Decided April 23, 2002
Justice Stevens delivered the opinion of the Court.
The question presented is whether a moratorium on development imposed during the process of devising a comprehensive land-use plan constitutes a per se taking of property requiring compensation under the Takings Clause of the United States Constitution. This case actually involves two moratoria ordered by respondent Tahoe Regional Planning Agency (TRPA) to maintain the status quo while studying the impact of development on Lake Tahoe and designing a strategy for environmentally sound growth. The first, Ordinance 815, was effective from August 24, 1981, until August 26, 1983, whereas the second more restrictive Resolution 8321 was in effect from August 27, 1983, until April 25, 1984. As a result of these two directives, virtually all development on a substantial portion of the property subject to TRPAs jurisdiction was prohibited for a period of 32 months. Although the question we decide relates only to that 32-month period, a brief description of the events leading up to the moratoria and a comment on the two permanent plans that TRPA adopted thereafter will clarify the narrow scope of our holding.
The relevant facts are undisputed. All agree that Lake Tahoe is uniquely beautiful, that President Clinton was right to call it a national treasure that must be protected and preserved, and that Mark Twain aptly described the clarity of its waters as not merely transparent, but dazzlingly, brilliantly so(quoting M. Twain, Roughing It (1872)).
Lake Tahoe's exceptional clarity is attributed to the absence of algae that obscures the waters of most other lakes. Historically, the lack of nitrogen and phosphorous, which nourish the growth of algae, has ensured the transparency of its waters. Unfortunately, the lakes pristine state has deteriorated rapidly over the past 40 years; increased land development in the Lake Tahoe Basin (Basin) has threatened the noble sheet of blue water beloved by Twain and countless others. As the District Court found, [d]ramatic decreases in clarity first began to be noted in the 1950s/early 1960s, shortly after development at the lake began in earnest. The lakes unsurpassed beauty, it seems, is the wellspring of its undoing.
The upsurge of development in the area has caused increased nutrient loading of the lake largely because of the increase in impervious coverage of land in the Basin resulting from that development.
Impervious coverage such as asphalt, concrete, buildings, and even packed dirtprevents precipitation from being absorbed by the soil. Instead, the water is gathered and concentrated by such coverage. Larger amounts of water flowing off a driveway or a roof have more erosive force than scattered raindrops falling over a dispersed areaespecially one covered with indigenous vegetation, which softens the impact of the raindrops themselves.Given this trend, the District Court predicted that unless the process is stopped, the lake will lose its clarity and its trademark blue color, becoming green and opaque for eternity.
Those areas in the Basin that have steeper slopes produce more runoff; therefore, they are usually considered high hazard lands. Moreover, certain areas near streams or wetlands known as Stream Environment Zones (SEZs) are especially vulnerable to the impact of development because, in their natural state, they act as filters for much of the debris that runoff carries. Because [t]he most obvious response to this problem is to restrict development around the lakeespecially in SEZ lands, as well as in areas already naturally prone to runoff, conservation efforts have focused on controlling growth in these high hazard areas.
In the 1960s, when the problems associated with the burgeoning development began to receive significant attention, jurisdiction over the Basin, which occupies 501 square miles, was shared by the States of California and Nevada, five counties, several municipalities, and the Forest Service of the Federal Government. In 1968, the legislatures of the two States adopted the Tahoe Regional Planning Compact, which Congress approved in 1969. The compact set goals for the protection and preservation of the lake and created TRPA as the agency assigned to coordinate and regulate development in the Basin and to conserve its natural resources.
Pursuant to the compact, in 1972 TRPA adopted a Land Use Ordinance that divided the land in the Basin into seven land capability districts, based largely on steepness but also taking into consideration other factors affecting runoff. Each district was assigned a land coverage coefficienta recommended limit on the percentage of such land that could be covered by impervious surface. Those limits ranged from 1% for districts 1 and 2 to 30% for districts 6 and 7. Land in districts 1, 2, and 3 is characterized as high hazard or sensitive, while land in districts 4, 5, 6, and 7 is low hazard or non-sensitive. The SEZ lands, though often treated as a separate category, were actually a subcategory of district 1.
