Property rights and environmental regulation: the case for compensation.

The right to acquire, use, and alienate property has long been regarded as a fundamental value in Anglo-American constitutional thought. (1) Historically, respect for private property was seen as providing the basis for individual autonomy and the enjoyment of liberty. (2) Reflecting this link between liberty and property, both the federal and state constitutions contain guarantees of private ownership. (3) Still, as with other individual rights, the rights of property owners have never been absolute. The common law of nuisance imposes restrictions on landowner activity that adversely impacts a neighbor's enjoyment of his or her land. (4) Moreover, zoning has limited land use for decades, ostensibly to safeguard public health and safety. (5)

In the late twentieth century, the emergence of the modern environmental movement, accompanied by often apocalyptic rhetoric, resulted in the enactment of a series of laws stringently controlling land use. Such legislation has made substantial inroads upon the traditional rights of owners. Property rights advocates have increasingly challenged the environmental agenda in both the judicial and legislative arena. Today, environmentalists and landowners appear trapped in a destructive cycle of mutual antagonism. Environmentalists harbor deep suspicions of market forces, and they commonly posit that recognition of the traditional dominion rights of property owners is antithetical to environmental protection. They frequently assert that unfettered private rights in land lead to widespread degradation and that individual property rights are an obstacle to regulations that effectuate the public interest.

In contrast to these environmentalists, I contend that scrupulous regard for the constitutional rights of owners is fully congruent with, and may even enhance, the achievement of sound environmental goals. The discharge of pollutants, an activity analogous to a nuisance and appropriately subject to the police power, will not be included in this discussion. Property ownership does not encompass a right to pollute. Instead, I will focus on laws designed to protect wetlands, woodlands, and species habitats in a natural state. Such measures, in effect, compel owners to convert their land into nature preserves and necessarily curtail economically productive uses. The subordination of use and development rights to often-hazy environmental objectives has triggered fear that growing governmental controls threaten the institution of private property. Affected landowners have turned, with only limited success, to courts and legislatures for relief from what the landowners see as regulatory takings of their property in contravention of the Filth Amendment. (6)

Environmentalists have taken special aim at the just compensation requirement of the Fifth Amendment. Environmentalists have sought to place a highly constricted interpretation on the protection afforded owners under the Fifth Amendment; this interpretation sharply contrasts with the expansive reading afforded other individual rights in our constitutional system. (7) Much of the environmental literature postulates transparent theories designed to circumvent the just compensation requirement, often by radically redefining the meaning of property ownership. (8) Rather than responding to efforts to reconceptualize private property, my objective here is to question the basic assumptions of the environmentalists. Why should property owners, who suffer a substantial loss by virtue of environmental regulations that restrict land use, fail to receive compensation? Why should a few individuals, rather than society as a whole, bear the cost of achieving public goods?

Payment of such compensation would be consistent with the fundamental premise of equity that underlies …