Mr. LIVINGSTONE. I am not sure that I have responded fully to the first question that you posed. If I left the impression that 504 (b) contained within it any current mechanism for the Secretary to judge State plans and thereby devise mechanisms to force the States into programs that they have not adopted, that is an error on my part. I do not intend to leave you with that impression. It seems to me that the act-and frankly one of our feelings that it tends to be weaker in its implementation that it does in its findings, than it is in its findings and declarations of policy-I think that the proposed act is a process for trying to encourage the States to utilize their current land use regulatory possibilities, and it sets up a process of going through all the factors that might be relevant in devising such programs, and that is it. It does not, for the most part, call for anybody evaluating whether they are doing a good job or not, other than at the end of the 3-year period the Secretary making a report to the Congress about national. land use policies. Mr. STEIGER. Did you have any other specific mechanisms in mind. as far as the sanctions, or was that just a suggestion that we explore that? Mr. LIVINGSTONE. That you should explore that at that time. If the States have not done what I think is the object of this legislation, mainly to get busy and utilize their land use powers, that maybe the Federal Government would have to take another look at this. Mr. STEIGER. All right. In regard to the last part of your statement about property rights, you are obviously aware, far more aware than I, of the multiple Supreme Court decisions that have determined that zoning is not the ticket. I do not know the citations-there are a lot of them-in light of that. and this is purely a theoretical result, but if as a result of this bill certain private lands are designated as critical State concerns, and that result is that there can be nothing done if it is not being developed, which is certainly a possibility, is that now a new form in effect, an extreme form of zoning, and might that not be the kind of taking, uncompensated taking, that concerns a lot of people about this kind of legislation? Mr. LIVINGSTONE. Mr. Steiger, I think that there is some zoning that is considered a taking if it leaves the property owner without any reasonable use of his land. It is clearly a taking, and I would think in the instance that you posed, where a propertyowner would have land that is designated to be within an area of critical State concern, and if the State program prohibited use of that land, that would be a taking. Mr. STEIGER. Do you know offhand the case history that would express that? Is there case history that expresses the judicial view that there is some zoning that is indeed a taking? Mr. LIVINGSTONE. We could furnish specific case citations. Mr. STEIGER. That would be very helpful, if I could have unani mous consent. Mr. STEELMAN. Absent objection, it will be included in the record. [The material referred to follows:] Mr. CHAIRMAN: The information which follows is submitted in response to the request of Congressman Steiger at the Hearings of March 24, 1975 that additional resource materials relating to the taking issue be placed in the record. I am therefore submitting this information, and request that it be made part of the official testimony (but without suggesting any endorsement of the findings). In 1973, the Council on Environmental Quality issued a 329 page report by Fred P. Bosselman, David Callies, and John Banta of the law firm of Ross, Hardies, O'Keefe, Babcock & Parsons of Chicago. The title of that report— which is pertinent to this Subcommittee's interests-is: "The Taking Issue: A Study of the Constitutional Limits of Governmental Authority to Regulate the Use of Privately-owned Land Without Paying Compensation to the Owners" (Washington, D.C.: Government Printing Office, 1973). Parts of that report (pp. 318-329) are reproduced below: PART V-SUMMARY AND CONCLUSIONS The founding fathers placed in the Constitution the following words: "... nor shall private property be taken for public use without just compensation.” 1 The application of this "taking clause" to land use regulation is the subject of this book. Why do these twelve words deserve so much study? Because any system of land use regulation will work only if it satisfies each and every link in a chain of interconnected tests. It must be politically feasible; it must make sense economically; . . . and it must hold up in court. The taking issue is an important link in that chain, because if the courts find the system of regulation so severe that it constitutes a taking, the whole system collapses. Our survey of land use problems around the country (Chapters 1-4) found that the similarities between the various sections of the country are greater than the differences. It is true that there are fewer land us problems in those states that are experiencing little growth pressure, and there are more problems in those states that have a particularly fragile environment. But throughout the country attempts are being made to regulate the use of land in new ways-and throughout the country these regulations are being influenced by concern over the taking issue. Our strongest impression from this survey is that the fear of the taking issue is stronger than the taking clause itself. It is an American fable or myth that a man can use his land any way he pleases regardless of his neighbors. The myth survives, indeed thrives, even though unsupported by the pattern of court decisions. Thus, attempts to resolve land use controversies must deal not only with the law, but with the myth as well. 1. THE HISTORY OF THE TAKING ISSUE How did a constitutional clause concerned with the taking of land become applicable to the regulation of land anyway? Originally it wasn't. The "taking" clause derived from the English nobles' fear of the King's seizures of land for his own use, a fear that was reflected in the Magna Carta : "No free man shall be deprived . . . of his freehold . . . unless by the lawful judgment of his peers and by the law of the land." But the use of land was being regulated-often very severely regulatedthroughout English and early American history. Only around the turn of the Twentieth Century did judges and legal scholars popularize the notion that if regulation of the use of land became excessive, it could amount to the equivalent of a taking. Chapter 5 sets out the early land use conflicts in medieval England. It discusses the various statutes and proclamations which attempted to control the growth and building of London and its environs, and highlights the movement towards the fencing of English common land between the Thirteenth and Seventeenth Centuries. Finally, the Chapter closes with a summary of the attitudes toward property of Coke and Blackstone-philosophies which affected property concepts carried to the New World. 