Unfortunately, the 1972 ordinance allowed numerous exceptions and did not significantly limit the construction of new residential housing. California became so dissatisfied with TRPA that it withdrew its financial support and unilaterally imposed stricter regulations on the part of the Basin located in California. Eventually the two States, with the approval of Congress and the President, adopted an extensive amendment to the compact that became effective on December 19, 1980.
The 1980 Tahoe Regional Planning Compact (Compact) redefined the structure, functions, and voting procedures of TRPA, and directed it to develop regional environmental threshold carrying capacitiesa term that embraced standards for air quality, water quality, soil conservation, vegetation preservation and noise. The Compact provided that TRPA shall adopt those standards within 18 months, and that [w]ithin 1 year after their adoption, it shall adopt an amended regional plan that achieves and maintains those carrying capacities. The Compact also contained a finding by the Legislatures of California and Nevada tha in order to make effective the regional plan as revised by [TRPA], it is necessary to halt temporarily works of development in the region which might otherwise absorb the entire capability of the region for further development or direct it out of harmony with the ultimate plan. Accordingly, for the period prior to the adoption of the final plan (or until May 1, 1983, whichever is earlier), the Compact itself prohibited the development of new subdivisions, condominiums, and apartment buildings, and also prohibited each city and county in the Basin from granting any more permits in 1981, 1982, or 1983 than had been granted in 1978.
During this period TRPA was also working on the development of a regional water quality plan to comply with the Clean Water Act. Despite the fact that TRPA performed these obligations in good faith and to the best of its ability, after a few months it concluded that it could not meet the deadlines in the Compact. On June 25, 1981, it therefore enacted Ordinance 815 imposing the first of the two moratoria on development that petitioners challenge in this proceeding. The ordinance provided that it would become effective on August 24, 1981, and remain in effect pending the adoption of the permanent plan required by the Compact.
The District Court made a detailed analysis of the ordinance, noting that it might even prohibit hiking or picnicking on SEZ lands, but construed it as essentially banning any construction or other activity that involved the removal of vegetation or the creation of land coverage on all SEZ lands, as well as on class 1, 2, and 3 lands in California. Some permits could be obtained for such construction in Nevada if certain findings were made.It is undisputed, however, that Ordinance 815 prohibited the construction of any new residences on SEZ lands in either State and on class 1, 2, and 3 lands in California.
Given the complexity of the task of defining environmental threshold carrying capacities and the division of opinion within TRPAs governing board, the District Court found that it was unsurprising that TRPA failed to adopt those thresholds until August 26, 1982, roughly two months after the Compact deadline. Under a liberal reading of the Compact, TRPA then had until August 26, 1983, to adopt a new regional plan. Unfortunately, but again not surprisingly, no regional plan was in place as of that date. TRPA therefore adopted Resolution 8321, which completely suspended all project reviews and approvals, including the acceptance of new proposals, and which remained in effect until a new regional plan was adopted on April 26, 1984. Thus, Resolution 8321 imposed an 8-month moratorium prohibiting all construction on high hazard lands in either State. In combination, Ordinance 815 and Resolution 8321 effectively prohibited all construction on sensitive lands in California and on all SEZ lands in the entire Basin for 32 months, and on sensitive lands in Nevada (other than SEZ lands) for eight months. It is these two moratoria that are at issue in this case....
On the same day that the 1984 plan was adopted, the State of California filed an action seeking to enjoin its implementation on the ground that it failed to establish land-use controls sufficiently stringent to protect the Basin. Id., at 1236. The District Court entered an injunction that was upheld by the Court of Appeals and remained in effect until a completely revised plan was adopted in 1987. Both the 1984 injunction and the 1987 plan contained provisions that prohibited new construction on sensitive lands in the Basin. As the case comes to us, however, we have no occasion to consider the validity of those provisions.
Approximately two months after the adoption of the 1984 Plan, petitioners filed parallel actions against TRPA and other defendants in federal courts in Nevada and California that were ultimately consolidated for trial in the District of Nevada. The petitioners include the Tahoe Sierra Preservation Council, a nonprofit membership corporation representing about 2,000 owners of both improved and unimproved parcels of real estate in the Lake Tahoe Basin, and a class of some 400 individual owners of vacant lots located either on SEZ lands or in other parts of districts 1, 2, or 3. Those individuals purchased their properties prior to the effective date of the 1980 Compact, primarily for the purpose of constructing at a time of their choosing a single-family home to serve as a permanent, retirement or vacation residence. When they made those purchases, they did so with the understanding that such construction was authorized provided that they complied with all reasonable requirements for building....
