Balancing Private Property Rights and the Public Interest

1. Balancing Private Property Rights and the Public Interest Rebecca Roberts

4. Property rights issue • Societal goals are sometimes pursued through government restrictions on the use of private property.

5. Political momentum • Increasing government regulation of private property. • Supreme Court protections for private property are tightening. • Strong cultural meaning founded in American concepts of freedom, liberty and citizenship.

6. Property rights movement • Supporters: • Seek to reduce government regulation of land • Landowners • Industries with direct economic interest • Conservatives, libertarians and other related political platforms

7. Property rights movement • Opponents: • Recognize societal benefit of government ability to regulate private property use • Environmentalists • State and local government • Planners, preservationists, scientists • Civil rights, public health, etc.

8. Legal basis • Takings Clause of the U.S. Constitution provides legal basis for land laws. • Public policies that affect property rights are created locally. • Court decisions outline principles for balancing public and private interests in land.

9. 5th Amendment • “…nor shall private property be taken for public use without just compensation.” • 5th Amendment, U.S. Constitution, (1791) • Reiterated in Wisconsin Constitution

10. 5th Amendment Recognizes: • Private property ownership • Eminent domain • “Takings” • Requirement for just compensation

11. Real property ownership • Real property • Physical land, improvements, vegetation, subsurface minerals, water rights

12. Real property ownership • Fee simple absolute Fee simple interest in real property is three-dimensional, extending within the bounds of the parcel perimeter upward and downward, and indefinitely into the future

13. Real property ownership • Land ownership has been described as a “bundle of divisible rights” • Owner may divide fee simple: • Physical partition • Usage rights • Time

14. Real property ownership • Green sticks = right to make profitable or pleasurable use of land • Red sticks = duties of real property ownership • Nuisance • Property taxation • Public regulation

15. Real property ownership • Society creates and defines property rights. • Social, technological economic and political changes constantly “redefine” property rights. • Slavery • Civil rights • Airplanes

16. Eminent domain • Eminent domain = state and local governments have authority to acquire private property for public use.

17. Takings • Taking = an unconstitutional government appropriation of private property rights. • Each of the notable takings cases has a lesson.

18. Evolution of takings law 3 types of takings claims: • Physical invasions • Compelled dedications • Regulatory measures

19. Physical invasions • Physical occupation by a governmental unit or the public is a taking per se, even if the occupation is temporary or minimal. • Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982)

20. Required dedications • “Essential nexus” test = exactions or conditions on development must be related to policy objectives and project impacts. • Nollan v. California Coastal Commission, 483 U.S. 825 (1987)

21. Required dedications • “Rough proportionality” test = exactions or conditions on development must be proportional to the particular harm posed by the development. • Dolan v. City of Tigard, 512 U.S. 374 (1994)

22. Regulatory takings • Regulations may cause a taking even if there is no physical invasion. • Pennsylvania Coal Company v. Mahon, 260 U.S. 393 (1922) “… while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking.” • Justice Oliver Wendell Holmes

23. Regulatory takings • “Influential factors” for compensable and non-compensable takings: 1. Economic impact 2. Reasonable investment-backed expectation 3. Character of government action • Penn Central Transportation Company v. New York City, 438 U.S. 104 (1978)

24. Regulatory takings • Regulatory takings are based on consideration of the parcel-as-a-whole. • Concrete Pipe v. Construction Laborers Pension Trust, 508 U.S. 602 (1993) • In contrast: Physical invasions need only consider affected portion of property

25. Regulatory takings • Owner must be denied all, or nearly all reasonable economic use of a property for a taking to occur. • Penn Central Transportation Company v. New York City, 438 U.S. 104 (1978) • When regulation removes all economic value from a property, it is a taking per se. • Lucas v. South Carolina, 505 U.S. 1003 (1992)

26. Regulatory takings • Reasonable, investment-backed expectations established prior to regulation are protected. • Penn Central Transportation Company v. New York City, 438 U.S. 104 (1978) • Limitations on landowner title at time of purchase do not result in taking. • Lucas v. South Carolina, 505 U.S. 1003 (1992)

27. Regulatory takings • Average reciprocity of advantage = if an owner benefits from a regulation then his/her diminished property value will less likely be viewed as a taking.

28. Takings vs. givings? • “Givings” = benefits of public regulatory policies, planning decisions and investments. • Unequally distributed • Taxes/exactions may not recoup givings

29. Balancing opportunities • Planning • Involve public and private interests in the planning process • Provide opportunities for education and meaningful involvement • Engage community in dialogue about balancing private and public interests

30. Balancing opportunities • Policy formulation • Match policy to public purpose • Analyze impact of various policy scenarios on public and private interests • Involve public in selecting alternative

31. Balancing opportunities • Implementation • Base regulation on quantifiable measures • Explain rationale for regulation • Illustrate provisions of regulation with graphics and easy-to-understand language • Provide opportunities for education

32. Balancing opportunities • Review existing regulations • Review common property rights issues • Explore flexible alternatives to regulation (ex. incentives, education, performance standards, etc.) • Provide opportunity for appeal

33. Conclusions • Private property is a flexible and socially defined concept. • Limitations on individual land interests often result in benefit to society as a whole. • Where private limitations go too far they must be compensated. • Community planning is one approach to balance private and community interests.

34. Thank you! • Any questions?