Regulatory taking

Abstract: The last few years have seen a reinvention of the economy through the growth of the “sharing economy” or the “new economy.” The modern sharing economy is diverse and is made up of various types of organizations and structures, including shared housing. What ties these various components together is that they “generally facilitate community ownership, localized production, sharing, cooperation, [and] small scale enterprise.” The rise of the new sharing economy has been a consequence of the latest assault on the old American Dream -- the version in which one is “expected to grow up, get a good job, and make money to buy all of the things [one] might need.” The realization of this dream, however, has been hampered by recent negative economic changes. One pair of commentators has opined that “[t]he sharing economy is not a top-down solution, meaning that it will not be imposed by a set of legislated policies . . . [Rather], it is being built from the ground up by every individual and group that chooses to begin consuming, transacting, or making a livelihood in a new way.” The sharing economy has redefined consumption in the housing context in a manner that implicates the exclusivity of the use and enjoyment of real property. Consequently, just as with other aspects of use and access to goods, materials, and services in the sharing economy, housing sharing is predicated on two ideas working in tandem with one another: (1) that “we can have access to many things that we need without having to own them all by ourselves” and (2) that by sharing some of the benefits of property ownership -- namely use and enjoyment -- we can also shift some of the (economic) burdens of ownership. The number of online platforms designed to link property owners with potential short-term lessees has grown rapidly over the last few years. Airbnb, the most well known of these platforms, describes itself as “a trusted community marketplace for people to list, discover and book unique accommodations around the world.” Airbnb boasts that it has connected over twenty-five million guests with hosted properties in 34,000 cities in 190 countries since its founding in 2008. Airbnb is not only the leading online platform for the exchange of short-term rentals, recently, it has been the most controversial as well. Recently, controversy erupted in New York City, Airbnb’s largest United States market. In October 2013, New York Attorney General Eric Schneiderman subpoenaed Airbnb’s records, requesting data on its hosts for the previous three years. Schneiderman contended that Airbnb hosts in New York City were violating the New York Multiple Dwelling Law. The New York Multiple Dwelling Law requires that certain multiple dwellings units only be occupied by “permanent occupants” -- those residing in the unit for thirty or more consecutive days. The Attorney General also asserted that Airbnb hosts in New York City were not complying with state and local tax registration and collection requirements. Many state and local governments rely on their inherent police powers to regulate short-term housing in residential areas. In particular, zoning laws -- like New York’s Multiple Dwelling Law -- may overtly prohibit occupation by short-term renters. Historically, governments have used their police powers to create and enforce zoning restrictions of this nature for the purpose of preserving or improving public safety, property values, and the “character” of residential neighborhoods. These policies are of a bygone era and are ill-suited to address the modern sharing economy. Moreover, local governments do themselves a disservice when they prohibit housing exchanges. Rather than frustrating the goals and purposes for which old economy regulations were designed (e.g., the preservation of property values and neighborhood character), such exchanges may aid in achieving these aims. Additionally, these restrictions may constitute a regulatory taking of private property without just compensation in violation of the Fifth and Fourteenth Amendments. The sharing economy has positively impacted many individuals and communities, but there is also a brewing conflict between this genesis and the realities of economic regulation -- a conflict of which the New York Airbnb subpoena controversy is emblematic. Thus, in the housing context, we see this conflict playing out in the tension between growing patterns of home sharing and existing regulations that prohibit such sharing. This Article focuses on the question of whether municipal restrictions on short-term leasing constitute unconstitutional takings of private property without just compensation. Part I gives an overview of home sharing in the new economy via short-term leasing. In doing so, it not only examines the controversy in New York, but also provides a historical perspective on home sharing in the United States, focusing particularly on the proliferation of boarding houses in the nineteenth century as a corollary to today’s home sharing market. The examination of this topic is couched in the historical context of minority, immigrant, and women homeowners’ “taking in boarders” in lean times in an effort to make ends meet and maintain ownership of their homes. Part II analyzes short-term leasing restrictions under the Takings Clause. In doing so, it examines the nature of short-term leasing restrictions and the reasons employed by municipalities to justify these regulations. Part III discusses the New York Airbnb controversy. Finally, Part IV argues that such facilitation is desirable because municipalities actually do themselves a disservice when they prohibit these new economy housing exchanges. Such exchanges can help to preserve property values by providing income to homeowners that can be used to offset mortgage and maintenance costs -- in other words, sharing the burden of ownership. If homeowners are able to do so, they are more likely to be able to maintain their homes in the short-term and, in the long-term to maintain ownership. Moreover, municipalities may also reap economic benefits from permitting such exchanges.

