Thursday, April 14, 2011

Zoning, Amortization Periods, and Regulatory Takings

We covered non-conforming uses in class today, specifically the AVR, Inc. v. City of St. Louis Park case.  My students, having read Lucas in Constitutional Law a few weeks ago, posited that a rezoning would not constitute a regulatory taking.  I disagreed.  My argument (and please consider that I have not studied Constitutional Law since 1999) is that if: (1) a municipality changes the zoning of an improved parcel of land (for example, rezones land occupied by a ready cement plant as residential); (2) the re-zoning diminishes the value of the underlying real estate; and (3) the municipality forces a change in use; then a compensable regulatory taking has occurred. 

Based on approximately 20 minutes of research, I can't find any cases where this has occurred.  I posit that this is because states either: (1) protect lawful nonconforming uses, thus preventing the above scenario from occuring frequently enough for me to easily locate a case; or (2) have adopted amortization periods, which are predicated on the idea that the value of the use will fully amortize over a certain period of time, so that when the prior lawful use is brought to an end, there is no loss to be compensated.

I think that my conclusion is consistent with Penn Central.  If there is a lawful nonconforming use, then the owner had an investment-backed expectations in that use.  If the government cuts short that use, then there is a compensable taking.

I am sure someone has written a brilliant article on this topic that I have not yet found.  Any references to said article or other feedback would be much appreciated.

Tanya Marsh

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I agree with both you and your students. I think that elimination of a non-conforming use probably wouldn't be a taking under the Court's contemporary regulatory takings jurisprudence, so I agree with your students. I agree with you that a contrary holding would be generally consistent with Penn Central, though Penn Central is so vague that anything would be consistent with it. And the protection of non-conforming uses seems inconsistent with the way most courts have applied Penn Central in other contexts (i.e., gov't almost always wins). Anyway, the best article on this subject is Chris Serkin's 2009 article in the NYU Law Review:

Posted by: Ben Barros | Apr 15, 2011 6:32:25 AM

Thanks for the reference to the article, and for being so diplomatic in agreeing with both me and my students.

Posted by: Tanya Marsh | Apr 19, 2011 7:30:22 AM

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