Supreme Court should further affirm importance of property rights

Supreme Court should further affirm importance of property rights
© Aaron Schwartz

Dartmond and Esther Cherk owned three acres of residentially-zoned investment property in Marin County, Calif. They wanted to divide the property into two lots, sell one and use the proceeds to build a retirement home on the other. Easy, right? Far from it. 

After nearly 20 years of back-and-forth with Marin County to determine how they could use their land, the Cherks finally received permission for their modest development plan — but only on the condition that they first pay a fee of almost $40,000, which the county claims will help alleviate its affordable-housing crisis. The Cherks have asked the U.S. Supreme Court — which recently emphasized that property rights are just as important as everything else in the Bill of Rights — to review their case and establish that property rights include protection against the type of extortion attempted by Marin County.

Everyone agrees that California has sky-high home prices and an affordable-housing crisis. But as the Cherks’ dilemma shows, this crisis exists because government, instead of allowing more home construction, burdens property owners and developers with costly and counterproductive regulations. The government-created scarcity of housing is the problem. Local governments have all the power they need to alleviate it if only they would allow more homes to be built. 

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This government-created scarcity is, unfortunately, an all too common result of state and local governments’ bullying property owners to fund priorities on politicians’ wish lists, when reasonable regulations would protect everyone’s interests. So, a government may require a property owner to pay for adverse impacts that will be caused by a proposed development. For example, if a proposed shopping mall needs new access roads, the government could properly condition its approval of a building permit upon a payment by the developer to offset the costs of road construction needed to alleviate the expected traffic congestion. 

But if a government’s condition is not related to a project’s harmful impacts, the condition is not a legal regulation but, instead, in the Supreme Court’s words, an “out-and-out plan of extortion.”

In short, governments can’t use a permit process to extort money from property owners by imposing conditions that have nothing to do with the proposed development. But governments such as Marin County keep trying.  

In a misguided attempt to solve the shortage of housing, Marin County, like many local governments, requires property owners who wish to change the use of their land to either construct “affordable” housing units or pay a fee instead of construction. But in the Cherks’ case, the county itself acknowledges there are zero negative impacts stemming from the couple’s proposed development. The county acknowledges the Cherks’ proposal would increase the amount of property available for housing construction.  

In other words, the Cherks’ plan would help solve, rather than exacerbate, the affordable-housing problem. Therefore, the county’s fee is simply a way to raise money for its policy priorities. And because that fee is not imposed to alleviate the negative impacts of the Cherks’ proposal — there are none — the county should be precluded from imposing the fee as a condition of approving the Cherks’ permit.

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But the Cherks’ claim for relief has been stymied by California courts, which ignore the crucial distinction between proper and improper conditions. The California Supreme Court has explained, in effect, “Too bad; these kinds of plans are mere land-use regulations,” as if “mere” land-use regulations can’t violate people’s property rights. The Fifth Amendment to the U.S. Constitution says that “private property [shall not] be taken for public use, without just compensation.” So, if the government believes property should be regulated for the benefit of the public, then the public — and not just a few targeted people — should pay for it. 

The Cherks, represented free of charge by Pacific Legal Foundation, are being compelled to bear burdens that should be borne by the broader Marin County public. Marin County could, for example, adopt generally applicable taxes. But since that could be unpopular, the county has opted to extract money from individual landowners. 

A Supreme Court victory for the Cherks would protect all small landowners from abusive practices such as the one imposed by Marin County — landowners who want nothing more than to put their property to peaceful, non-harmful uses. It also would allow for more home construction, which would help solve California’s housing crunch. 

The court will decide whether to take the Cherks’ case this fall. Here’s hoping the justices decide in favor of further protecting property owners against attempted extortion by state and local governments.

Oliver Dunford is an attorney with Pacific Legal Foundation, which litigates nationwide to achieve court victories enforcing the Constitution’s guarantee of individual liberty. Follow him on Twitter @ojdunford.