Also known as: regulatory taking
Written by attorneys · grounded in primary & secondary sources — see below
A doctrine under which government regulations that substantially diminish the economic value of private property or interfere with reasonable investment-backed expectations may require just compensation under the Takings Clause. The analysis weighs the economic impact of the regulation, the extent of interference with distinct investment-backed expectations, and the character of the governmental action. Regulations that leave the owner with a reasonable beneficial use and advance legitimate public interests are generally not compensable.
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Rosa Ruiz owns a historic riverside power plant that the State Heritage Council designates as a protected site. The designation bars demolition and major exterior changes, preventing Rosa from building a larger gas-fired facility she had planned. Rosa retains the ability to continue smaller-scale electricity generation and lease roof space for solar arrays, generating ongoing revenue.
Renee Rogers seeks a building permit to expand her retail store. The city conditions approval on Rogers dedicating a strip of her land for a public bike path. The required dedication bears no relationship to the store expansion's impact on traffic or drainage.
Ralph Richardson purchases beachfront lots zoned for residential development. A new state statute bars all construction to protect dunes. The ban leaves Richardson with no economically viable use of the parcels he acquired for building homes.
Rina Rahman operates a large hog farm next to Rowan Russell's residential property. A county ordinance grants farms immunity from nuisance suits arising from normal operations. The ordinance effectively transfers to the farm an easement to emit odors onto Russell's land.
Roberto Reyes owns a modest home in an area targeted for economic revitalization. The city condemns the property and transfers title to a private developer for a mixed-use project expected to increase tax revenue. Reyes receives only the appraised value of the lot.
Radiance Media owns oceanfront property that has long included a right to accreted beach. A state supreme court ruling declares that future accretions belong to the state. The decision eliminates the company's ability to use or develop the newly formed dry sand area.
Courts apply a multi-factor balancing test that examines the economic impact of the regulation on the claimant, the extent to which the regulation interferes with distinct investment-backed expectations, and the character of the governmental action. Land-use controls that substantially advance legitimate public interests and leave the owner with a reasonable beneficial use are generally upheld.
Supporting sources
…a given regulation would be seen as going "too far" for purposes of the Fifth Amendment. In 70-odd years of succeeding "regulatory takings" jurisprudence, we have generally eschewed any " set formula' " for determining how far is too far, preferring to "engag[e] in . . . essentially ad hoc, factual inquiries." Penn Central…
…See also Lucas v. South Carolina Coastal Council , 505 U. S. 1003, 1032, n. 18 (1992) (South Carolina could defend a regulatory taking "if an objectively reasonable application of relevant precedents [by its courts] would exclude . . . beneficial uses in the circumstances in which the land is presently found"); Bishop…
…we explained why similar practical concerns (among others) undermined the use of the "substantially advances" formula in our regulatory takings doctrine. See Lingle v. Chevron U. S. A. Inc. , 544 U. S. 528, 544 (2005) (noting that this formula "would empower—and might often require—courts to substitute their predictive judgments…
…purposes as appropriating or destroying it." Pennsylvania Coal Co. v. Mahon , 260 U. S. 393, 414 (1922). The so-called "regulatory takings
…CATV Corp. , 458 U.S. 419, 425, 102 S. Ct. 3164, 3171, 73 L. Ed. 2d 868, 886 (1982). Presumably, in all other cases involving “
No. The Constitution does not guarantee the right to the most profitable use of property. A taking occurs only when the regulation goes so far that it is functionally equivalent to an appropriation, such as by eliminating all economically viable uses or imposing a physical invasion.
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A regulation that grants third parties a recurring right to physically enter and remain on private property effects a per se physical taking. This rule applies even when each entry is brief or intermittent, because the government has appropriated the owner's right to exclude.
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No. The answer depends on the particular circumstances of the case. Temporary regulatory delays are evaluated under the ad hoc balancing test rather than a per se rule, because land-use regulations are ubiquitous and treating every delay as a taking would make ordinary government regulation impractical.
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