Friday, June 28, 2013
Building codes are often criticised as overly restrictive and costly. The New York Times, looking at India, reminds us that unregulated building does have consequences:
Mumbai has seen an alarming number of building mishaps this year, but what is more troubling is that more structures are likely to be vulnerable to collapse as old ones crumble from neglect and new ones are poorly made. [...]
Newer buildings, however, often have structural problems as developers compromise on quality in favor of speed. “The problem is that land has become so valuable that people are building on the land quickly, just to get something in place, and not with the intention of occupying it or keeping the inhabitants in mind,” said Matias Echanove, co-founder of URBZ, an urban research collective. “The acceleration of this process means that substandard apartments are quickly put up for purely speculative reasons.”
A bipartisan group of senators on Tuesday proposed an overhaul to the housing finance system that would gradually eliminate Fannie Mae and Freddie Mac, the two government-sponsored mortgage guarantee giants, and shift more mortgage and credit risk to the private sector.
Eight lawmakers from the Senate Banking Committee – four Democrats and four Republicans – said their legislation would protect taxpayers from bearing the costs of housing market downturns as occurred in the 2008 financial crisis when Fannie and Freddie were nationalized and bailed out with $187 billion in taxpayer-funded loans.
"All these years later, nothing has changed," said Sen. Bob Corker, R-Tenn., "It's time to end this failed model."
Thursday, June 27, 2013
At Prawfsblawg, Eduardo Penalver has a terrific post on the recent takings case in which he takes to pieces Justice Alito's majority opinion and looks at the distinction between takings and the unconstitutional conditions doctrine.
Reuters looks into the divorce of Harold Hamm, the Oklahoman who owns "more oil in the ground than any other American." Hamm has an $11 billion dollar fortune and did not ask his wife (of 25 years) to sign a prenup when they married:
Oklahoma attorneys familiar with the case say a settlement could cost him about $3 billion or more.
That's 60 percent higher than the largest reported divorce settlement - News Corp chairman Rupert Murdoch's $1.7 billion pay-out to ex-wife Anna in 1999. Murdoch has filed for divorce from his current wife, Wendi Deng, a spokesman said Thursday, confirming a report by Deadline Hollywood. The media mogul has a prenup, said a person familiar with the matter, but its terms aren't disclosed.
A multi-billion-dollar settlement would vault Sue Ann Hamm, 56, into the ranks of the 20 wealthiest women in America - worth more than Oprah Winfrey, the entertainment mogul whose fortune was estimated by Forbes at $2.8 billion this year.
Amnon Lehavi (IDC Herzliya - Israel) has recently finished his book The Construction of Property (Cambridge University Press). Here's the publisher's blurb:
The Construction of Property identifies the structural and institutional foundations of property, and explains how these features can accommodate various normative agendas. Offering rich and cutting-edge analysis, the book studies the spectrum of property regimes including private, common and public property as well as innovative forms of property hybrids such as US-style residential community associations, the British Private Finance Initiative, the Israeli Renewing Kibbutz, community land trusts and grassroots phenomena of property ordering in publicly-owned open spaces. It also investigates the protagonists of property beyond the individual and the state, identifying the key role that community organisations and business corporations play for both the private and public aspects of property. The book then addresses property's greatest challenge: the move from a largely domestic legal construct into one that accommodates the increasing social and economic forces of globalisation.
Wednesday, June 26, 2013
The always-insightful Tim Mulvaney has updated his post on Koontz over at Environmental Law Prof. If you haven't been following the case, Tim gives a clear outline of the dispute, explains what's at stake, and discusses the holding. His takeaway:
This morning, the U.S. Supreme Court issued a divided decision in Koontz v. St. John’s River Water Management District that expands Takings Clause protections for landowners. I raised the possibility last October that the case could serve as a vehicle for the Court to provide some sense of clarity to the field of takings jurisprudence that would benefit both landowners and government regulators alike, yet it appears on my first read of the 5-4 opinion that the Court has failed in this regard. Moreover, while the decision is undoubtedly a victory for proponents of a conception of property grounded in individual autonomy and control, there may be some silver lining for those who understand property as a socially contingent institution.
