SUPREME COURT WATCH

By David ButleRitchie

As the 2001-02 Term winds to an end, the Supreme Court has buttressed the control of state and local regulatory authorities in the areas of zoning and land use. In two separate cases decided recently, the high court has sided with local officials against property owners. In the first case, Tahoe-Sierra Preservation Council v. Tahoe Regional Planning Agency,¹ the Court ruled 6 to 3 that the denial of land use by a local regulatory body did not amount to an unconstitutional taking of property. In a later case, Los Angeles v. Alameda Books,² the Court decided in a 5-to-4 plurality that the City of Los Angeles may ban multiple sex shops from operating on the same site. While the composition of the majority in these two cases varied markedly, the decisions suggest a commitment on the part of this Court to support the authority of state and local government officials.

In the 1980s a group of landowners around Lake Tahoe banded together to challenge a moratorium implemented by the Tahoe Regional Planning Authority (TRPA). The TRPA, which is composed of officials from both Nevada and California, is tasked with protecting the environment around the lake. The planning authority first implemented a moratorium in 1981, which blocked development around the lake until the TRPA could undertake a land-use study to determine the effects of development on the lake and its ecosystem. The TRPA originally anticipated that the study would be concluded within thirty-two months. After that time, the authority planned to lift the moratorium and implement development guidelines based on the findings of the study. The Tahoe-Sierra Preservation Council filed suit against the TRPA, however, which caused the moratorium to stay in place during the pendency of the litigation.

The Tahoe-Sierra Preservation Council, which represented property owners in the Lake Tahoe basin, argued that the moratorium was a "partial taking" in that it deprived the owners of their interest in the land for a period of time. The council suggested that this was an unconstitutional taking without just compensation. The district court ruled that there was no "total taking," but accepted the owners’ argument that there was indeed a partial or "categorical" taking under the analysis set forth in Lucas v. South Carolina Coastal Council,³ because the moratorium deprived the property owners of "all economically viable use"⁴ of the property in question during the period of the moratorium. The district court maintained that the actions of the TRPA would not have constituted a taking prior to the decision in Lucas. Because Lucas suggested that the deprivation of all productive use of a parcel of property constitutes a taking, however, the court held that TRPA’s actions here were impermissible. This interpretation was based on the fact that the moratorium at issue here did not expressly or explicitly set forth a termination date.⁵

The Ninth Circuit Court of Appeals overturned the district court’s decision that the Lucas rule applied in a case such as this.⁶ The appeals court held that the temporary nature of the moratorium undermined the owners’ use of Lucas. Instead, the Ninth Circuit maintained that the case was more akin to land-use regulations that restrict the ability of owners to use their property in certain ways.⁷ Specifically, the Ninth Circuit suggested that "a planning regulation that prevents the development of a parcel for a temporary period of time is conceptually no different than a land-use restriction that permanently denies all use on a discrete portion of property, or that permanently restricts a type of use across all of the parcel."⁸ In these sorts of situations, such regulations do not deprive landowners of "all economically viable use" of their property. As a result, the Ninth Circuit maintained that the traditional balancing approach⁹ that the Supreme Court has used is more appropriate than the limited test annunciated in Lucas. The Council and owners appealed this decision.

The Supreme Court granted certiorari on the question of whether Lucas applies in situations of temporary land-use restrictions. The majority opinion, written by Justice John Paul Stevens, affirmed the ruling of the Ninth Circuit. In doing so, the majority was clear to point out that in situations such as the one arising under the Tahoe regulation there is no per se rule. Rather, the courts should look at the regulatory scheme involved. Stevens maintained that when a regulatory scheme involves land-use restrictions as opposed to regulatory takings the constitutional safeguards found in the Fifth Amendment are not implicated. Specifically, Stevens wrote that "[w]hen the government physically takes possession of an interest in property for some public purpose, it has a categorical duty to compensate the former owner . . . ."¹⁰ He went on to say, however, that when a government regulation merely prohibits certain uses, such action does not constitute a categorical taking. "The first category of cases requires courts to apply a clear rule; the second necessarily entails complex factual assessments of the purpose and economic effects of government actions."¹¹ This distinction is vital, according to Stevens, because "[l]and-use regulations are ubiquitous and most of them impact property values in some tangential way—often in completely unanticipated ways. Treating them all as per se takings would transform government regulation into a luxury few governments could afford."¹² As a result, the per se rule that petitioners attempted to derive from Lucas was rejected by the court’s majority.

