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Property rights was a pivotal issue in the 1994 Texas gubernatorial race, and as a result groups on both sides of the issueconducted statewide opinion polls. The consumer advocacy group Public Citizen released a pollon October 8. 1994 in which a number of questions about the environment, economics and property nights were asked.

1) When asked whether Texans havea“moral obligation to future generations to protect the diversity of
wildlife from pollution and extinction, even if they have no current economic value," 80 percent of
respondents agreed(39 percent strongly), 16 percent disagreed(4 percent strongly) and 3 percent fell into
anunspecified "other" category.

2) When asked whether moreor less public land needs to be set aside to protect endangered species, water
quality and for recreation 60 percent thought morepublic landshould be set aside while 25 percent thought
less should be set aside and the remaining 15 percent fell into an unspecified “other category

3) When the statement“allowing some people to do whatever they want with theirland harmsthe common
rightsofall citizenstoclean air, clean water, and wildlife diversity'' was pitted against theopposing statement
"governmental environmental laws are unfairly taking away the rights of somelandowners to use their
property however they want,” 44 percent agreed with the former while 39 percent agreed with the latter

4) When askedtochoose oneofthe following two statements: "taxpayers are alreadypaying fortoo much
and can't foot the bill to compensatelandowners," and when some uses of a pieceofland are prohibited
or limited because of environmental laws, the taxpayers should be required to compensate the
landowners." 56 percent chose the first statement while 29 percent chose the second.

5) When presented with the statement, “Texas charges property taxes on land set aside as habitat for
endangered species ortopreserve water quality. Some countries have aprogram that allows landowners
to pay no taxes on land that is set aside for this purpose," 67 percent agreed with this policy and 25 percent
opposed it, while 8 percent fell into the other” category.

As the first statement shows, most people favor blanket statements about the need to protect the environment Yet the other questions in the Public Citizen poll are worded in such a way as to make it appear that the people of Texas are not supporters of property rights, either in theory or practice. While 60 percent may believe more public land needs to be set aside to protect endangered species, water quality and for recreation, it is unclear whether respondents were advocating state acquisition of more land or specific uses for the land already in state ownership

Perhaps the most misleading of the questions was the juxtaposition of the statement “allowing some citizens to do whatever they want with their land harms the common rights of all citizens to clean air, clean water, and wildlife diversity" with “governmental environmental laws are unfairly taking away the rights of some landowners to use their property however they want." These two statements are not mutually exclusive Indeed, many property nghts adovcates would agree with both statements as property rights have never meant that people can do whatever they want" with their property. Under takings compensation proposals such as that proposed in the Republican Contract with America " if the activity in question can be construed as a public nuisance by a count of law then that activity can be enjoined without requiring compensation.

Thethird question was similarly misleading, asit presupposed that requiring compensation would necessarily result ina tax increase to pay for it --something that most Texans would oppose. When government agencies are going to be forced to pay compensation for regulatory takings, they always have the option torescind the regulatory action that would

Propera Rigilis facer

have caused the taking. Theresulting prioritizationofregulatoryacitivities within government agencies will greatly reducethe cost of paying compensation, as agencies will engagein fewer actions for which compensation is requried.

The Texas Farm Bureau commissioned apoll in July 1994 that had very different results from the Public Citizen pol. A total of 78 percentofTexansdisagreed (64.5 percent“strongly'') with the statement, “ingeneral, the government should have the right to restrict how private property is used.” Only 12.3 percent agreed (4.3 percent “strongly") with this statement, while 9.8 percent were neutral.

In this poll, when presented with the statement to protect the environment, the government should have the right to restrict how private property is used” the results were closer. 39 8 percem disagreed (22.3 percent "strongly"), 38 0 percent agreed (14.5 percent “strongly'), and 22.3 percent had no opinion or were undecided. Yet again, many of those who believe that the government should have the right to restrict the use of private property for environmental protection may still desire compensation.

This was bome out by responses to the following two statements in the Texas Farm Bureau poll:

1) “In general, property owners should be compensated if the value of their property is reduced by
government-mandated restrictions on land use." 81 percent agreed with this statement (59.5 percent
'strongly"), 9.6 percent disagreed (5.8 percent “strongly"), and 9 5 percent were neutral.

