May 22, 2009

Legislation limiting development in certain rural communities that meet specified criteria, doe not constitute a taking

Validity of Pending Legislation Affecting Development in Rural Communities
TN Attorney General Opinions (March 12, 2009). Opinion Number: 09-26

Does House Bill 2361/Senate Bill 2217, which would limit development in certain predominantly rural communities, amount to a compensable taking of property under Article I, Section 21 of the Tennessee Constitution?

Opinion may be found at the TBA website:

“[T]he Supreme Court established its threshold categorical formulation in Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 112 S.Ct. 2886, 120 L.Ed.2d 798 (1992), in which it determined that two categories of regulatory action would be compensable without reference to the three-part Penn Central type inquiry. But the Court acknowledged that, with respect to the second category, i.e., the deprivation of all economically viable use, it had not clarified the property interest against which the loss of value is to be measured. The Court went on to suggest that the answer might require an examination of how the property owner’s reasonable expectations had been shaped by the state’s laws affecting land use.Id.
“Applying all of this jurisprudence to the pending legislation that is the subject of this request, it is the opinion of this Office that the provisions of House Bill 2361/Senate Bill 2217 limiting development in predominantly rural communities, as long as those communities meet certain specified standards, are, on their face, constitutionally permissible. Any takings analysis of the enforcement of those provisions will be fact-dependent and must rely upon application of the case law and criteria listed above to the specific facts involved.”Id.