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104TH CONGRESS

1ST SESSION H. R. 489

To establish a uniform and more efficient Federal process for protecting

property owners’ rights guaranteed by the fifth amendment.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 11, 1995

Mr. SMITH of Texas (for himself, Mr. THORNBERRY, Mr. KNOLLENBERG, Mr.

BONILLA, and Mr. MCHUGH) introduced the following bill; which was referred to the Committee on the Judiciary

A BILL

To establish a uniform and more efficient Federal process

for protecting property owners’ rights guaranteed by the

fifth amendment.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Property Rights

5 Litigation Relief Act of 1995’’.

6 SEC. 2. FINDINGS.

7 The Congress finds that—

8 (1) the private ownership of property is essen9 tial to a free society and is an integral part of the
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1 American tradition of liberty and limited govern2 ment;

3 (2) the framers of the United States Constitu4 tion, in order to protect private property and liberty,

5 devised a framework of Government designed to dif6 fuse power and limit Government;

7 (3) to further ensure the protection of private

8 property, the fifth amendment to the United States

9 Constitution was ratified to prevent the taking of

10 private property by the Federal Government, except

11 for public use and with just compensation;

12 (4) the purpose of the takings clause of the

13 fifth amendment of the United States Constitution,

14 as the Supreme Court stated in Armstrong v. United

15 States, 364 U.S. 40, 49 (1960), is ‘‘to bar Govern16 ment from forcing some people alone to bear public

17 burdens, which in all fairness and justice, should be

18 borne by the public as a whole’’;

19 (5) the Federal Government, in its haste to

20 ameliorate public harms and environmental abuse,

21 has singled out property holders to shoulder the cost

22 that should be borne by the public, in violation of

23 the just compensation requirement of the takings

24 clause of the fifth amendment of the United States

25 Constitution;
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1 (6) there is a need to both restrain the Federal

2 Government in its overzealous regulation of the pri3 vate sector and to protect private property, which is

4 a fundamental right of the American people;

5 (7) the incremental, fact-specific approach that

6 courts now are required to employ in the absence of

7 adequate statutory language to vindicate property

8 rights under the fifth amendment of the United

9 States Constitution has been ineffective and costly

10 and there is a need for Congress to clarify the law

11 and provide an effective remedy;

12 (8) certain provisions of sections 1346 and

13 1402 and chapter 91 of title 28, United States Code

14 (commonly known as the Tucker Act), that delin15 eates the jurisdiction of courts hearing property

16 rights claims, complicates the ability of a property

17 owner to vindicate a property owner’s right to just

18 compensation for a governmental action that has

19 caused a physical or regulatory taking;

20 (9) current law—

21 (A) forces a property owner to elect be22 tween equitable relief in the district court and

23 monetary relief (the value of the property

24 taken) in the United States Court of Federal

25 Claims;
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1 (B) is used to urge dismissal in the district

2 court on the ground that the plaintiff should

3 seek just compensation in the Court of Federal

4 Claims; and

5 (C) is used to urge dismissal in the Court

6 of Federal Claims on the ground that plaintiff

7 should seek equitable relief in district court;

8 (10) property owners cannot fully vindicate

9 property rights in one court;

10 (11) property owners should be able to fully re11 cover for a taking of their private property in one

12 court;

13 (12) certain provisions of section 1346 and

14 1402 and chapter 91 of title 28, United States Code

15 (commonly known as the Tucker Act) should be

16 amended, giving both the district courts of the Unit17 ed States and the Court of Federal Claims jurisdic18 tion to hear all claims relating to property rights;

19 and

20 (13) section 1500 of title 28, United States

21 Code, which denies the Court of Federal Claims ju22 risdiction to entertain a suit which is pending in an23 other court and made by the same plaintiff, should

24 be repealed.
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1 SEC. 3. PURPOSE.

2 The purpose of this Act is to—

3 (1) encourage, support, and promote the private

4 ownership of property by ensuring the constitutional

5 and legal protection of private property by the Unit6 ed States Government;

7 (2) establish a clear, uniform, and efficient ju8 dicial process whereby aggrieved property owners

9 can obtain vindication of property rights guaranteed

10 by the fifth amendment to the United States Con11 stitution and this Act;

12 (3) amend certain provisions of the Tucker Act,

13 including the repeal of section 1500 of title 28,

14 United States Code;

15 (4) rectify the constitutional imbalance between

16 the Federal Government and the States; and

17 (5) require the Federal Government to com18 pensate property owners for the deprivation of prop19 erty rights that result from State agencies’ enforce20 ment of federally mandated programs.