2) "In general, property owners should be compensated if their ability to eam money is reduced by
government-mandated restrictions on land use." 72.8 percent agreed with this statement (48.3
percent “strongly"), 11 percent disagreed (6 percent “strongly") and 16.3 percent were neutral.

The responses to these two statements show that an overwhelming majority of Texans still would favor compensation for takings.

The survey even went so far as to pose a legislative hypothetical with the statement “I would suppon a law that grants financial reimbursement to property owners who suffer financial losses due to government-mandated restrictions on land use.” 73.0 percent agreed (47.0 percent “strongly"), 91 percent disagreed (5.3 percent "strongly"), and 18.0 percent were neutral. That Texans advocate passing a law to insure takings compensation indicates broad belief in property rights.

The most extensive state property rights poll was taken in May 1994 for Arizona Citizens for Property Rights in conjunction with the state property rights ballot initiative, Proposition 300. Like the other polsit showed strong support for property rights. For instance:

1) When given the statement “people have a constitutional right to be compensated for a loss of value in
their property,"65 percent agreed whileonly 27 percent disagreed.

2) When asked to evaluate government efforts aimed at “protecting therights of propertyowners," only
5 percent felt that the government is doingtoo muchwhile 48 percent felt that the government wasnot doing
enough. The remainder either did not know or believe that government is protecting private property

Propern: Rights Reader

3) When given the statement "the initiative is needed to protect propertyowners against the powerof state
government, "63 percent agreed andonly 27 percent disagreed. The remainder did not knowor retused

to answer

Whilethe poll showed strong support for property rights, Proposition 300 failed, largely because thebill was poorly worded and anti-property nights groups widelyoutspent property rights proponents.

The failure of Proposition 300 could havebeen foreseen from the results of the Arizona poll. When characterized in certain ways, property nights proposals lose public support. Consider two examples:

1) When given the statement “people should becompensated for losses in property value, but I won't
support a property rights law if it means higher taxes.” 66 percent agreed, 29 percent disagreed.
and 6 percent did not know.

2) When given the statement the last thing Arizona needs is another Proposition that requires government
bureaucrats to write more reports and do more studies." 74 percent agreed, 22 percent disagreed, and
3 percent did not know,

These responses show that while Arizonans strongly support the concept of property rights they do not support compensation for public nuisances, compensation through taxes or compensation requirements potentially leading to more bureaucracy. These sentiments are consistent with the other polls that asked similar questions Given Arizonan's strong support for propertyrights, the failureofthe supporters of Prop. 300 to include provisions addressing the above three issues and the ability of the opposition to capitalize on them in large part explains the failure of the initiatie

The polling data on property rights is not overwhelming. Nonetheless, what limited evidence there is suggests that Americans support property rights in principle, and do not see strong property rights protection as something that conflicts with the protection ofenvironmental quality.

Brian Seasholes is an environmental research associate at CEI.

Jarnian: 1995

Propern Righis Reaker

Mr. INGLIS. Mr. Miller, I appreciate having you here. I was in Budget with you earlier so we see each other in both places. That is why all Members of Congress are running around in various areas. So thank you for being here.

I recognize you for your testimony. And we have a vote on, but you have 5 minutes, and I will run after you testify.


SOUND ECONOMY Mr. MILLER. Thank you, Mr. Chairman. This is déjà vu for me. I was here in this very room testifying on regulations earlier in the week.

Before us is an issue that is quite important and I think represents one of the reasons you have had substantial turnover in Congress. People are tired of the excesses of government, and regulatory takings is one of them.

You have an issue here that has two ramifications-one is regulatory, the other is budget. Counsel asked me to address the budget part.

Let me first say something about the regulatory part. It is extremely important that agencies perceive what costs they are imposing on the private sector, that they receive signals from the private sector about what is truly important to the private sector and unimportant to the private sector and to have a price on things will rivet the agencies' attention.

That is one reason I think you ought to revise the provision in title IX—that allows the agency to go to general funds to pay compensation for some of these land takings. I think it ought to be in the budgets of the agencies. You will cause the agencies to do a better job of regulating in a cost-effective manner if they understand the costs that they are imposing.

Now there is a relevant question here. Would this be a budget buster? I don't think it would be. I think the agencies will figure out ways to minimize costs.