1.S. Constitution. Amendment V. 2 The Clause is sometimes called Article 39 because the original 1215 Magna Carta contained 63 articles, of which the above was Article 39. By 1225, the Charter consisted of 37 Articles as the original 63 were pared down and consolidated, of which the aforementioned was number 29. Chapter 6 picks up the story in Colonial America. An examination and analysis of colonial regulations shows that the prevailing pattern of land use regulation was quite similar to that in England. Compensation was generally provided for physical takings of developed property, but literally hundreds of regulations of the use of land were enforced without any compensation to the landowner. Nor was the issue of compensation for land use regulation raised either Bill of Rights. Rather the draftsmen of the taking clause seem to have during the revolutionary period or in the drafting of the Constitution or carried over the historic British concern over arbitrary seizure of land by the King, perhaps as reflected in seizures during the then recent revolutionary war-and to have applied that concern to actions of the new Federal Government. The courts have insisted that the taking clause be strictly observed. Whenever the government has needed land for some public purpose it has either purchased the land on the open market or exercised the power of condemnation, paying the owner the fair market value of his land. Court decisions during the entire first half of the Nineteenth Century (Chapter 7) find courts construing the taking clause strictly. To paraphrase a well-known commentator of the period writing in 1857, in order for an owner to be entitled to protection under the taking clause his property must have been actually taken in the physical sense of the word. No indirect or consequential damage, no matter how serious, warranted compensation. The last half of the Nineteenth Century led to a certain ambivalence on the part of the courts, as the country's tremendous economic expansion inevitably produced conflicts with vested interests. Nonetheless, late in the Nineteenth Century the Supreme Court handed down cases such as Powell v. Pennsylvania and Mugler v. Kansas which denied compensation to the owners of business properties that became virtually valueless because of state regulatory statutes. These statutes were held to be valid police regulations, not takings of property within the meaning of the constitutional prohibition. But Justice Holmes was soon to change the Court's direction, as Chapter 8 points out. Only two years after Mugler v. Kansas, Holmes wrote from the bench of the Massachusetts Supreme Court in Rideout v. Knox that the power of eminent domain (the power to acquire land) and the police power (the power to regulate land) differed only in degree and no clear line could be drawn between them. He continued to develop this philosophy in subsequent decisions and influenced a number of leading scholars of the period. 5 Then, in December of 1922, in the now famous case of Pennsylvania Coal Company v. Mahon, Holmes announced his famous rule: "The general rule at least is, that while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking." When a diminution of property values reaches a certain magnitude, he said. a taking occurs. Thus, Holmes declared Pennsylvania's Kohler Act, passed to prevent coal mine subsidence from destroying whole towns, unconstitutional as an undue regulation of the property of the coal company. Based on Holmes' reasoning the courts have continued to use a balancing test a weighing of the public benefits of the regulation against the extent of loss of property values. The Supreme Court lost interest in the issue soon after Pennsylvania Coal and has refused to hear cases arising under the taking clause except in very rare instances. As a result, the application of the Court's balancing test has been left to the lower Federal Courts-and especially to the state courts, in which most land use regulation cases arise. 2. THE STATE OF THE CURRENT LAW Over the last fifty years the state courts have decided literally hundreds of cases, each of which determines whether the value of a particular land use regulation does or does not outweigh the loss of property value to a particular landowner. As might be expected, given the lack of leadership from a common central court, this mass of decisions has often been characterized as "chaotic." a 127 U.S. 393 (1922). 4123 U.S. 623, 8 S. Ct. 273 (1887). 260 U.S. at 415. Since no state court feels itself particularly bound by the decisions of the courts of a different state, interpretations of the taking clause vary considerably. Chapters 9, 10 and 11 look at these state court decisions from three different perspective. Chapter 9 categorizes the cases in relation to various types of land use regulation that are involved. This classification is particularly useful for people concerned with specific regulations for such purposes as wetland protection, historic preservation, etc. In general this Chapter shows a general tendency of the courts to uphold well throughout regulations, though there are very few subjects on which one cannot find cases going both ways on very similar facts. Chapter 10 reviews the legal literature on the relationship between land use regulation and the taking clause. Most of the scholars who have studied this subject have founpd that there are no universal principles which will consistently explain the results of the cases. Each case is decided on its own facts, as the courts frequently point out. Nevertheless, the commentators have found a few tendencies worth noting. The one most often described is the tendency of the courts to prefer regulations that control those uses of land that were treated as "nuisances" under the traditional common law. Commentators have also tried to find some correlation between the amount that property values are reduced by a regulation and the willingness of the courts to find the regulation constitutional. For the most part, this attempt to find some numerical correlation appears not to have proven useful in predicting the outcome of future decisions. A dramatic upsurge of concern over the environment took place in the late 'CO's and early '70's. We wondered whether this "new mood" would affect the judiciary, so we culled out the taking cases decided after January 1, 1970, and examined them separately in Chapter 11. We discovered an interesting trend. Although the number of cases is still small, there is a strong tendency on the part of the courts to approve land use regulations if the purpose of the regulation is statewide or regional in nature rather than merely local. Although the courts are also supporting local land use regulations with a reasonable degree of consistency, they show an obvious preference for regulations having broad multi-purpose goals. 