceptualizing Res Judicata Doctrine in Land Use Cases, 63 Fla. L. Rev 1139 (2011).  Here's the abstract:

 Zoning disputes provide many Americans with their only firsthand exposure to the workings of democratic government. Land use issues trigger participation because neighbors perceive the wrong kind of development as posing a double-barreled threat to the stability of the community in which they have chosen to live and to the economic value of their homes.

The protagonists in zoning disputes-landowners and neighbors-invest time and other resources to persuade the relevant decisionmakers to rule in the protagonists’ favor. When the parties make that investment, should they assume that a decision made today will have some enduring significance? Whether the decision is “final” may play an important role in shaping the parties’ participation and presentations. If a zoning board were free to deny a variance today and to grant the identical variance next week (or next year), there would be less reason for neighbors (and landowner applicants) to spend time and money framing their arguments for today’s decision.

Many of the reasons that underlie res judicata doctrine apply to these local land use disputes. In the interest of conserving the resources of all parties- landowners, neighbors, and local decisionmakers-issues should be decided once, not multiple times. There is little reason to think that, were the issues decided multiple times, subsequent determinations would improve on prior ones. This is especially true in the context of land use, where the issues involve primarily questions of fact, and parties have incentives to come forward with all relevant information at the time the first decisionmaker considers the dispute.

If a court, rather than a zoning board, were resolving the dispute, res judicata doctrine would circumscribe the power of a subsequent court to depart from the earlier determination. In the first instance, however, zoning disputes are resolved not by the courts, but by local legislatures and administrative bodies. No finality principle comparable to res judicata attaches to legislative determinations, no matter which legislative body-Congress, a state legislature, or a local city council- makes those determinations. Unlike most judicial decisions, which resolve discrete disputes over past events, legislatures act prospectively. Finality rules would preclude legislative decisionmakers from considering new facts that cast doubt on the wisdom of past decisions. It should not be surprising, then, that legislatures are typically free of finality constraints.

In contrast to the well-established principles that apply to judicial and legislative determinations, the applicability of finality principles is unclear when it comes to administrative decisions by the local zoning board, such as the grant or denial of a variance. Courts sometimes treat zoning board decisions as if they were judicial decisions, using res judicata language to preclude new applications for relief that the zoning board previously denied. In other cases, courts-often from the same jurisdictions-permit boards to entertain applications virtually identical to previously rejected applications. Although courts sometimes suggest the need to be “flexible” in applying res judicata doctrine to zoning disputes, neither courts nor scholars have offered a coherent prescriptive or descriptive account for how that flexibility does or should operate.

This Article has two related objectives: to develop a normative theory explaining how finality principles should apply in the land use context and simultaneously to argue that existing case law, however inarticulately, reflects that normative theory. Part I begins by exploring the distinctive structure of zoning doctrine, which fits imperfectly with traditional categorization of decisions as legislative or judicial. Part II examines more generally the role of finality in legal decisionmaking. Part III demonstrates that, in light of the structure of zoning doctrine, traditional claim preclusion doctrine should have no place in zoning law. This Article argues, by contrast, that issue preclusion doctrine should and does operate to constrain zoning decisionmakers. The Article goes on to demonstrate that this framework explains the results, even if not the language, in the vast majority of zoning cases that raise finality issues.

Jim K.

Epstein on Judicial Takings in a Federalist System

Richard Epstein (NYU) has written Littoral Rights under the Takings Doctrine: the Clash between the Ius Naturale and Stop the Beach Renourishment, 6 Duke J. Const. L & Pub. Policy 37 (2011). He begins with the point that, due to the self-contradictory nature of judicial takings in a unitary court system, "the doctrine of judicial takings can, in practice, only arise in a federalist system." He goes on to argue for an appropriate deployment of centralized, federal oversight of state courts in defense of age-old, decentralized ius naturale. He sees Stop the Beach as a missed opportunity to invalidate years of Florida precedent as well as the Preservation Act that occasioned the controversy. He concludes that application of the judicial takings doctrine "should be limited to those circumstances in which the decided cases make a radical break from well-established common law patterns that systematically work for the advantage of the state or some identifiable private faction."

This article was published as part of a symposium on judicial takings that also included papers by Ilya Somin and Nestor Davidson.

Jim K.

Land Use at the Supreme Court, Part I

This month begins a term at the U.S. Supreme Court in which the Court will hear two important cases concerning land use. The cases turn on very different doctrinal issues. One concerns rights and remedies under the Administrative Procedure Act. The other involves an actual property issue, namely whether a state has title to a river bed arising out of application of the navigable waterway doctrine. In most ways, the cases could not be more different. Yet they are connected by one common theme. Both cases demonstrate the dangers—to landowners and governments alike—when a government entity is both a party interested in the outcome of a land use dispute and the authority charged with adjudicating the dispute.

The first case is Sackett v. EPA. According to their counsel, the Sacketts planned to build their dream home near (but not adjacent to) a lake in Idaho. They acquired the necessary local permits and received the assurance of the U.S. Army Corps of Engineers that no federal permits were required. They had begun preparations to build when EPA showed up, insisting that the lot was situated on wetlands (the putative wetland area is separated from the lake itself).

