by Pete Didisheim, NRCM Senior Director of Advocacy
Senator Hastings, Representative Nass, distinguished members of the Judiciary Committee. My name is Pete Didisheim. I am the Advocacy Director for the Natural Resources Council of Maine, and I appreciate the opportunity to testify in opposition to LD 1477, “An Act to Protect Owners of Real Property.”
We oppose LD 1477 for the same reasons expressed in our testimony against LD 1135. Specifically, we believe this bill could result in thousands of compensation claims, demanding billions of dollars in compensation payments, inviting scores of lawsuits, and undermining Maine’s ability to make prudent land use and other regulatory decisions in support of the public interest. The people of Oregon witnessed what a provision like this can do, and they promptly repealed it.
Like LD 1135, this bill creates a “pay or waive regulations” scheme, but it covers an even broader range of government actions. LD 1477 would allow compensation claims related to “any regulation,” other than a narrow set of exclusions. As such, the potential fiscal costs to the State and municipalities would be even larger, and the legal and analytic challenges of assessing the merit of compensation claims would be even more daunting.
LD 1477 would allow compensation claims associated with alleged adverse impacts on just a portion of a land owners property. As a result, virtually any impact on a property will be within the scope of the bill, no matter how small. This provision is inconsistent with findings of the US Supreme Court, which require consideration of a property as a whole for purposes of Constitutional takings claims.
The bill measures the difference between the regulated value of the property and the very high value the property would have if it, and it alone, were freed from the restrictions, while neighboring property owners remained subject to the regulations. As a result, the bill would not provide for payments that could plausibly be described as “just compensation,” but instead would allow landowners to demand significant, unfair windfall payments at taxpayer expense for potentially fabricated property uses.
On top of potential compensation costs to settle claims, there also would be huge litigation costs for municipalities and the state. Such litigation would involve opposing compensation claims and addressing litigation brought by abutters alleging damages caused by implementation of compensation claims.
One can imagine a hornet’s nest of complex legal actions involving property-owners suing a municipality because their property values were affected when a neighbor was relieved of zoning or regulatory restrictions. For example, a landowner’s property could be flooded if an abutter were allowed to fill in a wetland, because a town didn’t have the funds to pay a compensation claim.
As a practical matter, this bill would make every rezoning resulting in lower property values subject to compensation claims. And because LD 1477 appears to be retroactive, such claims could be made against zoning and regulatory actions that were taken years ago. Imagine the fiscal consequences if every landowner who has owned property for decades were to make a claim for compensation based on zoning actions taken since they inherited or acquired the property – which in some cases was 30, 50, or 70 years ago.
With today’s weak real estate market and weak economy, this bill would throw open the flood gates to compensation claims. Towns with any form of zoning would face legal challenges, and a broad range of state regulations could be thrown into disarray. This would be a lawyer’s delight, and a fiscal nightmare for the state.
For these reasons, we urge the Committee to vote Ought Not To Pass on LD 1477, as this Committee has done with similar bills in the past.
I appreciate this opportunity to testify before the Committee, and would be pleased to answer any questions that you may have.
