Distribution of Power Generation

1
Where Now for the Property Rights Movement?
Leonard C. Gilroy, AICPDirector of Government
ReformReason Foundationreason.org reason.com
reason.tv Preserving the American Dream
Conference November 11, 2006 San Jose, CA
2
Steady Erosion ofPrivate Property Rights

• Pre-1900s common-law, nuisance-based regulation
• Progressive Era
• expansion of regulatory state
• majoritarian rule over democracy, individual
  civil liberties, and private property rights
• Shift towards highly prescriptive restrictive
  regulation
• Euclid v. Ambler (1926) Upheld comprehensive
  zoning
• Modern land use regulation using public policy
  to mandate the private provision of public
  amenities

Reason Foundation
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3
Expanding Government Power

• Eminent domain power
• Intent to allow taking of private property for
  public use (i.e., roads, infrastructure) with
  just compensation
• Reality public use morphed into vague public
  purpose
• Police power
• Intent to secure rights by prohibiting harms
  (i.e., nuisance)
• Reality routinely used to restrict property
  rights, conduct that doesnt violate others
  rights (i.e., zoning, growth boundaries, habitat
  conservation)

Reason Foundation
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4
The Tide Turns Two Key Events

• Oregons Measure 37 (2004)
• Backlash to decades of overzealous statewide land
  use planning gt90 state off-limits
• M37 protected property owners from regulatory
  takings
• Kelo v. New London decision (2005)
• Upheld use of eminent domain to seize private
  property for economic development purposes
• Prompted national backlash that reinvigorated
  property rights movement

Reason Foundation
www.reason.org
5
Property Rights Victories 2004-2007

• Eminent domain reform
• Legislation, constitutional amendments, and/or
  ballot initiatives in over 40 states aimed at
  curbing eminent domain abuse
• FL, SD, GA, MN, IN are among the best models
• Regulatory takings reform
• Oregons Measure 37 (2004)
• Arizonas Proposition 207 (2006)
• Kelo-Plus - Combined eminent domain reform and
  protection from regulatory takings

Reason Foundation
www.reason.org
6
The Future of theProperty Rights Movement

• Low-hanging fruit has been plucked
• Eminent domain reform largely an easy sell
• Next fronts are more challenging
• Regulatory takings reform faces high hurdles
• Highly politicized 3 of 4 attempts failed in
  2006
• November 2007 Oregonians repealed Measure 37
• Ballot-box zoning public referenda on
  planning/zoning
• FL Hometown Democracy likely for November 2008
  ballot

Reason Foundation
www.reason.org
7
The Latest ThreatFlorida Hometown Democracy

• Ballot box zoning
• To date, a local phenomenon in CA, OH, FL, WA,
  etc.
• FL Hometown Democracy all local comprehensive
  plan amendments statewide would face a
  community-wide referendum.
• The threat of Hometown Democracy
• Housing markets/affordability
• Politicizing development
• Economic competitiveness
• Private property rights

Reason Foundation
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8
FL Hometown DemocracyPoliticizing Development

• Increased development uncertainty
• Hard to mobilize political support for
  residential development
• Easy to mobilize NIMBYs, slow/no-growthers
• Developers must run costly political campaigns
• Costs passed on to consumers
• Growth decisions by voters today excludes
  interests of future citizens
• Community as museum stasis over dynamism
• Constrains markets ability to respond to
  changing community needs preferences

Reason Foundation
www.reason.org
9
FL Hometown DemocracyHousing Market Effects

• Not politically neutralmore often limits, not
  expands, growth
• Exacerbates supply constraints in an already
  constrained market
• Econ 101 contributes to housing price inflation
• Counter to goal of improving housing
  affordability
• Promotes sprawl and congestion families must
  drive further to find affordable housing

Reason Foundation
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10
FL Hometown DemocracyEconomic Competitiveness

• Limited growth may translate into limited
  economic development opportunities
• Business startup/relocation
• Business expansion
• Tax/Fiscal Implications
• It becomes more likely that cash-strapped local
  governments would resort to tax hikes to increase
  revenues in the absence of robust economic
  growth.
• Economic growth follows path of least resistance

Reason Foundation
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11
FL Hometown DemocracyProperty Rights

• Full frontal assault on private property rights
• Under current planning system, property owners
  have some recourse to appeals and formal
  procedures for regulating development in the
  community interest
• Throwing landowners ability to develop their
  property to the whims of public opinion and PR
  campaigns represents the ultimate tyranny of the
  majority over individual property rights

Reason Foundation
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12
Questions? www.reason.org leonard.gilroy_at_reaso
n.org [phone]

Reason Foundation
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13
Oregons Measure 37

• Response to decades of highly aggressive state
  local land use regulation (Oregon Smart
  Growth)
• Requires that the state or local govts either
  compensate landowners when land use restrictions
  reduce the value of their property or waive the
  restrictions.
• Exempts nuisance laws, health and safety regs,
  federally-mandated regulations
• Goal to reinstate the rights owners had when
  they bought their land.

Reason Foundation
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