2006

It’s appearing more and more that Honolulu’s massive $4B+ rail project is on the fast track, and the City wants to control all development anywhere near the proposed project.  In additon to the technical amendment to eminent domain law noted here allowing the City to to enter into longer term leases for land it grabs by condemnation, the City Council, as reported here, here (video), and here, is contemplating enacting a moratorium on all development within 1/4 mile of the rail route, and 1/2 mile of a transit station. 

Supposedly designed to thwart land speculators anticipating the rail project, the proposal as drafted would put a halt to all development or improvement of any kind, large or small, within the noted zones. 

In addition to the usual legal problems that accompany development bans (inverse condemnation), it is not clear why the City believes a moratorium in necessary unless it plans on taking huge swaths of private property by eminent domain (which it might if it follows the usual course for mass transit projects) in excess of what is needed for the rail footprint, and leasing or selling off the overage.  If that is the case, the proposal may makes sense from the City’s perspective, since it may be seeking to capture any market gain that results from the project.  But what does this mean for private property owners who now may find themselves in the path of the rail line?  Someone down at the City better go read Klopping v. City of Whittier, a decision which prohibits the government from attempting to depress the market value of property in anticipation of condemnation.

     Continue Reading ▪ Contemplating a Rail Development Moratorium

“County zoning flaws leading landowners to court” reads the headline in the December 10 Maui News, detailing two cases where property owners have alleged that the County of Maui long ago confirmed that certain land uses were legal, and cannot now change its mind. 

Under Hawaii’s top-down system of land use classification, the State must first classifiy land as “urban” before the counties are able to zone it.  However, decades ago, the County of Maui apparently zoned the parcels at issue before the state got around to classifying it:

Back in 1964, shortly after the new state government established its land use laws, Maui County granted zoning to land in Pukalani and Makena without having the state first approve urban use.

Under the state land use law, counties are allowed to grant zoning only to properties that are in the urban district. The Land Use Commission determines the classification of lands as conservation, agricultural/rural and urban.

In the cases that now are leading to suits in 2nd Circuit Court and for a Makena family, Maui County not only approved the zoning before the lands were classified urban, but issued letters to the landowners verifying the zoning.

Except the county since has retracted the verification of zoning.

The fallout so far has been at least two lawsuits against the county by landowners in Pukalani and an ongoing headache for a Makena family that seeks to get the zoning that had previously been granted and then retracted.

The county’s somewhat casual approach to zoning in the old days has provided plenty of work for lawyers.

But these lawsuits are not a case of “make work” for lawyers, and reflect a serious issue of who must bear the burden of government’s official mistakes, when they are compounded with years of reliance by property owners, most of whom have no inkling of the error.  The County, it seems, wants to shift the responsibility for its errors onto innocent property owners.  In such instances, however, it seems that the burden of the error should fall on the entity responsible for the mistake, and with the resources to catch it: the government.  Given the scope of the problem, this will no doubt not be the last we hear of such lawsuits.

     Continue Reading ▪ More Maui Land Use Issues

The Supreme Court of Hawaii has scheduled rare oral argument in the Kauai Charter Amendment property tax appeal.  The issues include standing of government officials to sue themselves to obtain declaratory judgments, and the constitutional role of the counties in establishing real property tax policy.  Details of the case, including links to the merits briefs here. 

Arguments will be held in the Supreme Court courtroom in the Judiciary Building on Thursday, February 15, 2007 beginning at 9:00 a.m.  Each side is allowed one-half hour for argument.  The proceedings are open to the public and the media.

     Continue Reading ▪ HAWSCT Oral Arguments – Feb. 15, 2007 @ 9 am

In January, I will be speaking on three topics:

  • At the Hawaii Land Use Law Conference, I’m presenting “Water, Water, Everywhere: Coastal Zone Management Permits; Hawaii’s Floodway, Floodplain and Coastal Inundation Zone Requirements.”  Agenda and registration details here.
  • At the annual Advanced Land Use and Zoning seminar, my portion is “US Supreme Court Land Use Update,” which deals with the Rapanos Clean Water Act case, other federal developments in land use law, and some of the more interesting Hawaii Supreme Court land use decisions.  I will also be covering “Vested Rights Update” with my colleague Greg Kugle.  Complete agenda and registration information here.
  • At the HSBA Environmental Law section January meeting, I’m presenting “Clean Water Act Jurisdiction After Rapanos.”  Approximately one week before the meeting, I will post materials and resouces on this blog.

I hope to see you at one or more of these events.  Drop me an email for sign up information or see the links on the “Events” heading on the right.

     Continue Reading ▪ Upcoming Seminars

Hawaii property owners, especially those near the ocean or a stream, should pay special attention to the U.S. Supreme Court’s latest decision interpreting the federal Clean Water Act.

The Act is designed to keep pollution out of “navigable waters,” but what does that term mean? The answer is not as simple as it may appear.

As strange as it sounds, “navigable waters” includes much more than waters that are actually navigable. The Army Corps of Engineers, the agency tasked with enforcement, defines the term very expansively to include drainage ditches, isolated marshes, patches of desert, and anything adjacent to them. If there might be a “hydrological connection” between your land and actually navigable water, these all-embracing regulations require you to obtain a permit before you do anything that might impact navigable waters even miles away.

