Kristen M. Fletcher, J.D.
 

Since 1994, four states bordering the Gulf of Mexico have enacted private property rights legislation: Mississippi, Louisiana, Texas, and Florida. These statutes allow property owners to challenge a regulation that may have lowered the value of their property, i.e., "taken" the property without compensation, prohibited by the Fifth Amendment. According to the Supreme Court, when a regulation significantly lowers the value of property or renders it useless, a regulatory taking has occurred.⁽¹⁾ In the last decade, the U.S. Supreme Court and state courts have focused attention on the rights of coastal property owners. State legislatures responded with statutes that provide protection above those available under constitutional analysis.

States, however, began looking for ways to further limit the impact of regulations on private property. The result has been a rush to pass takings statutes combining three primary components. First, the statutes usually call for a "takings impact assessment," requiring regulators to analyze the potential for a taking before a regulation takes effect. Second, the statutes define a taking, usually by a specific percentage of diminution in value of the property. Third, they provide compensation for a temporary taking, purchase of the property, or recission of the intrusive regulation.

In 1995, Texas and Florida passed comprehensive statutes providing compensation for the taking of private property. Also in 1995, Mississippi and Louisiana passed statutes providing compensation for a taking of agriculture or forestry lands. These statutes raise a number of issues for the gulf region. What impact will these property rights statutes have on the natural resources of the Gulf region? Will these statutes prevent unfair burdens to private property owners without hindering protection of coastal ecosystems? Finally, as the gulf region increases in population and development, will the mere presence of these laws prevent effective environmental regulations because state agencies fear the impact of stiff compensation measures? Given the unique coastal ecosystem and active state legislatures, the gulf region is a valuable study for the impacts of takings statutes on coastal resources.
 

A. Florida: Private Property Rights Protection Act & Dispute Resolution Act
 

As early as 1974, Florida policymakers were reviewing the potential for a takings statute. In 1995, the state enacted two statutes to bolster private property rights in the state. First, the Private Property Rights Protection Act⁽²⁾ provides a cause of action to property owners whose land has been "inordinately burdened" by a Florida governmental regulation. Second, the Florida Land Use and Environmental Dispute Resolution Act⁽³⁾ creates an administrative process where a special master conducts a hearing with the property owner and agency to make recommendations of nonbinding alternatives. Neither Act specifically requires a takings impact assessment of regulations before they go into effect.

Under the Florida Act, a landowner's property has been taken if it is "inordinately burdened," defined as a restriction that prohibits the property owner from attaining her investment-backed expectation or one that causes her to permanently bear a disproportionate share of a burden imposed for public good. Florida's definition is unique because it does not assign a specific diminution amount to define a taking. The Act applies to laws and regulations enacted on or before May 11, 1995. If a law causes a taking, the governmental agency can rescind the regulation and pay compensation to the landowner for a temporary taking or it can purchase the property outright for the value of the property prior to the regulation.

Florida's taking scheme has impacted Florida's coastal regions in several ways. Pam and Mel McGinnis are Florida landowners who challenged the denial of a permit to fill wetlands and mangrove acreage. They first engaged in the special master proceeding but found themselves in court several years later with no real end to the litigation in sight. The five acre tract of land jutting into Tampa Bay remains undeveloped. Their struggle to develop the property and the perceived failure of the Florida Acts to assist them has kept coastal property issues at the forefront. Also, legal commentators claim that agencies have enacted fewer regulations since the laws took effect, including ordinances aimed at lower development, building height restrictions, and wildlife habitat designations, key issues in Florida's coastal areas.⁽⁴⁾
 

B. Texas: Private Real Property Rights Preservation Act
 

In 1995, Texas enacted its Private Real Property Rights Preservation Act⁽⁵⁾ as a preventive measure to ensure that the state does not mirror intrusive federal regulatory actions. The Texas Act requires detailed planning by agencies to analyze the regulation's purpose, burdens on property owners, and possible alternatives. An agency must also give 30 days notice before it can pass a possibly intrusive regulation. Failure to comply grants Texas landowners a cause of action for rescission of the regulation.

