Takings Cases This Term

For some reason Supreme Court cases seem to come in packs, when this or that issue captures the justices’ attention.  On deck this Term: civil rights cases (over affirmative action and the Voting Rights Act, among other issues); and cases involving Fifth Amendment “takings” of private property. So far, the justices have granted cert in three cases. They involve water; more water; and raisins.

Arkansas Game & Fish Commission v. United States was argued on October 3. Basic question: if the feds periodically release water from a dam and cause property damage on a downstream owner’s land, do they owe compensation? Harder than one might think. For example, if the water goes in and out, that looks more like a trespass than a taking. But what if (as in this case) the feds do it year after year and after awhile, the trees die? The most noteworthy aspect of the case (up to this point at least) is the U.S. government’s over-the-top position: releases of this sort, Deputy SG Ed Kneedler appeared to insist in oral argument, can never be a compensable taking. We flood what we want, and any harm is incidental. We’re simply adjusting the burdens and benefits of public life, or at least public life on a river. Before we wipe you out we give you a fair hearing, in meticulous observance of the Administrative Procedure Act; but after that it’s “Here’s a straw. Suck it up.” The transcript appears here; Lyle Denniston’s I-can’t-believe-he-said-that summary, here.

Koontz v. St John’s River Water Management District  (cert granted October 5; argument scheduled for January 15, 2013) involves two significant land use questions. The Takings Clause is way overrated because for most everything, you need a permit (often, as here, to mess with what the authorities say is a wetland)—which the authorities won’t give you until they’ve extracted whatever they think they need by way of concessions.  Under  Nollan v. California Coastal Commission (1987) and Dolan v. City of Tigard (1994),  the exactions are supposed to have some “nexus” and “rough proportionality” to the proposed land use.  That’s not worth a whole lot, though, unless you can challenge the demanded exaction before you’ve been compelled to accede to it. Thus, Koontz  asks whether a land-use agency can be held liable for a taking when it refused to issue a permit solely because the applicant did not accede to a permit condition that, if applied, would violate the Nollan and Dolan requirements. The second question is whether those tests apply only to land-use exactions (“your land for our permit”) or also to other exactions (“You haven’t got any land we want. What else have you got–money?”).

Horne v. Department of Agriculture  (cert granted November 20) involves one of umpteen New Deal programs that should long be dead but still are alive and well, this one involving raisins. California supplies virtually all of the nation’s raisins, and attempts to exploit that advantage never die. In a nutshell (metaphorically speaking because there’s a separate program for that product): if you produce raisins in California, then the Department of Agriculture, ostensibly to maintain stable prices, effectively confiscates some portion of your crop as “reserve tonnage,” for sale in markets where competition is limited (such as school-lunch programs).  The proceeds are used to pay the costs of running that part of the program. The producers may get a pittance, or nothing.

In Horne, vineyards in California were accused by the Department of failing to comply with the reserve tonnage requirement. The Department sought to compel them to obey the marketing order, and the vineyards ultimately were ordered, in administrative proceedings, to pay $695,227 in civil penalties and fines. The vineyards appealed the administrative order to federal district court, contending that they weren’t covered by the program and that the reserve requirement amounted to a taking.

Horne, like Koontz, presents in part a significant timing issue: do you first have to exhaust all other possible remedies (administrative, state law, etc.) even when, as here, your takings claim is a defense against government action? (This is both complicated and important; I’ll have more in future posts, as the case progresses.) And Horne, like Arkansas Game & Fish, presents a rather breathtaking government defense on the merits. The raisin scheme, say the feds, doesn’t actually require farmers to turn over their crop or their money to the feds, period. It merely conditions their ability to sell anything at all on turning some of their produce over. You have to balance the private producers’ loss against the public’s gain, which means (here as always) that the private parties lose. Alternatively, says the government, we can always tax the living daylights out of the producers. Hence, what can possibly be wrong with a turn-over-your-crop requirement in lieu of a tax?

Look for the private plaintiffs to win all three cases, in whole or in part. Don’t look for an incipient property rights revolution. It’s amazing to see in these cases what government thinks it can do; and once it gets into an anything-goes frame of mind, the Takings Clause—designed for a very different institutional context—is a very weak instrument. Still, the Court seems to be nervous about the outer limits. If so, that’s a step up from wholesale indifference.

Michael S. Greve is a professor at George Mason University School of Law. From 2000 to August, 2012, Professor Greve was the John G. Searle Scholar at the American Enterprise Institute, where he remains a visiting scholar. His most recent book isy The Upside-Down Constitution (Harvard University Press, 2012).

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