SPEAKERS CONTENTS INSERTS
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27–988 PDF
2006
PRIVATE PROPERTY RIGHTS IMPLEMENTATION ACT OF 2005
HEARING
BEFORE THE
SUBCOMMITTEE ON THE CONSTITUTION
OF THE
COMMITTEE ON THE JUDICIARY
HOUSE OF REPRESENTATIVES
ONE HUNDRED NINTH CONGRESS
SECOND SESSION
ON
H.R. 4772
JUNE 8, 2006
Serial No. 109–105
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Printed for the use of the Committee on the Judiciary
Available via the World Wide Web: http://judiciary.house.gov
COMMITTEE ON THE JUDICIARY
F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
HENRY J. HYDE, Illinois
HOWARD COBLE, North Carolina
LAMAR SMITH, Texas
ELTON GALLEGLY, California
BOB GOODLATTE, Virginia
STEVE CHABOT, Ohio
DANIEL E. LUNGREN, California
WILLIAM L. JENKINS, Tennessee
CHRIS CANNON, Utah
SPENCER BACHUS, Alabama
BOB INGLIS, South Carolina
JOHN N. HOSTETTLER, Indiana
MARK GREEN, Wisconsin
RIC KELLER, Florida
DARRELL ISSA, California
JEFF FLAKE, Arizona
MIKE PENCE, Indiana
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J. RANDY FORBES, Virginia
STEVE KING, Iowa
TOM FEENEY, Florida
TRENT FRANKS, Arizona
LOUIE GOHMERT, Texas
JOHN CONYERS, Jr., Michigan
HOWARD L. BERMAN, California
RICK BOUCHER, Virginia
JERROLD NADLER, New York
ROBERT C. SCOTT, Virginia
MELVIN L. WATT, North Carolina
ZOE LOFGREN, California
SHEILA JACKSON LEE, Texas
MAXINE WATERS, California
MARTIN T. MEEHAN, Massachusetts
WILLIAM D. DELAHUNT, Massachusetts
ROBERT WEXLER, Florida
ANTHONY D. WEINER, New York
ADAM B. SCHIFF, California
LINDA T. SÁNCHEZ, California
CHRIS VAN HOLLEN, Maryland
DEBBIE WASSERMAN SCHULTZ, Florida
PHILIP G. KIKO, General Counsel-Chief of Staff
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PERRY H. APELBAUM, Minority Chief Counsel
Subcommittee on the Constitution
STEVE CHABOT, Ohio, Chairman
TRENT FRANKS, Arizona
WILLIAM L. JENKINS, Tennessee
SPENCER BACHUS, Alabama
JOHN N. HOSTETTLER, Indiana
MARK GREEN, Wisconsin
STEVE KING, Iowa
TOM FEENEY, Florida
JERROLD NADLER, New York
JOHN CONYERS, Jr., Michigan
ROBERT C. SCOTT, Virginia
MELVIN L. WATT, North Carolina
CHRIS VAN HOLLEN, Maryland
PAUL B. TAYLOR, Chief Counsel
E. STEWART JEFFRIES, Counsel
HILARY FUNK, Counsel
KIMBERLY BETZ, Full Committee Counsel
DAVID LACHMANN, Minority Professional Staff Member
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C O N T E N T S
JUNE 8, 2006
OPENING STATEMENT
The Honorable Steve Chabot, a Representative in Congress from the State of Ohio, and Chairman, Subcommittee on the Constitution
The Honorable Jerrold Nadler, a Representative in Congress from the State of New York, and Ranking Member, Subcommittee on the Constitution
WITNESSES
Mr. Joseph L. Trauth, Jr., Partner, Keating, Muething & Klekamp, PLL
Oral Testimony
Prepared Statement
Mr. Franklin Kottschade, President, North American Realty
Oral Testimony
Prepared Statement
Mr. Daniel L. Siegel, Supervising Deputy Attorney General, Office of the Attorney General, State of California
Oral Testimony
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Prepared Statement
Professor Steven J. Eagle, Professor of Law, George Mason University School of Law
Oral Testimony
Prepared Statement
APPENDIX
Material Submitted for the Hearing Record
Response to Post-Hearing Questions from Joseph L. Trauth, Jr., Partner, Keating, Muething & Klekamp, PLL
Response to Post-Hearing Questions from Franklin Kottschade, President, North American Realty
Response to Post-Hearing Questions from Daniel L. Siegel, Supervising Deputy Attorney General, Office of the Attorney General, State of California
Response to Post-Hearing Questions from Professor Steven J. Eagle, Professor of Law, George Mason University School of Law
Letters submitted for the Record by Chairman Chabot:
Letter from Joseph M. Stanton, National Association of Homebuilders to the Honorable Jim Sensenbrenner, dated March 1, 2006
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Letter from R. Bruce Josten, Executive Vice President, Government Affairs, Chamber of Commerce of the United States of America, to the Members of the U.S. House of Representatives, dated March 8, 2006
Letter from Bob Stallman, President, American Farm Bureau Federation, to the Honorable Steve Chabot, dated April 12, 2006
Letter from Dan Danner, Executive Vice President, National Federation of Independent Business, to the Honorable Steve Chabot, dated May 15, 2006
Letters submitted for the Record by Ranking Member Nadler:
Letter from Terry L. Adkins, City Attorney, City of Rochester, Minnesota to the Honorable Steve Chabot and the Honorable Jerrold Nadler, dated June 9, 2006
Letter from Rudolph W. Giuliani, Mayor, City of New York to the Honorable Patrick J. Leahy, dated October 28, 1997
Letter from The United States Conference of Mayors to the Honorable Arlen Specter and the Honorable Patrick Leahy, dated June 6, 2006
Letter from the National League of Cities, U.S. Conference of Mayors, National Association of Counties, National Conference of State Legislatures, Council of State Governments and the International City Management Association to the Honorable Steve Chabot and the Honorable Jerrold Nadler, dated June 8, 2006
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Letter from W. Paul Farmer, Executive Director and CEO, American Planning Association to the Honorable Steve Chabot and the Honorable Jerrold Nadler, dated June 11, 2006
Letter from Timothy J. Dowling, Chief Counsel, Community Rights Counsel, to the Honorable Steve Chabot and the Honorable Jerrold Nadler, dated June 14, 2006
PRIVATE PROPERTY RIGHTS IMPLEMENTATION ACT OF 2005
THURSDAY, JUNE 8, 2006
House of Representatives,
Subcommittee on the Constitution,
Committee on the Judiciary,
Washington, DC.
The Subcommittee met, pursuant to notice, at 2:03 p.m., in Room 2141, Rayburn House Office Building, the Honorable Steve Chabot (Chairman of the Subcommittee) presiding.
Mr. CHABOT. The Committee will come to order.
This is the Constitution Subcommittee of the Judiciary Committee, and we welcome everyone here this afternoon. We will have some other Members probably coming here shortly on both sides.
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The Constitution Subcommittee convenes today to discuss H.R. 4772, the ''Private Property Rights Implementation Act,'' which I introduced earlier this year, along with the Democratic principal sponsor of the bill, Bart Gordon, to help all Americans defend their constitutional property protected rights.
Most Americans are familiar with one recent decision involving all Americans property rights, the case of Kelo v. City of New London, in which the Supreme Court held that the Constitution allows the Government to take private property from one citizen and give it to private companies or other private individuals.
The House of Representatives acted to correct that notorious decision by passing a bill, H.R. 4128, by the overwhelmingly bipartisan margin of 376–38. However, the Supreme Court, during its last term, handed down another—what many of us consider us to be bad decisions—that fails to protect the private property rights of all Americans. And correcting that decision through the legislation we will be discussing today should have the same bipartisan support, we hope.
Here is what the problem is. Strange as it sounds, under current law, property owners are now blocked from raising a Federal fifth amendment takings claim in Federal court.
And here is why. The Supreme Court's 1985 decision in Williamson County v. Hamilton Bank requires property owners to pursue, to the end of all available remedies, for just compensation in State court before the private property owner can file suit in Federal court under the fifth amendment.
