AUGUSTA, Maine — The Maine House narrowly approved a controversial bill that rewrites the state’s regulatory land-use rules to allow property owners to sue the state if the property lost at least 50 percent of its value due to a regulation.
Currently, if a land-use or environmental regulation diminishes property values, the owner has no recourse.
LD 1810, known as the “takings” bill, sharply divided House Republicans and Democrats before Wednesday’s mostly party-line 74-72 vote. Debate lasted nearly two hours and the vote itself took more than five minutes because, according to members, House leaders were actively lobbying members to ensure a positive vote.
On Thursday, the matter was scheduled to be taken up by the Maine Senate, where its fate was uncertain.
“It has been a long road to get to this point, but we’re encouraged that we will be able to provide farmers and other Maine landowners some relief,” said State Rep. Andre Cushing, R-Hampden. “We are simply asking future Legislatures to recognize that their actions can – and at times do – impact property owners’ ability to use or develop their land. The process proposed in this bill lays out a pathway for reasonable resolution.”
Democrats sharply disagreed and said it would increase lawsuits considerably, pit landowners against taxpayers and make special-interest lawyers rich. Worse, they said, is that the bill could allow agencies and courts to waive land use rules and regulations for any kind of development.
“This bill shouldn’t be called ‘takings,’” said Rep. Chuck Kruger, D-Thomaston. “This should be the ‘corporate-special-interest-giveaway’ bill. That’s who wins if this bill passes. It will not help ‘mom and pop’, small business, or regular people trying to improve their lot.”
Kruger pointed to a similar case in Oregon where the state was unable to pay a $203 million claim and was then forced to waive the law for a developer to allow mining, a geothermal plant and a resort near a national monument.
“This bill creates a new legal cause of action,” added Rep. Bob Duchesne, D-Hudson, during floor debate on Wednesday. “That’s what America needs: more ways to sue each other.”
As written, LD 1810 creates a process by which landowners can take action.
When land is seized under eminent domain to build a road, a hospital or other public facility, property owners are compensated for their lost property value. But there is nothing to protect owners from lost value because of increased regulations.
The first step in the process outlined in the bill would be mediation. If unsuccessful, a lawsuit could be filed but could be limited to challenging future state-level land-use laws. In other words, existing regulations are exempt from challenge, including local municipal ordinances and all regulations dealing with health, safety and nuisance matters.
Any loss in value would have to be determined by before-and-after appraisals by independent, professional real estate appraisers. Damages would be capped at the state tort level of $400,000.
“This is not about cashing in on state regulations,” Cushing said. “In the vast majority of cases, the problem can likely be solved by granting a waiver to the regulation or some other practical accommodation.”
The bill was drafted by Catherine Connors, a Pierce Atwood attorney who specializes in regulatory takings. Some Democrats have criticized her involvement since she stands to benefit from the new law.
Duchesne even referenced that connection during his floor remarks on Wednesday when he referenced the four branches of government: the Legislature, the executive, the judiciary and Pierce Atwood.
The bill that was approved on Wednesday was actually the minority report of the Judiciary Committee that was backed solely by Republicans.
The majority report, authored by Rep. Bradley Moulton, R-York, and Rep. Charlie Priest, D-Brunswick, would have turned the recently created Regulatory Fairness Committee into a standing legislative committee. That panel would meet to hear complaints about regulations that were affecting landowners and would have the power to recommend legislation.
The majority report never got a vote in the House.
Seventeen years ago, the Maine Legislature rejected a similar bill, but the idea has resurfaced lately in a number of states, including Florida, which passed a takings bill recently.
Similar takings bills have been advanced by the American Legislative Exchange Council, a conservative national group funded by corporations that drafts model legislation.
ALEC has come under fire in recent days after revelations that it has pushed “Stand Your Ground” legislation that has been cited in the death of Florida teen Trayvon Martin.
So far, at least 7 major corporations — Wendy’s, McDonald’s, The Bill and Melinda Gates Foundation, Intuit, Kraft, PepsiCo and Coca-Cola — have severed ties with ALEC.
Follow BDN reporter Eric Russell on Twitter @BDNPolitics.