I Heard It Through the Grapevine…

SEPTEMBER 2013 VOL. 65, ISSUE 9 PLANNING & ENVIRONMENTAL LAW
8. Id. at 16 (Kagan, J. dissenting) although the dissent does
state that the district “tried to extract from Koontz solely a
commitment to spend money to repair public wetlands.”
Id. at 25.
9. Id. at 23.
10. 77 So. 3d 1220, 1229-30 (2011).
11. Koontz, slip op. at 7.
12. Id.
13. Id. at 8–9.
14. Id. at 8, 16.
15. Town of Flower Mound v. Stafford Estates Ltd., 135 S.W.3d
620, 639 (Tex. 2004).
16. Koontz, slip op. at 9. The difference between a denial and
an approval scenario involved remedies: A person who
relinquished property as a result of an unconstitutionally
extortionate exaction might be entitled to just compensation. However, the Court declined to explore this matter
because the claim in Koontz was brought pursuant to a
state law, not a federal cause of action. Id. at 9. Similarly, the
majority declined to resolve the water district’s argument
that its demands for property were “too indefinite” to give
rise to liability under Nollan and Dolan (this had not been
dealt with by the appellate courts below, which treated the
district’s requirements as sufficient to qualify as demands
under Nollan and Dolan). Id. at 10.
17. Id. at 12.
18. Id. at 12–13.
19. Id. at 16 (Justice Kagan’s dissent), 13, 14.
20. Id. at 15.
21. Id. at 18 (Kagan, J., dissenting, citing E. Enters. v. Apfel,
524 U. S. 498 (1998) (Takings Clause does not apply to
government-imposed financial obligations that “d[o] not
operate upon or alter an identified property interest”).
22. Id. at 19.
23. Id. at 24.
24. Id. at 21, n.2.
25. Id. at 21.
26. Id. at 22, 16.
27. Id. at 7.
28. Id. at 13.
29. Id.
30. Sheffield Dev. Co. v. City of Glenn Heights, 2004 WL 422594,
at *7 (quoting E. Enters v. Apfel, 524 U.S. 498, 541 (1998)).
31. A Fistful of Dollars, Senses of Cinema, available at http://
sensesofcinema.com/2003/cteq/fistful_of_dollars.32.
Koontz, slip op. at 16.
32. Koontz, slip op. at 16.
Sophia M. Stadnyk is a lawyer and legal writer with
extensive experience in local government and municipal
law. She is a regular writer for the American Bar Association
on the Supreme Court and is admitted to the bar in
jurisdictions in the United States and Canada.
I Heard It Through the
Grapevine…
The Impact of Horne v. United States
­Department of Agriculture
Evan J. Seeman
Not since the 2005 term has the U.S.
Supreme Court decided more than one
“takings” case. This past term saw three
such cases. Somewhat overlooked in the
mix is the second of those cases—Horne
v. United States Department of Agriculture
(2013)—a case about raisins.1 There is
nothing extraordinary about the Horne
decision. In fact, the Supreme Court
does not decide much of anything at all.
Yet Horne is an important decision in its
own right that could have a lasting impact
on regulatory and land use proceedings and
property rights for all involved—planners,
property owners, and federal and state governments. This commentary summarizes
Horne and its likely impact.
The protagonists of this story (or perhaps
antagonists, depending on how you look at
it) are Marvin and Laura Horne, California raisin growers since 1969. In 2004, the
U.S. Department of Agriculture (USDA)
brought an enforcement action against the
Hornes seeking a whopping $650,000-plus
in fines and civil penalties for the Hornes’
refusal to hand over free of charge a certain
percentage of their raisins to the federal
government (47 percent in 2002–2003 and
30 percent in 2002–2003). The Hornes were
not happy. Their argument was simple—
why should they have to relinquish their
raisins when they, not the federal government,
expended time, money, and effort to grow
the raisins? Understandably upset, they
wrote to the federal government, “[t]his is
America, not a communist state[!]”2
Why would the government order that
the Hornes turn over their raisins without
Copyright 2013 by the American Planning Association.
Reprinted with permission from Planning & Environmental Law.
compensation? Under the Depression-era
Agricultural Marketing Agreement Act
(AMAA) of 1937, the Secretary of Agriculture can establish marketing orders to
regulate the sale and delivery of agricultural
crops to stabilize crop prices (and producer
returns) by creating an artificial scarcity in
the domestic market. It does so by requiring “handlers,” which it defines as “processors, associations of producers, and others
engaged in the handling” of agricultural
crops covered by the Act to give up their
crops.3 The AMAA does not apply to “producers,” who grow the crops. A “handler”
who violates the AMAA may be subject to
civil and criminal penalties.
