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ably that is a property right, so if we restricted people from earning a living in ways that diminished their earning capacity, that would also be a compensable taking. Mr. Ely.

Mr. ELY. I think it is well settled that the fifth amendment

Mr. FRANK. Time out. Nothing is well-settled. The revolution is in town. We are going to do everything new. We are making public policy. This is not a case of what the fifth amendment compels, but what my colleagues decide to do. And the question is do you advise us when we pass this bill to broaden it beyond the physical land as property and should we, as Mr. Pilon said, take into account all forms of property, 15 of which are more important to people than their physical property?

Mr. Ely. That is certainly true. My sense is that it might be proper for the Congress to focus on the immediate issue, which is excessive land use regulation and consider the issues posed by personal property, right to earn a livelihood or intellectual property as a separate matter.

Mr. FRANK. That is a question of legislative scheduling. As a matter of intellectual consistency and the application of principle is there any basis for differentiating given the thrust of the argument of other forms of property from physical tangible property?

Mr. Ely. All forms of property, in my opinion, are entitled to legislative protection.

Mr. FRANK. So we should be clear that, in fact, if we were to go forward with this, that these two witnesses both think that that is just the first step.

Mr. Pilon. It is only the beginning. Absolutely.

Mr. FRANK. Mr. Pilon, the Americans With Disabilities Act, you said how much regulation would cost would be up to us. Would you advise us to repeal that?

Mr. PILON. Are you giving me a reductio ad absurdum? You know that I am with the Cato Institute, don't you?

Mr. FRANK. I am asking you a question, Mr. Pilon. Let me say this, if your immediate response to being asked a question about a piece of legislation is that it is a reductio ad absurdum, it doesn't speak well for your self-confidence. Mr. PILON. Oh, no, no, you

Mr. FRANK. Wait a minute. This defensiveness of yours is inappropriate. You came here and you said to me that the amountI raised the question with regard to the Americans With Disabilities Act. I asked Mr. Schmidt about that and I said how much would that cost us. And you said that is entirely up to us.

I asked you a reasonable question based on what you said and your defensiveness that that is reductio ad absurdum seems inappropriate.

Do you think that we should repeal the Americans With Disabilities Act?

Mr. PILON. Absolutely. Absolutely. No, let me take that back. Either repeal it or pay for it.

Mr. FRANK. But you said it would be up to us. How much do you think it would cost us to pay for the Americans With Disabilities Act?

Mr. Pilon. If you don't know, I am sure I don't know.

Mr. FRANK. There is a basic thing you do not understand here. We don't ask you to come here to tell us things we already know. The notice is that you come here to give us some advice. And I have to say, that I find your backing away here a little bit

Mr. PILON. It is not backing away. It is a rhetorical answer to your rhetorical question.

Mr. FRANK. But you would agree that under your definition of this, we would have to pay for the Americans With Disabilities Act and it would cost billions of dollars, would you assume?

Mr. PILON. If you want it badly enough you should pay for it. Isn't that the way most people

Mr. FRANK. I asked you a simple question. You say you are an expert on this stuff. In your judgment would it require billions of dollars to pay for the Americans With Disabilities Act under your principle? Mr. PILON. I did not say I was an expert on how much the Mr. FRANK. You have no idea how much it would cost? Mr. PILON. When you order people to put elevators in

Mr. FRANK. Stop the rhetoric and give me an answer. What is the answer?

Mr. CANADY. Mr. Frank-
Mr. PILON. I will give you the answer. I don't know. It is billions.
Mr. FRANK. That is what I asked.

Mr. PILON. That is the closest I can come, and are you prepared to pay for it?

Mr. FRANK. That is closer than you have come in anything else I have asked you, so I will stop.

Mr. CANADY. Mr. Goodlatte.

Mr. GOODLATTE. Thank you, Mr. Chairman. I appreciate all of you coming to provide your viewpoints on this. Do any of you, assuming that we are going forward with the principle that we have enunciated here, do any of you have specific changes that you would like to bring up that address any of the concerns that Mr. Frank has raised?