As commentators on both the Left and the Right have observed, the factual question whether the Sacketts’ land is part of nearby wetlands is contestable. But the Sacketts have no way of contesting EPA’s contention unless and until EPA seeks enforcement of an order against them in federal court; two lower federal courts ruled that federal law provides no mechanism for a pre-enforcement challenge. As the Sacketts’ counsel pointed out, this situation left the Sacketts with an “unenviable choice.” They could apply for a permit that they believe they are not required to obtain and pay the associated costs. Or they could expose themselves to an enforcement action and the associated fines, which could run over $30,000 per day. Either way, they would incur inordinate expense to build on a lot that they purchased for $23,000.

This Hobson’s choice for the Sacketts rendered EPA the de facto adjudicator of their rights. And had a public interest litigation group not come to their aid, the Sacketts would have been at the mercy of a federal administrative agency that served as investigator, prosecutor, judge, and jury. Because the Court has agreed to hear the Sacketts’ claim not under the Clean Water Act but under the broader Administrative Procedure Act, the implications of the Court’s ruling could reach far. Jonathan Adler has speculated, “While this case focuses on the Clean Water Act’s ACO regime, the cert grant makes clear that it will have broader application to laws that employ similar enforcement mechanisms, including the Clean Air Act and Superfund.”

The second case is PPL Montana LLC v. Montana. The certified question can excite only a Property professor.

Does the constitutional test for determining whether a section of a river is navigable for title purposes require a trial court to determine, based on evidence, whether the relevant stretch of the river was navigable at the time the State joined the Union as directed by United States v. Utah, 283 U.S. 64 (1931), or may the court simply deem the river as a whole generally navigable based on evidence of present day recreational use, with the question “very liberally construed” in the State’s favor?

According to the pleadings, the case arose when the State of Montana decided to claim title in riverbeds that had long been used by a private landowner, namely a power company using the river to generate hydroelectricity. Montana became a state in 1889. Two years later, in 1891, a predecessor-in-title to the power company built a dam near Fort Benton, Montana on the Missouri River, apparently believing that this stretch of the river was not navigable, and that the State of Montana therefore had no title in it. More dams were built on the Missouri and Madison Rivers, and the State, no doubt benefiting from this land use, did not object. Indeed, the State participated in the licensing proceedings for some of the dams.

Then, in 2004, the State of Montana, piggybacking on a lawsuit filed by parents of Montana school children, claimed that it had owned title to the riverbeds all along because the contested stretches of river are navigable. The Montana Supreme Court ruled for the State and upheld a judgment of $41 million in back rent. 

In this case, the government actor advocating on behalf of the state—the Montana Attorney General—is distinct from the state courts that adjudicated the claim. But the central issue in the case turns on a disputed, mixed question of fact and law. And about this question the Montana state courts showed strikingly little curiosity. Despite 500 pages of expert testimony and exhibits disputing the State’s assertion of navigability, the Montana Supreme Court affirmed the trial court’s entry of summary judgment for the State. The Montana courts appear to have simply accepted the Montana Attorney General’s proposed findings.

It is now increasingly common for states and federal agencies to advocate for particular outcomes of private land use proposals. I intend to explore some of the implications of this trend at length in later posts. But in short, whatever its benefits, this advocacy entails significant costs. And these costs are not borne only by landowners. I will argue that the governmental authorities themselves pay a price, because they risk damaging their reputations as impartial ministers of law.

Adam MacLeod

Update: David Breemer of the Pacific Legal Foundation (PLF) comments below. As I should have noted, PLF is the public interest firm representing the Sacketts.

City of South Bend Enjoined by U.S. District Court from Transferring Land to Catholic HS

The South Bend Tribune reports that U.S. District Judge Robert Miller (NDIN) has granted a preliminary injunction sought by four local residents represented by the ACLU of Indiana. The plaintiffs object to the transfer of the former Family Dollar site, recently bought by the City for $1.2 M, to a local CDC that would turn it over to St. Joseph High School, a co-ed Catholic school which would use it for athletics and parking and had committed to accomodate requested public use for 10 years.  (FD: my two older children recently began attending St. Joseph High School here in South Bend, shortly after I began my new post here at Notre Dame.)  The local council had approved the acquisition and transfer on a 5-4 vote.

In the opinion, Judge Miller agrees with the plaintiffs that the transfer constitutes a direct subsidy to a religious institution in violation of the First Amendment's Establishment Clause.  The Court distinguished recent school voucher program precedent by emphasizing that the below-market transfer by the City is not part of a program with religion-neutral criteria.  To me, this point about the ad hoc nature of public-to-private land transfers makes the opinion an interesting land use case.  It raises the question:  Are religious institutions quarrantined from economic development land transfers even though (as the Court agrees) they are not from public benefits generally?    

Related to this point is the nature of the endorsement of (a?) religion.  With the qualification that I am not a First Amendment scholar, I did note that the Court found that the transfer violated the second prong of the Lemon test (you know, whether the action's primary effect is to advance/inhibit religion) Even though neither the City nor the plaintiffs thought the issue determinative, the Court disagreed. The Court implied in its ruling that the proposed transfer sends a message to adherents and non-adherents that they are insiders and outsiders respectively.  Was that part-and-parcel of the Court's distinction between programmatic and ad hoc public subsidies?

I would be glad to hear from you. I will be following the developments with not-just-an-academic interest.

 

Jim K.

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