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Then, just last year, in the case of San Remo Hotel v. City and County of San Francisco, the Supreme Court held that, once a property owner tries their case in State court and loses, the legal doctrine of claim preclusion requires Federal courts to dismiss the claims that have already been raised in State court, even though the property owner never wanted to be in State court with their Federal claims in the first place.
The combination of these two rules means that those with Federal property rights claims are effectively shut out of Federal court on their Federal takings claims. These decisions set them unfairly apart from those asserting any other kind of Federal rights, such as those asserting free speech or religious freedom rights, who nearly universally enjoy the right to have their Federal claims heard in Federal court.
The late Chief Justice Rehnquist commented directly on this unfairness, observing in his concurring opinion in the San Remo case that, ''The Williamson County decision all but guarantees that claimants will be unable to utilize the Federal courts to enforce the fifth amendment's just compensation guarantee.''
The Second Circuit Court of Appeals also noted that, ''It is both ironic and unfair if the very procedure that the Supreme Court required property owners to follow before bringing a fifth amendment takings claim, a State court's taking action, also precluded them from ever bringing a fifth amendment takings claim in Federal court.''
H.R. 4772, the ''Private Property Rights Implementation Act,'' will correct the unfair legal bind that catches all property owners in what is effectively a Catch-22. This bill, which is based on Congress's clear authority to define the jurisdiction of the Federal courts and the appellate jurisdiction of the Supreme Court, would allow property owners raising Federal takings claims to have their cases decided in Federal court without first pursuing a wasteful and unnecessary litigation detour, and possible dead end, in State court.
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H.R. 4772 would also remove another artificial barrier blocking property owners' access to Federal court. The Supreme Court's Williamson County decision also requires that, before a case can be brought for review in a Federal court, property owners must first obtain a final decision from the State government on what is an acceptable use of their lands.
This has created an incentive for regulatory agencies to avoid making a final decision at all by stringing out the process, and thereby forever denying a property owner access to courts. Studies of takings cases in the 1990's indicate that it took property owners nearly a decade of litigation, which most property owners can't afford, before takings claims were ready to be heard on the merits in any court.
To prevent that unjust result, H.R. 4772 would clarify when a final decision has been achieved and when the case is ready for Federal court review. Under this bill, if a land use application is reviewed by the relevant agency and rejected, a waiver is requested and denied, and an administrative appeal also rejects the application, then a property owner can bring their Federal constitutional claims in a Federal court.
The bill would change the way agencies resolve disputes. Rather, H.R. 4772 simply makes clear the steps the property owner must take to make their case ready for court review.
H.R. 4772 also clarifies the rights of property owners raising certain types of constitutional claims in the following ways.
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And I recognize myself for 1 additional minute, without objection.
First, it would clarify that conditions that are imposed upon a property owner before they can receive a development permit must be proportional to the impact the development might have on the surrounding community.
Second, it would clarify that, if property units are individually taxed under State law, then the adverse economic impact of a regulation—excuse me—then the adverse economic impact of a regulation has on a piece of property should be measured by determining how much value the regulation has taken away from the individual lot affected, not a whole collection of lots grouped together.
Third, the bill would clarify that due process violations involving property rights should be found when the Government has been found to have acted in an arbitrary and capricious manner.
I think we all look forward to discussing this legislation with our witnesses here this afternoon. We want to, again, thank them for appearing.
And at this time I will yield to the gentleman from New York, Mr. Nadler, who is the Ranking Member of the Constitution Subcommittee, for the purposes of making an opening statement.
Mr. NADLER. Thank you, Mr. Chairman. I want to join you in welcoming our witnesses today.
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I think we all agree that the Constitution's protection of property rights must be preserved. The Constitution provides for just compensation when Government takes property, but nowhere does it spell out exactly what a taking is. That has been left to those unelected Federal judges who, just yesterday, we were trying to strip of all authority to hear cases involving the Pledge of Allegiance.
We were told by the sponsors of this legislation that Congress has the power to strip the Federal courts of their jurisdiction to hear a particular constitutional claim, so long as the State courts remained available to hear the claim. What a difference a day makes.
Today, we have legislation that removes the most fundamentally local issues—zoning, environmental protection, infrastructure costs, development, sprawl—and plucks them out of the States and into the arms of those unelected Federal judges we didn't trust yesterday. It is enough to make your head spin.
Whatever dangers to the environment this legislation may pose, it is green in at least one respect: It is an outstanding example of recycling, taking us all back to those memorable days of Newt Gingrich's contract on America.
Later versions of that effort, which have been called kindler and gentler—and gentler, by at least one legal scholar, focused on procedural issues, a euphemism for forum shopping.
This bill is a little less kind and a little less gentle. It greatly expands the definition of a taking. It appears to require the Government to provide compensation in many cases where the Constitution would not. It would allow developers to game the system by arbitrarily dividing their lots to squeeze money out of our communities.
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Let us remember what is involved in many of these so-called regulatory takings cases. What is involved is the protection of the environment and local planning areas.
Should we have to pay off someone to keep them from degrading our water supply? That seems to be the claim of some developers who want to fill in wetlands at will.
What shall we tell the communities devastated by Hurricane Katrina who are bracing for the next hurricane season and need remaining wetlands to protect them? Who pays for the damage caused by wetlands devastation? Other taxpayers. They are the ones who—who will have their taxes raised to build new water purification plants.
Should we have to pay off people if we want to control sprawl? How about if we make them pay for some or all of the costs of the new roads, sewers, water lines and schools that will be needed when they are done with their development?
My friends on this Committee have often railed against trial lawyers who engage in forum shopping. Now this Committee appears prepared to legislate forum shopping to benefit one particular group: real estate developers.
This legislation provides a new and preferential standard for one group asserting its rights under section 1983, real property owners, not other property owners, not people who have been denied the right to counsel, not the descendents of former slaves, or any of the other myriad groups who look to the courts to vindicate their rights and for whom section 1983, which deals with depravation of civil rights under color of law, was written.
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By all means, we should protect property rights. But we should not so distort the process to give some developers virtual immunity from legitimate land use and environmental legislation, as I very much fear that this bill would do.
I look forward to the testimony of the witnesses, and I yield back the balance of my time.
Mr. CHABOT. I thank the gentleman.
And the chair would just note—I am sure it was a slip of the tongue—but it was the ''Contract with America,'' not the ''Contract on America.''
Mr. NADLER. It was most certainly not a slip of the tongue. [Laughter.]
Mr. CHABOT. I stand corrected, as so does the Ranking Member.
Do any of the other Members of the Committee present wish to make an opening statement?
Okay, we will go right into introducing the distinguished witness panel that we have here this afternoon.
Our first witness is Joseph Trauth. Mr. Trauth is a member of the Cincinnati law firm of Keating, Muething and Klekamp, where he practices zoning, planning and land use law. Mr. Trauth is a graduate of Xavier University and the University of Cincinnati's School of Law.
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Prior to practicing law at his current—excuse me—Mr. Trauth served in the U.S. Peace Corps as assistant to the director of economic development in Western Samoa, as assistant to U.S. Congressman W.J. Keating, and as chairman of the Volunteer Lawyers for the Poor Foundation. He was also listed as Ohio's ''SuperLawyer'' in 2004.
And we welcome you here this afternoon, Mr. Trauth.
Our second witness is Franklin Kottschade.
Am I pronouncing that correctly, Mr. Kottschade? Thank you.
Representing the National Association of Home Builders, a federation of more than 800 State and local associations, whose mission is to enhance the climate for housing in America.
Five years ago, Mr. Kottschade was named party in a case called Kottschade v. City of Rochester that sought to overrule the Supreme Court's Williamson County decision, but the Supreme Court ultimately decided not to hear his case.
And we welcome you here this afternoon.
Our third witness is Daniel L. Siegel. Mr. Siegel is the supervising deputy attorney general, in charge of the California attorney general's land law section. He represents various State agencies in complex State and Federal land use lawsuits, including many taking factions.
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In this capacity, he has authored amicus curiae briefs on behalf of the California attorney general in takings cases such as Brown v. Legal Foundation of Washington and San Remo Hotel v. City and County of San Francisco. Mr. Siegel is graduate of the New York University School of Law.
And we welcome you here this afternoon, Mr. Siegel.