At Prawfsblawg, Rick Hills has a tour-de-force on the Supreme Court's decision in Koontz, handed down yesterday (here's a link to the opinion). The whole thing is worth reading, but the first paragraph alone is worth the price of admission:
Federal takings doctrine is the jurisprudential equivalent of a land war in Asia -- a quagmire from which any aggressive initial expedition will eventually have to extricate itself with patently phoney declaration that the mission was accomplished after being bogged down in the swamps and rice paddies of mushy doctrinal distinctions and sniped at by local government guerrillas too elusive to pin down in open battle. Every once in awhile, the SCOTUS attempts one of these invasions of subnational governments' land-use prerogatives, invariably to retreat in disarray when it discovers that (a) it does not understand the legal terrain and (b) its district court foot soldiers balk at getting involved in what Justice Sutherland once called the "tedious and minute detail" of land-use law's implementation. (Examples of such embarrassed retreats include Louisville & Nashville Ry. v. Barber Asphalt Paving (1906) and San Remo Hotel v. San Francisco (2005))
Tim Mulvaney summarizes the holding at Environemntal Law Prof Blog:
In an opinion authored by Justice Alito, a five-Justice majority declared that (1) the Nollan/Dolan test (which places the burden of proof on government defendants to prove land use permit conditions bear a nexus to and rough proportionality with development impacts) is applicable at the point in time when a condition is merely proposed, even if the permit ultimately is denied; and (2) the Nollan/Dolan test applies to conditions beyond those that require public occupation of private lands to include conditions that would require the applicant to fund offsite mitigation. Dissenting, Justice Kagan, joined by Justices Ginsburg, Breyer, and Sotomayor, disputed the majority’s latter conclusion as setting up a situation where lower courts will struggle to distinguish between takings and taxes.
Tuesday, June 25, 2013
Since everyone else is talking about the Affirmative Action case today, I thought I could chip in my two cents. Before going to law school I worked in the admissions office at Princeton University for two years. Here's a short piece I wrote about Affirmative Action based on that experience. The gist is that Affirmative Action is the least offensive thing that happens in a university admissions department; it affects fewer people than you think and (contra Justice Thomas) causes fewer harms.
Also, if any of you have high school aged kids, I'm more than happy to read their application essays.
Monday, June 24, 2013
From the New York Times:
Homeowners who have fallen behind on their mortgage payments should check their mail carefully in coming weeks. Lenders will be offering loan modifications without even being asked. Under a new Streamlined Modification Initiative announced by the Federal Housing Finance Agency, mortgage servicers must now offer borrowers who are 3 to 24 months delinquent a plan to help avoid foreclosure.
The elimination of paperwork coupled with a proactive approach should benefit borrowers, said Timothy M. Dwyer, the chief executive of Entitle Direct, a direct-to-consumer title insurance company. “All it takes is for the borrower to make that new payment and they’re in the trial period of the program,” he said. “It can’t be any more simple than that. There’s not even a requirement that you sign something, send it in and have it approved.”
Borrowers must make three monthly payments on time before the modification becomes permanent. The program applies to loans owned or guaranteed by Fannie Mae or Freddie Mac. The start date was to be July 1, but an agency spokesman said Fannie and Freddie had already begun the program. It expires Dec. 31, 2015.
William Fischel (Dartmouth - Econ) has posted Fiscal Zoning and Economists' Views of the Property Tax on SSRN. Here's the abstract:
Fiscal zoning is the practice of using local land-use regulation to preserve and possibly enhance the local property tax base. Economists agree that if localities can conduct "perfect zoning," which effectively makes all real estate development decisions subject to a review that balances its benefits and costs to the community, then the local property tax can be converted into a benefit tax and lacks the deadweight loss of taxation. This essay argues that American zoning is closer to this ideal than many other economists think. The practice is often difficult to detect because zoning serves several objectives besides fiscal prudence.
