Takings of Private Property

The Issue:  The Fifth Amendment provides that private property shall not be taken without just compensation.  What actions of government constitute "takings"?
Introduction

The Takings Clause of the Fifth Amendment is one of the few provisions of the Bill of Rights that has been given a broader interpretation under the Burger and Rehnquist courts than under the Warren Court.  It is a clause near and dear to the heart of free market conservatives.

Only certain types of takings cases present serious interpretive questions.  It is clear that when the government physically seizes property (as for a highway or a park, for example) that it will have to pay just compensation.  It is also clear that serious, sustained physical invasions of property (as in the case of low overflying aircraft, for example) require payment of compensation equal to the difference between the market value before and after the invasion.  The difficult cases are generally those where government regulations, enacted to secure some sort of public benefit, fall disproportionately on some property owners and cause significant dimunition of property value.

The Court has had a difficult time articulating a test to determine when a regulation becomes a taking.  It has said there is "no set formula" and that courts "must look to the particular circumstances of the case."  The Court has identified some relevant factors to consider: the economic impact of the regulation, the degree to which the regulation interferes with investor-backed expectations, and the character of the government action.  Still, as our cases suggest, there is a lot of room for argument as to how these various factors should be weighed.

Cases

Penn Central v. New York City (1978) 
Dolan v. City of Tigard (1994)
Lucas v. South Carolina Coastal Com'n. (1992)
Tahoe Preservation Council v Tahoe Regional Planning Agency (2002)
Kelo v City of New London (2005)


David Lucas on his South Carolina property that the Supreme Court concluded was "taken."

Supreme Court Determines What is "a Public Use"


Homes in a New London, Conn. neighborhood that stand to be torn down
after the city won its case before the U. S. Supreme Court
In June 2005, the Supreme Court decided an important case involving the meaning of "public use" in the Fifth Amendment.  In Kelo v City of New London, the Court, voting 5 to 4, upheld a city plan to condemn homes in a 90-acre blue-collar residential neighborhood.  New London plans to give the land to a developer for $1, with a 99-year lease, to build a waterfront hotel, office space, and higher-end housing.  Justice Stevens, writing for the Court, found this donation of property to a developer to be a "public use." Stevens said that the Court's jurisprudence gave government "broad latitude" to determine what uses might be "public." In a concurring opinion, Justice Kennedy indicated that the Court still stood willing to review on constitutional grounds takings that are arguably simply the city favoring one private owner over another, rather than takings based on a good faith analysis of the public interest.  Angry property rights advocates reacted to the decision by suggesting that local governments consider condemning the homes of justices in the majority and turning them over to private developers for construction of B & Bs.
The Takings Clause 
Private property shall not be taken for a public use, without just compensation.

New York's Grand Central Station, the focus of attention in the Penn Central case.   

Questions
1. Should affected individuals or corporations be compensated whenever the actions of government diminish property values?  If so, should people whose property values have increased as the result of governmental action have to cough up the increase?
2.  What do you think about the desirability of a rule that requires the payment of just compensation whenever governmental action causes a dimunition in value greater than a certain amount, say 10%? 50%?
3.  Should the requirement of just compensation depend upon whether the government was taking action to prevent a harm or to secure a public benefit?
4.  Lucas contended that the action of the S. C. Coastal Commission rendered his property valueless?  Is this true? What value might it have? (In oral argument, Justice Blackmun asked the attorney for Lucas: "If the property has no value, will you give it to me?")
5.  What options does South Carolina have after the Court's decision in Lucas?
6. Is Dolan just an "exactions" case, or does it have significance for other types of takings cases?
7. Does the "rough proportionality" test of Dolan strike you as one that courts will find easy to administer?
8. What is the "private property" that government may not take without just compensation?  Does it include personal property such as a car? Does it include intellectual property such as rights under copyright law in a song?
9.  Presumably, if the use for which property is taken is not "public," the taking violates the Constitution--even if compensation is paid.  What might be examples of non-public uses? May the government condemn property and turn it over to a private developer?
10. If a 32-month moratorium on all development is not enough to be a per se taking (see Tahoe Preservation Council), what about a 10-year moratorium?  Is the majority right is applying the Penn Central analysis to all bans on development called "temporary" by regulators?
Supreme Court Says When Government Adds More Beach,
 It Can Claim the New Land

The beachfront in Destin, Florida at issue in Stop the Beach Nourishment vs Florida
After the State of Florida spent millions widening beaches to protect against shoreline erosion, a group of oceanfront owners in Destin sued, arguing that the new 75-foot strip of sand should be theirs, and not the government.  The landowners argued that the Florida courts had redefined their land boundaries, which used to extend all the way to the tide line, in such a way as to constitute a taking of their property.  The Court, 8 to 0 (Justice Stevens not participating because he owned a Florida oceanfront condo), held that the state's actions were not a taking requiring compensation to the owners, noting that the beach erosion project could be seen as an attempt to preserve property values.  The Court split 4 to 4 on the question of whether courts could ever be financially liable for a taking.  (Stop the Beach Renourishment vs Florida Dep't of Environmental Protection (2010).)

Links
Most sites reflect the interests of property rights groups and endorse a broad interpretation of "takings"
Protecting Private Property (Cato Institute)
Regulatory Takings and Private Property (Public Eye)
Endangered Species and Takings
Taking Homes for a Private Developer: Kelo v City of New London (2005)

STEVENS
SOUTER
BREYER
GINSBURG
KENNEDY
5
TO
4
O'CONNOR
REHNQUIST
SCALIA
THOMAS
The Court, on a 5 to 4 vote, held that a city's plan to condemn homes in a residential neighborhood and give the acreage to a private developer for $1 for a 99-year lease to create an upscale development did not violate the Fifth Amendment's requirement that takings of property be for "a public purpose."  (Of course, as provided by the Fifth Amendment, the government had to provide "just compensation" for the taking.
 
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