California's Prop 90: Trojan Horse
Take a moment to become familiar with this issue so that you can
educate other. The proponents of this proposition are counting
on people to be misinformed.
"If passed, Prop 90 will destroy California's quality of life,
trample private property rights (exactly the opposite of what
proponents disingenuously argue), threaten homes (again the
opposite of what pro-forces argue), hurt the economy, small
businesses, agriculture, neighborhoods, and it will gut
environmental protections."
*************************************
Date: October 5, 2006
From: Peter Douglas, Executive Director California Costal
Commission
Re: Prop. 90: Why it guts California coastal and ocean
protections
Introduction and overview:
As a state employee I cannot campaign unless doing so on my own
time. I can however, educate and provide analysis, comments and
thoughts that inform the debate. As pending legislation we can
engage in discussion of issues raised by Prop 90 that affect
implementation of California's coastal management program.
Indeed, the California Coastal Commission voted unanimously to
oppose Prop 90 because of its significant negative impacts on
the ability of state and local government to protect coastal and
ocean resources. The Commission's report can be seen on our
website at http://www.coastal.ca.gov/. Not only would Prop 90
eviscerate coastal protections, it would impose incalculable new
costs the Commission's budget could not possibly absorb. The
adverse fiscal impacts alone will destroy the program. The
Commission found it imperative that the public be informed about
what Prop 90 really does.
While Prop 90 applies statewide, its focused impacts along the
coast will be especially devastating due to enormous ongoing
development pressures and the sensitivity of coastal resources.
Having carefully studied Prop 90, discussing it with many
attorneys in and out of government, observing the unfolding
Oregon land use tragedy, and having spent 35 years in public
service protecting California's environment, I can unequivocally
say it is the most extreme, cynical, anti-public and
anti-environment proposed law I have ever seen in this State. If
passed, Prop 90 will destroy California's quality of life,
trample private property rights (exactly the opposite of what
proponents disingenuously argue), threaten homes (again the
opposite of what pro-forces argue), hurt the economy, small
businesses, agriculture, neighborhoods, and it will gut
environmental protections.
Proposition 90 is a Trojan horse because it is not what it
pretends to be. Prop 90 is deceptive and unfair because it will
strip private property owners of the ability to protect their
homes, their property values and their neighborhoods by, among
other things, creating conditions inviting unfettered
development that trump legitimate concerns of private property
owners. The public will be effectively shut out of any
meaningful role in development decisions adversely affecting
neighborhoods, sensitive environments, agricultural lands,
cultural and historic places, and other areas the use of which
directly affect quality of life. Independent fiscal analyses
conclude Prop 90 will cost taxpayers billions of dollars
annually by driving up the cost of government at all levels and
adversely impacting essential public services. That's why the
measure is dubbed the Taxpayer Trap Initiative.
Proponents argue Prop 90 is needed to protect homes against
abuses of eminent domain by government. In fact, eminent domain
is rarely used across the country and is a diversionary tactic
used here to hide the real agenda underlying the measure: To
cripple governments ability to govern through regulations that
are in the public's best interest. In fact, the wealthy New York
libertarian financier of Prop 90, Howie Rich, has said he
doesn't really care about eminent domain. He wants to shrink
government. The eminent domain argument is a red herring and
exploits an unpopular 2005 U.S. Supreme Court decision in the
Kelo case out of Connecticut upholding a decision by local
government to condemn several homes for private redevelopment.
True, Prop 90 severely limits eminent domain authority and will
dramatically impede the ability of government to make much
needed infrastructure improvements. However, the impacts of the
eminent domain provisions pale in comparison to the far-reaching
pernicious effects of the measure's regulatory compensation
provisions.
