Eminent Domain Isn't the Only Way Governments Hurt Homeowners

Land use regulations and restrictions often block owners from using their own land and send property values plummeting; New study shows how states can learn from landmark Oregon's Measure 37 to protect property rights
Los Angeles (April 20, 2006) — For decades state governments have been implementing zoning and land use regulations that limit property rights and prevent owners from using their land in ways they had intended. At the same time, bureaucrats have become increasingly bold and aggressive in using eminent domain to take private property. These trends, already devastating to many homeowners, were further bolstered by the Supreme Court's Kelo decision allowing the government to seize private homes for private economic development.

Now, taxpayers have reached a boiling point and are demanding that their property rights be protected. A new Reason Foundation study shows how state lawmakers can shield property owners against both eminent domain abuses and the land use regulations that often cause severe financial losses by eroding property values.

The Reason Foundation study demonstrates how Oregon voters got fed up with restrictive urban planning laws and passed a piece of landmark legislation, Measure 37. The law requires local governments to financially compensate a landowner when urban planning rules reduce the value of their property, or they must allow the owner to use the land under the laws in place when the property was originally purchased.

"Oregon taxpayers have had enough of bad zoning laws and unnecessary land restrictions," said Leonard Gilroy, author of the study, a certified urban planner and a policy analyst at Reason Foundation. "The state is hailed as the nation's urban planning model, but its planning and zoning regulations have taken a massive, negative toll on individual property owners. Oregon would owe landowners $5.4 billion a year to compensate them for the regulatory impacts of the state's misguided planning laws. That isn't fair. And it isn't the American way. Oregon's Measure 37 offers a great template for other states looking to implement meaningful reforms and it provides a check on government power by ensuring that state and local governments adequately weigh the costs and benefits of public action."

The Reason study serves as a how-to guide for government officials and citizens groups designing statewide regulatory takings protection measures in their own states. It shows how these laws can be coupled with eminent domain laws to comprehensively protect landowners. The report also outlines several issues for lawmakers to consider, including whether to amend the state constitution; whether to make the law retroactive or prospective; how to deal with compensation issues in the law; how to handle property transfer issues; and the scope of regulatory takings that should be covered by the law.

Full Report Online

The full study, Statewide Regulatory Takings Reform: Exporting Oregon's Measure 37 to Other States, is online at www.reason.org/ps343.pdf. Reason Foundation´┐Żs land use and growth policy research is available at www.reason.org/growth.

About Reason

Reason Foundation is a nonprofit think tank dedicated to advancing free minds and free markets. Reason produces respected public policy research on a variety of issues and publishes the critically acclaimed monthly magazine, Reason. For more information, please visit www.reason.org.

Contacts

Leonard Gilroy, Policy Analyst, Reason Foundation, (713) 927-8777
Adrian Moore, Vice President of Research, Reason Foundation (661) 477-3107
Chris Mitchell, Media Relations, Reason Foundation, (310) 367-6109




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