Tahoe-Sierra v. Tahoe Reg'l Planning Agency, TAHOE-SIERRA

• Decision Date: 20 October 2000
• Docket Number: Nos. 99-15641,TAHOE-SIERRA,99-15771,s. 99-15641
• Citation: 228 F.3d 998
• Parties: (9th Cir. 2000) PRESERVATION COUNCIL, INC.; RICHARD A. ALLISON; ALPINE INVESTMENT COMPANY, LTD.; AMCO, INC.; JEFFREY B. ANDERSEN; BETH C. ANDERSEN; PETER J. ANDERSEN; JANET I. ANDERSEN; DONALD F. ARCHIBALD; JEAN L. ATHERTON; DAVID E. BAKER; MAXINE A. BAKER; JOHN H. BAKER; PIERINO C. BARENGO, et al., PlaintiffAppellee-Cross-Appellant, v. TAHOE REGIONAL PLANNING AGENCY, a separate legal entity created pursuant to an interstate compact between the States of California and Nevada; the voting members of the governing body of the Tahoe Regional Planning Agency including TONY CLARK, CHESTER A. GIBBS, ALEXANDER HAAGEN, III, STAN HANSEN, THOMAS HSIEH, JAMES KING, ROBERT PRUETT, JAMES S. REED, LARRY SEVINSON, THOMAS STEWART, WILLIAM D. SWACKHAMER, PEGGY TWEDT, RONALD D. WESTERGARD and NORMAN C. WOODS; STATE OF CALIFORNIA; STATE OF NEVADA, Defendant-Appellant-Cross-Appellee. Filed
• Court: U.S. Court of Appeals — Ninth Circuit

Page 998

228 F.3d 998 (9th Cir. 2000)

TAHOE-SIERRA PRESERVATION COUNCIL, INC.; RICHARD A. ALLISON; ALPINE INVESTMENT COMPANY, LTD.; AMCO, INC.; JEFFREY B. ANDERSEN; BETH C. ANDERSEN; PETER J. ANDERSEN; JANET I. ANDERSEN; DONALD F. ARCHIBALD; JEAN L. ATHERTON; DAVID E. BAKER; MAXINE A. BAKER; JOHN H. BAKER; PIERINO C. BARENGO, et al., PlaintiffAppellee-Cross-Appellant, v. TAHOE REGIONAL PLANNING AGENCY, a separate legal entity created pursuant to an interstate compact between the States of California and Nevada; the voting members of the governing body of the Tahoe Regional Planning Agency including TONY CLARK, CHESTER A. GIBBS, ALEXANDER HAAGEN, III, STAN HANSEN, THOMAS HSIEH, JAMES KING, ROBERT PRUETT, JAMES S. REED, LARRY SEVINSON, THOMAS STEWART, WILLIAM D. SWACKHAMER, PEGGY TWEDT, RONALD D. WESTERGARD and NORMAN C. WOODS; STATE OF CALIFORNIA; STATE OF NEVADA, Defendant-Appellant-Cross-Appellee.

Nos. 99-15641, 99-15771.

United States Court of Appeals for the Ninth Circuit

Filed October 20, 2000

D.C. No. CV-84-00257-ECR

Before: Henry A. Politz,^* Stephen Reinhardt, and Michael Daly Hawkins, Circuit Judges.

Prior Report: 216 F.3d 764

ORDER

Judges Politz, Reinhardt, and Hawkins voted to deny the petition for rehearing. Judges Reinhardt and Hawkins voted to deny the petition for rehearing en banc and Judge Politz recommended denial of the petition for rehearing en banc.

A judge of the court called for a vote on the petition for rehearing en banc. A vote was taken, and a majority of the active judges of the court failed to vote for en banc rehearing. Fed. R. App. P. 35(f).

The petition for rehearing and the petition for rehearing en banc are denied.

KOZINSKI , Circuit Judge, with whom Circuit Judges O'SCANNLAIN, TROTT, T.G. NELSON and KLEINFELD join, dissenting from the order denying the petition for rehearing en banc:

The panel does not like the Supreme Court's Takings Clause jurisprudence very much, so it reverses First English Evangelical Lutheran Church v. County of Los Angeles, 482 U.S. 304 (1987), and adopts Justice Stevens's First English dissent. Because we are not free to rewrite Supreme Court precedent, I urged our court to take this case en banc. By voting not to rehear, we have neglected our duty and passed the burden of correcting our mistake on to a higher authority.

1. For almost twenty years, Lake Tahoe property owners have battled the Tahoe Regional Planning Agency (TRPA), which has blocked the owners' efforts to build homes on their land. The primary issue on this appeal, the fourth in this interminable case, is a temporary moratorium that required owners to leave their land idle for almost three years. The moratorium is only one of a series of restrictions and regulations that have prevented the plaintiffs--largely families who purchased lots in the 1970s hoping to build vacation or retirement homes-from making any use whatsoever of their property. After a bench trial, the district court found that the regulation deprived the owners of the use of their property for three years, and so held they were entitled to compensation. The panel does not set aside the lower court's finding. Instead, it reverses the judgment because, in its view, a temporary regulation can never be a regulatory taking.