Emphasizing the temporary nature of the regulations, the testimony that the average holding time of a lot in the Tahoe area between lot purchase and home construction is twenty-five years, and the failure of petitioners to offer specific evidence of harm, the District Court concluded that consideration of the Penn Central factors clearly leads to the conclusion that there was no taking. In the absence of evidence regarding any of the individual plaintiffs, the court evaluated the average purchasers intent and found that such purchasers did not have reasonable, investment-backed expectations that they would be able to build single-family homes on their land within the six-year period involved in this lawsuit.
The District Court had more difficulty with the total taking issue. Although it was satisfied that petitioners property did retain some value during the moratoria, it found that they had been temporarily deprived of all economically viable use of their land. The court concluded that those actions therefore constituted categorical takings under our decision in Lucas v. South Carolina Coastal Council (1992)....
Both parties appealed....
Contrary to the District Court, the Court of Appeals held that because the regulations had only a temporary impact on petitioners fee interest in the properties, no categorical taking had occurred. It reasoned:
Property interests may have many different dimensions. For example, the dimensions of a property interest may include a physical dimension (which describes the size and shape of the property in question), a functional dimension (which describes the extent to which an owner may use or dispose of the property in question), and a temporal dimension (which describes the duration of the property interest). At base, the plaintiffs argument is that we should conceptually sever each plaintiffs fee interest into discrete segments in at least one of these dimensions the temporal one and treat each of those segments as separate and distinct property interests for purposes of takings analysis. Under this theory, they argue that there was a categorical taking of one of those temporal segments.The Court of Appeals distinguished Lucas as applying to the relatively rare case in which a regulation denies all productive use of an entire parcel, whereas the moratoria involve only a temporal slice of the fee interest and a form of regulation that is widespread and well established.....
Petitioners make only a facial attack on Ordinance
815 and Resolution 8321. They contend that the mere enactment of a temporary
regulation that, while in effect, denies a property owner all viable economic
use of her property gives rise to an unqualified constitutional obligation
to compensate her for the value of its use during that period. Hence, they
face an uphill battle that is made especially steep by their desire
for a categorical rule requiring compensation whenever the government imposes
such a moratorium on development. Under their proposed rule, there is no
need to evaluate the landowners investment-backed expectations, the actual
impact of the regulation on any individual, the importance of the public
interest served by the regulation, or the reasons for imposing the temporary
restriction. For petitioners, it is enough that a regulation imposes a
temporary deprivationno matter how brief of all economically viable use
to trigger a per se rule that a taking has occurred....
The text of the Fifth Amendment itself provides a basis for drawing a distinction between physical takings and regulatory takings. Its plain language requires the payment of compensation whenever the government acquires private property for a public purpose, whether the acquisition is the result of a condemnation proceeding or a physical appropriation. But the Constitution contains no comparable reference to regulations that prohibit a property owner from making certain uses of her private property. Our jurisprudence involving condemnations and physical takings is as old as the Republic and, for the most part, involves the straightforward application of per se rules. Our regulatory takings jurisprudence, in contrast, is of more recent vintage and is characterized by essentially adhoc, factual inquiries, Penn Central, designed to allow careful examination and weighing of all the relevant circumstances.
When the government physically takes possession of an interest in property for some public purpose, it has a categorical duty to compensate the former owner regardless of whether the interest that is taken constitutes an entire parcel or merely a part thereof. Thus, compensation is mandated when a leasehold is taken and the government occupies the property for its own purposes, even though that use is temporary. Similarly, when the government appropriates part of a rooftop in order to provide cable TV access for apartment tenants, Loretto v. Teleprompter Manhattan CATV Corp. (1982); or when its planes use private airspace to approach a government airport, United States v. Causby (1946), it is required to pay for that share no matter how small. But a government regulation that merely prohibits landlords from evicting tenants unwilling to pay a higher rent, that bans certain private uses of a portion of an owners property, or that forbids the private use of certain airspace, does not constitute a categorical taking. The first category of cases requires courts to apply a clear rule; the second necessarily entails complex factual assessments of the purposes and economic effects of government actions.
