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Sotomayor On Takings And Property Rights Issues

The Senate's hearings on Circuit Judge Sonia Sotomayor's nomination as an Associate Justice of the U.S. Supreme Court begin today. Here's our summary of cases in which she was involved as a circuit and district judge on the issue.

If confirmed, we may find out her thinking about regulatory takings very soon, because in its next Term, the Court will be reviewing Stop the Beachfront Renourishment, Inc. v. Florida Dep't of Environmental Protection, No. 08-11 (cert. granted. June 15, 2009), a case about the taking of littoral (beachfront) land in Florida. Our summary of the issues in that case is here.

If she is elevated to the Court, this case could prove especially interesting because her one unabashedly pro-property owner decision as a Second Circuit judge focused on procedural due process. In Brody v. Village of Port Chester, 434 F.3d 121 (2d Cir. 2005), the court held that New York's eminent domain law deprived the property owner of adequate notice, and that when the law provides a short time frame to institute a challenge to a condemnation, the government has an obligation to provide express and conspicuous notice of the time frame. The Stop the Beachfront petition raises a procedural due process question:

Is the Florida Supreme Court's approval of a legislative scheme that allows an executive agency to unilaterally modify a private landowner's property boundary without a judicial hearing or the payment of just compensation a violation of the due process clauses of the Fifth and Fourteenth Amendments to the United States Constitution?

This case is shaping up to be very interesting.

Field Of (Broken) Dreams In New London?

That now-cliched line from Field of Dreams, "if you build it they will come" (actually, it's "he will come," but work with us here) seemed to be the driving force behind the New London Development Corporation's plans for the Fort Trumbull neighborhood when it wanted to condemn the homes of Susette Kelo and her neighbors. If they condemned, Pfizer would come.

They condemned the hell out of it, but it turns out that it wasn't the pharmaceutical giant that came, or even Shoeless Joe and his Black Sox. According to a report in the New London, Connecticut paper The Day, birds -- killdeer, red-winged blackbirds, mourning doves and others -- have come: "Fort Trumbull Neighborhood Is For The Birds."

When Spinoza observed some 350 years ago that "nature abhors a vacuum," the Fort Trumbull peninsula hadn't seen its first fort yet, let alone any hints of the epic property-rights struggle to come as the 21st century dawned.

Now, just two years after the last house was razed by the New London Development Corp. for an as-yet unrealized new development, the former neighborhood is something of a demonstration site for the Dutch philosopher's famous insight. The empty lots once occupied by yards, porches and office buildings are turning into a meadow of wildflowers, milkweed and tall grasses, and the birds are moving in.

As Professor Gideon Kanner commented on this story last week, You Can't Make this Up. See also Eminent Domain is for the Birds, from Reason's blog.

Florida Supreme Court: Property Owner's Off-Site Mitigation Taken Into Account In Calculating Business Damages From A Partial Take

In System Components Corp. v. Florida Dep't of Transportation, No. SC08-1507 (July 9, 2009), the Florida Supreme Court resolved a conflict in the lower Florida courts regarding the application of business damages in a condemnation case under Florida Statutes § 73.071(3)(b). The court held that a business is not required to relocate as the result of a partial taking, but if it chooses to do so, only the actual damages suffered by the business are compensable, and "its business damages must be determined in light of its continued existence at its new location." Slip op. at 3.

The Florida appeals courts were split on the issue. In State Dep't of Transportation v. Tire Centers, LLC, 895 So. 2d 1110 (Fla. 4th DCA 2005), the Fourth District court awarded business damages as if the business had ceased to exist on the date of the taking, reasoning that the business owner had no duty to relocate, but in System Components Corp. v. Dep't of Transportation, 985 So. 2d 687 (Fla. 5th DCA 2008), the Fifth District court of appeals did not agree.

The System Components case involved a partial taking of property for road widening. The property owner operated its business on the site from a 5000 square foot building. The taking cut the building in half, and reduced the parcel from 1.8 acres to .64 acres. The remaining land was unusable due to setback requirements which precluded rebuilding, and of nominal value. Consequently, the property owner moved its business to another site.