Our fourth and final witness is Professor Steven Eagle of George Mason Law School. Excuse me. Professor Eagle is an expert in regulatory takings and other aspects of property law, who has appeared before this Subcommittee many times.
He is the author of a leading property law treatise and many other scholarly and popular articles on the subject. He also teaches a variety of programs for judges and the practicing bar. Professor Eagle received his J.D. from Yale Law School.
We thank all our witnesses for taking their time out of very busy schedules, as we know, to appear before us this afternoon.
And, Professor Eagle, congratulations, by the way, on a tremendous basketball season this year. We were all watching, and hoping, and praying. Since the University of Cincinnati in my district didn't quite make it this year, we were pulling for you all. And we had staff people that were attending almost all your games. So a job well done.
It is the practice of the Committee to swear in all witnesses appearing before us, so if you would all please stand and raise your right hands.
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Do you swear that, in the testimony you are about to give, you will tell the truth, the whole truth, and nothing but the truth, so help you God?
Thank you. All witnesses have indicated in the affirmative.
Finally, I would like to just explain to you what we call the 5-minute rule here. Each of the witnesses will have 5 minutes. And each of the Members who are asking questions up here will also have 5 minutes.
We even have a lighting system up there. When you begin speaking, the green light will come on. That will be on for 4 minutes. A yellow light will come on after 4 minutes to let you know you have about a minute to wrap up. And then the red light will come on.
We would appreciate it if you would wrap up within that time, if at all possible. I won't gavel you down immediately, but we are keeping pretty close track of time. So if you could stay within that, we would very much appreciate that.
And, Mr. Trauth, you are recognized for 5 minutes.
TESTIMONY OF JOSEPH TRAUTH, JR., PARTNER, KEATING, MUETHING & KLEKAMP, PLL
Mr. TRAUTH. Thank you, Chairman Chabot, Ranking Member Nadler, Members of the Subcommittee.
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My name is Joseph L. Trauth, Jr. I am an attorney with the law firm of Keating, Muething & Klekamp in Cincinnati, Ohio, full service law firm. I am licensed to practice both in Ohio and Kentucky, and I have specialized during that period in land use law and real estate law.
The primary purpose of H.R. 4772 is to simply and expedite access to the Federal courts for parties injured under the 5th and 14th amendment of the United States Constitution. The bill is primarily concerned with regulatory takings.
We often hear about the eminent domain cases, which are very high-profile, but every day we have regulatory takings, and I have seen it over the past 32-plus years.
The following details the significant impact the bill would have, as well as the reasons its passage is necessary. My testimony focuses primarily on section II and section V of the bill.
And I would like to say that this is not a developers' bill; it is not a builders' bill. It is a personal property rights bill, and those are the people that I represent every day. These are the personal; these are the people who own property personally, farmers, people who have held land in their family, people who have put all of their money into property.
Section II of the bill is primarily aimed at granting property owners with Federal takings claims access to the Federal courts system. Currently, an aggrieved party must file suit in State court when municipalities or other governmental agencies violates his or her 14th amendment or fifth amendment property rights. Even if the property owner brings a purely Federal claim, he or she will be barred from filing in Federal court.
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The Williamson County case that was talked about early strips property owners of protected rights. Williamson County created three harmful effects for property owners.
First, by requiring that fifth amendment takings cases to originate in State court, States have developed different standards interpreting what constitutes a taking and when a taking is unconstitutional.
The second consequence of Williamson County is that the costs associated with litigating a taking claim have dramatically increased.
And, finally, after San Remo Hotel v. San Francisco was decided in 2005, property owners were left with the possibility of never being able to bring their takings claims under the fifth amendment in a Federal court.
The problem is with different State standards. There is no logical reason why the fifth amendment should mean different things depending upon which State you reside in. However, as a result of Williamson County, this is exactly what has happened.
State courts, such as Ohio, have elevated themselves above the Supreme Court of the United States in regards to interpreting the Federal Constitution.
The Supreme Court has established a two-part disjunctive test to prove unconstitutionality. Does the ordinance substantially advance the legitimate State interests? Or does it deny the owner with economically feasible use of his land?
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Unfortunately, in Ohio, back in 1990, Ohio created a conjunctive test. You had to prove both, and you had to prove both beyond fair debate, which was interpreted under case law as to mean beyond a reasonable doubt.
So to protect your constitutional fifth amendment right in Ohio, you have a criminal prosecution standard to meet in order to protect your federally granted fifth amendment property rights. That is just wrong; it is inappropriate.
Kentucky and Indiana, who are in our region, have slightly different standards. Passing H.R. 4772 solves the problem of differing State standards. Its passage is necessary for Ohioans to fully enjoy their constitutional rights.
Ohio essentially seceded from the fifth amendment and the 14th amendment for 8 years. And they still today require a criminal conviction standard for property owners to prove that his or her Fifth and 14th amendment rights have been trampled. Passing of this bill will reunite Ohioans with their 5th and 14th amendment rights.
The exhaustion requirement of Williamson County can prohibitively increase litigation costs. I have two stories. One was a case that I had in Ohio, where an intersection next to an expressway was zoned for single-family housing. We fought it for 8 years in a State court before we got to a damage claim, and at that point in time my clients had to settle, because it had just gone on too long and was too costly.
The second one is two parties, the township and the developer and the property owner, had signed a consent decree and the judge refused to sign the consent decree. This case is still going on today after 3 years, with no remedy in sight.
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San Remo preclusion is a problem. And as I said, the fifth section of the bill, I think, clarifies and defines multiple constitutional standards. It does not make a dramatic shift in the law.
Finally, H.R. 4772 will provide uniformity to fifth amendment regulatory takings and eminent domain takings cases and ensure property owners rights throughout the United States as being adequately protected by the Federal courts.
Again, this is not for Fortune 500 companies. This bill is not for developers. This is for citizens of the United States who own property and have a right to have that protected in the Federal court, and I think this bill will do that. And we urge its passage.
Thank you.
[The prepared statement of Mr. Trauth follows:]
PREPARED STATEMENT OF JOSEPH L. TRAUGH, JR.
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Mr. CHABOT. Thank you very much.
Mr. Kottschade, you are recognized for 5 minutes.
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TESTIMONY OF FRANKLIN KOTTSCHADE, PRESIDENT, NORTH AMERICAN REALTY
Mr. KOTTSCHADE. Mr. Chairman, before I start, I would like to claim personal privilege to introduce my wife.
Mr. CHABOT. Go right ahead.
Mr. KOTTSCHADE. My wife, Bonnie, who is—we have been married 39 years. Thank you.
Mr. CHABOT. We welcome you here, also, Mrs. Kottschade.
Mr. KOTTSCHADE. Chairman Chabot, Ranking Member Nadler, Members of the Subcommittee, my name is Franklin Kottschade. I am a builder-developer from Rochester, Minnesota. And I am pleased to testify on behalf of the National Association of Home Builders in support of H.R. 4772, the ''Private Property Rights Implementation Act.''
Last year, the House took decisive and swift action in response to the United States Supreme Court's Kelo decision. Unfortunately, misuse of eminent domain powers is not the only abuse of the fifth amendment protections.
A more persuasive and subtle abuse of private property rights can occur when Government regulates the property as if they condemned it. When Government entities take private property rights through excessive regulation and then refuse to pay just compensation, property owners should be able to protect their constitutional rights in Federal court, just as has been done with other constitutional rights.
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H.R. 4772 levels the playing field in the regulatory takings context by allowing owners to bring takings claims directly to Federal court. I am one of the many litigants who attempted without success to address the violations of my constitutional rights in Federal court.
In 1992, I embarked on a 14-year legal battle. I applied for approval of 104-unit development, consistent with existing zoning regulations. The city said yes, but imposed nine owners conditions that rendered the number of townhouses I could build to 26, and made the project economically infeasible.
The city's conditions would have added $70,000 to each townhouse, a 300-percent increase in an area where the average townhouse market was $125,000.
Every effort I made to negotiate or appeal the decisions of the zoning board and the city common council was flatly denied. After 9 years of negotiations with the city, I filed suit in Federal court in 2001. And 5 years after filing that suit, I still do not—I still don't know if my fifth amendment rights were violated because a court has never heard the merits of my case.