So what goods are covered by the
AMAA? Only some of the most essential—you know, hops (beer), tobacco (cigarettes), and of course, raisins.4
In 1949 the Secretary of Agriculture
created the California Raisin Marketing
Order (Raisin Order), which requires “handlers” to, among other things, hand over
their raisins, allow the federal government
to access their property to inspect their
raisins, file reports about raisin quantities, and pay certain assessments to cover
the Raisin Administrative Committee’s
(RAC) administrative costs. Each year, the
RAC reviews crop yield and inventories
to determine whether price stabilization
is necessary, and, if it is, the RAC recommends what percentage of raisins should
be given to the government. The RAC sells
the raisins for resale overseas or gives them
to noncompetitive domestic markets, such
as school lunch programs. Proceeds from
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the sale of the crops are used to finance the
RAC’s administrative costs. Any remaining funds are distributed on a pro rata basis
among “producers” (not “handlers,” like the
Hornes).
Because only “handlers,” and not “producers,” have to give up their raisins, the
Hornes devised a plan to escape the Raisin
Order’s requirements by repurposing their
business to, in their view, qualify them as
raisin “producers.” The federal government,
however, insisted that the Hornes were still
“handlers” subject to the requirements of
the Raisin Order.
When the Hornes refused to hand
over their raisins, the USDA brought the
$650,000-plus enforcement action against
them. The Hornes raised an affirmative
defense to invalidate the Raisin Order
as a violation of the Fifth Amendment’s
prohibition against “taking” property without just compensation. The Tucker Act
requires that “takings” claims against the
federal government in excess of $10,000
be brought in the Court of Federal Claims,
unless Congress has withdrawn Tucker
Act jurisdiction from the operative statute through a “comprehensive remedial
scheme.”5 The Hornes did not file suit in
the Court of Federal Claims.
Predictably, the USDA, which conducted the administrative hearing, concluded
that the Hornes were “handlers” subject
to the Raisin Order and rejected the
Hornes’ takings defense. The Hornes filed
suit in Federal District Court to review
the USDA’s decision. The District Court
agreed with the USDA. It stated of the
Hornes’ takings claim: “[I]n essence, [the
Hornes] are paying an admissions fee or
toll—admittedly a steep one—for marketing raisins. The Government does not force
plaintiffs to grow raisins or to market the
raisins; rather, it directs that if they grow
and market raisins, then passing title to
their ‘reserve tonnage’ raisins to the RAC
is the admissions ticket.”6 On appeal, the
Ninth Circuit affirmed the lower court’s
conclusion that the Hornes were “handlers”
but determined that it lacked jurisdiction
over their takings defense because the
Tucker Act required that they first file suit
in the Court of Federal Claims.
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The Supreme Court disagreed and reversed the Ninth Circuit. In a unanimous
decision authored by Justice Thomas, the
Court found that the AMAA withdrew
Tucker Act jurisdiction over the Hornes’
takings claim and stated, “it would make
little sense to require the party to pay
the fine in one proceeding and then turn
around and sue for recovery of that same
money in another proceeding.”7 Although
the Court acknowledged the Hornes’ argument that it was unconstitutional for the
government to take their raisins without just
compensation and unconstitutional to fine
them for failing to give up their raisins, it
punted the issue back to the Ninth Circuit.
ries), . . . tobacco, vegetables, . . . hops, [and]
honeybees.” 8 Of course, all eyes will be on
the Ninth Circuit, on remand from the
Supreme Court, as it considers the merits
of the Hornes’ takings claim. It will be
interesting to see how the Ninth Circuit
frames the issue: (1) as an alleged taking
against the USDA’s imposition of fines and
civil penalties or (2) as an alleged taking on
the requirement that the Hornes hand over
their raisins. The stakes will be high—an
adverse decision for the USDA could
spell the beginning of the end for its Depression-era regulatory scheme, a scheme
Justice Kagan referred to during oral argument as “the world’s most outdated law.”
[C]ould the Court eliminate Williamson County’s ripeness
requirement altogether, allowing takings claims to be
brought in federal courts[?]
Despite the Court’s failure to decide
whether the raisin confiscation was a taking, the Horne decision opens the door to
new ways by which property owners may
assert takings claims. In the years ahead,
property owners, municipalities, and courts
will interpret and apply Horne to real-life
situations. The following are the most likely
impacts of Horne.