Abstract: Compulsory purchase, expropriation, eminent domain, and simply “taking’ are different names for the same legal institution: that which allows states to acquire property against the will of its owner to fulfill some purpose of general interest. Traditionally, expropriation has been considered one of the main instruments of land policy. Today, however, it is subject to many criticisms and mounting social resistance. Campaigns for housing rights, movements for the defense of property rights, legislative and judiciary activism, and land tenure reforms, among other factors, are changing the conditions under which governments exercise their power of eminent domain.

Abstract: The last few years have seen a reinvention of the economy through the growth of the “sharing economy” or the “new economy.” The modern sharing economy is diverse and is made up of various types of organizations and structures, including shared housing. What ties these various components together is that they “generally facilitate community ownership, localized production, sharing, cooperation, [and] small scale enterprise.” The rise of the new sharing economy has been a consequence of the latest assault on the old American Dream -- the version in which one is “expected to grow up, get a good job, and make money to buy all of the things [one] might need.” The realization of this dream, however, has been hampered by recent negative economic changes. One pair of commentators has opined that “[t]he sharing economy is not a top-down solution, meaning that it will not be imposed by a set of legislated policies . . . [Rather], it is being built from the ground up by every individual and group that chooses to begin consuming, transacting, or making a livelihood in a new way.” The sharing economy has redefined consumption in the housing context in a manner that implicates the exclusivity of the use and enjoyment of real property. Consequently, just as with other aspects of use and access to goods, materials, and services in the sharing economy, housing sharing is predicated on two ideas working in tandem with one another: (1) that “we can have access to many things that we need without having to own them all by ourselves” and (2) that by sharing some of the benefits of property ownership -- namely use and enjoyment -- we can also shift some of the (economic) burdens of ownership. The number of online platforms designed to link property owners with potential short-term lessees has grown rapidly over the last few years. Airbnb, the most well known of these platforms, describes itself as “a trusted community marketplace for people to list, discover and book unique accommodations around the world.” Airbnb boasts that it has connected over twenty-five million guests with hosted properties in 34,000 cities in 190 countries since its founding in 2008. Airbnb is not only the leading online platform for the exchange of short-term rentals, recently, it has been the most controversial as well. Recently, controversy erupted in New York City, Airbnb’s largest United States market. In October 2013, New York Attorney General Eric Schneiderman subpoenaed Airbnb’s records, requesting data on its hosts for the previous three years. Schneiderman contended that Airbnb hosts in New York City were violating the New York Multiple Dwelling Law. The New York Multiple Dwelling Law requires that certain multiple dwellings units only be occupied by “permanent occupants” -- those residing in the unit for thirty or more consecutive days. The Attorney General also asserted that Airbnb hosts in New York City were not complying with state and local tax registration and collection requirements. Many state and local governments rely on their inherent police powers to regulate short-term housing in residential areas. In particular, zoning laws -- like New York’s Multiple Dwelling Law -- may overtly prohibit occupation by short-term renters. Historically, governments have used their police powers to create and enforce zoning restrictions of this nature for the purpose of preserving or improving public safety, property values, and the “character” of residential neighborhoods. These policies are of a bygone era and are ill-suited to address the modern sharing economy. Moreover, local governments do themselves a disservice when they prohibit housing exchanges. Rather than frustrating the goals and purposes for which old economy regulations were designed (e.g., the preservation of property values and neighborhood character), such exchanges may aid in achieving these aims. Additionally, these restrictions may constitute a regulatory taking of private property without just compensation in violation of the Fifth and Fourteenth Amendments. The sharing economy has positively impacted many individuals and communities, but there is also a brewing conflict between this genesis and the realities of economic regulation -- a conflict of which the New York Airbnb subpoena controversy is emblematic. Thus, in the housing context, we see this conflict playing out in the tension between growing patterns of home sharing and existing regulations that prohibit such sharing. This Article focuses on the question of whether municipal restrictions on short-term leasing constitute unconstitutional takings of private property without just compensation. Part I gives an overview of home sharing in the new economy via short-term leasing. In doing so, it not only examines the controversy in New York, but also provides a historical perspective on home sharing in the United States, focusing particularly on the proliferation of boarding houses in the nineteenth century as a corollary to today’s home sharing market. The examination of this topic is couched in the historical context of minority, immigrant, and women homeowners’ “taking in boarders” in lean times in an effort to make ends meet and maintain ownership of their homes. Part II analyzes short-term leasing restrictions under the Takings Clause. In doing so, it examines the nature of short-term leasing restrictions and the reasons employed by municipalities to justify these regulations. Part III discusses the New York Airbnb controversy. Finally, Part IV argues that such facilitation is desirable because municipalities actually do themselves a disservice when they prohibit these new economy housing exchanges. Such exchanges can help to preserve property values by providing income to homeowners that can be used to offset mortgage and maintenance costs -- in other words, sharing the burden of ownership. If homeowners are able to do so, they are more likely to be able to maintain their homes in the short-term and, in the long-term to maintain ownership. Moreover, municipalities may also reap economic benefits from permitting such exchanges.