The property owner filed a motion in limine to exclude evidence of the fact that it relocated and continued to operate in a new location. Citing Tire Centers, it asserted that "it was entitled to the 'total-take' value of its business as though it had ceased to exist on the date of taking." Slip op. at 7. The owner argued that condemnation actions "are solely concerned with the land taken and the resulting damages to the condemnee," and its mitigation measures did not relieve the condemnor for the wipeout of its business. Id.

The Supreme Court first noted that business damages are a matter of "legislative grace" and are not required by the state or federal constitutions, and the court was thus limited to the language of the statute. Slip op. at 13-15. In section 73.071, the legislature provided for damages in right-of-way partial takings:

(3)  The jury shall determine solely the amount of compensation to be paid, which compensation shall include:

. . .

(b)  Where less than the entire property is sought to be appropriated, any damages to the remainder caused by the taking, including, when the action is by the Department of Transportation, county, municipality, board, district or other public body for the condemnation of a right-of-way, and the effect of the taking of the property involved may damage or destroy an established business of more than 4 years' standing before January 1, 2005, or the effect of the taking of the property involved may damage or destroy an established business of more than 5 years' standing on or after January 1, 2005, owned by the party whose lands are being so taken, located upon adjoining lands owned or held by such party, the probable damages to such business which the denial of the use of the property so taken may reasonably cause; any person claiming the right to recover such special damages shall set forth in his or her written defenses the nature and extent of such damages;

Florida Statutes § 73.071(3)(b) (emphasis added). The court held that to compensate the property owner under this section for goodwill damages when the business chooses to relocate and as a result does not suffer any loss of goodwill would result in a "windfall" --

In this case, the jury awarded System Components business damages for (a) loss of value due to an altered capital structure (i.e., increased debt), (b) moving expenses and rent, (c) costs associated with obtaining a replacement property, (d) costs associated with constructing a replacement facility, and (e) down-time productivity losses, and the trial court subsequently deducted the amount of FDOT‘s good-faith deposit to avoid double recovery. System Components did not lose any goodwill and its witnesses could not identify any specific loss of sales. The company did not cease to exist on the date of taking. Consequently, System Components received the "probable" business damages "reasonably" suffered as a result of the taking.

Slip op. at 25-26.

The court held the statute does not impose a duty to relocate, id. at 31-32, but that if a business owner chooses to do so as the result of a partial right-of-way taking, the statute only requires compensation for those damages actually suffered.

Note: the opinion cited a Florida Bar Journal article we noted back in May 2009, Eminent Domain: Identifying Issues in Damages for the General Practitioner, by Carlos A. Kelly.

Tuesday Round-Up

Here are items which we've been reviewing today:

• Dwight Merriam's thoughts on SCOTUS nominee, Second Circuit Judge Sonia Sotomayor.

• A report that the "Florida Hometown Democracy" initiative has made the 2010 ballot. According to the report "[i]f the proposal gets 60 percent approval at the polls, Hometown Democracy would require local referendums on changes to city and county comprehensive plans."

• From the Willets Point United blog: "Willets Point United Hires NY State's Top Eminent Domain Attorney." (They've hired our Owners' Counsel of America colleague Michael Rikon.)

• The New York Court of Appeals (that state's highest court) will be hearing arguments in the Atlantic Yards cases. The NY Observer's report here, and the NY Times report here.

• Speaking of takings for sports facilities, Professor Gideon Kanner dishes on using taxpayer money to attract and support stadiums and arenas.

• My Damon Key colleague Mark Murakami links to a Maui News article about a different approach to beach erosion issues.

Links From ABA Condemnation Committee Conference Call

A very interesting conference call today, focusing on the property-related decisions by SCOTUS nominee Sotomayor and the takings case recently accepted for review by the U.S. Supreme Court. Here are the links to some of the cases and other topics discussed during today's call, and other items of interest which we didn't have time for:

• Judge Sonya Sotomayor's decisions about eminent domain and regulatory takings

• Resource page for the Florida beachfront takings case, Stop the Beachfront Renourishment, Inc. v. Florida Dep't of Environmental Protection, No. 08-11 (cert. granted, June 15, 2009).