Federal courts refuse to hear my case, ruling that I must first defend my constitutional rights in State court, and yet the recent Supreme Court decision in San Remo confirms that once a takings plaintiff goes to State court, he will be unable to later access the Federal courts.
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As a result, property rights claims under the fifth amendment bear the unfortunate and unique distinction of never being heard in Federal court, unlike the protection of other provisions by the Bill of Rights.
Accordingly, various studies show, undertaken by the National Association of Home Builders, over the past 15 years, only 19 out of 161 taking cases brought to Federal court were considered on its merits. Of course, this was before San Remo completely shut the door to the Federal court.
And of 18 Federal appellate cases where the merits were reached, it took property owners on an average of 9.1 years to have a Federal court reach its final determination. This is wrong.
Ironically, if my case were involved in building of a church instead of townhouses, I could have gone directly to Federal court, because Federal courts will hear the first amendment land use cases. Only property owners with fifth amendment claims are denied ever the specter of justice.
Currently, municipalities and local governments hold all the cards. I learned recently of a case that clearly shows the system is broken, Koscielski v. City of Minneapolis. The property owner filed a claim in State court. Minneapolis had the case removed to Federal court, which the federal—which the Supreme Court rules under its ruling in the College of Surgeons.
Once in Federal court, the city of Minneapolis argued that Mr. Koscielski's takings were not ripe because he had not gone to State court. Yet it was the city of Minneapolis that requested the removal to Federal court in the first place.
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And this is not an isolated situation. The exact same thing happened in the Fifth Circuit.
The Government's abuse of the system in these cases is egregious. It wastes the court's time and forces property owners on an expensive, wild goose chase through our courts. Congress must restore the balance between Government and property owners by passing this important legislation which will put the fifth amendment back on par with the rest of the Bill of Rights.
Mr. Chairman, Members of the Committee, thank you for the opportunity to testify today.
[The prepared statement of Mr. Kottschade follows:]
PREPARED STATEMENT OF FRANKLIN P. KOTTSCHADE
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Mr. CHABOT. Thank you, Mr. Kottschade.
And, Mr. Siegel, you are recognized for 5 minutes.
TESTIMONY OF DANIEL SIEGEL, SUPERVISING DEPUTY ATTORNEY GENERAL, OFFICE OF THE ATTORNEY GENERAL, STATE OF CALIFORNIA
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Mr. SIEGEL. Chairman Chabot, Ranking Member Nadler, Members of the Subcommittee, on behalf California Attorney General Bill Lockyer, thank you for this opportunity to testify.
Forty attorneys general, Republicans as well as Democrats, oppose the predecessors to this bill. I would like to review why there has been such strong bipartisan opposition to these measures.
First, they run counter to basic concepts of federalism. Most significantly, this bill would reduce the role of State courts in local land use disputes. State courts, however, are the best forum for resolving local disputes.
As the Supreme Court explained just last year in its San Remo decision, ''State courts undoubtedly have more experience than Federal courts do in resolving the complex factual, technical and legal questions related to zoning and land use regulations.''
Similarly, the newest Supreme Court member, Justice Alito, cautioned in an opinion he authored shortly before joining the Supreme Court that the Federal judiciary should reject procedural rules—reject procedural rules—under which it could be, ''cast in the role of a zoning board of appeals.''
This bill, however, would do just that: It would move local land use disputes out of the State courts and into the Federal courts, making them zoning board of appeals.
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Second, this bill facilitates the intimidation of local governments, instead of locally based collaborative—the use of a locally based collaborative process. A key supporter made this clear.
In 2000, promoting a prior effort to alter these Williamson County requirements, the chief lobbyist for the National Association of Home Builders, Jerry Howard, declared that, ''This bill will be a hammer to the head of these State and local bureaucracies.''
He is right, especially when you consider whose head this hammer will be to. This will mainly be to the head of the approximately—excuse me, there are approximately 36,000 cities and towns throughout the nation. Ninety percent of them have populations of under 10,000.
These small towns and cities, with their limited financial resources, will be highly intimidated by the threat of a Federal lawsuit. They will also be intimidated by the bill's finality provisions, which facilitate the filing of premature lawsuits, if local governments try to work out reasonable compromises to often difficult land use issues. That is not good policy.
Finally, this bill runs counter to separation of powers principles. The separation of powers defect is particularly stark in the section V of—section V of the bill, which is called a clarification. It is a new provision that was not in prior bills.
It seeks to change—this bill seeks to change, for example, the test used by the courts in reviewing substantive due process challenges involving property rights disputes.
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As Justice Alito explained in an appellate decision he wrote shortly before joining the Supreme Court, ''These land use disputes are judged under a 'shocks the conscience' standard, not an arbitrary and capricious standard.'' That was expressed holding.
This bill, however, seeks to change the standard to an arbitrary and capricious standard that is not permitted under separation of powers principles. In City of Boerne v. Flores, the Supreme Court expressly held that Congress cannot dictate the standard that courts already use in reviewing constitutional challenges; that is the rule of the judiciary. A similar separation of powers problem permeates the rest of this bill.
Is the current land use system—land use system perfect? No, of course not. With the tens of thousands of decisions being made each year, there are sure to be abuses. Most are corrected by the State court; moreover, State and local governments are continuously seeking to improve the system.
This bill, however, is not the solution. It would federalize local land use issues. It facilitates the use of intimidation rather than a thoughtful, deliberative process. And it runs counter to separation of powers principles.
On behalf of the California attorney general, I therefore respectfully urge that you reject this bill.
Thank you.
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[The prepared statement of Mr. Siegel follows:]
PREPARED STATEMENT OF DANIEL L. SIEGEL
[Note: Image(s) not available in this format. See PDF version of this file for complete hearing record.]
Mr. CHABOT. Thank you, Mr. Siegel.
And our final witness here this afternoon will be Professor Eagle.
Professor Eagle, you are recognized for 5 minutes.
TESTIMONY OF STEVEN EAGLE, PROFESSOR OF LAW, GEORGE MASON UNIVERSITY SCHOOL OF LAW
Mr. EAGLE. Thank you, Mr. Chairman, Representative Nadler, and distinguished Members of the Subcommittee.
My name is Steven Eagle. I am a professor of law at George Mason University, in Arlington, Virginia. I testify today in my individual capacity as a teacher of property, land use, and constitutional law. I write extensively on property issues.
My prepared statement, Mr. Chairman, is somewhat technical. In my oral statement, however, I wish to stress principles more than technicalities. It is not my general inclination to suggest that more laws be passed, and that goes especially for Federal laws. I want America to be a nation under the rule of law and not a nation under the rule of laws in the plural.
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My own approach is one of subsidiarity, that decisions be made at the lowest appropriate level. I neither oppose local government nor want to deprive local officials of their legitimate powers.
To the extent that completing the third edition of a 1,200-page treatise on regulatory takings makes me a student of the subject, Mr. Chairman, I would be the first to concede that the line separating private property rights and legitimate Government regulations is not always easy to draw.
But at the same time, Mr. Chairman, we have to struggle with real issues. We ought not to create artificial ones for ourselves and for the public.
Mr. Kottschade is a home builder. In a real sense, he represents the young families and others who are depending on him for places to live. The rest of us on this panel are employed in interpreting words.
It is tempting to use language and to invent and defend unnecessary procedural requirements with the result of discouraging those with whom we disagree from seeking justice. We inveterate federalism in the United States, but federalism is inherently messy.
No one knows what kind of politics, or religion, or personal characteristics might be acceptable to the people of a given community like its local officials. However, our Federal Constitution provides certain rights to individuals, and those rights sometimes work against the grain of what local officials want. This is the heart of our Bill of Rights.
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In Dolan v. City of Tigard, the Supreme Court declared, ''We see no reason why the takings clause of the fifth amendment, as much a part of the Bill of Rights as the first amendment or the fourth amendment, should be relegated to the status of a poor relation.''
The fact that State courts might be more aware of local preferences doesn't prevent plaintiffs from bringing other kinds of claims involving the Bill of Rights to Federal courts, and that should be the case here, as well.
