Property Rights Initiative in Washington State
Property Rights groups in Washington State appear to have managed to gather enough signatures to get an initiative put on the ballot in the fall that would, if approved by voters, require compensation for government regulation that results in any decline in property value. Faced with a successful claim, the regulating body will have the option of paying compensation or releasing the landowner from the applicable regulation. The text of the initiative (I-933) is here. I-933 largely mimics Oregon’s famous Measure 37, which was recently upheld against constitutional challenge by the Oregon Supreme Court. Measure 37 has been, by most accounts, a disaster for Oregon land use planning. To date, over 1000 claims have been filed, seeking over $3 billion in damages. Of claims resolved as of October 2005, 90% have resulted in waivers of regulation. Only 10% have been denied. No compensation has been paid.
What’s wrong with these sorts of laws? Plenty.
First, they are based on the wrongheaded and frankly antisocial premise that we should not be expected to bear any burden in our use and enjoyment of property, no matter how trivial. The simple fact is that we all enjoy the benefits of life in society, and life in society entails obligations, including the occasional regulatory burden. These laws reinforce the bizarre notion that we should be able to reap all the benefits of life in community but never be asked to suffer even the least inconvenience. Now, the Washington law has some interesting wrinkles that make this assertion a little more complicated and that, if narrowly interepreted by the courts, might make the impact of the law far less dramatic than Measure 37. For example, I-933 defines a regulation that damages property values as one that “prohibit[s] or restrict[s] the use of private property to obtain benefit to the public the cost of which in all fairness and justice should be borne by the public as a whole.” Property students will recognize this as one of the Supreme Court’s favorite formlulations for a regulatory taking. Accordingly, on a narrow reading of this initiative, it merely requires what the Constitution already mandates and therefore accomplishes, exactly, nothing. But the law goes on to provide specific examples of the sorts of things that might (or should? or would? or do?) qualify under this definition (e.g., prohibition on the replacement or maintenance of a beach wall). Because many of the items on that list would not normally be considered regulatory takings, if the list is read to provide examples of regulations that (per se) satisfy the more general formula, then the law will constitute a dramatic expansion of takings law in Washington State.
Second, these laws are plainly unbalanced in their approach to the consequences of state action, since they do not require property owners to compensate the state for actions by the state that enhance their property values (UPDATE: in a way not shared with other taxpaying property owners). In this, they faithfully reflect the selfishness of their underlying assumptions. The property owner is permitted to freely reap a unique benefit when the state, for example, opens up a freeway exit next to his commercial property, but he cannot be asked to bear an equivalent (or even much smaller) burden without receiving compensation.
Third, while they are often portrayed as the result of broad grassroots outrage at over-regulation, these laws are often the consequence of narrower interest group politics. In this case, I-933 was put on the ballot with the help of paid signature-collectors. Funding came from a variety of property-rights interest groups, including $200,000 from an out-of-state property rights organization. According to the Seattle Times, “Initiative campaigns with the resources to employ paid signature-gatherers almost always qualify” for the ballot.
Fourth, the laws are often downright hypocritical, favoring property rights only for those of whose land uses they approve. Both the Oregon and Washington measures, for example, specifically exclude the regulation of adult businesses (through zoning law) from their ambit. Apparently, their libertarian individualism only goes so far.