• On Judicial Takings, And The Hawaii Water Rights Backstory In Stop The Beach Renourishment - our summary of Robinson v. Ariyoshi, 753 F.2d 1468 (9th Cir. 1985) and Sotomura v. County of Hawaii, 460 F. Supp. 473 (D. Haw. 1978), two cases regarding judicial takings relied upon by the cert petition,

• Scalia and O'Connor's dissent from the denial of cert in Stevens v. City of Cannon Beach, 510 U.S. 1207 (1994) ("As a general matter, the Constitution leaves the law of real property to the States. But just as a State may not deny rights protected under the Federal Constitution through pretextual procedural rulings, see NAACP v. Alabama ex rel. Patterson, 357 U.S. 449, 455-458 (1958), neither may it do so by invoking nonexistent rules of state substantive law. Our opinion in Lucas, for example, would be a nullity if anything that a State court chooses to denominate "background law" -- regardless of whether it is really such -- could eliminate property rights.").

• McQueen v. South Carolina Coastal Comm'n, 530 S.E.2d 628 (S.C. 2000).

• Pruneyard Shopping Center v. Robbins, 447 U.S. 74 (1980) (California Supreme Court's interpretation of California Constitution's free speech clause to require a shopping center to allow handbilling on its property was not a taking).

• Another beachfront case - Severance v. Patterson, No. 07-20409 (5th Cir., Apr. 23, 2009). 

• Case to watch: Casitas Municipal Water District v. United States, 543 F.3d 1276 (Fed. Cir. 2008). More here.

• Property owners entitled to damages including reasonable attorneys fees and costs for failed condemnation attempt, even if government prevails in intermediate steps. More here.

• Delegation of eminent domain power: redevelopment agency without power to take property until it enters into a development agreement when statute requires as a condition precedent. Eagan Economic Development Authority v. U-Haul Company of Minnesota, No. A08-0767 (Minn. Ct. App., May 19, 2009).

• Delegation of eminent domain power: statutory delegations strictly construed. Spokane Airports v. RMA, Inc., No. 26538-2-III (Wash. Ct. App., Apr. 28, 2009).

• Might Makes Blight In The New York Appellate Division - Develop Don't Destroy Brooklyn v. Urban Dev. Corp., 2009 NY Slip Op 01395 (Feb. 26, 2009).

• Determining Eminent Domain Pretext In Serial Takings - County of Hawaii v. C&J Coupe Family Ltd. P’ship, 198 P.3d 615 (Haw., Dec. 24, 2008) (proposed Findings of Fact and Conclusions of Law on remand).

• Rose Acre Farms, Inc. v. United States, No. 2007-5169 (Fed. Cir., Mar. 12, 2009) - regulation restricting the sale of eggs was not a taking under Penn Central Transp. Co. v. City of New York, 438 U.S. 104 (1978), because the economic impact of the regulation "was not severe" and the character of the government action "strongly favored" the government.

Eminent Domain Academic Round-Up: Pretext And Compensation

I've been reading some noteworthy law journal articles on the subject of eminent domain --  two on the issue of pretext, and one on just compensation. Worth reviewing.

• Daniel S. Hafetz, Ferreting Out Favoritism: Bringing Pretext Claims After Kelo, 77 Fordham L. Rev. 3095 (2009).

  The plaintiffs in Goldstein based their pretext claims on both Justice John Paul Stevens's brief discussion of pretext in the majority opinion of Kelo and Justice Anthony Kennedy's more lengthy discussion in his concurrence. Acknowledging that "[t]here may be private transfers in which the risk of undetected impermissible favoritism of private parties is so acute that a presumption . . . of invalidity is warranted," Kennedy’s fifth-vote concurrence identified the possibility of "a more stringent standard of review than [rational basis review] for a more narrowly drawn category of takings." Although the Second Circuit rejected the application of this heightened pretext standard in Goldstein, it acknowledged that "Kelo opened up a separate avenue for a takings challenge" where the plaintiff alleges the asserted public purpose is a pretext for bestowing a private benefit.

  Article available here from the Fordham Law Review. (In the section on Goldstein and Twombly, this inversecondemnation.com post is cited.)

• Daniel B. Kelly, Pretextual Takings: Of Private Developers, Local Governments, and Impermissible Favoritism, 17 Sup. Ct. Econ. Rev. (forthcoming Summer 2009).