The regulatory compensation component of Prop 90 means,
depending to some extent how courts interpret it, that any time
any public agency takes a regulatory action (many think this
even applies to new decisions under existing law), except for
purposes of protecting public "health and safety" (current
Constitutional law includes protection of public "welfare" which
is deliberately deleted by Prop 90), that results in a
"substantial economic loss" (this could mean any diminution in
value) to any private property, the government (i.e., taxpayers)
must pay compensation to the owner. This provision will be
devastating to California, and especially coastal and ocean
protections. Examples of major negative consequences include:
significant loss of quality of life; new costs to taxpayers in
the billions of dollars annually (that's why its called "The
Taxpayer Trap Initiative" and why taxpayers' associations oppose
it); significant negative impacts on the State's economy and
business community (that's why the Chamber of Commerce, the
Business Roundtable, California Manufacturers Association, and
Small Business Association oppose it); negative impacts on
agriculture (that's why the Farm Bureau opposes it); negative
impacts on residential property values and neighborhoods (that's
why associations of homeowners oppose it); possible loss of
mobile homes (due to vulnerability of rent control and
conversion prevention ordinances and that's why mobile
homeowners associations oppose it); destruction of environmental
protection laws and programs (that's why environmental groups
oppose it); cripples the ability of local government to govern
(that's why the League of Cities and the California Association
of Counties oppose it); threatens essential public services,
such as police and fire protection (that's why public safety
organizations oppose it); guts state coastal and ocean
protections (that's why the Coastal Commission opposes it);
reduces consumer protections; threatens workers and tenants'
rights.
Regulatory Compensation Requirement:
Proposition 90 seek to accomplish two goals: (1) requiring
government to pay private property owners when any government
regulatory action reduces the value of any private property and
(2) prohibiting use of eminent domain to facilitate private
economic development.
Oregon voters approved a regulatory compensation measure in 2004
that has had widespread calamitous effects including freezing
land use planning, depressing residential property values,
harming agricultural uses, and eliminating protections of
neighborhoods and environmental quality. Over 3,000 claims for
compensation have been filed in Oregon seeking nearly $5 billion
in payments to private property owners from local governments.
To avoid the risk of being sued and of having to make enormous
claim payments, most local governments in Oregon have simply
waived the application of regulatory requirements designed to
carry out land use plans, zoning laws, and other laws to protect
neighborhoods, farmland, historic places, environmental quality,
scenic resources and many more public interests. The result has
been a collapse of sound land use planning and land use
practices, deterioration of important community values due to
intrusive and incompatible development, environmentally
destructive land uses, delays of good development due to
uncertainty, loss of private property rights when homeowners see
their property values shrink due to unwanted nearby development
that they have no ability to stop, increased costs to taxpayers,
and costly litigation. Local governments in Oregon have been
forced into the untenable position of having to approve bad
development over legitimate objections from neighbors, members
of the public and the business community.
Prop 90 goes much further than Oregon's Measure 37, because it
is not limited to real property (land) and because Measure 37
did not include an eminent domain provision. Prop 90 applies to
all private property - real property (land) and intangible
property such as an economic interest in a business, idea,
patent, license or any other legally recognized private property
interest. Prop 90 would amend the Constitution to require that
taxpayers pay compensation to a property owner who claims a
reduction in private property value resulting from any
government regulatory action taken to protect public welfare.
Currently the Constitution allows reasonable regulation, subject
to judicial review to guard against abuses, to protect the
public's welfare. Prop 90 only allows such regulation to protect
public "health and safety." This strips government of ability to
implement quality-of-life safeguards such as ordinances and
regulation to protect coastal resources, residential
neighborhoods, farming, environmentally sensitive habitats such
as streams, wetlands and woodlands, open space, marine reserves,
and public access to the coast. It also seriously impairs
government action to implement consumer protections, to protect
workers rights or a living wage, to prevent discrimination in
employment or housing, to protect rights of renters or mobile
home homeowners, animal welfare regulations, historic
preservation, to enact gambling prohibitions, adult
entertainment restrictions, banking regulations, antitrust and
unfair competition laws, and much more.
Prop 90 will spawn extensive and expensive litigation. One very
likely and absurd scenario in the coastal zone and elsewhere is
that a private property owner who wants a permit to develop a
clearly incompatible use in a residential neighborhood threatens
to sue the local government if denied. The residential
homeowners in the neighborhood, who fear their property values
will go down as a result of the incompatible development if
local government or Coastal Commission regulatory actions allow
it, also threaten to sue under Prop 90 (which they can because
the measure is so poorly drafted). Because the developer, having
deeper pockets than most homeowners, is more likely to sue for
compensation, the likely course of action, given what's
happening in Oregon, is that in order to avoid costly litigation
and the risk of having to pay claims thereby depleting already
limited public treasuries or having to cut essential public
services, such as police and fire protection, the local
government or state agency, such as the Coastal Commission, will
simply waive application of regulatory controls and allow the
development to proceed even without reasonable safeguards.
This places the local government, state agencies such as the
Coastal Commission, the public and taxpayers in an absurd
position of suffering losses whichever way they go. Taxpayers
pay if the development is denied and taxpayers pay if it is
approved!!! That is an irresponsible result! But Prop 90 sets
the stage for it.
