Regulatory Takings

Question 1

• Penn Central v. City of New York – S. Ct. (1978)

Answer 1

• Penn Central v. City of New York – S. Ct. (1978) “Grand Central Landmark”
o F: P wants to build 55 story skyscraper atop Grand Central, argues that application of Landmark Act is unconstitutional taking of air rights
 Relied on Pennsylvania Coal to argue that the police power used for aesthetic purposes (landmark act) doesn’t actually provide public benefit as historical preservation is not necessary
o H: For D; this doesn’t completely eliminate the value of the property, thus not a taking

• Test that emerges after Penn Central:
o 1. Is the regulation a per se taking?
o 2. If not, consider the Penn Central factors – is there an unfair burden on the property owner?

Question 2

 Two theories of per se regulatory taking:

Answer 2

• Completely irrational or biased/corrupt statute = regulatory taking OR
• Eliminates value of the property completely = regulatory taking (see Lucas, infra)

Question 3

Penn Central Factors

Answer 3

 Factors:
• Economic impact of the regulation on the claimant
• Extent to which the regulation has interfered with distinct investment-backed expectations
• Character of the governmental action (is there a physical invasion, e.g. Loretto)
 Applying factors:
• No significant economic impact because air rights could be transferred elsewhere; could also be sold (thus there was still value)
• There were some investment backed expectations, but construction hadn’t actually begun

Question 4

• Key property concept:

Answer 4

one person (party) shouldn’t have to bear the entire cost of a public benefit

Question 5

• Test that emerges after Penn Central:

Answer 5

o 1. Is the regulation a per se taking?

o 2. If not, consider the Penn Central factors – is there an unfair burden on the property owner?

Question 6

• Lucas v. South Carolina Coastal Council – S. Ct. (1992) “Beachfront Taking”

Answer 6

o F: Statute imposes permanent moratorium on development of P’s land, which P had bought in order to build homes on (area was dedicated to be residential subdivision; houses existed on adjacent lots); Statute provides no exception provisions
 Purpose of statute- protect from erosion; response to threat of public nuisance (overdevelopment); threatens the beach resources which amounts to “serious public harm” (trial ct. finding)
o H: For P – this is a regulatory taking and requires compensation
 Total taking – moratorium deprives the land of any economic value
• Objection – there are still other uses, just can’t build a home on it
 Not a noxious use – use of the property itself is not offensive to the public, the area had already been developed and zoned residential
• Thus not a common law nuisance
o Penn Central analysis probably still produced same result

Question 7

• Regulatory Takings after Lucas

Answer 7

o 1. Is there physical invasion of property? (Loretto)
o 2. Has regulation denied all economically beneficial/productive use of land?
 If value is zero: is it a common law nuisance?
• If yes  not a taking
• If no  regulatory taking, requiring compensation

Question 8

• Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency – S. Ct. (2002)

Answer 8

o F: Temporary moratorium on development in Lake Tahoe due to deterioration of the Lake – forming–> losing its blue water color
o I: Does (temporary) moratorium on development constitute per se taking?
o H: No, not a taking
 Revives Penn Central framework because there was not a total taking here
 Not entitled to relief under Penn Central framework
 Moratoria were essential tools of successful development; requiring compensation during any moratorium would put negative pressure on agency to rush the planning process  public policy counsels against this (want productive development)
o Rehnquist dissent – says this is an extraordinary situation which does represent a taking: “ban on all development lasting almost six years does not resemble any traditional land-use planning device”