This longstanding distinction between acquisitions of property for public use, on the one hand, and regulations prohibiting private uses, on the other, makes it inappropriate to treat cases involving physical takings as controlling precedents for the evaluation of a claim that there has been a regulatory taking, and vice versa. For the same reason that we do not ask whether a physical appropriation advances a substantial government interest or whether it deprives the owner of all economically valuable use, we do not apply our precedent from the physical takings context to regulatory takings claims. Land-use regulations are ubiquitous and most of them impact property values in some tangential wayoften in completely unanticipated ways. Treating them all as per se takings would transform government regulation into a luxury few governments could afford. By contrast, physical appropriations are relatively rare, easily identified, and usually represent a greater affront to individual property rights. This case does not present the classi[c] taking in which the government directly appropriates private property for its own use; instead the interference with property rights arises from some public program adjusting the benefits and burdens of economic life to promote the common good.
Perhaps recognizing this fundamental distinction, petitioners wisely do not place all their emphasis on analogies to physical takings cases. Instead, they rely principally on our decision in Lucas v. South Carolina Coastal Council (1992)a regulatory takings case that, nevertheless, applied a categorical rule to argue that the Penn Central framework is inapplicable here. A brief review of some of the cases that led to our decision in Lucas, however, will help to explain why the holding in that case does not answer the question presented here.
As we noted in Lucas, it was Justice Holmes opinion in Pennsylvania Coal Co. v. Mahon (1922), that gave birth to our regulatory takings jurisprudence. In subsequent opinions we have repeatedly and consistently endorsed Holmes observation that if regulation goes too far it will be recognized as a taking.....In the decades following that decision,we have generally eschewed any set formula for determining how far is too far, choosing instead to engage in essentially ad hoc, factual inquiries. Indeed, we still resist the temptation to adopt per se rules in our cases involving partial regulatory takings, preferring to examine a number of factors rather than a simple mathematically precise formula....
In First English, the Court unambiguously and repeatedly characterized the issue to be decided as a compensation question or a remedial question. And the Courts statement of its holding was equally unambiguous: We merely hold that where the governments activities have already worked a taking of all use of property, no subsequent action by the government can relieve it of the duty to provide compensation for the period during which the taking was effective....To the extent that the Court in First English referenced the antecedent takings question, we identified two reasons why a regulation temporarily denying an owner all use of her property might not constitute a taking. First, we recognized that the county might avoid the conclusion that a compensable taking had occurred by establishing that the denial of all use was insulated as a part of the States authority to enact safety regulations. Second, we limited our holding to the facts presented and recognized the quite different questions that would arise in the case of normal delays in obtaining building permits, changes in zoning ordinances, variances, and the like which [were] not before us. Thus, our decision in First English surely did not approve, and implicitly rejected, the categorical submission that petitioners are now advocating.
Similarly, our decision in Lucas is not dispositive of the question presented. Although Lucas endorsed and applied a categorical rule, it was not the one that petitioners propose. Lucas purchased two residential lots in 1988 for $975,000. These lots were rendered valueless by a statute enacted two years later....The categorical rule that we applied in Lucas states that compensation is required when a regulation deprives an owner of all economically beneficial uses of his land. Under that rule, a statute that wholly eliminated the value of Lucas fee simple title clearly qualified as a taking. But our holding was limited to the extraordinary circumstance when no productive or economically beneficial use of land is permitted....
Certainly, our holding that the permanent obliteration of the value of a fee simple estate constitutes a categorical taking does not answer the question whether a regulation prohibiting any economic use of land for a 32-month period has the same legal effect. Petitioners seek to bring this case under the rule announced in Lucas by arguing that we can effectively sever a 32-month segment from the remainder of each landowners fee simple estate, and then ask whether that segment has been taken in its entirety by the moratoria. Of course, defining the property interest taken in terms of the very regulation being challenged is circular. With property so divided, every delay would become a total ban; the moratorium and the normal permit process alike would constitute categorical takings..... The starting point for the courts analysis should have been to ask whether there was a total taking of the entire parcel; if not, then Penn Central was the proper framework....
