There is an interesting out of California where Citadel Exploration, an oil company, has sued the San Benito County for $1.2 billion for banning fracking and oil extraction on land within its jurisdiction. Citadel is arguing that the ban constitutes a regulatory taking and that it is entitled to the value lost, which it says amounts to 20-40 millions barrels of oil and a profit of $1.2 billion. It is a troubling case for environmentalists and land use advocates seeking to place limitations on certain industrial activities viewed as harmful.
At issue is Measure J, which bans all fracking and other high-intensity oil extraction.
For environmentalists, such cases could reignite the debate over constitutional takings: the need to compensate private owners like Seadrift of public easements.
In Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992), the Court required compensation for regulatory takings. In that case. South Carolina’s Coastal Zone Management Act (1977) required owners of coast land in “critical areas” near beaches to obtain permits from South Carolina Coastal Council before committing the land to new uses. The Court found that the regulation deprives Lucas of value that had to be returned in the form of public compensation.
One exception is common law nuisance where a coastal authority can show that the regulation is designed to prevent a public nuisance such as run-off or erosion etc.
The burden — both legal and financial — in making such a claim can be high. The county would have to show that fracking causes such harms if it comes down to a Lucas fight — something companies vigorously deny. That could make this an important case and potentially damaging for environmentalists if the courts expand on the burden on states and municipalities in showing harm as an exception to takings compensation.
In the end, San Benito County Supervisor Jerry Muenzer indicated that the effort to get over a billion dollars from the county would be like . . . well … fracking water from a stone: “$1.2 billion. That’s like asking for the moon. The county will file for bankruptcy and reorganize. He’s not going to get anything.”
Source: KSBW
I’m okay with banning them from doing this. However, if they already owned the land, they should be compensated for the value of the land. Not the value of what is under it and cannot be harvested.
@ Darren
I don’t think that the potential for unknown and unproven environmental harm should outweigh the loss of the asset (mineral, timber etc) and the associated loss of revenue and the loss of total value of the property.
When the property was bought no such restriction existed or any indication that a restriction might be imposed in the future. Otherwise, the the person would not have purchased the property if that were the case. The TAKING away of the right to utilize your own property, whether it is environmental laws or zoning or what have you that occurs AFTER you have purchased your property…..it is still a taking.
If you buy property that comes associated with right (mineral, gas, oil, timber, water or the right to subdivide) the value of that property is not just in the land but also in the associated rights. When a government agency comes in at a later date and invalidates or takes away those rights, I would certainly consider that a taking of property. The land owner should be compensated for the reduction in value AND in the lost revenue from the assets on and under the property.
I wonder if the regulation could take on future mining claims. Since a mining claim is not issued, there is no property to be taken for the purposes of eminent domain. Under that at least Citidel might be permitted to frack, but others would not. Unless of course there is a pre-emption clause on mining claims by the State of California.
As for the environmental damage, I wonder if the proof of environmental harm would be a preponderance of evidence. Given the increasing clauses of environmental damage of fracking, that might be increasingly easier. The county probably would do well to see if there is any form of damage locally, as opposed to other locations in which Citidel would claim the geological conditions are not the same.
Around here, if you are accepted to the local and state historic register, you’re eligible for a tax credit, and you’re exempt from certain building codes. No way would they force you to remove a staircase in a situation like that.
Well, let me play like a Democrat for a minute. . .
All you racists are against the TPP because you don’t like white people! You have to pass the TPP to know what’s in it! If you like your rights, you can keep your rights!
Now, time to brush my teeth, and gargle with some Dr. Tichenor’s!
Squeeky Fromm
Girl Reporter
For a government to violate the Taking Clause and to prove such a claim in court to obtain relief of some sort the plaintiff must show a true “taking”. Denying you the right to yell Fire! in a crowded theatre may on its face be a violation of the First Amendment. But that does not stand. Denying you the right to sell your oil under your feet is not a taking. A “taking” is when the government steals or grabs and does not pay for an item, whether it be money, land, boats, or oatmeal. The Taking Clause, unlike Sintur Klaus, will not work during the holiday season either.
I am just wondering if some of the more astute Legal Eagles can explain if, or if not, a “regulatory taking” theory could be applied to a civil property seizure / civil forfeiture by police (other than the obvious Constitutional claim that would seem to make civil forfeiture illegal on its face), since these seized assets are often sold at far below replacement value long before they may be recovered by their entirely innocent owners.
Oh, how interesting. Are Liberals trying to make Gruber a GOP phenomenon?
I’ve always had a rule never to trust any politician farther than I can throw him.
I really enjoyed Megyn Kelly’s interview with Professor Turley, as well as Judge Napolitano the following night.
Prof Turley rightly pointed out that it is irrelevant whether someone agrees or disagrees with what Obama is trying to do – be it Amnesty, the ACA, or whatever. The problem is that Obama is defying the separation of powers. And Liberals will rue the day they gave a President that power, because they may not like the agenda of the next President.
The other 2 branches are neither directed nor required to do the President’s bidding. That would place him above, and in control, of those branches, as a King or Dictator. The branches are EQUAL in power, and designed to counteract each other when one tries to get too strong, as we’re seeing today. However, we have a population of people who appear to be cheering on the rise of a dictator.