Friday, June 21, 2013
Benny Kass advises a couple who are attempting to gift a $200,000 to their two grandchildren using the annual gift exclusion:
[I]f you decide to go this route, each year you and your wife can gift $56,000 worth of the property to your two granddaughters. If the property value stays under $224,000 — and the current exclusion number stays the same — you can complete the transfer within four years.
[But] in many cases, such a gift could be a disservice to the granddaughters. When you gift them the property, your basis for tax purposes becomes their basis. So if you bought the property for $100,000, that's their basis. If they sell for $300,000 down the road . . . they will have to pay a lot of capital gains tax. [...]
But if you die, and your grandkids inherit the property, under current law they get what is known as the stepped-up basis. In other words, their tax basis is the value of the property on the day you died. So, my firm suggestion: Let them inherit the property, and leave it to them in your wills.
A case out of California:
A California husband and wife deemed the "landlords from hell" by authorities are headed for four years in prison for menacing their tenants, according to authorities.
The landlords' actions ranged from cutting holes in the floor of one victim's living room with a power saw while he was inside the apartment to soaking victims' beds, clothes and electronics with ammonia, according to the San Francisco District Attorney's Office. "The actions of these defendants are so outlandish and brazen that it sounds like the plot line of a horror movie," district attorney George Gascon said in a statement. [...]
The laundry list of offenses the two were accused of also included purchasing a semi-automatic handgun and threatening to shoot the building manager, changing locks, cutting phone lines, shutting off utilities, removing a victims' belongings from their apartment and destroying them, multiple burglaries and threatening letters to victims. [...] The couple were charged with felonies in April 2008, but posted bail and ran away to Italy, authorities said.
Jaime Bouvier (Case Western) has posted The Symbolic Garden: An Intersection of the Food Movement and the First (Maine Law Review) on SSRN. Here's the abstract:
is communicated when a neighbor raises raspberries instead of roses on
the porch trellis, grows lacinato kale rather than creeping bentgrass in
the front yard, or keeps Buckeye hens rather than a Bulldog? This essay
asserts that these and other urban agricultural practices are
expressive, that they are not just ends in themselves but are
communicative acts. These acts are intended to educate neighbors, assert
a viewpoint, establish identity, and are widely viewed as symbols of
support for a social and political movement, what Michael Pollan has
dubbed the “Food Movement.” And, as symbolic acts, they deserve
protection under the First Amendment.
This article will first examine the recognition of the Food Movement as a social and political movement. It will then look at how gardens and other urban homesteading practices, like raising chickens and bees, are broadly asserted and accepted as symbols of the Food Movement. Finally, it will assess how First Amendment principles will apply to these urban agricultural practices and the degree of constitutional protection they should receive.
Thursday, June 20, 2013
The National Trust for Historic Preservation has released its 26th annual list of America's most endangered historic places. Many regard this list as the preservation community's most effective tool for mobilizing constituencies to save the country's threatened places. This year's list includes the Houston Astrodome, the Pan Am Terminal at JFK Airport, and the Village of Mariemont, Ohio -- one of the country's first planned communities. Here's the list.
(pic: One of Montana's Historic Rural Schoolhouses)
Abraham Bell (San Diego) has posted An Economic Analysis of Territorial Sovereignty in International Law (Book Chapter) on SSRN. Here's the abstract:
laws of territorial sovereignty are among the earliest to have been
developed in modern international law, and are among the most important.
While this would seem to indicate the potential attractiveness of
normative economic analyses of the laws of territorial sovereignty,
there is unfortunately little scholarship on territorial sovereignty law
that utilizes the insights of economic analysis.