Neither Lucas, nor First English, nor any of our other regulatory takings cases compels us to accept petitioners categorical submission. In fact, these cases make clear that the categorical rule in Lucas was carved out for the extraordinary case in which a regulation permanently deprives property of all value; the default rule remains that, in the regulatory taking context, we require a more fact specific inquiry. Nevertheless, we will consider whether the interest in protecting individual property owners from bearing public burdens which, in all fairness and justice, should be borne by the public as a whole, justifies creating a new rule for these circumstances.
Considerations of fairness and justice arguably could support the conclusion that TRPAs moratoria were takings of petitioners property based on any of seven different theories. First, even though we have not previously done so, we might now announce a categorical rule that, in the interest of fairness and justice, compensation is required whenever government temporarily deprives an owner of all economically viable use of her property. Second, we could craft a narrower rule that would cover all temporary land-use restrictions except those normal delays in obtaining building permits, changes in zoning ordinances, variances, and the like.... Third, we could adopt a rule like the one suggested by an amicus supporting petitioners that would allow a short fixed period for deliberations to take place without compensation...after which the just compensation requirements would kick in. Fourth, with the benefit of hindsight, we might characterize the successive actions of TRPA as a series of rolling moratoria that were the functional equivalent of a permanent taking. Fifth, were it not for the findings of the District Court that TRPA acted diligently and in good faith, we might have concluded that the agency was stalling in order to avoid promulgating the environmental threshold carrying capacities and regional plan mandated by the 1980 Compact. Sixth, apart from the District Courts finding that TRPAs actions represented a proportional response to a serious risk of harm to the lake, petitioners might have argued that the moratoria did not substantially advance a legitimate state interest. Finally, if petitioners had challenged the application of the moratoria to their individual parcels, instead of making a facial challenge, some of them might have prevailed under a Penn Central analysis.
As the case comes to us, however, none of the last four theories is available....Recovery under a Penn Central analysis is also foreclosed both because petitioners expressly disavowed that theory, and because they did not appeal from the District Courts conclusion that the evidence would not support it. Nonetheless, each of the three per se theories is fairly encompassed within the question that we decided to answer.
With respect to these theories, the ultimate constitutional question is whether the concepts of fairness and justice that underlie the Takings Clause will be better served by one of these categorical rules or by a Penn Central inquiry into all of the relevant circumstances in particular cases. From that perspective, the extreme categorical rule that any deprivation of all economic use, no matter how brief, constitutes a compensable taking surely cannot be sustained. Petitioners broad submission would apply to numerous normal delays in obtaining building permits, changes in zoning ordinances, variances, and the like, as well as to orders temporarily prohibiting access to crime scenes, businesses that violate health codes, fire-damaged buildings, or other areas that we cannot now foresee. Such a rule would undoubtedly require changes in numerous practices that have long been considered permissible exercises of the police power. As Justice Holmes warned in Mahon, [g]overnment hardly could go on if to some extent values incident to property could not be diminished without paying for every such change in the general law. A rule that required compensation for every delay in the use of property would render routine government processes prohibitively expensive or encourage hasty decision-making. Such an important change in the law should be the product of legislative rulemaking rather than adjudication....
Indeed, the interest in protecting the decisional process is even stronger when an agency is developing a regional plan than when it is considering a permit for a single parcel. In the proceedings involving the Lake Tahoe Basin, for example, the moratoria enabled TRPA to obtain the benefit of comments and criticisms from interested parties, such as the petitioners, during its deliberations. Since a categorical rule tied to the length of deliberations would likely create added pressure on decisionmakers to reach a quick resolution of land-use questions, it would only serve to disadvantage those landowners and interest groups who are not as organized or familiar with the planning process. Moreover, with a temporary ban on development there is a lesser risk that individual landowners will be singled out to bear a special burden that should be shared by the public as a whole. At least with a moratorium there is a clear reciprocity of advantage, because it protects the interests of all affected landowners against immediate construction that might be inconsistent with the provisions of the plan that is ultimately adopted. While each of us is burdened somewhat by such restrictions, we, in turn, benefit greatly from the restrictions that are placed on others....