Likewise, in a bond covenant case, United States Trust Company of New York v. New Jersey, the Supreme Court warned us that more judicial oversight is required when the State's self-interest is at stake. In the regulation of real property, the financial interests of municipalities might well depend on keeping out uses that result in the expenditure of tax revenues, such as the creation of residences that will house school pupils.
I support H.R. 4772, Mr. Chairman, because I think it will remove artificial impediments to individual property owners, vindicating their rights not to have their property taken without just compensation.
My friend, Daniel Siegel, is concerned that H.R. 4772 would provide a hostile process involving land owners and local government, as opposed to a thoughtful and balanced process he thinks exists now.
I would suggest, with respect, that salaried planning staffs and city attorneys are better able to use delay to advantage than home builders and land owners, who must pay property taxes, mortgage interests, and their own litigation fees.
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Under the final decision prong of Williamson County, localities have yet an additional incentive to avoid giving permanent applicants a straightforward response. If they are going to have to wait for a truly final decision, as Mr. Siegel indicates, they have a long time to wait.
The Williamson County State compensation prong is one that many courts have mentioned. Yet, in the case of Lingle v. Chevron, we saw that a phrase, long repeated by the Supreme Court, when first subject to re-analysis fell by the wayside.
Likewise, Mr. Chairman, I think that, in this case, we will find that, when the Supreme Court finally does get down to examining Williamson County, it will decide that the State compensation prong is not necessary as a constitutional standard and makes little sense as a prudential standard.
I hope, Mr. Chairman, that the Subcommittee understands that, if it and the Congress express the intent of having the process one where it is easier for individuals to vindicate their rights, that the Supreme Court probably will accept many of those provisions. And if it does not, Mr. Chairman, that is something that will have to be dealt with in the normal course of legislation and judicial adjudication.
But most of the issues we are talking about are not written in stone, and for the Supreme Court to have the benefit of a clear expression of congressional intent and a congressional statute would be very salutary.
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Thank you, Mr. Chairman.
[The prepared statement of Mr. Eagle follows:]
PREPARED STATEMENT OF STEVEN J. EAGLE
[Note: Image(s) not available in this format. See PDF version of this file for complete hearing record.]
Mr. CHABOT. Thank you, Professor Eagle.
Members of the Committee will now have 5 minutes each to ask questions. And the Chair will recognize himself for 5 minutes for that person—that purpose.
And, Mr. Trauth, I will begin with you.
Can you describe what it takes under current law for a citizen to get into Federal court with a Federal free speech or religious discrimination claim and contrast that to what it takes for someone to get into court with a Federal property rights claim?
Mr. TRAUTH. Yes. Mr. Chairman, today, for a free speech or religious discrimination claim, a person under the U.S. Constitution has direct Federal access to Federal courts. Under a taking claim, property rights claim, you have no access under the case law of San Reno in 2005.
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Mr. CHABOT. We are talking about Federal rights under both issues, in essence, both?
Mr. TRAUTH. What is that?
Mr. CHABOT. I say that we are talking about a right that one would think one would have under the Constitution in both instances?
Mr. TRAUTH. Yes, right. I mean, to be denied access to Federal court on a constitutional claim is ridiculous. When, you know, this is as sacrosanct as any other Federal right under the Constitution—even more so. I mean, our country was founded on private property rights.
And, you know, not to be able to address that in Federal court, I think, is absurd.
Mr. CHABOT. Thank you.
Mr. Kottschade, I will go with you next, if I can. What has happened to your land since the Supreme Court denied your cert petition?
Mr. KOTTSCHADE. Mr. Chairman, in March of 2003, the State of Minnesota Department of Transportation commenced condemnation proceedings against it. Now, this is very significant, and I just heard the testimony that the State and local governments are working to improve the system. I am not sure I can afford that.
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The reason I say that tongue-in-cheek is real simple: The city of Rochester attached conditions onto my property which devalued it. Now, the State of Minnesota has come in and is clipping the coupons. They have offered me, at this point, 10 cents on a dollar.
When I challenged them on that, ''Why are they doing that?'' They said, ''Well, you can't get the permits anyway.''
So there is a collaboration between local and State government, as was testified. I am not sure that, as a citizen of this community, of this nation, that I can afford that.
Mr. CHABOT. Thank you.
Let's see, Mr. Siegel, if I could go to you next. In one case in Minnesota, a property owner filed his Federal takings lawsuit in State court first, as he was required to do so by the Supreme Court's Williamson County case. Then the city removed the case to Federal court, as they are allowed to do under the Supreme Court's College of Surgeons case.
Then, the Federal court dismissed the property owner's case because the property owner hadn't litigated his case in State court first, even though that is exactly what the property owner was doing when the city removed the case to Federal court.
Can you give me any example from any other area of law that results in such a hopelessly unfair Catch-22 for the average citizen?
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Mr. SIEGEL. Well, I have not read that case, the Minnesota case. But I what I believe happened, from my—reading the testimony of my co-witness here—is that, under the removal statutes, any party to a State action who believes that an action should have been filed in Federal court can remove the case into Federal court, which is like filing a complaint, a new lawsuit in Federal court.
The court then looks at that new lawsuit and says, ''Should this really be here in Federal court or not?'' And it sounds like, in that case, in should never have been in the Federal court in the first place, so that Federal court put the court—the case back where it belonged, in State court, because there never had been an exhaustion of State court requirements, which is required under Williamson County.
So it is just the way that the removal statutes work. And, you know, the Committee may want to look at the removal statutes, but that is how they operate.
Mr. CHABOT. Mr. Kottschade?
Mr. KOTTSCHADE. Mr. Chairman, for the record, the Federal—or the State moved to take that into Federal court under the College of Surgeons v. Chicago case, where the State can take court cases into Federal court, but I as a property owner am denied that right. And I guess the question is: Why isn't a level playing field, that if the city can petition a takings case into Federal court, why can't I, as an individual, go to State—or go into Federal court?
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Mr. CHABOT. In the little time that I have left, if I can go to you, Professor Eagle. Practically speaking, under current rules, can the average person expect to be able to litigate their Federal property rights claims up to and through the Federal court system today? And what financial and time barriers await such people who try to do so?
Mr. EAGLE. No, Mr. Chairman, they cannot. If they file an as applied case, that is, that the regulation is unconstitutional, given their specific situation, it can take them up to a decade and several hundred thousand dollars of expenses to ripen their case for Federal court.
And then, of course, under San Remo, they will be precluded from having the substance heard anyway. So that is absolutely a dead end.
On the other hand, Mr. Chairman, there could be a facial challenge, saying that the regulation, under all circumstances, never conceivable can be constitutional, but, of course, that is impossible to win, so they lose right off. Either way, they have no chance.
Mr. CHABOT. Thank you. My time has expired.
The gentleman from New York, Mr. Nadler, is recognized for 5 minutes.
Mr. NADLER. Thank you.
Mr. Siegel, the bill makes certain changes to the ripeness doctrine. To what extent do you think that these changes to ripeness and other standards in section V, of the takings standard in section V, present constitutional issues we have to deal with, not just statutory issues?
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Mr. SIEGEL. They very definitely present constitutional issues. And it is most stark in section V.
For example, I gave one example concerning changing the standard of review and substantive due process cases, where in essence what this bill does is it directs the judiciary to change the law, change the judiciary's interpretation of the Constitution.
Another example is in the so-called partial as a whole provision. That is in subsection two of section V. And what this bill does is it says that if a property owner owns, say, 100 lots, and if one of those lots cannot be developed because it has a wetland, but the other 99 can, the court is directed to only look at that single lot that cannot be developed.
That is not current law. As explained in District Intown and many other cases, the courts look at what is—whether or not a property holding is a unified holding or not, and that is the test that is used.
This directs the courts to change their interpretation of the Constitution, and that is, on the separation of powers principles, there is—Congress does not have that authority.
Mr. NADLER. Do you think this provision will be ineffective as passed?
Mr. SIEGEL. Well, it will not only be ineffective, but it will—rather than helping developers, to the extent that developers rely on these provisions it is going to delay rather than speed up their lawsuits, because there is going to be litigation over this bill and whether or not it is valid.
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So there is going to be more confusion and more delay, rather than what its supporters are hoping for, which is to try to speed things up.