  Since Kelo v. City of New London, the preferred litigation strategy for challenging a condemnation that benefits a private party is to allege that the taking is "pretextual." This Article contends that, although pretextual takings are socially undesirable, the current judicial test for identifying such takings is problematic. Yet an alternative, intent-based test might be impracticable, as well as underinclusive: condemnors often have mixed motives, particularly when confronted with a firm’s credible threat to relocate. Instead, the Article develops a framework that emphasizes informational differences between local governments and private developers. When the government lacks information regarding the optimal site for an assembly, the government may need to rely on a private party to identify, as well as develop, a particular site. However, when the government itself possesses information regarding the site, precondemnation private involvement, as well as post-condemnation involvement by a preferred developer, is generally unnecessary. Such involvement increases the likelihood of a pretextual transfer without any corresponding public benefit. The Article concludes that a burden-shifting framework, analogous to Title VII’s test for identifying pretext, can be adopted in the takings context. The new framework is then applied to several situations in which allegations of pretext are likely to arise.

  Available here from SSRN.

• Matthew Cory Williams, Restitution, Eminent Domain, and Economic Development: Moving to a Gains-Based Conception of the Takings Clause, 41 Urban Lawyer 183 (Winter 2009) (25th Smith-Babcock-Williams Student Writing Competition Winner).

Post-Kelo, those recognizing the value of eminent domain to aggregate property for redevelopment have suggested that the real focus should not be on whether economic development is a public purpose, but on the amount of compensation given to the takees. Indeed, assuming takees werec compensated at the takee’s subjective value, the problem of forcing takees to "sell" their property to the government would be a much less divisive issue. However, current measures of "just compensation" are based on the "fair market value" of the property. In response to this "under compensation," several suggestions have been made on how to raise the level of compensation, and some states have enacted measures aimed at increasing compensation levels. Proposed solutions seek to award some of the benefit of the reaggregation and development of the land, called "after value," to the takees. This article examines whether awarding after value to takees complies with the major purposes of the Takings Clause. While it examines a few of the many proposed ways to award takees a portion of this after value, this article focuses more on whether the general idea of after value complies with the philosophies underlying the Takings Clause.

Article available here for ABA members.

New Article On Redevelopment And "Blight" - Proposal For Reform

I just finished reading a recently-published law review article by Missouri Court of Appeals Judge Harold L. Lowenstein, Redevelopment Condemnations: A Blight or a Blessing upon the Land?, 74 Mo. L. Rev. 30 (2009) (available here).

Despite the efforts of legislatures to reform eminent domain, the exercise of eminent domain for private redevelopment still confers a concentrated benefit on a few while imposing the costs of such redevelopment on a discrete set of property owners. To remedy this imbalance, and to prevent developers and development agencies from abusing this power, this article proposes that property owners be accorded remedies at the beginning as well as at the end of the eminent domain process.

The article recommends redefining blight in "concrete and measurable terms," and allowing courts to undertake "meaningful judicial review" of blight determinations. The article also suggests that precondemnation blight cover damage to property for the "pall cast" by the establishment of a redevelopment district.

Worth a read.

The Ames Brothers On Eminent Domain Negotiations

Remember that song Undecided, recorded by the Ames Brothers (and countless others)?

First you say you do, and then you don't (no you don't)
And then you say you will, and then you won't (no you won't)
You're undecided now
So what are you gonna do?

Now you wanna play, and then it's no (then it's no)
And when you say you'll stay, that's when you go (when you go)
You're undecided now
So what are you gonna do?

That looks to be the situation shaping up in the federal government's attempt to acquire land near Somerset, Pennsylvania for the United 93 memorial (for background see this post).

Initially, the land was to be taken by eminent domain after negotiations broke down, prompting two panel members to resign. Then, the headline "Gov't reverses course on Flight 93 memorial land" (June 5, 2009) which reported "The federal government has backtracked and decided not to take the western Pennsylvania property needed to build a Flight 93 memorial. Interior Secretary Ken Salazar and Sen. Arlen Specter met Friday in Somerset with landowners. They say the government will try to negotiate instead of using eminent domain to take the land." 

The next day, however, the AP reported "Deadline set for Flight 93 memorial land talks" (June 6, 2009), which included this news: "The federal government says it will negotiate with landowners for one week in an attempt to get property needed to build a Flight 93 memorial without using eminent domain."

Summary of negotiations: "Let's talk without the threat of us using eminent domain. You have a week to sell." 

For two examples of how the feds often "negotiate" with landowners, see here (the Bureau of Land Management: "the federal government does not negotiate") and here (where the Border Patrol asserted that its casual contacts with the landowner and conversations with her qualified as bona fide "negotiations").