The government may conscript private property for public purposes, but the Fifth Amendment requires that it pay the owner for it. See U.S. Const. amend. V ("nor shall private property be taken for public use, without just compensation"). The requirement of just compensation ensures that the few are not forced to bear the cost of uses that benefit the many. Although a taking is most obvious where the government directly appropriates the property, physical occupation is not necessary. "[W]hile property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking." Pennsylvania Coal Co. v. Mahon , 260 U.S. 393, 415 (1922). The Supreme Court has explained time and again that where a regulation deprives the owner of all use and enjoyment of his property, this amounts to a taking and the government must pay. See Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1016 (1992). That's because the "total deprivation of beneficial use is, from the landowner's point of view, the equivalent of a physical appropriation. " Id. at 1017. This compensation requirement also guarantees that the government does not do by regulation what it cannot do through eminent domain--i.e., take private property without paying for it.

Of course, most land-use regulations are not takings and do not call for compensation. A regulation effects a taking only where it denies the owner "all economically beneficial or productive use of land." Id. at 1015. Lucas held that a South Carolina agency took two beachfront lots when it promulgated an environmental regulation that prevented the owner from building on his property. The Court concluded that, when the property owner is required "to sacrifice all economically beneficial uses in the name of the common good, that is, to leave his property economically idle, he has suffered a taking." Id. at 1019.

The only difference between this case and Lucas is that the regulation here had a finite duration. It was originally supposed to expire after two years and then was extended for another eight months. (In fact, its prohibitions continue to this day under subsequent development plans.) So the question is whether there is something special about a finite moratorium that relieves the government from its duty to compensate. The Supreme Court answered that question in First English when it said that " `temporary' takings which, as here, deny a landowner all use of his property, are not different in kind from permanent takings, for which the Constitution clearly requires compensation." 482 U.S. at 318 (emphasis added).

First English concerned a temporary development moratorium that Los Angeles enacted in response to a flood in the Angeles National Forest. First English Church challenged the ordinance, which prevented it from rebuilding damaged buildings. The California courts ruled that the regulation could only be a taking if permanent; if, on the other hand, the county decided to rescind the regulation, it ceased to be a taking. The U.S. Supreme Court disagreed, holding that"where the government's activities have already worked a taking of all use of property, no subsequent action by the government can relieve it of the duty to provide compensation for the period during which the taking was effective." Id. at 321.

Justice Stevens dissented from First English because he disagreed with the Court's "conclu[sion] that all ordinances which would constitute takings if allowed to remain in effect permanently, necessarily also constitute takings if they are in effect for only a limited period of time." Id. at 322 (Stevens, J., dissenting). Justice Stevens would have held that a temporary regulation cannot be a taking, even though it deprives the owner of all present uses, because the property retains value based upon its future uses. That reasoning, embraced by no other member of the Supreme Court, is adopted by the panel in this case.

While the opinion nowhere cites Justice Stevens's First English dissent, the reasoning--and even the wording--bear an uncanny resemblance. Here's why Justice Stevens disagreed with First English:

Regulations are three dimensional; they have depth, width, and length. As for depth, regulations define the extent to which the owner may not use the property in question. With respect to width, regulations define the amount of property encompassed by the restrictions. Finally, and for purposes of this case, essentially, regulations set forth the duration of the restrictions. It is obvious that no one of these elements can be analyzed alone to evaluate the impact of a regulation, and hence to determine whether a taking has occurred. . . . [I]n assessing the economic effect of a regulation, one cannot conduct the inquiry without considering the duration of the restriction. . . . Why should there be a constitutional distinction between a permanent restriction that only reduces the economic value of the property by a fraction-perhaps one-third--and a restriction that merely postpones the development of a property for a fraction of its useful life--presumably far less than a third?

Id. at 330, 332 (Stevens, J., dissenting). And here is the key passage of the panel's opinion:

Property interests may have many different dimensions. For example, the dimensions of a property interest may include a physical dimension (which describes the size and shape of the property in question), a functional dimension (which describes the extent to which an owner may use or dispose of the property in question), and a temporal dimension (which describes the duration of the property interest) . . . . A planning regulation that prevents the development of a parcel for a temporary period of time is conceptually no different than a land-use restriction that permanently denies all use on a discrete portion of property, or that permanently restricts a type of use across all of the parcel. Each of these three types of regulation will have an impact on the parcel's value . . . . There is no plausible basis on which to distinguish a similar diminution in value that results from a temporary suspension of development.

Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency , 216 F.3d 764, 774, 776, 777 (9th Cir. 2000) (citation omitted). Although claiming its opinion is fully consistent with First English, the panel plagiarizes Justice Stevens's dissent.

The panel opinion creates a conflict with Tabb Lakes, Ltd. v. United States , 10 F.3d 796 (Fed. Cir. 1993), which followed the majority's reasoning in First English . In so doing, Tabb Lakes recognized that "a taking, even for a day, without compensation is prohibited by the Constitution...