Mr. NADLER. Okay, one more question, Mr. Siegel, before I go onto others. We have considered several bills over the years that are similar to this one. How is this one different? I am sure you are familiar with the other takings bills we have considered in the last few years.
And should Members who voted for the other bills have any concerns that this contradicts those?
Mr. SIEGEL. They should be very concerned about section V. Section V never appeared in any of the prior bills. It is described as a ''clarification'' of constitutional law, but what it is doing is attempting to make constitutional law, and that has never been done before in any of the prior bills.
Mr. NADLER. Thank you.
Mr. Kottschade, are there jurisdictions where a developer would fare better in State court than in Federal court? Would this legislation give the developer the choice of forum?
Mr. KOTTSCHADE. Congressman, that is a great question. The short answer is: I do not want to go to court, period. I want to be able to develop. I want to be able to pull projects together. I—but——
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Mr. NADLER. Yes, but this—excuse me, but this bill—if you don't want to go to court, this bill doesn't affect it.
The question is, if this—if you have to go to court, you feel you have to go to court, does this bill give you a choice of forums?
Mr. KOTTSCHADE. What, Congressman, this bill would give me a right to go to court, Federal court, as I testified earlier. I don't believe today, based upon a decision in Minnesota, that I have—can go to State court, because, if I do, I am going to get bounced into Federal court and I am going to get bounced out.
So I think, after the—after the Koscielski v. Minneapolis, this is very important that we have this.
Mr. NADLER. May I ask Professor Eagle the same question?
Mr. SIEGEL. If I could——
Mr. NADLER. Mr. Siegel, go ahead? Whoever is most eager to answer.
Mr. SIEGEL. We could change our names.
Mr. NADLER. Whoever is the most eager to answer. [Laughter.]
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Mr. SIEGEL. Well, I would like to just quickly answer, which is that the removal statutes involve a very quick process. So if there is a concern, I think, if one has a good case, they should bring it in State court.
I am surprised. My understanding is that Mr. Kottschade never brought his case, even after the—being thrown out of Federal court, never brought his case in State court, which is surprising, because that is——
Mr. NADLER. Why should he bring it into State court, as opposed to Federal court, if he can do it in either?
Mr. SIEGEL. Well, he can bring his case to State court. What he is saying is that he would be removed to Federal court under a removal—he—under a removal statute, which is——
Mr. NADLER. Yes, but are there cases where you would be advantaged in bringing it in Federal court, as opposed to State court, and vice versa?
Mr. SIEGEL. I don't think so.
Mr. NADLER. Okay.
Professor Eagle?
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Mr. EAGLE. If I may answer that, Mr. Chairman, if you look at City of Chicago v. International College of Surgeons itself, I think it is no accident that the International College of Surgeons wanted this matter heard in State court. The Illinois courts have a tradition of taking property rights more seriously than the courts of some other States.
But there is nothing incongruous about this, Mr. Nadler, because when a plaintiff chooses to bring an action, the plaintiff almost always has the right to pick the cause of action and to bring that case in the applicable court. So this is the same treatment that the International College of Surgeons wanted that any other plaintiff would get.
Mr. CHABOT. The gentleman's time has expired.
The gentleman from Arizona, Mr. Franks, is recognized for 5 minutes.
Mr. FRANKS. Well, thank you, Mr. Chairman.
Professor Eagle, I would like to ask you first, you know, some of the critics of the legislation, H.R. 4772, have somehow said that this would federalize local disputes. But isn't it true that Federal constitutional property rights and the procedural rules that ultimately govern them is truly a Federal issue?
Mr. EAGLE. Well, as I said earlier, Mr. Franks, I think that the Bill of Rights of the Constitution does understand that individuals have certain rights.
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One of those rights is the right not to be deprived of property without just compensation, and this should be treated in the same fashion as other rights within the Bill of Rights. And, thus, I think it certainly is amenable to hearing in Federal court.
Mr. FRANKS. Thank you.
Well, Mr. Chairman, I might then just take, based on that, take a moment to respond to something that was said earlier, that somehow a day had changed a great deal of this Committee's focus.
The central premise of the United States Constitution and its declaration is that governments are instituted among men to protect their basic, God-given rights. And among those are life, liberty and property, in the Constitution and in life, liberty and the pursuit of happiness in the declaration.
And it occurs to me that the right of property, as outlined in the Constitution, is a very basic, foundational, constitutional right.
And far from moving from our concept of yesterday, when we in this Committee, in the full Committee, we were doing what we could to tell courts that they had failed in protecting the rights of freedom, freedom of religion, in telling people that they could not say the words ''under God'' in the Pledge of Allegiance, we were, at that time, trying to protect a basic constitutional right: life, liberty and property being the first three of those.
And here again today, the reason that we are putting this in the courts, wanting to put this into the Federal courts, is simply because people like Mr. Kottschade and others are unable to get a clear hearing on the Federal issue of property rights.
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And far from holding the courts to be the—the Supreme Court from being the ultimate arbiter, if, indeed, the Supreme Court is the ultimate arbiter of all of those issues and the Constitution is not, then I ask myself: Why are we here? Why don't we just close the doors, and go home, and let the courts do it all, if they are the ultimate arbiter?
The truth is, as Members of Congress, we are given a great charge to protect those basic, federal, Constitution rights; among those are life, liberty and property.
And I think that is what we are trying to do here, Mr. Chairman. Thank you.
Mr. CHABOT. Thank you very much. Does the gentleman yield back?
Mr. FRANKS. I yield back.
Mr. CHABOT. Okay. The gentleman's time is expired.
The gentleman from Virginia, Mr. Scott, is recognized for 5 minutes.
Mr. SCOTT. Thank you, Mr. Chairman.
Mr. Chairman, I think the last comment from the gentleman from Arizona shows how complicated some of these things are, but it can be boiled down to the idea that, if we agree with what the courts are going to do, we want them to hear the case as quickly as possible. If we don't think we are going to agree with what the courts are going to do, we don't want them to hear it at all.
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So, Mr. Siegel, there is a concept of exhausting administrative remedies. At some point, you want the case to remain through the normal steps of administrative procedure, that is the little zoning board, the city council, and wherever else you have to agree to it. When is it appropriate for the case to be ripe for a Federal review of a Federal constitutional right?
Mr. SIEGEL. Well, the courts have explained, most recently in the Pallazzolo decision, that, when the permissible uses of property are known to a reasonable degree of certainty, then the case is ripe.
The courts want to know what uses of property are permitted, so it can decide whether or not there has been such an economic impact on the property, that is, as the court recently explained, so onerous as to amount to a direct appropriation.
But to make that determination, is this imposition so onerous you have to know what local government is doing? And there needs to be a reasonable degree of certainty, according to the courts.
Mr. SCOTT. Well, the way it is working now in practice is you never get there.
Mr. SIEGEL. Oh, certainly cases get there all the time. I mean—and people complain sometimes about the California—California courts——
Mr. SCOTT. No, because, if you stuck—you never get to a Federal court review—let me back up. You think there ought to be somewhere in the process a Federal review of a Federal constitutional right?
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Mr. SIEGEL. Oh, I am sorry, no, I misspoke if I implied that. The court has been clear, going back to Allen v. McCurry, a case decided, I believe, in 1981, that there is no right to have a 1983 action heard in Federal court.
If there is a meaningful opportunity to be heard in a State court and one has been given that opportunity, that can bar, through collateral estoppel, the right to a Federal hearing and access to a Federal court.
That was not a property rights case. It was not a—it was a search and seizure case. In San Remo, the court explained that the same principle applies in that search and seizure case to a property rights case, so there is not an absolute right to go to Federal court.
Mr. SCOTT. So, in those cases, there would never be a Federal—following that line of thinking, there can in some cases be no Federal review of a Federal constitutional right?
Mr. SIEGEL. There can't—there would be Federal review, but not by a Federal district court or court of appeal. There could be Federal review by the United States Supreme Court, because the—once a State court has reached its decision, if it involves the interpretation of Federal law or Federal Constitution, there is the right to petition for certiorari to the United States Supreme Court.
And, in fact, many of the takings case that, you know, takings litigants at least know about are just such cases. The first English case, the Nolan case, the Pallazzolo case are all cases that came out of the State court systems. Property owners said, ''Wait a second; we disagree with the way the State courts are interpreting the Constitution.''
