Editorial: In defense of property rights

The U.S. Supreme Court unanimously struck a blow for property rights on Tuesday, throwing a roadblock in front of federal regulators who have used the Clean Water Act to bury developers and landowners under a flurry of red tape.

The case involved a North Dakota peat-mining business hoping to mine property in northern Minnesota. But officials with the EPA and U.S. Army Corps of Engineers determined that the property included vital wetlands connected to the Red River 120 miles away. That meant the company would have to undergo an expensive and cumbersome federal permitting process — with no guarantee of success — or proceed under the threat of criminal liability.

When the company challenged the agency interpretation of the law as too expansive, the government argued that judicial review was not an option because the regulators had yet to make a final determination on the issue.

Under that logic, of course, regulators could drag out a case for years, leaving a property owner with no recourse but to idle his land or risk incurring millions in fines.

“If respondents discharged fill material without a permit in the mistaken belief that their property did not contain jurisdictional waters,” Chief Justice John Roberts wrote, “they would expose themselves to civil penalties of up to $37,500 for each day they violated the act. … Respondents need not assume such risks while waiting for the EPA to “drop the hammer’ in order to have their day in court.”

Encouragingly, three justices led by Anthony Kennedy questioned the legitimacy of the Clean Water Act itself, which has been used as cover to allow federal agencies to ramp up property regulation under that guise that even drainage ditches and puddles constitute applicable “waters of the United States.” The law, Justice Kennedy wrote, “continues to raise troubling questions regarding the government’s power to cast doubt on the full use and enjoyment of private property throughout the nation.”

He’s right. And it’s telling that even the left-leaning justices agreed that the government’s broad application of the law can undermine the property rights of land owners.

Ultimately, issues of overzealous land-use regulation and private property should be considered against the backdrop of the Fifth Amendment’s Takings Clause. Forcing the government to compensate property owners whose land is severely devalued due to regulation might lead to more prudent and sensible legislation in the first place.

Until then, however, the high court’s affirmation that property owners may challenge the federal government’s efforts to regulate every puddle and pond is a step in the right direction.