I don't have time for a complete analysis of all the negative
ways Prop 90 will undermine coastal and ocean protection in
California, but here are some examples:
Any new regulatory decision interpreting or implementing
Coastal Act or local coastal program policies in connection with
a coastal development permit that denies the permit or
conditions approval in a way that can be argued to have resulted
in an economic loss to the applicant can be the subject of a
claim for compensation and a lawsuit. The chilling effect on
making sound coastal protection decisions is obvious. There is
also the dilemma that if the Coastal Commission or local
government approves new development inconsistent with legal
coastal protection policies that a claim and suit for damages
can be brought by private property owners who are not the
applicant.
There are 75 coastal local governments. Most of the approved
local coastal programs are more than 20 years old and clearly in
need of updating to address new information and changed
circumstances. Prop 90 will freeze in place most land use
planning because local governments and the Commission will avoid
the risk of having to pay claims for changes in regulations that
are clearly necessary from an environmental protection
perspective but that could be argued to reduce economic value of
land or a business interest.
Offshore industrial development such as oil drilling, liquid
natural gas terminals and alternative energy facilities such as
wind and wave electric energy generating facilities will likely
have to be approved and approved without environmental
safeguards the imposition of which could be argued to result in
a loss of economic value warranting compensation.
Establishment of marine reserves could lead to damage claims
because they could be argued to result in an economic loss to
commercial and recreational fishers who have a private property
business interest in the fishery to which they are denied access.
A key element of California's coastal program is ensuring that
new development complies with coastal resource protection
policies by applying permit conditions, such as public access
easements, water pollution prevention measures, bluff edge
setbacks, buffer set aside areas adjacent to environmentally
sensitive habitat, reduced densities, or relocating the
footprint of new development. Virtually all-regulatory actions
that do not fall within the public health and safety exception
would be vulnerable to claims for damages resulting from the
imposition of permit conditions that arguably diminish the
economic value of private property.
Coastal regulatory actions to which Prop 90 applies include
local government and Coastal Commission coastal development
permits, appeals of local permit decisions, review of any
development that affects State coastal resources involving a
federal permit, license or funding grant, permits for port
development by private entities, and some aspects of local
coastal program amendments.
These negative effects are but some of the reasons the
Commission voted to oppose Prop 90.
Suffice it to say when a coalition of opponents that includes
the California Coastal Commission, Chamber of Commerce, Realtors
Association, Manufacturers Association, Business Roundtable,
police and firefighter associations, local governments,
environmental organizations, environmental justice groups, the
Farm Bureau and many other groups unite against a proposed law,
there is something clearly wrong with it.
Unfortunately, Prop 90 has been rolling along below the radar
and unless more attention is focused on its hidden poison, it
may well pass. Signers of petitions putting it on the ballot
were not told about the regulatory compensation provisions of
the measure or about the enormous cost to taxpayers associated
with it. Instead they were lured into signing up by compelling
claims that it merely seeks to protect homeowners and their
private property rights (which from a broader and realistic
perspective it does NOT do!) against abuses of eminent domain.
I personally spoke with nearly a dozen signature gatherers and
asked them about the regulatory compensation provisions of the
measure. Every one of them told me they knew nothing about that
aspect of the petition since their only interest in the campaign
was getting paid for each signature they secure.
Prop 90 will freeze in place land use planning and land use
protections. It will gut laws having strong public support that
protect the coast, San Francisco Bay, Lake Tahoe, and other
sensitive environments, residential neighborhoods, agricultural
lands and public parklands. It erodes the States ability to
protect against new offshore oil drilling, new liquid natural
gas terminals, harmful ocean energy projects (e.g., possibly
offshore wind turbines, wave energy machines), and setting aside
essential marine reserves to restore marine life and fisheries.
The Prop 90 tragedy is that the broader public has no clue how
harmful the measure is. When focus groups are told about its
real effects, opposition is overwhelming. To date mainstream
media has failed to tell the real story about who is behind
Prop 90 and what tremendous damage it will do to California.
(This is beginning to change see front page SF Chronicle,
10/5/06: Mogul's network bankrolls Prop 90; and High Country
News, 7/24/06, Taking Liberties.) Only a massive public
education effort before November 7 has the potential to save
California's coastal protection program, quality of life,
private property rights, environment and economy from the
deceptive stealth campaign that has characterized the Prop 90
experience.
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