This essay aims to begin filling that gap by utilizing insights from a related field of private law: property. The doctrines of territorial sovereignty bear a strong resemblance to the laws of property in municipal law. Territorial sovereignty, like property; contains rules of acquisition, transfer, and abandonment. It uses chains of title to evaluate claims, and adopts standard property maxims such as nemo dat quod non habet, (one cannot transfer what one does not have). The Essay presents several areas of research in the field of property law that can fruitfully be incorporated into economic analysis of territorial sovereignty, and suggests the means for incorporating the insights.
Unfortunately, economic analysis of property law can only partially fill the gaps in analysis of territorial sovereignty. Many of the concerns of the law of territorial sovereignty differ significantly from those of property. The Essay, thus, considers future potential directions for research, and concludes with observations on the limitations of the analogy between property and territorial sovereignty.
Wednesday, June 19, 2013
My quest to destroy Bikeshare programs is finally gaining some adherents. Although I appreciate the anger in this video from the Wall Street Journal, I wish Ms. Rabinowitz had stayed away from sweeping generalization about "totalitarians" and gotten a little farther into the real policy issues of costs v. benefits.
Darren Prum (Florida State) & Tetsuo Kobayashi (Florida State - Geography) have posted Green Building Geography Across the United States: Does Governmental Incentives or Economic Growth Stimulate Construction? on SSRN. Here's the abstract:
As green building activity continues to rise across the country, some state governments decided to create incentives that would motivate developers to voluntarily pursue third party certification for their real estate projects in order to assist in meeting sustainability and environmental goals. Despite the growing number of studies in green buildings, the geography of green buildings and sustainable construction only includes a few studies, which emphasize the lack of green building research from the spatial perspective and their relevance to public policies the lack of green building research from the spatial perspective and their relevance to public policies. This study analyses spatial distributions of certified green buildings in relation to governmental incentives deemed necessary to further environmentally friendly public policies that embrace sustainable construction practices while applying a regression analysis over time to determine the impact of such a course of action in relation to economic growth. This study focuses on each of the six states that applied tax incentives. The regression analysis between the number of certified green buildings and Gross Domestic Product in each state shows positive correlation between the two indicating an economic growth is a significant factor to explain the growth in green buildings.
Tuesday, June 18, 2013
Ilya Somin offers a brief update on the fate of the Private Property Rights Protection Act:
Last week, the House Judiciary Committee passed the Private Property Rights Protection Act, which would prevent local governments that engage in Kelo-style economic development takings from receiving federal economic development funds. As I explained in a post last year (which explains the bill in more detail), this legislation has been kicking around Congress since 2005. At various times, it has passed the House only to die in the Senate. If it finally passes both houses this time around, it will be a useful, though limited step towards disincentivizing abusive takings that transfer property to powerful private interests, often without actually producing the promised economic benefits for the region.
Why has the PRPA failed to pass for so long, despite overwhelming public opposition to Kelo-style takings? Various factors play a role. But a big one is political ignorance, of the same type that has led to enactment of many ineffective “reforms” at the state level. Most voters are unaware of the PRPA and don’t keep track of its legislative fortunes.Most voters are rationally ignorant and and devote only a very limited amount of time and effort to following political issues. Since the PRPA is not one of the top handful of issues on the political agenda, the public knows little about it and Congress can sit on it for years with little fear of punishment at the ballot box. Meanwhile, many local governments go on taking property for the benefit of private interest groups, while at the same time also collecting federal economic development funds. This is just one relatively small example of the broader problem of political ignorance discussed in my forthcoming book Democracy and Political Ignorance.
The "Atlas of True Names" reveals the etymological roots, or original meanings, of the familiar terms on today’s maps. For instance, where you would normally expect to see the Sahara indicated, the Atlas gives you “The Tawny One”, derived from Arabis word es-sahra, meaning “the fawn coloured."
(HT: Joseph Blocher)