Mr. PILON. Yes, I think that the nuisance law area does need to be spelled out a little more fully. What we are dealing with here is balancing the police power with the eminent domain power. If the police power is defined too broadly it has a way of gobbling up the compensation requirement.

If, on the other hand, it is defined too narrowly then what you have is property owners themselves suffering because people can pollute and get away with it because there is no police power available to preclude that kind of pollution. So what you have got to do is trace the police power back to its origins and you go back to look at the executive power that each of us has to secure his rights in the state of nature. And you can spell out the scope of the police power. You may, for practical reasons, want to exclude such things as local zoning from that. But that is the kind of thing that you are going to have to come to grips with.

Mr. GOODLATTE. Would you exclude local zoning?

Mr. PILON. Again, standing on principle, I would not. I think the Euclid zoning case was wrongly decided by the Supreme Courtargued for the State, interestingly, by Senator Howard Metzenbaum's grandfather.

Mr. GOODLATTE. Anybody else have recommendations that would help address? Ms. Cline, anything that you would change in this that would help address the problem that you experienced, which I find to be an amazing experience that you have been through.

Ms. CLINE. Well, we have had such a horrendous experience that I cannot say anything except that we have seen unleashed power against a family. And to the degree that that can be balanced, it needs to be. Because the cost, as I said, the cost of what we—the burden of bearing this on our shoulders, if it had gone to the criminal arena as far as an indictment, was told to us to be $500,000 to protect ourselves.

Now, a lot of people-a percentage of that would break them. And for that to be the only recourse to exert your rights is a scary proposition. You can call it a police State, you can call it whatever you want, but it is just not fair.

Mr. GOODLATTE. What do you think about adding an attorney's fees provision to cover the circumstances that you are in? If there is an unlawful taking and there is a certain threshold that is met before reasonableness sets in and you have to go beyond that threshold to get justice, should you be entitled to attorney's fees.

Ms. CLINE. I think absolutely. I don't even know what the recourse is now. I don't think there is any provision in this for us to bewe consider the money we have spent completely lost.

Mr. FRANK. There is under the Equal Access to Justice Act, there is a trigger figure, and it would depend on how big the business is. But we do have a Federal law that compensates people against whom regulatory action has been launched under certain circumstances, depending on the

if they qualify as a small business. I don't know the exact figures, but you might want to check.

Mr. BYRNE. Parties that prevail under compensation actions against the United States also get attorney's fees.

Mr. PILON. There is a section in this bill on arbitration that seems to me could withstand closer scrutiny in that it allows the agency to appoint the arbitrator. It seems that there is a better way to do that, and it is the way it is done in real estate contracts, and oftentimes construction contracts, in which both parties appoint a neutral who then appoints an arbitrator.

That would avoid any possibility of collusion between an agency and a select group of arbitrators, or the appearance of collusion.

Mr. BYRNE. I would like to make the suggestion that you really throw this bill out and start by trying to find out what the facts are. And one way to do that would be to ask either the Department of Justice, or if you think that they have an institutional point of view, ask the Congressional Research Service or the General Accounting Office to provide you with annual accounts of the kinds of takings actions that have been filed against the United States, not just the ones that have been settled, but the ones that have been filed.

And I would urge the Congress to look at that and to identify areas where, in your judgment, Federal agencies are applying existing laws in an inappropriate or oppressive manner and change those laws. Look at the laws that really raise concerns, find out what they are, and get the facts, not on the basis of highly emotional testimony, and fix the laws that need to be fixed.

Mr. PILON. Could I respond to that? I think you would find that a very skewed set of numbers because most people who are affected by regulatory takings do not bring legal action. They are either highly intimidated by the fact that they are being challenged by the Government or highly intimidated by the sheer cost of bringing an action, so they don't come close to a court. The number of cases that get to a court are minuscule in comparison to the number of cases that are out there. Most people suffer in silence.

Mr. GOODLATTE. Thank you.

Mr. CANADY. Thank you. I want to thank each member of this panel and we appreciate your being with us.

We have one additional panel and the members of the third panel, if you would-if the members of the third panel will come forward and take their seats.

I am going to have to ask that you please take your conversations outside. We need to move on with the hearing. I appreciate your being here.

