Class 4: Eminent Domains and Regulatory Takings Flashcards
Review: What is exclusionary zoning
Is proof of discriminatory effect enough?
Is historical pattern of zoning enough to show a discriminatory motive?
All zoning is exclusionary to a degree.
Exclusionary zoning is when: restrictive measures that aim to close an entire community to unwanted groups – typically people of low income who don’t contribute much to the tax base and who use a lot of government services.
No, proof of discriminatory effect is not enough. It must show a racially discriminatory motive.
It can. This can be shown by a historical pattern of zoning in the community, from the history behind the challenged ordinance, to departures from standard policies, and, of course, by actual discriminatory comments on the record (which are rare).
Review: Hypo
Acme Housing, a non-profit corporation, wants to build a federally subsidized low-income housing project in Valleytown, an affluent, nearly-all-white suburb.
Valleytown refuses to rezone the site of the proposed project from single-family residential to multi-family, mainly because the property values near the project would drop sharply. A majority of the families who would qualify for the housing project are African-American.
If the zoning scheme is attacked in U.S. federal court for being exclusionary and in violation of the constitution, who will prevail?
A) Acme housing, because the exclusionary zoning and refusal to rezone has a racially discriminatory effect.
B) Acme housing, because the exclusionary zoning and refusal to rezone is sufficient evidence of a racially discriminatory intent.
C) Valleytown, because there is insufficient evidence of a racially discriminatory intent, and discriminatory effect alone is not enough.
D) ACME Housing, because the exclusionary zoning and refusal to rezone does not substantially advance a legitimate public interest.
Answer:
A= Effect is not enough so wrong.
B= Refusal to rezone is not enough for intent.
C================ is Correct.
D= Does not relate.
New Content: Taking has two general ideas
Eminent Domain
Regulatory Takings
Explain both.
Eminent Domain: Intentional action by the government to take property for public use and pay the owner.
Regulatory Takings: Government intends to regulate property but does not take it. Thus the property owner would need to try and sue for money and say it constituted a taking. Basically for RT’s the government doesn’t want to pay you.
These regulations typically relate to zoning ordinates or states that limit ability of your property.
Under the constitution what are the two requirements needed for eminent domain?
- Public use
- Just compensation
Issues arise heavily about what are “public use” part
Talk about the public use part for eminent domain.
Clear public uses are not problems (making a highway)
But sometimes the government may take your property and give it to another private party.
Example: Amazon wants to invest 50m into your community. The government wants this, so it will take your land and give to Amazon under eminent domain.
Kelo v City of London
Facts: They took property using eminent domain.
Issue:
What is the rule for takings and public use?
What is the “ends-justify-the-means-test” for public use?
Ratio: Government cannot take property if it is not for public use even if just compensation is paid.
As long as your purpose is legitimate, a court won’t get involved and thus will be a public use.
This case really BROADENED the public use rule.
If something “might’ benefit the country, is this enough for eminent domain?
Yes under federal law. The public use requirement is very very broad, and even a chance of benefit of public use is enough.
What happened after the Kelo case in regards to public use and eminent domains for states?
States have created rules that is more restrictive so that this doesn’t happen in comparison to federal law.
What does just compensation mean for eminent domain?
Does sentimental or personal value come into play?
What are factors for finding Fair market value?
Fair market value of the property measured upon the properties highest and best use
(aka if it was residential I give you 1m, but if you can make it commercial, I’ll give you 5m)
Court rejected any idea of personal value.
Past sales, recent sales etc.
Hypo: He will not ask a question on this.
You own two 10-acre parcels, and the local government decides to condemn one of the parcels and take it through eminent domain. The government’s use of that “taken” 10-acre parcel will substantially reduce the value of the other 10-acre parcel still in your hands.
How is just compensation computed in this situation?
What if the “taking” reduced the amount the other parcel appreciated in value, but did not reduce its actual value?
(aka because you had two parcels side-by-side they went more in value, but now because one is gone, it goes down)
Substantial reduction of value is compensable. (Trivial reduction is not.)
State v. Doyle states that “loss of appreciation of property is compensable if it represents value that would have been realized as of the date of taking, if the taking had not occurred.”
Hypo:
Conservatown seeks to use its condemnation powers to take your property. Your property is currently zoned for any type of use (industrial, commercial, residential).
The town does not want to pay the market rate for your very flexibly zoned property, so they change the zoning ordinance to zone your property (and other property around it) as residential only, which will reduce its FMV because it can’t be used commercially.
What’s the just compensation here?
The vast majority rule is that an ordinance enacted solely to reduce a municipality’s acquisition costs is invalid.
But, practically, the condemnee faces a considerable burden in proving that the ordinance has no other legitimate purpose behind it.
Regulatory takings: What is this?
What is the key issue here?
Opposite of eminent domain.
Government intends to regulate the property and does not pay.
This would mean the owner has to sue and try and say this regulation amounted to a taking.
Key issue is whether a taking has occurred because of the governments regulation. Thus, it is more than a mere regulation and is now a taking.
x
x
Penn Central Case
Facts: Had a landmark and needed permission to modify it. They sue government because of regulations.
Issue: They argued because they couldn’t build upwards it was a taking.
1) Court created three factors to determine if it was a regulation or regulatory taking (Change in value, how much did it interfere with exepections and the character of the government action)
Explain these ideas.
Ad hoc balancing Factors
- Diminution in value because of regulation (just one factor)
- How much has the regulation interfered with distinct investment-backed expectations?
In Penn Central, the regulation still permitted the intended use of Penn Central’s initial investment – to use Grand Central as a railway station.
Put another way, the regulation only prohibited other uses – not the main reason the investment was undertaken.
- Character of the Gov’t action/regulation
This regulation had extensive provisions allowing for transferring of the property rights to an adjacent property. Thus, Penn Central received some benefit from the regulation for its other – non-landmark properties.
Hypo:
The City of Callaway enacted a statute that prohibits building additionally stories on historic landmarks without prior approval from the Historic Preservation Control Board. The statute then designates 100 properties as Callaway landmarks. Thereafter, Kyle, a Trump-like developer, buys one of the commercial buildings that is designated as a landmark. He wants to build a 50-story building on top of the existing landmark structure. The Board, however, denies all of his proposals, so Kyle sues, saying that landmark statute is a taking.
Does the fact that the statute was enacted before Kyle bought the property preclude a takings claim?
No. Notice of a statute does not prohibit a takings claim. Notice of a restriction does not make a statute any less unconstitutional if the court deems it so. But it would be a factor in the ad hoc balancing.