But, as Kelly pointed out, how will they feel if, say, a religious Conservative takes office next, and decides to suspend all prosecutions of protestors who harass and block access to abortion clinics? And if that suspension of the law leads to an increase in protestors, to the point that women literally cannot access the clinics, too bad.
How will Liberals look back upon this power grab then?
Pogo:
No kidding. I have a friend who lives in a 1920s home, with an 1800s stone house also on the property. They registered the 1800s home as a heritage property, but now pay $2000/month in property taxes because of that designation, even though it is not income producing. Boy, that should have no effect on future register rates of heritage homes, right? Because there is never an effect from those laws and regulations.
Anyway, the entire property was just seized by eminent domain. She lives near an ephemeral creek (so rare here in CA) with lovely, mature pines shading the area. It’s a little paradise tucked away.
It’ll be all gone. They can build right up to the very doorstep of that 1800s cabin. And it wasn’t taken for public safety, or any good reason. The local government decided to widen a road so that a developer could build a housing tract, and she didn’t have a say, or the right to her home.
Reblogged this on Citizens, not serfs.
It’s my understanding that the energy companies already either owned, leased, or otherwise paid for the land that they suddenly cannot develop.
This is an interesting case.
Property owners in my area face a conundrum when they legally buy land priced to build upon, and then the government suddenly bans them from doing so. People are left with a nest egg invested in land that is suddenly worthless.
In CA, the government has started installing meters on private landowners wells, regardless of whether or not the underground water is contained entirely on their property. If they use “too much” as determined by government, that well is capped. We have seen orchards and farms dry up, people driven out of business, with no compensation for what was, essentially, a government seizure of water rights. People invest up to $60,000 to develop that well, and the DWP neither maintains it, nor brings water to their home. But they’ve just grabbed the rights to that water.
Owners should be compensated. If the government caps someone’s well, then they should extend their water piping to that home, at government’s expense. Because there are also routinely discussions on disallowing people to truck in water, or sell houses that do not have a domestic water supply, either a well or county water. So capping a well can effectively render a property unsellable, and unlivable if the owner cannot afford the added expense of trucking in water.
And this Browndoggle Bullet Train is going to plummet property values for homes that are close to the new track, but not so close as to be taken via eminent domain. Where is their compensation for losing half their home value because they suddenly will be rattlingly close to the tracks?
This may surprise some people in government, but if you take something of value from a property owner, you should compensate them fair market value.
Karen – there is some case law on this, but I do not have access to Lexis-Nexis.
So we should all start companies that have their occupation banned in some area, and then sue over it? Sounds good to me.
Amusing. Now Environmentalists have the Government speak down to a science. Science has nothing to do with their emotional outbursts and heightening the lid on we humans and in the process have manipulated the environment to their liking instead of having the realization that we humans are only 1 % of all populations on this planet and the more educated we become, the more we attempt to defeat what nature is going to do. That lack of control drives them nuts. Rules and all the regulations they insist upon will not change the Rules set by GOD concerning this planet! It is as simple as that!
Annie, I’m not for Grubering from either side. Both sides suck.This is why I keep saying nothing will change for the better, only the worse.
“I see the 3 major networks are not even carrying Obama’s speech tonight. That’s more than just a little interesting. The WH is pissed.” Oh well, they are carrying it on Univision.
Trouble is brewing.
Carllyle,
I wrote about TPP last year:
President Obama Trying to “Fast Track” the Trans-Pacific Partnership—a Trade Pact That Could Be Worse Than NAFTA
http://jonathanturley.org/2013/09/28/president-obama-trying-to-fast-track-the-trans-pacific-partnership-a-trade-pact-that-could-be-worse-than-nafta/
Excerpt:
Brodwin added that the TPP pact would even prevent communities from making the decision about whether or not to allow fracking in their area. Some critics have referred to TPP as “NAFTA on steroids.”
Wallach:
Countries would be obliged to conform all their domestic laws and regulations to the TPP’s rules—in effect, a corporate coup d’état. The proposed pact would limit even how governments can spend their tax dollars. Buy America and other Buy Local procurement preferences that invest in the US economy would be banned, and “sweat-free,” human rights or environmental conditions on government contracts could be challenged. If the TPP comes to fruition, its retrograde rules could be altered only if all countries agreed, regardless of domestic election outcomes or changes in public opinion. And unlike much domestic legislation, the TPP would have no expiration date.
At a Senate banking Committee hearing in May, Senator Elizabeth Warren (D-Mass.) cautioned, “There are growing murmurs about Wall Street’s efforts to use the Trans-Pacific Partnership…as [a] vehicle…to water down the Dodd-Frank Act. In other words, trying to do quietly through trade agreements what they can’t get done in public view with the lights on and people watching.”
TPP Tribunals
Countries that are signatories to the trade pact “will have to change their policies to conform to the agreement.” What does that mean? It would require a dismantling of “any regulations, safeguards or incentives” the countries had enacted “to support their economies and provide better lives for their citizens.” In fact, a system of tribunals would be established in order “to hold governments to account.” Corporations would be allowed to sue governments “to demand the relaxation of standards, and could claim damages from governments that failed to conform.”