Should Decreases in Property Value Caused by Regulations Be Compensated?

This Essay attempts to determine the correct regulatory takings compensation policy given the general doctrinal framework in other bodies of American law. In particular, it addresses the following questions. First, given a compensation requirement for eminent domain, is it sensible to interpret the government's regulatory authority as permitting the elimination of property value without compensation? Second, since regulations often produce benefit as well as harm, how can a regulatory givings be incorporated into a consequentialist analysis of regulatory takings compensation? Should the right of property owners to benefit from capital appreciation caused by regulations without returning the windfalls to the government be interpreted as implying a denial of right to receive compensation where the regulations produce adverse effects? Third, given the likelihood that overlapping regulations will produce both benefit and harm for property owners over time, should land use regulations remain uncompensated in light of the probability of a future or past beneficial land use regulation? Fourth, in light of the ubiquity of ad valorem property taxes, should regulations that adversely affect property be seen as implicitly accompanied by compensation given that a reduction in housing values will lead to lower tax payments just as an increase in property prices caused by a public action will increase tax liabilities for property owners? The findings of the Essay may be summarized as follows. The case for takings compensation is far from perfect, and serious arguments can and have been made against compensation. However, once compensation is a required accompaniment to eminent domain takings, it is extremely difficult to draft a cogent argument for ruling out compensating for regulatory takings in general. Adding consideration of givings and taxes to the picture further demonstrates the problematic nature of much of the law of takings, but does not make a compelling case against compensating for regulatory takings