21 SEC. 4. DEFINITIONS.

22 For purposes of this Act the term—

23 (1) ‘‘agency’’ means a department, agency,

24 independent agency, or instrumentality of the United

25 States, including any military department, Govern26 ment corporation, Government-controlled corpora-
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1 tion, or other establishment in the executive branch

2 of the United States Government;

3 (2) ‘‘agency action’’ means any action or deci4 sion taken by an agency that—

5 (A) takes a property right; or

6 (B) unreasonably impedes the use of prop7 erty or the exercise of property interests or sig8 nificantly interferes with investment-backed ex9 pectations;

10 (3) ‘‘just compensation’’—

11 (A) means compensation equal to the full

12 extent of a property owner’s loss, including the

13 fair market value of the private property taken

14 and business losses arising from a taking,

15 whether the taking is by physical occupation or

16 through regulation, exaction, or other means;

17 and

18 (B) shall include compounded interest cal19 culated from the date of the taking until the

20 date the United States tenders payment;

21 (4) ‘‘owner’’ means the owner or possessor of

22 property or rights in property at the time the taking

23 occurs, including when—
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1 (A) the statute, regulation, rule, order,

2 guideline, policy, or action is passed or promul3 gated; or

4 (B) the permit, license, authorization, or

5 governmental permission is denied or sus6 pended;

7 (5) ‘‘private property’’ or ‘‘property’’ means all

8 property protected under the fifth amendment to the

9 Constitution of the United States, any applicable

10 Federal or State law, or this Act, and includes—

11 (A) real property, whether vested or

12 unvested, including—

13 (i) estates in fee, life estates, estates

14 for years, or otherwise;

15 (ii) inchoate interests in real property

16 such as remainders and future interests;

17 (iii) personalty that is affixed to or

18 appurtenant to real property;

19 (iv) easements;

20 (v) leaseholds;

21 (vi) recorded liens; and

22 (vii) contracts or other security inter23 ests in, or related to, real property;
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1 (B) the right to use water or the right to

2 receive water, including any recorded lines on

3 such water right;

4 (C) rents, issues, and profits of land, in5 cluding minerals, timber, fodder, crops, oil and

6 gas, coal, or geothermal energy;

7 (D) property rights provided by, or memo8 rialized in, a contract, except that such rights

9 shall not be construed under this title to pre10 vent the United States from prohibiting the for11 mation of contracts deemed to harm the public

12 welfare or to prevent the execution of contracts

13 for—

14 (i) national security reasons; or

15 (ii) exigencies that present immediate

16 or reasonably foreseeable threats or inju17 ries to life or property;

18 (E) any interest defined as property under

19 State law; or

20 (F) any interest understood to be property

21 based on custom, usage, common law, or mutu22 ally reinforcing understandings sufficiently well23 grounded in law to back a claim of interest;
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1 (6) ‘‘State agency’’ means any State depart2 ment, agency, political subdivision, or instrumental3 ity that—

4 (A) carries out or enforces a regulatory

5 program required under Federal law;

6 (B) is delegated administrative or sub7 stantive responsibility under a Federal regu8 latory program; or

9 (C) receives Federal funds in connection

10 with a regulatory program established by a

11 State pursuant to a Federal requirement,

12 if the State enforcement of the regulatory program,

13 or the receipt of Federal funds in connection with a

14 regulatory program established by a State, is di15 rectly related to the taking of private property seek16 ing to be vindicated under this Act; and

17 (7) ‘‘taking of private property’’—

18 (A) means any action whereby private

19 property is directly taken as to require com20 pensation under the fifth amendment to the

21 United States Constitution or under this Act,

22 including by physical invasion, regulation, exac23 tion, condition, or other means; and

24 (B) shall not include—
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1 (i) a condemnation action filed by the

2 United States in an applicable court; or

3 (ii) an action filed by the United

4 States relating to criminal forfeiture.

5 SEC. 5. COMPENSATION FOR TAKEN PROPERTY.

6 (a) IN GENERAL.—No agency or State agency, shall

7 take private property except for public purpose and with

8 just compensation to the property owner. A property

9 owner shall receive just compensation if—

10 (1) as a consequence of a decision of any agen11 cy, or State agency, private property (whether all or

12 in part) has been physically invaded or taken for

13 public use without the consent of the owner; and

14 (2)(A) such action does not substantially ad15 vance the stated governmental interest to be