First, Horne clarifies that “just compensation” is not the only remedy available for a
“takings” claim in enforcement proceedings
where the compensation remedy has been
withdrawn. Rather, it is now clear that a
“takings” claim can be asserted as an affirmative defense to an enforcement action
even before anything has been “taken” and
without first seeking just compensation, particularly in cases in which there are statutory
(nonmonetary) remedies available. This will
have an indelible impact on property rights
at the federal, state, and local levels.
The USDA should expect future challenges to other agricultural commodities
covered by the AMAA—“[m]ilk, fruits
(including filberts, almonds, pecans and
walnuts . . . , pears, olives, grapefruits, cherries, caneberries (including raspberries,
blackberries, and loganberries), cranber-
State regulatory schemes will also see
challenges. Take, for example, rent control—
a regulatory system under which state
governments dictate the rent that owners of
rent-stabilized apartments may charge tenants. New York enacted the Rent Stabilization Law (RSL) in 1969 and subsequently
established the Rent Guidelines Board to
annually review and adjust the minimal percentage increase of fair rent that landlords
of rent-stabilized apartments could charge
their tenants.9 Like the AMAA, violators of
the RSL risk monetary penalties.10 In 2011
there was much speculation that the Supreme Court would grant a New York landlord’s petition for a writ of certiorari seeking
to overturn New York’s rent-control system.
Although the Supreme Court declined to
review the landlord’s claim, Horne could
give new life to such challenges, particularly
where enforcement actions are brought
against landlords.11
By the same token, local land use agencies now face an increase in “takings” defenses to enforcement actions. Virtually any
enforcement proceeding before a zoning
board or other land use agency could involve “takings” defenses in response to the
alleged illegal activity.
Second, the Horne decision is noteworthy for the Court’s continued displeasure
with its 1985 decision Williamson County
Regional Planning Commission v. Hamilton Bank of Johnson City.12 In Williamson
County, a Tennessee landowner seeking
to develop a residential subdivision sued
the local planning commission and others arguing that certain zoning laws and
regulations constituted a “taking” of his
property without just compensation. The
Supreme Court reversed the lower court’s
award of $350,000 as just compensation
for the “taking” and concluded that the
claim was not “ripe” for review; that is,
the landowner had to first seek compensation by any available state regulatory or
judicial proceedings. If the property owner does not first seek this state relief, the
“takings” claim is not “ripe” for review.13
Although Horne did not overrule Williamson County, it did reject the USDA’s
claim that the federal courts are without
jurisdiction to hear the case until the
Hornes had been denied just compensation in a state court proceeding. In footnote
6 of the decision, the Court notes that
the Williamson County ripeness test is not
jurisdictional and that a “[c]ase or controversy exists once the government has taken
private property without paying for it.”14 If
Williamson County’s ripeness requirement
is not a barrier to jurisdiction, its purpose is
not entirely clear.
Horne is not the first time that the
Court has indicated that Williamson
County’s ripeness requirement could
be overruled. In San Remo Hotel v.
San Francisco (2005),15 four concurring
justices (including Justice Thomas) expressed their opinion that Williamson
County was wrongly decided: “It is not
clear to me that Williamson County was
correct in demanding that, once a government entity has reached a final decision with respect to a claimant’s property,
the claimant must seek compensation in
state court before bringing a federal takings claim in federal court.”16 Horne reaffirms, to some extent, this concern, albeit
in a footnote. In the years to come, could
the Court eliminate Williamson County’s
ripeness requirement altogether, allowing
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takings claims to be brought in federal
courts in the first instance?
The Horne decision is maddening in
that it does not decide the overarching issue—whether the government’s
raisin program is illegal. That said, while
Horne’s impact may not be fully realized
for years, it will affect the process for
property owners bringing takings claims
and courts hearing them. Horne could
allow property owners to forego timeconsuming and expensive proceedings
before having a federal court consider a
“takings” claim. The federal, state, and
local governments, however, need not be
overly discouraged; they may find solace
in the fact that Horne does not change
the landscape on what is or is not a “taking”—just the means and methods by
which such claims may be heard.
ENDNOTES
1. 133 S.Ct. 2053 (2013).
2. Id. at 2059, n.3.
3. See 7 U.S.C. §§ 608c(13)(B) and 608c(1).
4. See 7 U.S.C. § 608c(2).
5. 133 S.Ct. at 2062.
6. Id. at 2059 (quoting No. CV-F-08-1549 LJO SMS, 2009 WL
4895362, *26 (ED Cal., Dec. 11, 2009)).