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The United States Supreme Court stepped in to decide whether or not the State courts were interpreting the Constitution properly or not.
Mr. SCOTT. And if the State is hanging things up so that it takes, as has been pointed out, an average of over 9 years to get there, does that seem like a reasonable length of time to get—finally get a Federal review of a Federal right?
Mr. SIEGEL. Nine years, I think, is a long time for any case to proceed. That is a reality, in some situations, in some courts, not just in takings law, but in any law.
There has been no comparison that I have seen of how long it takes for a takings case, which—a ripe takings case to go from being filed to being to an ultimate decision versus other cases. I don't think there is any difference between how any—you know, in terms of the length of time it takes for any case to be litigated.
As you say, in my State——
Mr. SCOTT. Let me—I don't mean to cut you off, but my time is just about up, and I wanted to ask another question on section V in the bill, which kind of redefines deals with takings, what is the present law? And how does that section change present law?
Mr. SIEGEL. Present law is that as—one of the takings provisions under this bill says that, in analyzing a parcel in a subdivision, say, with a hundred different lots, you, under this bill, only look at the particular lot that is being regulated, while current law says that you look at the parcel as a whole.
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Mr. SCOTT. You mean——
Mr. SIEGEL. You look at if all the lots are part of the same development, they were purchased at the same time, they were part of the same scheme, then the courts have been treating those in cases such as Tab Lakes and District—I am sorry, I am forgetting the name of the case now—as a single unit, rather than this discrete little unit.
Mr. SCOTT. Is that the only change by section V?
Mr. SIEGEL. No, no. There is an attempt to change the Nolan/Dolan standards, to extend what is—as Professor Eagle pointed out—at least strongly, implicitly current law, that those cases, for example, do not apply to fee impositions. And this bill attempts to apply them to fee impositions.
It also attempts to change the rule articulated in Dolan that legislative decisions are given deference, and this bill attempts to take away that deference. So those are two changes of existing constitutional law, as interpreted by the United States Supreme Court.
Mr. CHABOT. The gentleman's time has expired.
The gentleman from Florida, Mr. Feeney, is recognized for 5 minutes.
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Mr. FEENEY. Well, Professor Eagle, with respect to the deference—if I understood Mr. Siegel's last comment—what we really do in section V is to clarify the standard. The Supreme Court has never used ''shock the conscience'' as a test in a property takings case; it is usually police work.
What we go back to is an arbitrary and capricious standard, is that right?
Mr. EAGLE. Yes, sir. And if I may, let me just make a much more general comment about this notion that this bill would go against existing law.
There was a very insightful colloquy in the oral argument in San Remo—which I had the privilege of attending—where the attorney for the city said that the court had never considered the interaction of issues of preclusion and the Williamson County doctrine.
And Justice O'Connor said, ''Well, it is clear we didn't, so now we are faced with the consequences of that. And it looks to me like the lower courts have run pretty far with Williamson County.''
And that is exactly what has happened. There are decisions in some of the lower courts that reached the results that Mr. Siegel has indicated, but the Supreme Court's view of these has not yet been definitively determined. And I certainly don't think, apart from what the Chair has, in my view correctly, pointed out to be this Committee's independent duty and Mr. Franks has pointed out to be this Committee's independent duty to look at the Constitution.
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The fact of the matter is that the Supreme Court itself has not really definitely ruled in the Constitution on these issues. And even in the International College of Surgeons case, the Chicago case, we are talking about how that interacts with the decision of the court in Williamson County.
And the point is: The court didn't consider it; the court didn't even mention Williamson County.
Mr. FEENEY. We address a lot of unaddressed issues, at least from the Supreme Court. I actually have a parochial interest here, and I want to make sure that my understanding is correct.
In Florida, for—we have different guaranteed constitutional rights if property is taken by the State or a subdivision thereof, a country or a city, for example, attorney's fees on top of fair market value. There is actually—you know, by and large, property owners would rather be condemned by the State than by the feds, for that reason.
My question is, supposing a property owner condemned by a State or a subdivision thereof opted—wanted to opt for a Federal court under this law, once it was passed in Florida, the Federal court, as I understand it, would be applying State law in the remedy stage, including attorney's fees. Does everybody agree with that?
Mr. EAGLE. Well, I think the question would be what body of law—what right that the plaintiff is seeking to have vindicated in court.
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Mr. FEENEY. Well, assuming that—okay, I have put the bunny in the hat, as my professors used to say. Assuming that the property owner can establish a regulatory takings under the fifth amendment in a Federal court by a State subdivision, would the property owner then be eligible for attorney's fees?
Mr. Siegel, do you have an opinion on that?
Mr. SIEGEL. I do not believe, if it was based upon Federal law, unless——
Mr. FEENEY. Supposing the statute—supposing the State statute of Florida said that, if a State subdivision takes your property, you are entitled to attorney's fees? In that case, at the remedy stage, wouldn't they get—avail themselves as the property owner of——
Mr. SIEGEL. In State court, they would. What I am struggling with and I have don't have the answer to is, if the Federal court—if the property owner seeks to have a State compensation claim also brought into Federal court and have the Federal court decide that, and if the Federal court decides to accept that claim under pendant jurisdiction——
Mr. FEENEY. Well——
Mr. SIEGEL [continuing]. Then it might——
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Mr. FEENEY [continuing]. I would like to put that question in writing. Basically, the question is, supposing there is a regulatory taking, a rezoning issue, for example, by a State subdivision, but I, as a property owner, I decide to go to Federal court.
And so I will put that in writing. Maybe we can all do collectively some research about how this would impact the rights of Florida property owners, which is preeminent in my mind on occasion.
Mr. Siegel, I was interested in the question about a property owner—whether 9 or 10 years is a reasonable length of time to wait for all—to all your State remedies and processes to expire before you eventually get to a Federal court on an important Federal principle.
And aside from the fairness of that, how about the mere fact that, you know, if I acquire property when I am 50 and have a life expectancy of 70, the 10 years that I am tied up—I can't use my property while I am having courts decide what my rights are—hasn't half the value to me effectively been taken, merely because the Government has an endless amount of resources? They are taxing me to pay to promote their position, and I have to pay out of my pocket during that 10-year period.
Do you have sort of a moral problem with the fact that there is an imbalance between the resources, typically, between a private property owner and the Government?
Mr. SIEGEL. Well, let me answer the delay question from the point of view of my State. Delay in having justice issued is a problem in property rights cases and in any other kind of case. It is a very serious problem.
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In California, we therefore have the Trial Court Delay Reduction Act, which forces trial courts to move cases along. We also have—quickly, and it has that time limit in which cases need to be brought to trial.
We also have strict limits on the amount of time an appellate court can take to issue a decision and the California Supreme Court. So that delay is a problem for property owner and for any other litigant, and it is something that has been addressed in our State and should be addressed.
It should be—what we are saying, though, is the whole system of reviewing these property rights disputes should not be federalized. It should be addressed in the Florida courts, and in the California courts, and in any other State courts. And the States have been and should continue to work on making their systems fair and efficient.
And, yes, it is a very serious problem to have a 9-year delay for a litigant.
Mr. CHABOT. The gentleman's time has expired.
Mr. FEENEY. Could I ask unanimous consent just to follow up on that point?
Mr. CHABOT. Yes. I think Mr. Kottschade would like to answer the question, as well.
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Mr. FEENEY. Well, wonderful. And if—but with the—with the patience of my colleagues, on that point, Mr. Siegel, you said it is a very serious problem.
If States aren't as efficient in California at resolving issues, do you think that the mere length of time that it takes to go through the State process and resolve all of your—expedite or go through all of your procedural rights, before you ever get to Federal court, you think, in and of itself—and I would like to hear Professor Eagle's and perhaps Mr. Trauth's opinion on—could that be a fifth amendment problem?
Mr. SIEGEL. Well, these aren't just——
Mr. FEENEY. If a State is not as efficient as California and if it is taking 10 or 15 years before I could actually figure out what I can do with Black Acre, in and of itself, is the length of time a fifth—does that implicate the fifth amendment, potentially?