16 achieved by the legislation or regulation on which

17 the action is based;

18 (B) such action exacts the owner’s constitu19 tional or otherwise lawful right to use the property

20 or a portion of such property as a condition for the

21 granting of a permit, license, variance, or any other

22 agency action without a rough proportionality be23 tween the stated need for the required dedication

24 and the impact of the proposed use of the property;
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1 (C) such action results in the property owner

2 being deprived, either temporarily or permanently, of

3 all or substantially all economically beneficial or pro4 ductive use of the property or that part of the prop5 erty affected by the action without a showing that

6 such deprivation inheres in the title itself;

7 (D) such action diminishes the fair market

8 value of the affected portion of the property which

9 is the subject of the action by the lesser of—

10 (i) 10 percent or more with respect to the

11 value immediately prior to the governmental ac12 tion; or

13 (ii) $10,000, or more with respect to the

14 value immediately prior to the governmental ac15 tion; or

16 (E) under any other circumstance where a tak17 ing has occurred within the meaning of the fifth

18 amendment of the United States Constitution.

19 (b) BURDEN OF PROOF.—(1) The Government shall

20 bear the burden of proof in any action described under—

21 (A) subsection (a)(2)(A), with regard to show22 ing the nexus between the stated governmental pur23 pose of the governmental interest and the impact on

24 the proposed use of private property;
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1 (B) subsection (a)(2)(B), with regard to show2 ing the proportionality between the exaction and the

3 impact of the proposed use of the property; and

4 (C) subsection (a)(2)(C), with regard to show5 ing that such deprivation of value inheres in the title

6 to the property.

7 (2) The property owner shall have the burden of

8 proof in any action described under subsection (a)(2)(D),

9 with regard to establishing the diminution of value of

10 property.

11 (c) COMPENSATION AND NUISANCE EXCEPTION TO

12 PAYMENT OF JUST COMPENSATION.—(1) No compensa13 tion shall be required by this Act if the owner’s use or

14 proposed use of the property is a nuisance as commonly

15 understood and defined by background principles of nui16 sance and property law, as understood within the State

17 in which the property is situated, and to bar an award

18 of damages under this Act, the United States shall have

19 the burden of proof to establish that the use or proposed

20 use of the property is a nuisance.

21 (2) Subject to paragraph (1), if an agency action di22 rectly takes property or a portion of property under sub23 section (a), compensation to the owner of the property

24 that is affected by the action shall be either the greater

25 of an amount equal to—
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1 (A) the difference between—

2 (i) the fair market value of the property or

3 portion of the property affected by agency ac4 tion before such property became the subject of

5 the specific government regulation; and

6 (ii) the fair market value of the property

7 or portion of the property when such property

8 becomes subject to the agency action; or

9 (B) business losses.

10 (d) TRANSFER OF PROPERTY INTEREST.—The Unit11 ed States shall take title to the property interest for which

12 the United States pays a claim under this Act.

13 (e) SOURCE OF COMPENSATION.—The compensation

14 referred to in this section shall be paid out of funds made

15 available to the Federal agency or department by appro16 priation for the fiscal year in which the property depriva17 tion referred to in this section occurred. If no such funds

18 have been made available to the agency, such payment

19 shall be made from the Judgment Fund.

20 SEC. 6. JURISDICTION AND JUDICIAL REVIEW.

21 (a) IN GENERAL.—A property owner may file a civil

22 action under this Act to challenge the validity of any agen23 cy action that adversely affects the owner’s interest in pri24 vate property in either the United States District Court

25 or the United States Court of Federal Claims. This section
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1 constitutes express waiver of the sovereign immunity of

2 the United States. Notwithstanding any other provision of

3 law and notwithstanding the issues involved, the relief

4 sought, or the amount in controversy, each court shall

5 have concurrent jurisdiction over both claims for monetary

6 relief and claims seeking invalidation of any Act of Con7 gress or any regulation of an agency as defined under this

8 Act affecting private property rights. The plaintiff shall

9 have the election of the court in which to file a claim for

10 relief.

11 (b) STANDING.—Persons adversely affected by an

12 agency action taken under this Act shall have standing

13 to challenge and seek judicial review of that action.