3. STRATEGIES FOR THE FUTURE: THE IMPORTANCE OF THE MYTH The court decisions form only the visible surface of the law. Below the surface lies the myth of the taking clause-a powerful public perception of the clause as the embodiment of every man's right to buy and sell land for a profit. As the Task Force on Land Use and Urban Growth put it, "The popular impression of the takings clause may be even more out of date than some court opinions." 997 Land use regulation is predominantly a function of local government-over ten thousand separate local governments, each exercising control over the land within its particular jurisdiction. Since the "myth" of the taking clause assumes that less can be regulated than the court decisions actually permit, many local governments fail to exercise their powers or if they do, they back down easily when challenged. Other local governments despair of reaching any reasonable accommodation with landowners and decide to prohibit everything, leaving the issue up to the courts to resolve. Why has the myth of the taking clause made land values so much more sacrosanet than a reading of the court decisions would actually suggest? We suspect a number of causes inherent in the structure of American local government. The myth of the taking clause is inhibiting the sort of reasonable regulatory action that is needed to protect the environment while respecting the position of individual landowners. In weighing strategies to deal with the taking issue, therefore, we begin with awareness that a new legal doctrine will have little impact unless it filters down to where the action is. The law in this area is what local officials think it is. While it is important to establish sound legal principles, it is equally important to communicate these principles to the people who are making the decisions. Citizens' Advisory Committee on Environmental Quality Task Force on Land Use and Trban Growth, The Use of Land, 147-148 (1973). 4. STRATEGIES FOR DEALING WITH THE TAKING ISSUE: EXPERIENCE, NOT LOGIC The taking clause has bedeviled some of our brightest and most lucid legal scholars. A number of excellent articles have appeared in our legal periodicals over the past ten years. We were impressed with the profound logic by which each author attempted to make sense out of the confused body of cases--at least until we read the next article in which a new author convincingly demolished the logic of his predecessor and expounded a new and even more convincing system of analysis. We eventually came away with a sense of frustration, convinced that the world did not need one more analytically good, true and beautiful solution to the taking problem. Holmes' own observation that experience, not logic, governed the law, seemed most appropriate here. We began by arraying five portential strategies for approaching the taking issue, ranging from one end of the spectrum to the other. Chapter 12 presents the argument that the courts should discard the idea that a regultaion of the use of land can constitute a "taking." It suggests that the idea of a regulatory taking was a judicial fiction of the early 1900's, wholly inconsistent with the tradition of the founding fathers. It recommends a return to the strict construction of the taking clause in the manner in which it was originally conceived. Such an approach would subject land use regulations to the same standards of judicial review that now apply to other government regulations. Chapter 13 proposes a less direct approach. It points out that many courts have apparently treated the idea of regulatory taking more as a hypothetical possibility than a real one. The Supreme Court of California, for example, appears unlikely to hold any regulation invalid under the taking clause. The United States Supreme Court itself (the last time it ruled on the issue) left some doubt whether any regulation could constitute a taking as long as the court was convinced that the public purpose served by the regulation was important. This suggests an emphasis on demonstrating the importance of the purpose behind land use regulations. Chapter 14 discusses another approach to the taking issue, one that had been suggested by a number of commentators: the drafting of statutory standards to determine when compensation is required. Although the taking test is a constitutional one which is ultimately in the hands of the courts, the courts have generally accepted legislative determinations in similar situations. The English have for years used a system of statutory standards for determining whether compensation must be paid to a person affected by a land use regulation. In general, compensation is paid only if the land is capable of no reasonably beneficial use," under the regulation. But even then compensation is not paid if the regulation is designed to promote certain listed purposes (e.g., flood control, adequacy of sewerage services, etc.). Surprisingly, the British system appears to please both developer, administrator and environmentalist. It might be studied in more depth as a model for statutory standards to be adopted here. The first three strategies have sought some change in the substantive law. Chapter 15 suggests that even if the existing law remains unchanged most land use regulations can survive attack in the courts if they are based on sound factual evidence and are carefully drafted. This Chapter discusses some examples to illustrate these points. Finally, Chapter 16 explores the alternative of providing compensation whenever possible to foreclose attacks on land use regulations under the taking clause. It discusses various suggestions for systems of compensable regulations including the one newly proposed to the American Law Institute. It also points out the possibility of using massive land acquisition programs in lieu of regulation, but does not discuss this alternative extensively because the cost appears to make such a program impractical. 5. EVALUATING THE STRATEGIES Having examined a range of possible strategies we concluded that it was impossible to recommend one single strategy to deal with the taking issue. The taking issue represents an inevitable conflict between two valid and important interests; the need for a livable environment and the importance of private property rights. No magic words will make the conflict disappear. A dramatic overruling of the Pennsylvania Coal case would help deflate the myth that now makes the taking clause so powerful. But courts would still |