Opinion ID: 852390
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Heading: The Constitutional Background

Text: Article I, section 21 of the Indiana Constitution provides that No person's property shall be taken by law, without just compensation; nor, except in case of the State, without such compensation first assessed and tendered. The Fifth Amendment of the U.S. Constitution similarly provides that nor shall private property be taken for public use, without just compensation. The Fifth Amendment's Takings Clause applies to the states via the Due Process Clause of the Fourteenth Amendment. Webb's Fabulous Pharmacies, Inc. v. Beckwith, 449 U.S. 155, 160, 101 S.Ct. 446, 66 L.Ed.2d 358 (1980); Chi., Burlington & Quincy R.R. v. City of Chicago, 166 U.S. 226, 241, 17 S.Ct. 581, 41 L.Ed. 979 (1897). We have held that the state and federal takings clauses are textually indistinguishable and are to be analyzed identically. Cheatham v. Pohle, 789 N.E.2d 467, 472-73 (Ind.2003) (citing B & M Coal Corp. v. United Mine Workers of Am., 501 N.E.2d 401, 406 (Ind.1986)). There is no question that an exercise of eminent domain, such as the condemnation of the 0.154-acre strip in this case, is a constitutional taking. Other forms of governmental action, however, are takings only if they meet the prevailing federal standard, which is that government action effects a taking if it deprives an owner of all or substantially all economic or productive use of his or her property. Lingle v. Chevron U.S.A., Inc., 544 U.S. 528, 538-40, 125 S.Ct. 2074, 161 L.Ed.2d 876 (2005). Factors considered under the foregoing test include the economic impact of the regulation on the property owner, the extent to which the regulation has interfered with distinct investment-backed expectations, and the character of the government action. Penn Cent. Transp. Co. v. New York City, 438 U.S. 104, 124, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978). The effects of the road improvements on Plaza East, if viewed separately from the taking of the 0.154-acre strip, plainly do not meet the Lingle test. Presumably for this reason Kimco presents its case in terms of Indiana case law. Because recent constitutional takings cases to some extent have modified Indiana case law, a discussion of these constitutional cases is useful background. In Biddle v. BAA Indianapolis, LLC, 860 N.E.2d 570 (Ind.2007), we reviewed Indiana's eminent domain language and harmonized our takings analysis with the federal approach spelled out in Lingle and Penn Central. Biddle was a Fifth Amendment case analyzing the compensability of aircraft noise near residential properties. 860 N.E.2d at 572-73. In the course of distilling a takings framework to apply to the case, Biddle disapproved some earlier formulations of compensable actions either by eminent domain or some form of regulatory taking: [6] Some of our own inverse condemnation cases have labeled the required degree of harm for takings a special or peculiar injury.... This requirement has two aspects to it. First, the injury must be different in kind from what the public experiences. Second, the injury must be of a degree that exceeds mere inconvenience. Neither of these seems to add much to the task of identifying takings. It merely states the obvious to observe that to have a plausible takings claim one must experience a burden not shared by the public generally. And one who suffers mere inconvenience likely possesses an extraordinarily weak takings claim. We think the Lingle analysis ... is a more precise standard for measuring the degree of harm, one that will result in more consistent decisions. Id. at 580 (citations omitted). Biddle involved a federal constitutional claim and dealt with the specific issue of aircraft noise in residential communities. But importantly, we expressed our disapproval of Indiana's traditional takings language and explained that the federal approach was more effective and practical, and would produce more uniform results. We reaffirm the view expressed in Cheatham and Biddle that our state constitutional takings analysis is the same as federal constitutional eminent domain law, as interpreted by Lingle and Penn Central. Constitutional doctrine is not the end of the matter. Legislatures may confer greater rights to compensation for government action than those afforded by the constitutional takings clauses. Kelo v. City of New London, 545 U.S. 469, 489, 125 S.Ct. 2655, 162 L.Ed.2d 439 (2005). The legislature in Indiana has arguably done so as to takings by exercise of eminent domain. In particular, the eminent domain act provides for the following bases of compensation in eminent domain proceedings: (1) The fair market value of each parcel of property sought to be acquired and the value of each separate estate or interest in the property. (2) The fair market value of all improvements pertaining to the property, if any, on the portion of the property to be acquired. (3) The damages if any, to the residue of the property of the owner or owners caused by taking out the part sought to be acquired. (4) The other damages, if any, that will result to any persons from the construction of the improvements in the manner proposed by the plaintiff. Ind.Code § 32-24-1-9(c) (2004). As we will see, some cases have looked to this statutory language as the source of compensable damage in an eminent domain context.