Court shies away from giving landowners more rights

Patricia Smith lives in Davis, Calif., but she is doing more to protect water quality in faraway Lake Tahoe than any resident of the beautiful but environmentally sensitive land surrounding the pristine lake.

As an outsider seeking to build a house on an undeveloped lot near the lake, Ms. Smith has been forced to wait more than 20 years through a series of open-ended building moratoriums enacted by local officials to prevent additional runoff pollution that threatens to cloud the waters of Lake Tahoe. It is a policy that forces outsiders, like Smith, to pay a higher price for the continuing runoff pollution caused by existing residents.

This week, the US Supreme Court declared there is nothing automatically unconstitutional about this local policy, provided the policy is merely temporary.

In a ruling against Smith and some 400 other owners of undeveloped lots seeking compensation for policies that have rendered their property unbuildable, the high court declined to say that a moratorium lasting a certain amount of time would automatically trigger the Fifth Amendment's just-compensation clause.

Instead, the court, in a 6-to-3 decision, said the plight of landowners should be given no special weight in the mix of interests surrounding land use and environmental regulations. Judges must consider all relevant circumstances before deciding whether landowners are due any compensation, the justices said.

The ruling pulls the court away from the recent trend of embracing a more categorical approach to property rights, which has been championed by Justice Antonin Scalia. Instead, the court appears to be moving back toward a more ad hoc approach developed by former Justice William Brennan.

"In our view the answer to the abstract question whether a temporary moratorium effects a taking is neither 'yes, always' nor 'no, never;' the answer depends upon the particular circumstances of the case," writes Justice John Paul Stevens for the majority.

The ruling is good news for land-use planners, environmentalists, and many local and state officials who were worried that a decision by the high court requiring payment of compensation might make environmental and planning regulations prohibitively expensive.

It marks a significant setback to the coalition of landowners, developers, and conservative legal theorists who had argued that when the government takes something away from a person, even for a limited period of time through temporary planning or environmental regulations, compensation should be paid.

Richard Epstein, a property-law expert at the University of Chicago Law School, says the decision creates dangerous incentives for land-use planners and property owners. "This is as much about protecting insiders [existing residents] as it is about protecting the lake," he says. "Once you know that, you can't sit back and say the democratic process is working fine."

Environmentalists disagree. "This ruling is an enormous victory for the environment and smart-growth communities," says Melody Flowers of the Sierra Club's Challenge to Sprawl Campaign. "Had the court issued the kind of ruling the landowners wanted, the expense to local governments would have been astronomical. That would have barred most localities from making any land-use regulations."

Chief Justice William Rehnquist said in a dissent that the Tahoe moratorium in effect amounted to an unconstitutional taking of property, mandating compensation. "Lake Tahoe is a national treasure and I do not doubt that [the local government's] efforts at preventing further degradation of the lake were made in good faith in furtherance of the public interest," the chief justice writes. "But the Constitution requires that the costs and burdens be borne by the public at large, not by a few targeted citizens."