Mr. SIEGEL. Let me just make one point before answering that, which is that, when one goes to State court, they are not just going to State court to bring procedural, technical challenges. They are going to State court to bring their claim for just compensation, because the takings clause prohibits the taking of property without just compensation.
And what is being litigated is not some technicality. It is as I am as—am I entitled to just compensation? And the Florida court or the California court is saying either, ''Yes, your property was taken; you were denied compensation; you have the right to money,'' or the court will say, ''No, this was not a taking; you are not entitled to just compensation.''
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Mr. CHABOT. The gentleman's time has once again expired, but the other witnesses were asked to respond.
And, Mr. Kottschade, if you would like to—Professor Eagle, did you want to respond to anything on that?
And Mr. Trauth?
Okay, and then Mr. Kottschade? I don't care which order you go.
Mr. KOTTSCHADE. Congressman, I really appreciate your question, in terms of 9 years, 10 years, but I want you to remember that I am 14 years into this. And, by the way, another couple of years and this is going to be old enough to vote; that is how long it has been going on.
And I don't—I honestly don't know when the end is near. And that frightens me, because, you know, when I started this project, purchased this land, I was 50—I was 50 years old. Tomorrow, I will become 65.
Does this mean—and my wife keeps asking me when, when, when? And, you know, I can't honestly answer here. Will this be another 10 or 15 years? There has got to be an end to it, and so your question is a great question. Thank you for asking it.
Mr. TRAUTH. Yes, Congressman Feeney. I think the problem is an equal protection problem, to a certain extent, because, why should one constitutional right be treated differently than another constitutional right?
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And, in the one, like a first amendment issue or a religious freedom issue, you are entitled to go directly to Federal court, but here, where you have go a property right, you know, which a fairly substantial right under the U.S. Constitution 5th and 14th amendment, you can't go to Federal court.
And the reason that I want to be able to have the option to go to Federal court with a property owner is that Federal courts are usually more efficient in handling these cases than our State courts. I mean, I have seen it over, and over, and over again in State courts, where you get lost in the black hole, literally, and you never get out.
And that is what happened with Mr. Kottschade.
The other issue deals with costs. It is not going to cost the Government—governmental entities any more. Most of them actually have insurance. So the property owner is fighting the governmental entity who is insured with their own fund; so, the balance is clearly unequal. And, therefore, access to Federal court is a must.
And, again, I get back to the fact that this is not a developer issue. It is not a home builder issue. It is a personal property rights issue.
Mr. CHABOT. And Professor Eagle, this will be our last response.
Mr. EAGLE. Yes. I think, Mr. Feeney, that the answer to the question is that the delay is not the delay in a given court proceeding, as much as the fact that the needless complexities and technicalities we have causes remands, re-hearings by appellate courts, other remands.
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And you also have the fact that administrative agencies take a long time to process situations and also may gratuitously and wrongfully bring actions, such as has happened in California, where an agency tries to assume jurisdiction when it doesn't have the basis to do so.
That could be litigated for 2 or 3 years until it finally gets back to the agency it is supposed to be—that is supposed to have jurisdiction over the matter. And this is simply attributed to a normal administrative delay.
Mr. CHABOT. Thank you. The gentleman's time has expired.
Mr. Nadler is recognized to make a point?
Mr. NADLER. Thank you. I just wanted to be observed, and then I am going to make a unanimous consent request.
As we have discussed these issues, we are all conscience of the fact of how we lucky we are that we never have similar delays in the Federal courts.
Mr. Chairman, I ask unanimous consent to place the following letters in opposition, one from the United States Conference of Mayors, one from the National League of Cities, and one from former Mayor Giuliani of New York City in opposition to this legislation into the record.
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Mr. CHABOT. Without objection, so ordered.
Mr. NADLER. Thank you. And I also ask unanimous consent that all Members have 5 legislative days to revise and extend their remarks and to include additional materials in the record.
Mr. CHABOT. Without objection, so also ordered.
Mr. NADLER. Thank you, Mr. Chairman.
Mr. CHABOT. Okay. The gentleman's time has expired.
I want to thank the panel very much for their testimony this afternoon. It was really excellent. And I think you gave us an opportunity to consider this from many different angles.
And the Committee will further consider this in the near future and, in that consideration, your contribution will be a big part of that. So thank you for doing that.
If there is no further business to come before the Committee, we are adjourned. Thank you.
[Whereupon, at 3:15 p.m., the Subcommittee was adjourned.]
A P P E N D I X
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Material Submitted for the Hearing Record
RESPONSE TO POST-HEARING QUESTIONS FROM JOSEPH L. TRAUTH, JR., PARTNER, KEATING, MUETHING & KLEKAMP, PLL
[Note: Image(s) not available in this format. See PDF version of this file for complete hearing record.]
RESPONSE TO POST-HEARING QUESTIONS FROM FRANKLIN KOTTSCHADE, PRESIDENT, NORTH AMERICAN REALTY
[Note: Image(s) not available in this format. See PDF version of this file for complete hearing record.]
RESPONSE TO POST-HEARING QUESTIONS FROM DANIEL L. SIEGEL, SUPERVISING DEPUTY ATTORNEY GENERAL, OFFICE OF THE ATTORNEY GENERAL, STATE OF CALIFORNIA
[Note: Image(s) not available in this format. See PDF version of this file for complete hearing record.]
RESPONSE TO POST-HEARING QUESTIONS FROM PROFESSOR STEVEN J. EAGLE, PROFESSOR OF LAW, GEORGE MASON UNIVERSITY SCHOOL OF LAW
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LETTER FROM JOSEPH M. STANTON, NATIONAL ASSOCIATION OF HOMEBUILDERS TO THE HONORABLE JIM SENSENBRENNER, DATED MARCH 1, 2006
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LETTER FROM R. BRUCE JOSTEN, EXECUTIVE VICE PRESIDENT, GOVERNMENT AFFAIRS, CHAMBER OF COMMERCE OF THE UNITED STATES OF AMERICA, TO THE MEMBERS OF THE U.S. HOUSE OF REPRESENTATIVES, DATED MARCH 8, 2006
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LETTER FROM BOB STALLMAN, PRESIDENT, AMERICAN FARM BUREAU FEDERATION, TO THE HONORABLE STEVE CHABOT, DATED APRIL 12, 2006
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LETTER FROM DAN DANNER, EXECUTIVE VICE PRESIDENT, NATIONAL FEDERATION OF INDEPENDENT BUSINESS, TO THE HONORABLE STEVE CHABOT, DATED MAY 15, 2006
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LETTER FROM TERRY L. ADKINS, CITY ATTORNEY, CITY OF ROCHESTER, MINNESOTA TO THE HONORABLE STEVE CHABOT AND THE HONORABLE JERROLD NADLER, DATED JUNE 9, 2006
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LETTER FROM RUDOLPH W. GIULIANI, MAYOR, CITY OF NEW YORK TO THE HONORABLE PATRICK J. LEAHY, DATED OCTOBER 28, 1997
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LETTER FROM THE UNITED STATES CONFERENCE OF MAYORS TO THE HONORABLE ARLEN SPECTER AND THE HONORABLE PATRICK LEAHY, DATED JUNE 6, 2006
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LETTER FROM THE NATIONAL LEAGUE OF CITIES, U.S. CONFERENCE OF MAYORS, NATIONAL ASSOCIATION OF COUNTIES, NATIONAL CONFERENCE OF STATE LEGISLATURES, COUNCIL OF STATE GOVERNMENTS AND THE INTERNATIONAL CITY MANAGEMENT ASSOCIATION TO THE HONORABLE STEVE CHABOT AND THE HONORABLE JERROLD NADLER, DATED JUNE 8, 2006
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LETTER FROM W. PAUL FARMER, EXECUTIVE DIRECTOR AND CEO, AMERICAN PLANNING ASSOCIATION TO THE HONORABLE STEVE CHABOT AND THE HONORABLE JERROLD NADLER, DATED JUNE 11, 2006
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LETTER FROM TIMOTHY J. DOWLING, CHIEF COUNSEL, COMMUNITY RIGHTS COUNSEL, TO THE HONORABLE STEVE CHABOT AND THE HONORABLE JERROLD NADLER, DATED JUNE 14, 2006
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