Tag: Fifth Amendment

More Property Rights Shenanigans on the West Coast

Cato recently filed an amicus brief urging the Supreme Court to review a Ninth Circuit decision that tramples on property rights.  (See also this oped I co-authored with co-counsel.)

Well, tomorrow the Ninth Circuit hears another case involving property rights violations, and this time the plaintiffs, in exchange for a building permit, were forced to give up their right to vote. Arguing for the beleaguered property-owners will be none other than Cato adjunct scholar Tim Sandefur.  You can read more about the case in Tim’s own blogpost on PLF’s site.

Here’s the basic principle with these cases: just as the government can’t take your property (for public use) without just compensation, it can’t attach arbitrary regulations and fees.  After all, if you own an acre of land and the government tells you you can’t do anything on it – be it run around or drain puddles or build – it might as well have “taken” it by eminent domain.  And if it says you can do these things only if you give up some other entitlement you have – not necessarily money, but, say, the right to put up signs criticizing the local government – it has imposed an unconstitutional condition on your enjoyment of your property.

When the Government Takes Your Money, It Takes Your Property

When Daniel and Andrea McClung applied for a permit to build a small business on their property in Sumner, Washington, the city charged them nearly $50,000 to pay for improvements to the city’s entire storm drainage system.

The McClungs sued the city under the Fifth Amendment to the Constitution, whose Takings Clause prohibits the government from “taking” private property for public use without just compensation.  They argue that the city cannot force them to pay fees for off-site pipes absent proof that their development would have a specific detrimental effect on the existing drainage system–and without any evidence that the impact was worth $50,000.

The Ninth Circuit ruled in favor of the city, reasoning that money is not property (so there could be no unconstitutional taking) and that because the fees were imposed by ordinance (so the city’s determination that the pipes needed upgrading was justification enough for the fees).  The McClungs have now asked the Supreme Court to review their case.

Cato, joined by the Pacific Legal Foundation and the Building Industry Association of Washington, argues that this case is a perfect vehicle for the Court to revisit the scope of Fifth Amendment protections.

Our brief highlights the deep divisions among state and federal courts over several important issues, such as whether the Takings Clause applies to legislative (as opposed to bureaucratic) exactions and whether it applies to monetary exactions (not just burdens on land use).  The Court should take this case to ensure that the standard for reviewing development conditions is uniform across the country and make clear that property right protections do not depend on ill-defined distinctions such as the form of property demanded by the government or the manner in which a condition is imposed.

When the Goverment Robs Peter to Pay Paul, It Violates the Constitution

The Supreme Court’s 2005 decision that the government could use its eminent domain power to transfer private property to a different private actor – which promised to use it to generate more tax revenue – touched off a firestorm of criticism and created a movement to strengthen property rights.  (For the story behind that case, Kelo v. New London, I recommend Little Pink House: A True Story of Defiance and Courage, for which Cato hosted a book forum in January.)   On Friday, Cato filed a brief urging the Supreme Court to review a decision ratifying a similar, even more blatant, government taking of private property for a non-public use.

In Empress Casino v. Giannoulias, the Illinois Supreme Court upheld a statute transferring money from private riverboat casinos – and at that only the certain politically disfavored ones located in and around Chicago – to private horseracing tracks.  The state high court found that the Fifth Amendment’s Takings Clause does not apply to exactions of money from private entities, which ruling the casinos are asking the U.S. Supreme Court to review.

Cato’s brief argues that the Court should grant certiorari for yet another reason: The Illinois statute (which coincidentally appeared in the transcript of the Blagojevich sting) is in clear violation of the Takings Clause’s “public use” requirement, impermissibly eroding protections for private property even under Kelo’s (flawed) standard. The statute does nothing more than rob Peter to pay Paul, a result that cannot be squared with the Fifth Amendment, which permits government takings only for public use, and then only if just compensation is paid. This case instead involves a naked transfer of the casinos’ revenues to the racetracks, with no meaningful restriction on how the racetracks use those funds — and does not remotely resemble any public use approved by the Supreme Court.

Permitting such a statute to stand will only encourage federal, state, and local governments to exact funds from one private actor for the exclusive benefit of another, transgressing the very property rights and economic liberties that inspired the Declaration of Independence and Constitution.