The Texas Act defines a taking as a reduction of 25% in the value of property "in whole or in part or temporarily or permanently."⁽⁶⁾ By including "in whole or in part," the Act leaves the fact finder a choice between analyzing the entire parcel of property in question or only that parcel affected by the regulation in order to determine diminution in value. This approach is in direct conflict with current Supreme Court takings jurisprudence which has consistently analyzed takings cases according to the entire parcel of property in question, leaving the potential for judicial inconsistency.

The Act is limited in its applicability, however. The Act applies to those regulations first proposed on or after September 1, 1995. The Act specifically excludes actions to fulfill a federal or state mandated obligation; certain rules regarding water safety, hunting, and fishing; specific provisions of the Texas Natural Resources Code; and actions to regulate construction in a floodplain area or to prevent subsidence. Finally, it only applies to rules and regulations first proposed on or after September 1, 1995. If a taking exists, the court orders the governmental entity to rescind the action or purchase the property.

While property rights remain at the forefront of Texas politics, the language of the Act limits its impact on the Texas coast. Arguably, the Act does not apply to regulations adopted under authority of the Texas Coastal Management Program because it is taken to fulfill a state-mandated obligation. In addition, the Act may exempt regulations adopted to meet obligations under federal law, such as the Coastal Zone Management Act, leaving Texas its primary coastal protection tools.
 

C. Mississippi: Agricultural & Forestry Activities Act
 

In 1995, Mississippi enacted the Agricultural and Forestry Activities Act to provide compensation for takings of agricultural or forestry lands because the use of land in the state "as forest and agricultural lands are essential factors in providing for the favorable quality of life in the State of Mississippi."⁽⁷⁾ The Act does not specifically provide for a takings impact assessment of proposed actions. Instead, the Mississippi Legislature amended the Administrative Procedures Act to require economic impact statements when they propose a new rule or significantly modify an old rule to analyze the need for the proposed action, the cost of the rule to the agency and landowners, and alternatives.

The Mississippi Act defines a taking as a 40% reduction in the fair market value of any part or parcel forest or agricultural land. This so narrowly defines the relevant unit of property that almost any environmental regulation will amount to a taking. When a taking occurs, the state may rescind the regulation and pay for temporary damages or the state entity may pay the amount of diminution of the property value without resulting in state ownership. The Mississippi Act specifically exempts state actions which are taken to protect public health and safety, including those taken by the Mississippi Air and Water Pollution Control Commission and the Mississippi Commission on Wildlife, Fisheries and Parks.

The statute's impact on the Mississippi gulf coast is questionable. Agricultural and forestry lands make up less than 15% of the land of the three Mississippi coastal counties.⁽⁸⁾ Coastal communities have not experienced takings challenges. An interesting question remains for the coast, however. With its recent increase in casino complexes and associated development, the possibility of zoning changes or new regulations on the coast will cause changes in agricultural and forestry properties that may awaken activity under the Mississippi Act.
 

D. Louisiana: Right To Farm & Right To Forest Acts
 

The Louisiana Legislature considered several takings bills from 1992 - 1995. Prior to 1995, Louisiana's "Right to Farm Act" protected those engaged in agricultural practices from legal actions in various situations.⁽⁹⁾ In 1995, the Louisiana Legislature amended this Right to Farm Act to include compensation and assessment provisions to apply to regulatory takings of both farmlands and forest lands.

The Louisiana Act has three major distinctions from other gulf state statutes. First, its written impact assessment scheme has unique procedural requirements. A governmental agency must prepare a written assessment if the action is likely to result in a diminution in value of agricultural or forestry lands. The governmental entities must deliver the written impact assessment to any affected landowner, as well as the Governor and Commissioner of Agriculture and Forestry putting landowners on early notice of potential takings.