This has been seen as a setback for advocates of the conservative-led "property rights" movement, which had seen this case as a vehicle for persuading the high court to expand the rights of owners and developers against government regulation.¹³ The ruling, then, is seen as strengthening the hand of environmental regulators against private landowners.¹⁴ Property rights advocates like Dean Douglas Kmiec of the Catholic University School of Law, however, view this as an unfair imposition on a small group of citizens.¹⁵ This was the position taken by Chief Justice Rehnquist, who was joined by Justices Scalia and Thomas, in the dissent. Stevens, who was joined in the majority by the centerist Justices Breyer, Ginsberg, O’Connor, Kennedy, and Souter, brushed aside the unfairness argument, however. The majority suggested that
"interim development controls"—which development moratoria like the one at issue here are often called—are necessary and "essential tool[s] of successful development."¹⁶ This six-member majority, then, has reinforced the notion that state and local regulators need the flexibility to control land use for certain purposes.

A similar decision was reached by the court in Los Angeles v. Alameda Books, albeit in a considerably different context. In 1978 the City of Los Angeles passed a local law that restricted adult businesses from being situated less than 1,000 feet from other such establishments. The law also required adult enterprises to be more than 500 feet away from any school, religious institution, or public park.¹⁷ These sort of zoning restrictions have become commonplace in American cities. Los Angeles enacted the restrictions after a 1977 study suggested that the concentration of adult businesses in one area leads to increased crime, including "higher rates of prostitution, robbery, assaults and thefts in surrounding areas."¹⁸ This ordinance contained a loophole, however, that permitted more than one enterprise to be operated out of a single location.¹⁹ The city closed this loophole in 1983 by banning "the establishment or maintenance of more than one adult entertainment business in the same building, structure or portion thereof."²⁰ The intent of the statute was to preclude the development of "sex superstores." The rationale of city officials was again based on the 1977 study.

Alameda Books, along with another adult bookstore, were cited for violating the statute. Both establishments contained various adult related enterprises in the same location, and both conceded that they were in violation of the plain meaning of the statute.²¹ The book stores challenged the citation in federal district court on the grounds that the statute violated free speech. The city and the bookstores both filed for summary judgment. The District Court for the Central District of California initially denied the summary judgment motions, but after the bookstores moved for reconsideration the district court granted their motion for summary judgment.²² The district court held that the city’s ordinance was not a content neutral restraint on free speech, and that the study (along with other evidence) was not sufficient to support the city’s contention that concentrated adult enterprises lead to higher crime rates. Based on these findings, the district court subjected the ordinance to strict scrutiny. Under this analysis, the district court judge held that the city did not demonstrate that the statute served a compelling state interest. As a result, the district court invalidated the ordinance and granted summary judgment in favor of the adult establishments.

The Ninth Circuit Court of Appeals affirmed, maintaining that the district court’s strict scrutiny analysis was unnecessary because "the city failed to present evidence upon which it could reasonably rely to demonstrate that its regulation of multiple-use establishments is ‘designed to serve’ the city’s substantial interest in reducing crime."²³ The appeals court based this on its reading of Renton v. Playtime Theatres, Inc.,²⁴ which utilized a time, place, and manner analysis with regard to zoning restrictions on adult entertainment.²⁵ The Supreme Court granted certiorari on the question of whether an ordinance serves a substantial governmental interest under Renton.²⁶

Under Renton, courts must look at whether a statute (1) restricts but does not ban all adult establishments altogether; (2) is content neutral in its application; and (3) is designed to serve a substantial government interest and that reasonable alternative avenues of communication remained available.²⁷ So long as these ends are met, municipalities may regulate adult enterprises under Renton. The Ninth Circuit found that the 1977 study was not sufficient to meet the third prong of this test and invalidated the Los Angeles ordinance. The Supreme Court, in a 5-to-4 plurality opinion, disagreed. Justice O’Connor, writing for herself, Chief Justice Rehnquist, Justice Scalia, and Justice Thomas, maintained that the zoning regulation was adequately supported by the study, which suggested a link between a high concentration of adult businesses and higher rates of crime.²⁸

The distinction between multiple businesses in separate locations and multiple businesses in a single location was held to be irrelevant.²⁹ Based on the evidence available to Los Angeles officials, it was "rational for the city to infer that reducing the concentration of adult operations in a neighborhood, whether within separate establishments or in one large establishment, will reduce crime rates."³⁰ O’Connor went on to say that a "municipality may rely on any evidence that is ‘reasonably believed to be relevant’ for demonstrating a connection between speech and a substantial, independent government interest."³¹ Justice Kennedy, in his concurrence, agreed that the city might rightfully use its zoning authority to restrict multiple adult businesses in one location, but suggested that the term "content neutral" as used in Renton is imprecise. Nevertheless, Justice Kennedy sided with O’Connor, Rehnquist, Scalia, and Thomas in holding that the district court erred in granting summary judgment for the bookstores.