First, we will hear from Roger Marzulla, chairman of the Defenders of Property Rights. Mr. Marzulla was the Assistant Attorney General for the Environment and Natural Resources under President Ronald Reagan.

Second, Alletta Belin will testify on behalf of Tom Udall, the attorney general of New Mexico. Ms. Belin is the assistant attorney general of New Mexico.

Third, we will hear from Mr. James Miller III. Mr. Miller is counselor to both Citizens for a Sound Economy and the Tax Foundation. He was Director of the Office of Management and Budget under President Reagan.

Fourth, we will hear from Senator Richard Russman, the chairman of the New Hampshire Senate Environment Committee. Finally, we will hear from Jonathan Adler from the Competitive Enterprise Institute.

I will ask each of you—is Mr. Miller behind those boxes?

We would ask each of you to summarize your testimony in 5 minutes. And without objection, as with all the other witnesses, your testimony-your full statement will be placed in the record. We thank you for being here.

. Mr. Marzulla.

Mr. MARZULLA. Thank you, Mr. Chairman. Thank you for inviting me to speak

Mr. CANADY. Mr. Marzulla, I will ask you to withhold at this point because of this vote. And rather than listening to you and then racing off, we will recess the committee now and we will come back after the vote and we will hear the whole panel at that time.

Thank you.

(Recess.) Mr. CANADY. The subcommittee will come to order. Mr. Marzulla, please start again. I apologize for the delay. STATEMENT OF ROGER J. MARZULLA, CHAIRMAN, BOARD OF

DIRECTORS, DEFENDERS OF PROPERTY RIGHTS Mr. MARZULLA. Indeed. Thank you, Mr. Chairman.

Thank you for inviting me here to speak on behalf of the thousands of Americans whose homes, farms, small businesses, whose pensions, livelihoods and dreams have, in many instances, been wantonly taken from them by excessive government regulation.

Three and a half years ago, my wife Nancy and I founded an organization called Defenders of Property Rights to help people like that, people whose property had been taken and had not the means to defend themselves against their own government. People, I might add, who never thought they would find themselves in a pitched battle for their way of life in dealing with government agents.

The reason this has arisen, Mr. Chairman and members of the subcommittee, is that over the past two decades this Nation has created the most massive, the most complex regulatory scheme ever in history. There are thousands and thousands of pages, statutes and regulations impacting the use of property rights, and yet there is not one single provision dealing with the rights of the property owners themselves when they are faced with excessive governmental regulation.

The boxes here to my left, Mr. Chairman, contain the letters and documents, the pleas for help that daily arrive at Defenders of Property Rights from property owners across this Nation whose land, whose farms and livelihoods have been taken and affected by excessive governmental regulation. Regrettably, of course, we are only able to help a small proportion of those people, and most of their pleas and demands and needs go unanswered.

There are those who suggest that the current situation is just fine, that the fifth amendment to the Constitution satisfactorily provides redress for those whose property has been taken from them by their Government.

I am here to tell you, having been on both sides of the fencethat is, having defended these cases for the Federal Government and now being a representative of the property owners in those same kinds of cases, that it simply is not adequate. That, in fact, the law is tilted sharply in favor of the Federal Government in this litigation.

First, there is a whole panoply of procedural defenses which are asserted routinely by the Federal Government in defending those takings claims that are brought-lack of rightness, mootness, lack of jurisdiction, filing in the wrong court, the Anti-Assignment Act and a whole raft of other legal defenses that sometimes take years to litigate.

Next is the complexity of the case-by-case, ad hoc, factual increase of whether or not a taking has occurred. Congressman Frank pointed out, and the Associate Attorney General agreed, that Dolan is now the law of the land. But a year ago the Solicitor General of the United States could file a brief saying that the Dolan theory was wrong and that it was not the law of the land.

Indeed, it is precisely that kind of litigation which has stretched out in cases like Loveladies Harbor, Inc., Hendler and others, litigation which involves takings that occurred a decade or more ago and required the expenditure of hundreds of thousands in those cases, in some cases more than a million dollars in attorney fees to bring to resolution.

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