An example of how this regulatory power was abused is the case of John Rapanos, a Michigan property owner whose appeal was decided by the U.S. Supreme Court in July. The federal government is pursuing Mr. Rapanos because it claims he needed a Clean Water Act permit before he moved sand from one side of his cornfield to the other. The government claimed his cornfield contained “wetlands,” which are “navigable waters” because they have a hydrological connection to a river twenty miles away.

Mr. Rapanos’ legal odyssey was only just beginning. When he refused to obtain the permit, the government convicted him of a federal crime, sought to throw him in federal prison for 10 years, and fined him $185,000. As if that was not enough, the government also sought civil fines of $10 million, mitigation fees, and forfeiture of half of his land.

Finally, after twelve years of trials and appeals, his case reached the Supreme Court, which ruled that the government overstepped its authority. The Court struck down the regulations, but could not agree why they were unlawful.

Four Justices said that in order to subject isolated “wetlands” to Clean Water Act regulations, the government had to show the nearby water is relatively permanent (such as the ocean or a stream), and there is a continuous surface connection between the property and that water.  Four dissenting Justices said that the regulations were perfectly acceptable as they were, and would have upheld the penalties against Mr. Rapanos.  The remaining Justice, Anthony Kennedy, said that the determination of whether property contained federal wetlands should be decided case-by-case to determine whether there was a “significant nexus” to actually navigable waters.

In the end, the Court could not agree on anything but the result: the Corps had gone too far, and its regulations were invalid. Unfortunately, the 4-4-1 split and resulting lack of clear direction from the Court has left farmers and ranchers in just as much uncertainty as they were before the decision. 

Even a careful property owner can only speculate whether a seemingly isolated wet patch of land, ditch, or drain – however remote and insignificant it may appear – may be somehow connected to traditionally navigable waters. Property owners act at their peril, because even innocuous actions may result in a violation.

Hawaii owners may be especially at risk, because no land in Hawaii is more than a few miles from the ocean, and most farms and ranches are much, much closer.  Nearly any seemingly isolated drain, ditch, or moist soil may later be shown to have an invisible hydrological connection to the ocean.  Does this mean you need a federal Clean Water Act permit before you risk undertaking routine tasks on your own property? Under the inconclusive Rapanos decision, your guess is at least as good as the Supreme Court’s.

The Corps has been urged to scale back its ambitions and revise its regulations to impose more reasonable rules. Historically, however, the Corps has resisted change, even when mandated by the Supreme Court.  Revised regulations, even if eventually enacted, are likely years away.  In the interim, it is up to the lower courts to try and apply the fractured Rapanos decision, leaving property owners to guess whether their activities may put them at risk.

If five Supreme Court judges cannot agree on a definition of “navigable waters,” it hardly seems fair that property owners are now tasked with determining whether their activities might require a Clean Water Act permit, chancing imprisonment and fine if they turn out to be wrong.

     Continue Reading ▪ Muddying the Clean Water Act

Light posting until mid-December.  To satisfy your land use fix, try these links:

  1. hawaiilawyer.com – My firm’s main site, with RSS feed.
  2. Institute for Justice – RSS feed.
  3. Land Use Prof Blog.
  4. PLF on Eminent Domain – frequently updated on eminent domain reform.
  5. Rapanos blog – Clean Water Act jurisdiction issue.
  6. SCOTUS blog – US Supreme Court real time opinions, briefs, transcripts, and analysis.
  7. Supreme Court of Hawaii – November 2006 opinions and orders.  December 2006.

      Continue Reading ▪ Programming Note

It looks like the City is getting its eminent domain ducks in a row in anticipation of the massive $3 to $4 billion fixed rail project.  On November 13, the Mayor signed Ordinance 06-45, allowing the City to enter into longer term leases for property it seizes by eminent domain. 

The prior law allowed month-to-month leases up to one year, with the possibility of extension to two years.  The amendment continues these terms, but also permits under “extraordinary circumstances” the council to approve month-to-month terms up to four years. 

    Continue Reading ▪ Honolulu Amends Eminent Domain Law

Professor Ilya Somin has posted a summary of the Kelo-fueled voter measures:

Why are the anti-Kelo referendum initiatives so much more effective than most of their legislative cousins? I suspect because the former are usually drafted by property rights activists rather than by state legislators. As I discuss in more detail in the posts linked above, politicians often have incentives to give voters the impression that they are “reforming” eminent domain without actually doing so. Activist groups have few if any such incentives and the reforms they draft are therefore likely to have fewer loopholes and be more effective in eliminating economic development takings.

Despite not getting enough votes to pass in California and Idaho, overall, it looks like the property rights issue received a big stamp of approval from the public. 

How about Hawaii?  Last session, the legislature did not pass any of the four eminent domain reform measures proposed after Kelo, and Hawaii law does not permit statewide initiative or referendum.  The only way to get a measure on a statewide ballot is a constitutional amendment, most of which originate in the Legislature. 

     Continue Reading ▪ Eminent Domain Reform a Big Winner