Justice Souter, writing for the dissent with Justices Breyer, Ginsburg, and Stevens, agreed with the Ninth Circuit that the 1977 study did not factually support the city’s contention that separating multiple establishments would lower crime rates.³² The four dissenters were also worried by the notion that the majority viewed this as nothing more than a zoning issue. To the Justices in the dissent, such a view might go beyond so-called "secondary effects" zoning and actually curb specific kinds of speech. This, of course, would be constitutionally impermissible.³³ To the members of the dissent, without further evidence that multi-establishment adult enterprises have an impact on crime rates, the Los Angeles ordinance smacks of an attempt to curb a particular sort of speech.

These two cases present an interesting ideological split in the Court, even as they lead to similar outcomes. The more conservative members of the court reject municipal regulation in the area of land use in the context of environmental concerns, but embrace it when the issue relates to family values. The more moderate members of the court have just the opposite inclination. Although there are certainly more subtle issues at play in these cases, the effect is the same: this Term the high court has decided that state and local regulators have the broad authority to determine how to address local land-use concerns.

Just In

On May 28, 2002, the Supreme Court decided that states are immune from having federal agencies review state actions in the face of private complaints. The Court ruled 5 to 4, in Federal Maritime Commission v. South Carolina Ports Authority,³⁴ that allowing such review would violate the sovereign immunities of the states. The majority, which consisted of the five most conservative members of the court (Kennedy, O’Connor, Scalia, Thomas, and Rehnquist), continued its assault on the broad notion of federalism by denying the federal government the authority to review the actions of the South Carolina Port Authority. The port authority denied berthing rights to a private company, which filed a complaint with the Federal Maritime Authority. The State of South Carolina objected, claiming that the federal agency did not have authority to hear the complaint. The Fourth Circuit, and ultimately the Supreme Court, agreed. The high court, in a rare opinion by Justice Thomas, claimed that the states are immune from having to defend their actions in quasi-judicial fora. The minority, in an opinion read from the bench by Justice Breyer, claimed that the majority was impeding the ability of the federal government to enforce health and safety laws.³⁵

Endnotes

1. Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, No. 00-1167 (April 23, 2002).
2. Los Angeles v. Alameda Books, Inc., No. 00-799 (May 13, 2002).
3. 505 U.S. 1003 (1992).
4. 34 F. Supp. 2d 1236, 1245 (Nev. 1999).
5. Id. at 1250-51.
6. 216 F.3d 764, 773 (9th Cir. 2000).
7. Id. at 776.
8. Id.
9. Found in Penn Central Transp. Co. v. New York City, 438 U.S. 104 (1978).
10. Tahoe-Sierra Preservation Council, slip op. at 18.
11. Tahoe-Sierra Preservation Council, slip op. at 18-9, quoting Yee v. Escondido, 503 U.S. 519, 523 (1992).
12. Tahoe-Sierra Preservation Council, slip op. at 19.
13. http://www.washingtonpost.com/ac2/wp-dyn?pagename=article&node= &contentId=A37559-2002Apr23
14. Id.
15. Id.
16. Tahoe-Sierra Preservation Council, slip op. at 34.
17.See Los Angeles Mun. Code § 12.70(C) (1978).
18. Alameda Books, Inc., slip op. at 2.
19. Id. at 3.
20. See Los Angeles Mun. Code § 12.70(C) (1983).
21. Alameda Books, slip op. at 4.
22. Id. at 5.
23. Id.
24. 475 U.S. 41 (1986).
25. 222 F.3d 719, 723-24 (9th Cir. 2000).
26. Alameda Books, slip op. at 5.
27. Renton v. Playtime Theatres, Inc., 475 U.S. 41, 46-50 (1986).
28. Alameda Books, slip op. at 8.
29. Id.
30. Alameda Books, slip op. at 9.
31. Alameda Books, slip op. at 10, quoting Renton v. Playtime Theatres, Inc., 475 U.S. 41, 51-52 (1986).
32. Alameda Books, dissent slip op. at 5.
33. Id.
34. No. 01-46.
35. Charles Lane, Court Backs States in Case Testing Reach of U.S. Agencies, N.Y. Times, at A4 (May 29, 2002).

David ButleRitchie is an assistant professor of law at the Appalachian School of Law in Grundy, Virginia.