8/2/2019 Testimony Peter Mills LD1810 Takings Bill
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February 21, 2012
Peter Mills
Comments on the Takings Bill -- LD 1810
No one seems able to draft a takings statute that makes sense.
This is not the fault of the drafters. It's the
impossibility of the undertaking. LD 1810 is a classic
example.
Appraisal.
In LD 1810, the process starts with an owner who files an
appraisal written by someone whose qualifications
aren't specified; it could be the owner himself just expressing
his personal view. The appraisal need accomplish
nothing more than to assert that a particular parcel has lost at
least 50% of its value because of a new regulation.
Most land appraisals are based either on comparable sales or an
income valuation. Even if the land has no income
history and there are no comparable sales of other parcels to
show differences in value with and without the same
restrictions, the appraiser can merely take a guess and file a
report. Any such report, no matter how incompetent,
shifts the burden to the state to prove a negative -- to prove
how and why the owner is wrong.
The state is given 60 days to evaluate real estate to which it
has no right of access, property that no one in stategovernment may
ever have seen.
With what funds and by what means can the state complete its
valuation? What if the parcel is a million acres? A
competent commercial appraisal of only a few acres can cost
thousands of dollars.
Parcels.
Although the statute directs that the owner's "entire parcel" be
taken into account and not merely the affected part,
it doesn't define "parcel." What if the owner, in anticipation
of the regulation, has split his land in order toconcentrate the
impacts into affected parcels he creates? What if the owner has
extensive holdings divided by a
road, by a stream or by a town line. What if there are two
adjoining plots of land acquired at different times or
with different legal titles but with identical beneficial
interests? What if adjoining lots are owned by different
members of the same family, or business partners, or various
straw men?
Findings.
The fact finder is charged with determining a taking based on
three factors:
(1) the diminution in value;
(2) the "reasonable investment-backed expectations of the
property owner" [Does this mean that if the owner's
expectations for the property are unreasonable, there is no
taking? Then, the bill should say so.]; and
(3) the "character" of the use regulated. [What does this mean?
If the regulation is especially noble or
valuable, e.g., saving a bald eagle versus a least tern, does it
mean that a drop in value no longer matters?]
Relief.
If a taking is found, the state has three choices: buy the land,
pay damages or cease enforcement. But the statute
doesn't specify when or how the state must make its
election.
If the state chooses to buy the property, must it pay 100% of
its pre-taking value or only 51%? Why must it payfull value to buy
a parcel that has lost half its value when a neighbor who loses 40%
is paid nothing?
If the state chooses to pay damages instead, does it owe the
entire amount of the loss or only that amount that is
necessary to bring the combined value of the land and awarded
damages up to 51% of the land's pre-taking value?
The statute says that the state owes 100% if the loss exceeds
50% but nothing if the loss is less than 50%.
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8/2/2019 Testimony Peter Mills LD1810 Takings Bill
2/3
February 21, 2012
Peter Mills
If the state chooses the third option, lack of enforcement, the
statute forbids the state from imposing the regulation
at all on the affected parcel. Should not the state be entitled
to enforce the regulation in some modified way to
mitigate the owner's loss to less than 50%? What further
litigation and appraisal efforts would this engender?
ComplexityBureaucratic complexity in a takings law is
unavoidable. The primary impact -- and its intended impact -- is
to
stymie regulation for the benefit of large landowners with ample
resources to paralyze state agencies. That is, infact, how takings
laws have been used in the few states that have enacted them. It's
not a statute for the little guy.
A little history
60 years ago, the rivers of Maine were open sewers. Houses and
businesses in Skowhegan, Waterville and
Augusta were built facing the street rather than the putrid
Kennebec. The smelly river bank was a place for poor
immigrants to live.
When shorefront zoning and water quality laws were introduced,
they greatly restricted what landowners could do
with their property. At least initially, owners were deprived of
many potential uses and much contemporary value.
Had a takings law been in effect, these laws from the 1970's
might never have been implemented.
Now that those laws have taken effect and the rivers are running
clean, waterfront real estate has increased in
value beyond anyone's imagination.
That private value was created by government regulation.
Would it now be appropriate for the state to recover that value
from waterfront property owners? Suing for such
gains would seem just as logical as the converse effort to
compensate landowners for the intangible andsometimes temporary
losses arising from similar regulations for the public good.
An appropriate remedy.
Attached below is the draft of a bill to address regulatory
takings in the same way that similar issues have been
resolved by zoning codes for the past hundred years. It allows
for a variance in those circumstances when an
aggrieved landowner suffers an undue hardship that meets the
time honored criteria of the statute.
Although variances are not frequently granted, they do serve as
an important safety valve for those occasions
when a landowner has been unfairly impacted by the strict
application of a new regulation.
Draft of an Environmental Variance Statute
"Upon application by an aggrieved landowner, the authority
issuing a new land regulation under Chapters ?
and ? shall grant variances as necessary to avoid undue hardship
caused by strict application of the
regulation to the applicant. "Undue hardship" as used in this
subsection means:
A. The land in question can not yield a reasonable return unless
a variance is granted;
B. The need for a variance is due to the unique circumstances of
the property and not to generalconditions in the region;
C. The hardship is not the result of action taken by the
applicant or a prior owner; and
D. The granting of the variance will not substantially reduce or
impair the use of abutting property nor
alter the essential character of the locality."
Respectfully submitted,
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