It may well be true that any moratorium that lasts for more than one year should be viewed with special skepticism. But given the fact that the District Court found that the 32 months required by TRPA to formulate the 1984 Regional Plan was not unreasonable, we could not possibly conclude that every delay of over one year is constitutionally unacceptable.....We conclude, therefore, that the interest in fairness and justice will be best served by relying on the familiar Penn Central approach when deciding cases like this, rather than by attempting to craft a new categorical rule.
Chief Justice Rehnquist, with whom Justice Scalia and Justice Thomas join, dissenting.
For over half a decade petitioners were prohibited from building homes, or any other structures, on their land. Because the Takings Clause requires the government to pay compensation when it deprives owners of all economically viable use of their land, and because a ban on all development lasting almost six years does not resemble any traditional land-use planning device, I dissent....
I now turn to determining whether a ban on all economic development lasting almost six years is a taking. Lucas reaffirmed our frequently expressed view that when the owner of real property has been called upon to sacrifice all economically beneficial uses in the name of the common good, that is, to leave his property economically idle, he has suffered a taking....But the Court refuses to apply Lucas on the ground that the deprivation was temporary.
Neither the Takings Clause nor our case law supports such a distinction. For one thing, a distinction between temporary and permanent prohibitions is tenuous. The temporary prohibition in this case that the Court finds is not a taking lasted almost six years. The permanent prohibition that the Court held to be a taking in Lucas lasted less than two years. The permanent prohibition in Lucas lasted less than two years because the law, as it often does, changed. Land-use regulations are not irrevocable. And the government can even abandon condemned land. Under the Courts decision today, the takings question turns entirely on the initial label given a regulation, a label that is often without much meaning. There is every incentive for government to simply label any prohibition on development temporary, or to fix a set number of years. As in this case, this initial designation does not preclude the government from repeatedly extending the temporary prohibition into a long-term ban on all development. The Court now holds that such a designation by the government is conclusive even though in fact the moratorium greatly exceeds the time initially specified. Apparently, the Court would not view even a 10-year moratorium as a taking under Lucas because the moratorium is not permanent.....
More fundamentally, even if a practical distinction between temporary and permanent deprivations were plausible, to treat the two differently in terms of takings law would be at odds with the justification for the Lucas rule. The Lucas rule is derived from the fact that a total deprivation of use is, from the landowners point of view, the equivalent of a physical appropriation. The regulation in Lucas was the practical equivalence of a long-term physical appropriation, i.e., a condemnation, so the Fifth Amendment required compensation. The practical equivalence, from the landowners point of view, of a temporary ban on all economic use is a forced leasehold. For example, assume the following situation: Respondent is contemplating the creation of a National Park around Lake Tahoe to preserve its scenic beauty. Respondent decides to take a 6-year leasehold over petitioners property, during which any human activity on the land would be prohibited, in order to prevent any further destruction to the area while it was deciding whether to request that the area be designated a National Park.
Surely that leasehold would require compensation. From petitioners standpoint, what happened in this case is no different than if the government had taken a 6-year lease of their property. The Court ignores this practical equivalence between respondents deprivation and the deprivation resulting from a leasehold. In so doing, the Court allows the government to do by regulation what it cannot do through eminent domain, i.e., take private property without paying for it....
Justice Thomas, with whom Justice Scalia joins, dissenting.
A taking is exactly what occurred in this case. No one seriously doubts that the land use regulations at issue rendered petitioners land unsusceptible of any economically beneficial use. This was true at the inception of the moratorium, and it remains true today. These individuals and families were deprived of the opportunity to build single-family homes as permanent, retirement, or vacation residences on land upon which such construction was authorized when purchased. The Court assures them that a temporary prohibition on economic use cannot be a taking because logically . . . the property will recover value as soon as the prohibition is lifted. But the logical assurance that a temporary restriction . . . merely causes a diminution in value is cold comfort to the property owners in this case or any other. After all, [i]n the long run we are all dead.
I would hold that regulations prohibiting all productive uses of property are subject to Lucas per se rule, regardless of whether the property so burdened retains theoretical useful life and value if, and when, the temporary moratorium is lifted. To my mind, such potential future value bears on the amount of compensation due and has nothing to do with the question whether there was a taking in the first place. It is regrettable that the Court has charted a markedly different path today.
Exploring Constitutional Conflicts