Now don't get us wrong: we're not saying that exercising eminent domain to take land for a national memorial to honor the UA 93 passengers who fought back wouldn't be a public use -- it sure looks like a taking that would be upheld, if challenged.

But it's one thing to be legal and another to be wise (as the New London Development Corporation found out).

Video Of Kelo's New London Neighborhood With Author Jeff Benedict

A short video with Jeff Benedict, author of Little Pink House - A True Story of Defiance and Courage (Grand Central Publishing 2009), which tells the backstory to the infamous Supreme Court eminent domain decision Kelo v. City of New London, 545 U.S. 469 (2005) (available from Amazon here).

More on the book here.

SCOTUS Nominee Sotomayor On Takings Issues

Second Circuit Judge Sonia Sotomayor, the nominee to fill Justice David Souter's seat on the U.S. Supreme Court, has served as either a federal District or Circuit Judge for 18 years during which she's either authored or sat on panels in cases involving eminent domain or regulatory takings.  Here's an admittedly unscientific sampling of those decisions, which reveal a mixed bag on the property issue:

• Brody v. Village of Port Chester, 434 F.3d 121 (2d Cir. 2005) (Sotomayor on panel).  This decision represents the most favorable case for property owners, although it is more a due process than a takings case.  The panel held that New York's eminent domain law deprived the property owner of due process notice, and that when the law provides a short time frame to institute a challenge to a condemnation, the government has an obligation to provide express notice of the time frame. The court held:

  Thus, while the legislative decision to condemn is not reviewable, the purpose of the condemnation is. The role of the judiciary, however narrow, in setting the outer boundaries of public use is an important constitutional limitation. To say that no right to notice or a hearing attaches to the public use requirement would be to render meaningless the court's role as an arbiter of a constitutional limitation on the sovereign's power to seize private property.

  The district court's opinion on remand is summarized here.

• In an earlier decision in the same litigation, the Second Circuit in an opinion authored by Judge Sotomayor held that a property owner had standing to challenge the lack of individual notification of the taking of his property, and that the owner was not precluded from asserting a due process challenge because he would not have raised it as a defense to the taking under New York's eminent domain law.  On the issue of the remedy available to the property owner (who sought return of his land), Judge Sotomayor refused to order the return of the property, and wrote:

  We recognize that at least one other circuit appears to order reinstatement and backpay as a remedy in employment cases before a new hearing is held. This intermediate remedy would be analogous to ordering a return of Brody's property upon a finding of a due process violation, and then requiring the Village to begin again and initiate condemnation procedures that complied with due process, regardless of the likely merits of Brody's challenge in the Article 2 process. While we express no view on what the appropriate remedy would be for denials of due process in the employment context, we find that the reliance interests of third parties in this case are sufficiently compelling that Brody is entitled to a return of his property only if he can prove that any denial of due process made a difference in the condemnation proceedings. Moreover, in cases such as this one, we believe that these same reliance interests create a strong incentive for the condemnor to comply with the requirements of due process before the property has been condemned and development has begun, in light of the risk that a court somewhere down the road might order a return of the property.

  Brody v. Village of Port Chester, 345 F.3d 103, 120-121 (2d Cir. 2003) (citations and footnote omitted).  Cf. Ciszewski v. New York, 279 Fed. Appx. 39 (2d Cir. 2008) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) (property owner precluded from raising due process challenges to a taking when owner did not challenge public use).

• Didden v. Village of Port Chester, 173 Fed. Appx. 931 (2d Cir. 2006) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) appears to be the the only case in which a Kelo-like situation was presented (the order cited Kelo as the reason it was "obliged to conclude that [the property owners] have articulated no basis upon which relief can be granted." Professor Richard Epstein has summarized the case and Judge Sotomayor's role in it here:

I have written about Didden in Forbes. The case involved about as naked an abuse of government power as could be imagined. Bart Didden came up with an idea to build a pharmacy on land he owned in a redevelopment district in Port Chester over which the town of Port Chester had given Greg Wasser control. Wasser told Didden that he would approve the project only if Didden paid him $800,000 or gave him a partnership interest. The "or else" was that the land would be promptly condemned by the village, and Wasser would put up a pharmacy himself. Just that came to pass. But the Second Circuit panel on which Sotomayor sat did not raise an eyebrow. Its entire analysis reads as follows: "We agree with the district court that [Wasser's] voluntary attempt to resolve appellants' demands was neither an unconstitutional exaction in the form of extortion nor an equal protection violation."