I do think, Mr. Chairman, the Congress has enormous responsibility in revising some of these statutes. If you have a statute that is very broad and open-ended, that you can have the EPA identifying practically every mud hole in the country as a wetland, then something is wrong, and Congress bears the responsibility for giving the Agency that much discretion.

But by its very nature regulation is something where the Congress says we don't have time to do all the details, and we authorize you to do it in our place.

When you do that, you have to understand the incentives that the agencies face. Their raison d'etre is to issue regulations. So it may take several kinds of controls and influences on the regulators to get them to do the right thing.

Centralized review of regulations is one answer. A regulatory budget is another answer. Forcing agencies to compensate the victims of regulatory takings as required by the fifth amendment is another one.

For that reason, I congratulate you on this approach, and I urge you to give favorable consideration to this legislation. I speak not only for myself but on behalf of the 250,000 members and supporters of Citizens for a Sound Economy.

Mr. INGLIS. Thank you, Mr. Miller. [The prepared statement of Mr. Miller follows:) PREPARED STATEMENT OF JIM MILLER, COUNSELLOR, CITIZENS FOR A SOUND

ECONOMY Good morning. Mr. Chairman and Members of the Committee: Thank you for the opportunity to present the views of Citizens for a Sound Economy, a 250,000 member research, education, and advocacy group that promotes market-based solutions to public policy problems.

In both Congress and the courts, there has been a renewed interest in protecting private property rights. Although enshrined in the Constitution, property rights have been neglected in recent history, and many government actions have infringed upon the rights of private property owners. As the scope of regulation has expanded—most notably environmental regulations—there has been increasing pressure to evaluate the impact of government regulations on property owners. Government regulations that restrict the use of private property can have an impact that is substantially the same as a physical taking of the property by the federal government.

Briefly, Title IX, “Private Property Protections and Compensation," of the Job Creation and Wage Enhancement Act of 1995 (H.R. 9) would introduce safeguards that private property owners receive compensation from federal regulations or policies that reduce the value of the property. Quite frankly, such a policy not only seems fair, but is required by the “just compensation" clause of the Fifth Amendment of the U.S. Constitution.

REGULATORY TAKING In recent decades, federal regulations have increased dramatically, and some new government regulations impose substantial restrictions on a property owner's land use decisions. The result has been an increase in litigation directed at protecting the rights of landowners. Much of this litigation has been based on the theory that a particular federal land use regulation has violated the rights of property owners guaranteed under the Fifth Amendment.

To protect private property rights and excessive government intrusion on private property, the Founding Fathers added the Fifth Amendment to the Constitution, which requires the federal government to fully compensate property owners for any property taken by the federal government. In recent years, regulatory takings—i.e., restrictions imposed on property not through physical takings but through regulations have been addressed by the Supreme Court. Unfortunately, the exact scope of the rights guaranteed by the “just compensation" clause have been hard to define. Those landowners who seek to determine their rights under the Constitution face the burden of expensive and time consuming litigation with no clear indication of outcome. At the same time many agencies are uncertain about their responsibilities regarding property rights and the Constitution. Title IX of H.R. 9 provides the legislative guidance necessary to ease the legal burden on consumers while clarifying the obligations of federal agencies.

Currently, the federal government imposes a regulatory burden on the American public of more than $500 billion per year-roughly one-third the size of the total federal budget. (See attached figure for an historical perspective.) The regulatory burden is tantamount to a hidden tax on the American public. By its very nature, then, this "tax" does not elicit the same public scrutiny that changes in the fiscal budget generates. In fact, there is often an element of bureaucratic discretion in the rulemaking process that entrusts the promulgation of regulations to unelected officials. Individuals have fewer avenues of recourse for questions over the regulatory burden than the tax burden.

Much of the hidden tax of regulation has been imposed on property owners who have been forced to alter or limit the use of their property. Requiring a federal agency to compensate these individuals has two important effects. First, individual property owners are not forced to bear the costs of environmental goods demanded by society as a whole. There may indeed be a value that society places on environmental goods; however, individuals should not be forced to bear the costs of such collective goods alone. If the government determines a specific use for a piece of property is more preferred than others, then, as stipulated in the U.S. Constitution, the government should compensate the property owner for taking the land for that


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