14 (c) AMENDMENTS TO TITLE 28, UNITED STATES

15 CODE.—(1) Section 1491(a) of title 28, United States

16 Code, is amended—

17 (A) in paragraph (1) by amending the first sen18 tence to read as follows: ‘‘The United States Court

19 of Federal Claims shall have jurisdiction to render

20 judgment upon any claim against the United States

21 for monetary relief founded either upon the Con22 stitution or any Act of Congress or any regulation

23 of an executive department, or upon any express or

24 implied contract with the United States, in cases not

25 sounding in tort, or for invalidation of any Act of
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1 Congress or any regulation of an executive depart2 ment that adversely affects private property rights

3 in violation of the fifth amendment of the United

4 States Constitution’’;

5 (B) in paragraph (2) by inserting before the

6 first sentence the following: ‘‘In any case within its

7 jurisdiction, the Court of Federal Claims shall have

8 the power to grant injunctive and declaratory relief

9 when appropriate.’’; and

10 (C) by adding at the end thereof the following

11 new paragraphs:

12 ‘‘(4) In cases otherwise within its jurisdiction,

13 the Court of Federal Claims shall also have ancillary

14 jurisdiction, concurrent with the courts designated in

15 section 1346(b) of this title, to render judgment

16 upon any related tort claim authorized under section

17 2674 of this title.

18 ‘‘(5) In proceedings within the jurisdiction of

19 the Court of Federal Claims which constitute judi20 cial review of agency action (rather than de novo

21 proceedings), the provisions of section 706 of title 5

22 shall apply.’’.

23 (2)(A) Section 1500 of title 28, United States Code,

24 is repealed.
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1 (B) The table of sections for chapter 91 of title 28,

2 United States Code, is amended by striking out the item

3 relating to section 1500.

4 SEC. 7. STATUTE OF LIMITATIONS.

5 The statute of limitations for actions brought under

6 this title shall be 6 years from the date of the taking of

7 property.

8 SEC. 8. ATTORNEYS’ FEES AND COSTS.

9 The court, in issuing any final order in any action

10 brought under this Act, shall award costs of litigation (in11 cluding reasonable attorney and expert witness fees) to

12 any prevailing plaintiff.

13 SEC. 9. ALTERNATIVE DISPUTE RESOLUTION.

14 (a) IN GENERAL.—Either party to a dispute over a

15 taking of property as defined under this Act or litigation

16 commenced under this Act may elect to resolve the dispute

17 through settlement or arbitration. In the administration

18 of this section—

19 (1) such alternative dispute resolution may only

20 be effectuated by the consent of all parties;

21 (2) arbitration procedures shall be in accord22 ance with the alternative dispute resolution proce23 dures established by the American Arbitration Asso24 ciation; and
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1 (3) in no event shall arbitration be a condition

2 precedent or an administrative procedure to be ex3 hausted before the filing of a civil action under this

4 Act.

5 (b) COMPENSATION AS A RESULT OF NEGOTIATED

6 SETTLEMENTS OR ARBITRATION.—The funds used for

7 compensation to the owner (as determined by the appro8 priate official of the Federal agency or department) shall

9 be taken from the responsible agency’s budget for that fis10 cal year or transferred to the agency from the Judgment

11 Fund for payment to the owner.

12 (c) REVIEW OF ARBITRATION.—Appeal from arbitra13 tion decisions shall be to the United States District Court

14 or the United States Court of Federal Claims in the man15 ner prescribed by law for the claim under this Act.

16 (d) PAYMENT OF CERTAIN COMPENSATION.—In any

17 appeal under subsection (c) in which the court does not

18 rule for the Federal agency or department, the amount

19 of the award of compensation determined by the arbitrator

20 shall be paid from funds made available to the Federal

21 agency or department by appropriation in lieu of being

22 paid from the Judgment Fund, except that if no such

23 funds have been made available to the agency or depart24 ment such payment shall be made from the Judgment

25 Fund.
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1 SEC. 10. RULES OF CONSTRUCTION.

2 Nothing in this Act shall be construed to interfere

3 with the authority of any State to create additional prop4 erty rights.

5 SEC. 11. SEVERABILITY.

6 If any provision of this Act, an amendment made by

7 this Act, or the application of such provision or amend8 ment to any person or circumstance is held to be unconsti9 tutional, the remainder of this Act, the amendments made

10 by this Act, and the application of the provisions of such

11 to any person or circumstance shall not be affected there12 by.

13 SEC. 12. EFFECTIVE DATE.

14 The provisions of this Act and amendments made by

15 this Act shall take effect on January 1, 1995 and shall

16 apply to any agency action that occurs on or after such

17 date.

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