Maybe I am missing something, but American business should shudder in its boots if Judge Sotomayor takes this attitude to the Supreme Court. Justice Stevens wrote that the public deliberations over a comprehensive land use plan is what saved the condemnation of Ms. Kelo's home from constitutional attack. Just that element was missing in the Village of Port Chester fiasco. Indeed, the threats that Wasser made look all too much like the "or else" diplomacy of the Obama administration in business matters.

• Gherardi v. New York, 161 Fed. Appx. 60 (2d Cir. 2005) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) gives some indication that Judge Sotomayor has no real issues with the regulatory ripeness rules of Williamson County Regional Planning Comm'n v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985).  The court in Gherardi rejected an as applied takings challenge because the plaintiffs did not allege they applied for, and were denied, development approvals.  See also Leone v. Whitford, 300 Fed. Appx. 99 (2d Cir. 2008) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) (affirming the dismissal of a regulatory takings claim for failure to exhaust administrative remedies under Williamson County); Webster v. National Fuel Gas Supply Corp., 268 Fed. Appx. 85 (2d Cir. 2008) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) ("We dismiss the inverse condemnation claim encompassed in Webster's complaint in order to allow the New York state courts to adjudicate this claim in the first instance.").

• Also in the ripeness context, Judge Sotomayor was on the panel in a prisoner habeas corpus appeal, in which the court contrasted prudential ripeness with "more fundamental and more rigid, constitutionally-based" ripeness:

  The notion of ripeness, as a doctrine of prudence, has become a staple in the adjudication of claims that a state or municipality has taken property without providing just compensation. In that context, a plaintiff must obtain a final decision from the regulatory body that the plaintiff alleges has taken his or her property, and the plaintiff must also seek compensation through any procedures the state has in place. See Suitum v. Tahoe Reg'l Planning Agency, 520 U.S. 725, 733-34, 117 S.Ct. 1659, 137 L.Ed.2d 980 (1997). Until a plaintiff can demonstrate that both of these requirements are met, the plaintiff's regulatory takings claim is generally deemed not ripe. Id. But since the doctrine is driven by judicial prudence rather than the Constitution, a court is free to exercise jurisdiction over such a case when the circumstances so warrant. See Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1012-13, 112 S.Ct. 2886, 120 L.Ed.2d 798 (1992) (noting that a takings plaintiff's opportunity to apply for a special permit "goes only to the prudential 'ripeness'" and deciding that prudence dictated that the Court reach the merits in that case-given that Article III injury had properly been alleged-since the special permit scheme that the plaintiff had not complied with had been established only late in the litigation).

  Simmonds v. INS, 326 F.3d 351, 358 n.7 (2d Cir. 2003).

• Judge Sotomayor was the district judge in a bankruptcy case which involved a claim of a regulatory taking.  In In re St. Johnsbury Trucking Co., 199 Bankr. 83 (S.D.N.Y. 1996) and 191 Bankr. 122 (S.D.N.Y. 1996), she summarily dismissed a claim that the regulation was a taking even though she agreed that they wiped out the value of property ("St. Johnsbury protests that these two sections, as distinct from the other undercharge defenses, "destroy the entire economic value of St. Johnsbury's undercharge claims" against small shippers and for claims accruing prior to September 30, 1990. Indeed they do."):

  As a matter of law, the question of whether a regulatory action rises to the level of an unconstitutional taking is governed by the three-part test enunciated in Penn Central Transp. Co. v. City of New York, 438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978) and refined in Connolly v. Pension Benefit Guarantee Corp., 475 U.S. 211, 106 S.Ct. 1018, 89 L.Ed.2d 166 (1986). The Whittier court analyzed the takings issue raised by St. Johnsbury in light of Connolly and I agree with its analysis. Whittier, 57 F.3d at 650-51. Connolly held that Congress has the freedom to "adjust the benefits and burdens of economic life to promote the common good." Connolly, 475 U.S. at 225, 106 S.Ct. at 1026. That is what Congress did by enacting the Rates Act.