7. Id. at 2063.
8. 7 U.S.C. § 608c(2).
9. New York City Local law No. 16 (1969); see New York City
Local Law No. 23 (2009).
10. See http://www.nyshcr.org/rent/about.htm#howrs; New
York City Local Law. No. 16 (1969).
11. See Harmon v. Kimmel, Docket No. 11-496 (2011). The petition for writ of certiorari, supporting amicus curiae briefs,
and opposition briefs are available at http://www
.scotusblog.com/case-files/cases/harmon-v-kimmel; see
Adam Liptak, U.S. Supreme Court Declines to Hear Suit Challenging the Rent Stabilization Law, n.y. times (April 23, 2012).
12. 473 U.S. 172 (1985).
13. Id. at 194.
14. 133 S.Ct. at 2062, n.6.
15. 544 U.S. 323 (2005).
16. Id. at 349
CELL TOWER CASE CLARIFIES AGENCY POWERS
Brian J. Connolly
In May, the U.S. Supreme Court decided the case of City of Arlington v. Federal
Communications Commission,1 a decision that addressed a relatively specific question
of administrative law but which may have some consequences for local land use
planning and zoning.
The Communications Act of 1934 requires states and local governments to render
decisions on wireless facility (i.e. cell phone tower) siting applications “within a
reasonable period of time after the request is duly filed.”2 Upon petition of a wireless
industry group concerned about long permitting delays occurring at the local level,
the Federal Communications Commission (FCC) in 2009 issued a ruling that a
“reasonable period of time” per the statute was 90 days for applications for placement
of a new antenna on an existing tower and 150 days for any other wireless facility
application.3 Some local governments challenged the FCC’s determination, arguing
that because the Communications Act expressly allowed state and local governments
to regulate wireless facility placement, and because the statute expressly provided
for judicial review of state and local determinations in the arena of wireless facilities,
the FCC lacked authority to interpret the Act’s provisions relating to local siting
review. The Fifth Circuit Court of Appeals found the Act ambiguous with respect
to whether the FCC could administer the permitting limitations, and pursuant to
longstanding doctrine, deferred to the agency’s decision.4
The local governments filed a petition for writ of certiorari with the Supreme Court
on two questions: First, whether it is appropriate for courts to defer to administrative
agencies where the agencies are interpreting the scope of their own jurisdiction, and
second, whether the FCC’s authority to administer the Communications Act gave it
authority to override state and local regulation of the wireless facility placement.5 The
Supreme Court granted the petition only as to the first issue.
In an opinion authored by Justice Scalia, a majority of the Court agreed that
the FCC was entitled to deference in determining the scope of its own authority.
The majority found that agencies’ jurisdictional interpretations should be subjected
to the same judicial analysis—a high level of deference, in the case of interpreting ambiguous statutory language—as the agencies’ substantive determinations. A
concurrence was filed by Justice Breyer, and Chief Justice Roberts dissented with
Justices Kennedy and Alito.
The outcome of the case means that, in the face of ambiguous statutes with
respect to agencies’ jurisdiction over particular matters, courts will defer to agencies’
interpretations of their jurisdiction. The practical result of the case for the purposes
of land use planning and zoning is that local governments must now proceed
quickly to process wireless facility siting applications within the 90- and 150-day
time frames established by the FCC.
ENDNOTES
1. 133 S. Ct. 1863 (2013).
2. 47 U.S.C. § 332(c)(7)(B)(ii).
3. In the Matter of Petition for Declaratory Ruling to Clarify Provisions of Section 332(c)(7)(B), 24 FC.C.R. 13994, 14005 (2009).
4. City of Arlington v. FCC, 668 F.3d 229 (2012).
Evan J. Seeman is a lawyer with Robinson & Cole LLP in
Hartford, Connecticut, where he represents municipalities,
developers, land owners, and advocacy groups in land
use, zoning, real estate, and environmental matters. He is a
coauthor, with Dwight H. Merriam, faicp, of the blog RLUIPADefense, available at http://www.rluipa-defense.com.
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5. Petition for Writ of Certiorari, City of Arlington v. FCC, 133 S. Ct. 1863 (No. 11-1545) (Jun. 27, 2012).
Brian J. Connolly is an attorney with the Land Use Practice Group at Otten Johnson Robinson Neff & Ragonetti, P.C., in Denver.
He holds a J.D. from the University of Michigan Law School, a Master of Regional Planning from Cornell University, and a B.S. in
urban studies from Cornell University.