More Moratoria Likely After Tahoe Decision

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Moratoria on construction had been a local planner’s tool of last resort, imposed only when left with no other options to halt a project or group of projects.

May 01, 2002

Moratoria on construction had been a local planner’s tool of last resort, imposed only when left with no other options to halt a project or group of projects. In part, the reluctance stemmed from a bevy of property-rights lawsuits that in recent years posed the risk of future liability against agencies that impose moratoria. But after the U.S. Supreme Court’s recent decision about a development moratorium placed on vacation property in Lake Tahoe, Calif., planners now might have a green light to use them more regularly.

“It gives planners greater ability to use moratoria as a planning tool, and I think you will see a lot more of them,” says Mary DiCrescenzo, a land-use attorney with the NAHB. “If the court had ruled that a temporary moratorium amounted to a taking, that would have been incredible news” for builders and developers.

Until the court’s April 23 ruling, developers speculated that a decision against the Tahoe Regional Planning Agency in favor of 200 property owners would immediately trigger a Fifth Amendment clause requiring “just compensation” for any loss of land. Instead, all cases about alleged takings related to development moratoria now require rulings based on a case-by-case review of facts. In effect, six justices believed that “just compensation” would make it too costly for planners to do their jobs.

Quick Facts About Land Use and 'Takings'

The Fifth Amendment’s 'Takings Clause':

Better known for granting the right to not self-incriminate, the amendment also requires “just compensation” for land or property taken by government.

Landmark U.S. Supreme Court rulings on land use and takings:

First English Evangelical Lutheran Church of Glendale v. County of Los Angeles. A 1987 ruling found that government regulation of land use can be a taking even if it is temporary.

Lucas v. South Carolina Coastal Council. The plaintiff argued successfully that a 1988 beachfront management law deprived him of all economic use of his property and therefore was a taking. The ruling established a test for all future takings.

Palazzolo v. Rhode Island. The 2001 ruling says there is a limit to the denials a government can issue to a landowner's proposals for land development without constituting a taking.

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