Abstract: TABLE OF CONTENTS I. INTRODUCTION A. Two Sides to a Controversy B. Slippery Slopes C. The Thesis of This Article II. INTRUSIVE, COUNTERPRODUCTIVE, AND INEQUITABLE A. A Nation of Zoo-Keepers B. Politics as Usual C. Do Supreme Court Decisions Matter in Environment Policy III. THE POINTLESSNESS OF THEORY A. The Search for a Theoretical Fix B. Is Law Deducible C. A Collision of Views, Not a Conflict of Interests IV. THE END OF THE ECOSYSTEM A. What is Bad for the Marsh Is Bad for Mankind B. Ecology as a Comprehensive View C. The Historization of Nature D. The Problem of Classification E. The Problem of the Baseline F. The redundancy of Species V. LOGOS AND TELOS IN THE NATURAL ENVIRONMENT A. Everything Is Connected to Everything Else B. Ecology as a Normative Science C. The Non-Equilibrium Paradigm D. The Keystone Species E. Does Nature Know Best? F. Theory in Ecology G. Theory Against History H. Everything Can Connect with Everything Else I. Design in Ecology J. The "Rivet-Popping" Analogy VI. THE WARS OF RELIGION A. The Gospel of Efficiency B. Preference Satisfaction as the True and Only Heaven C. Why Protect Species? VII. CONCLUSION "When landowners find an endangered animal on their property, Chuck Cushman says, the best solution under current law is to `shoot, shovel and shut up'."(1) So the Arizona Republic newspaper reported the response of one landowner to the decision of the Supreme Court in Babbitt v. Sweet Home Chapter of Communities for a Greater Oregon.(2) At issue in Sweet Home was section 9 of the Endangered Species Act (ESA), which makes it a crime to "take" an endangered or threatened species.(3) The ESA defines "take" as "to harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect."(4) Interior Department regulations extended the definition of "harm" to include "significant habitat modification or degradation [that] actually kills or injures wildlife by significantly impairing essential behavioral patterns, including breeding, feeding, or sheltering."(5) In Sweet Home, the Supreme Court by a six to three majority upheld this extension of the meaning of "harm" in section 9 of the ESA.(6) Cushman, executive director of the American Land Rights Association, based in Battle Ground, Washington, identified civil disobedience as a rational response to the Court's decision. He explained, "[a] private-property owner is thinking to himself, `I find a spotted owl on my property, I'm going to lose everything I've worked for all my life.'"(7) A property owner may find immediate recourse in shooting and burying the bird before federal agents discover it.(8) A more general political remedy, Cushman observed, must be sought from Congress.(9) "I think you're going to see an eruption in Congress. It's obvious to everyone now that the Endangered Species Act is broke [sic] and it's gotta be fixed."(10) Newspaper editorials condemned the Sweet Home decision as a confiscation of property rights. "The U.S. Supreme Court in a 6-3 decision yesterday trampled property rights in granting federal regulators broad control of private land to protect endangered species," declared the Detroit News.(11) "No worse environmental decision has come from the high court in two decades. The harm can only be undone by Congress, which must overhaul the Endangered Species Act."(12) In a syndicated editorial, James J. Kilpatrick wrote that the small landowners who brought suit in Sweet Home rely on logging for their livelihoods, which is the only economically viable way that they can use their land.(13) "Now comes the government saying that timber may not be cut in forests supporting the owl and the woodpecker--not if the cutting involves significant habitat modification that actually kills or injures wildlife. …