The Louisiana Act requires only a 20% diminution in fair market value of the "affected portion of any parcel" to show a taking, the lowest criteria of the four gulf statutes. Similar to the Mississippi statute, the Louisiana Act's definition of "governmental action" excludes those actions taken in compliance with federal law or regulation, directed or mandated by a court, or taken to protect public safety and health.⁽¹⁰⁾ It also exempts state agricultural and forestry agencies from the Act. As a result, the Act does not apply to those regulations with the greatest potential to limit property rights on forest or agricultural lands. Once a taking occurs, the statute provides that the owner of agricultural land may choose to recover a sum equal to the diminution in value of the property and retain title or recover the entire fair market value and transfer title. For forestry lands, the owner may recover a sum equal to the diminution in value and retain title.

Unlike Mississippi, Louisiana's Act has a greater chance to impact coastal resources. Louisiana's coastal counties contain more agricultural and forest lands and the diminution rate for a taking is only 20%. In recent years, the number of farms operating in Louisiana coastal counties increased.⁽¹¹⁾ It may impact Louisiana's coastal management program which has been credited with reducing tidal wetland losses through regulations, acquisitions, outreach. The Act, however, will more likely affect inland properties.
 

E. Alabama: Proposed Legislation
 

Alabama has yet to pass a takings statute but this does not reflect a lack of effort. In 1994, 1995, and 1996, both the Alabama House and Senate introduced takings bills. The most recent statute, introduced in 1997, was the Alabama Right to Farm and Forest Act, applying a compensation and assessment scheme to agricultural and forest lands.⁽¹²⁾ The bill did not pass but provides a good look at what Alabama may adopt in the future.

Its assessment scheme required analysis of the regulation's potential for a physical taking, any diminution in value, potential for interference with agricultural or forestry development, possible alternatives, the cost to reimburse landowners and where in the agency budget that reimbursal money is located. The proposed bill defined a taking by any diminution in value, representing the most expansive compensation scheme in the nation. Finally, it provided similar remedies including compensation, outright purchase of the property, and costs of litigation.

With regard to impacts on the gulf coast, Alabama's coastal area has few acres set aside as agricultural or forest lands and most of the areas are either designated reserves or developed. Its coastline does not appear to be assisted or impaired by the proposed scheme. As for the future of property rights in Alabama, the legislature is not considering a bill this session.
 

F. Future of Takings & the Gulf Coast
 

Property rights legislation in the gulf region has the potential to greatly impact coastal resources of the five gulf states. The immediate impact is a keen focus upon the tension between the right to develop coastal properties and the regulations passed to protect coastal ecology. While many agree that the gulf coast represents a unique ecosystem, the states' legislatures are calling for a greater balance between regulations and property rights. The long-term impact may be fewer or less stringent regulations that are less effective in protecting coastal resources. State legislatures have risen to the challenge of creating takings statutes but state agencies must make sure the taking statutes do not lessen the effectiveness of necessary regulations.
 
 

ENDNOTES

1. See penn coal, lucas, dolan....

2. Fla. Stat. Ann. § 70.001 (1997).

3. Fla. Stat. Ann. § 70.51 (1997).

4. See Victor Hull, Little-Used Law Having Wide Impact, Sarasota Herald-Tribune, April 20, 1997, at A17 (quoting Jim Bennett, Pinellas County Chief Assistant County Attorney).

5. Tex. Gov't Code Ann. § 2007.001 (1997).

6. Tex. Gov't Code Ann. § 2007.002 (1997).

7. Miss. Code. Ann. §§ 49-33-1 to 49-33-19, 49-33-5 (1997).

8. U.S. Department of Commerce, Bureau of the Census, 1992 Agricultural Atlas of the United States, 1992 Census of Agriculture, Vol. 2, Sept. 95.

9. La. Rev. Stat. Ann. § 3:3603 (West 1997).

10. La. Rev. Stat. Ann. § 3:3622 (3)(a) - (h) (West 1997).

11. 1992 Agricultural Atlas of the United States at 3.

12. 1997 AL H.B. 485.
 

University of Mississippi