Regulatory Costs Fairness Act Exposed
The Regulatory Costs Fairness Act was adopted by ALEC's Natural Resources Task Force at the States and Nation Policy Summit on December 9, 2006. The act was approved by the ALEC Board of Directors on January 8, 2007 and reapproved on January 28, 2013.
CMD's Bill Summary
This "model" legislation attempts to expand the interpretation of the Fifth Ammendment's "takings" clause to make taxpayers liable to land owners, including corporations, that claim their property value is diminished by government regulations (such as environmental, zoning, or land use regulations). The U.S. Supreme Court has held that a regulation can be a Taking requiring compensation when it "goes too far," such as when it deprives the property owner of "all economically beneficial uses." This bill would lower the bar for a regulatory taking to basically any reduction in property value, and allow a property owner to demand compensation from taxpayers for that reduction in value. This bill would allow corporations to demand compensation from the government for regulations that affect them (such as pollution laws or zoning laws) and this wishlist legislation would make it difficult to implement regulations that help protect public health and the environment. While the bill would allow small landowners or homeowners the right to demand compensation, it notable exempts from "takings" analysis the placement of energy facilities (clearly benefitting energy companies) that might diminish the rights of citizens who live nearby. Ballot initiatives based on this interpretation of "takings" have been advanced in several Western states in the past decade. Oregon approved Measure 37 in 2004 (which was largely overturned by Measure 49 in 2007), and Arizona approved a similar initiative in 2006. Similar measures that passed in Montana and Nevada were invalidated by courts. Many of the ballot initiatives nationwide were financed by New York libertarian Howie Rich and his group "Americans for Limited Government," among others. See also Property Investment Protection Act, Private Property Protection Act.