Pacific Legal Foundation Releases “State of Property Rights” Report

Contact: Dawn Collier
Phone: (916) 419-7111

Sacramento,CA; April 20, 2005: April 20, 2005: Pacific Legal Foundation, the nation’s leading defender of property rights in the courts, today released its first annual “State of Property Rights” report that finds a growing national movement to reclaim individual property rights while government agencies continue their regulatory assault on those rights.

PLF reports that a number of high-profile property rights cases and voter initiatives in 2004 show that protecting property rights remains a front-burner issue for many Americans, especially in battleground regions where overzealous environmental and “antigrowth” regulation, and property taxation, have come to a head.

Yet, while there have been notable successes in some areas on behalf of Americans’ constitutionally protected property rights, officials at all levels of government around the country continue to impose ever more burdensome limits on the use of private property—without compensating property owners.

“Government too often imposes outlandish limits on the use of private property,” said M. David Stirling, Vice President of Pacific Legal Foundation. “Over the last year, we’ve been encouraged to see more and more people taking a stand against property seizures and asserting their constitutional rights. Oregon voters passed a landmark property rights initiative, voters in Hawaii said enough is enough to skyrocketing property taxes that are driving them from their homes, and Connecticut families whose homes were taken by the government to sell cheaply to corporate interests finally got their day before the United States Supreme Court.”

“Unfortunately, government continues to unreasonably restrict people’s land use, often in the name of environmental protection,” Stirling said. “Too often government uses guesswork and bad science to impose needless restrictions on private property, never compensating the owners or doing the real scientific research necessary to determine whether the added regulation will benefit the environment.”

Among the positive highlights for advancing property rights over the last year are:

In November, Oregon voters passed Measure 37, a groundbreaking initiative that requires government agencies to compensate property owners for lost property value caused by government regulation. The measure passed with more than 60% of the vote in a state that has been saddled for over 30 years with the most stringent land use control laws in the country. PLF is currently helping to defend Measure 37 against court challenges.
In December, the federal government agreed to pay California farmers $16.7 million for contracted irrigation water it confiscated and diverted to protect fish. The government agreed to a settlement after a federal judge awarded the affected farmers a whopping $26 million a year earlier. The judge ruled the farmers were entitled to the compensation under the Fifth Amendment, which protects private property from government seizure without compensation. The case, Tulare Lake Basin Water Storage District v. United States, is widely recognized as an unprecedented decision that could have far-reaching implications on how the Endangered Species Act and other environmental laws are implemented when water diversions are at stake. PLF supported the farmers in a friend of the court brief and is working with other farmers pursuing similar claims.
In the fall of 2004, the United States Supreme Court announced it would hear four property rights cases in the 2004-2005 session, setting the stage for a stunning string of decisions that could change the landscape of property rights for years to come. In the most high-profile case, homeowners in New London, Connecticut, stood up for their rights by challenging their city’s effort to throw them out of their homes under the power of “eminent domain” to make way for private businesses to build a theater complex and commercial center. Other cases this term include a rent control case out of Hawaii, a San Francisco case seeking to keep federal courts open to property rights claims, and a water rights case out of California’s Central Valley. PLF filed friend of the court briefs in all four cases.
In the fall of 2004, western property and business owners who had seen their property rights frozen and businesses stymied because of excessive critical habitat designations to protect fish welcomed a Bush administration decision to reduce critical habitat areas by as much as 80 to 90%. The decisions involved bull trout in the Pacific Northwest and 19 populations of west coast salmon and steelhead protected by the Endangered Species Act. The new critical habitat designations were made using the “Alameda whipsnake test” established as a result of PLF’s landmark court win in 2003.
In July, the Michigan Supreme Court unanimously overturned its infamous Poletown decision that allowed Detroit to raze an entire neighborhood and transfer the property to General Motors to build an auto plant. The 1981 decision opened the floodgates of eminent domain abuse by local governments, with state courts nationwide redefining the Fifth Amendment’s “public use” requirement to include giving seized property to megabusinesses like Costco to generate a higher tax base. PLF supported the homeowners in the case.

While these successes helped to begin a roll back of decades of actions hostile to property rights, there were detrimental actions to property rights as well.

“Governments continue to impose unreasonable limits on the ownership and use of private property,” Stirling said. “For example, rural property owners outside of Seattle are victims of a government ordinance denying them the right to use two-thirds of their property—essentially as a no-touch zone.”

Among the negative developments over the last year are:

In October, Seattle-based members of the King County, Washington, county council enacted a “critical areas ordinance” that requires rural property owners with more than 5 acres to set aside as much as 65% of their property in its natural state indefinitely— without compensation. Property owners stormed downtown Seattle in protest, but efforts to put a referendum on the ballot to repeal the ordinance were blocked by county officials in the courts. On behalf of a grassroots property rights group and individual property owners, PLF has filed suit to invalidate the ordinance.
In November, Kauai, Hawaii, voters overwhelmingly passed a measure similar to California’s Prop. 13 to rein in property taxes that have increased 50% since 1998. Instead of honoring the voters’ mandate, county officials sued to block the measure, claiming that only government—not voters—can make decisions affecting property taxes. The county prevailed at the appellate court level and PLF is now taking the case to the Hawaii Supreme Court.
In April, 2004, the United States Supreme Court declined to hear three cases asking for badly needed clarification of the limits on federal authority to regulate wetlands under the Clean Water Act. Despite the Court’s landmark decision in Solid Waste Agency of Northern Cook County v. United States (SWANCC) in 2001, federal courts have continued to define federal wetlands expansively—and illegally. The Bush administration has also declined to issue regulations implementing the decision. As a result, government continues to assert jurisdiction over private property containing rain-filled depressions in the ground that are often little short of mud puddles. Property owners are forced to pay hundreds of thousands of dollars for permits they should not be required to get or risk millions of dollars in penalties—and even jail time—for permit violations. PLF is representing property owners in several key cases on this issue and has filed a petition for review at the United States Supreme Court.
In June, 2004, a federal fisheries agency further harmed property owners when it proposed a policy that fails to comply with PLF’s landmark court victory in Alsea Valley Alliance v. Evans, where a judge ruled the government illegally ignored prolific numbers of hatchery fish when it listed Oregon coast coho as a threatened species. The ruling forced the government to reexamine 26 listings of salmon and steelhead populations in the Pacific Northwest. However, when the government issued its new policy, rather than comply with the court ruling, the government proposed to “relist” all 26 populations—and add a new one. The decision is a slap in the face to western property owners, farmers, and businesses that have had their livelihoods held hostage by regulatory restrictions to protect fish that are not even threatened. PLF has notified the government that it will file a lawsuit challenging the listings if the agency issues the proposal as its final policy in June, 2005.

As a result of these important events in 2004, PLF predicts 2005 will be a landmark year for property rights since a number of high-profile cases stand to be decided.

“In the year ahead, we hope the Supreme Court will return our judiciary to the historic role of protecting individual property rights and use the four cases before it to clearly move in that direction,” said PLF’s Stirling. “We hope that a growing population of property owners will assert their rights whenever government at any level infringes on those rights, whether by eminent domain, confiscatory regulation of land use, imposition of rent control, or the taking of water from farmers.”

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