believe this bill will address a significant problem affecting the economic and personal freedom of too many Americans.

Unfortunately, under the Supreme Court's current, restrictive interpretation of the Takings Clause of the Fifth Amendment, a property owner whose land value has been diminished by a use restriction usually cannot receive compensation unless the restriction has rendered his property valueless. As a result, virtually no substantive or even procedural obstacles hinder unelected bureaucrats from imposing economically devastating use restrictions on private land.

The Omnibus Property Rights Act solves this problem by providing that a landowner shall receive full compensation whenever federal government action directly reduces the value of his land by one-third or more. The "directly" qualifier precludes compensation for "consequential damages," such as those suffered by the owner of a gas station on a rural two-lane highway when a parallel superhighway is built nearby.

The Act also requires agencies to conduct a "takings impact analysis" before imposing a regulation "which is likely to result in a taking of private property," thus forcing regulators to consider the consequences of the regulations they propose. In this way the bill will protect Americans from unnecessary regulations that inhibit their full use of their own, private property, and see to it that necessary regulations that take away significant use and value from this land are accompanied by proper compensation.

Mr. Chairman, I feel it necessary in expressing my support for this bill to confront certain myths currently being bandied about concerning our attempt to see that regulatory takings are accompanied by proper compensation.

The first myth is that the Act would create a new "entitlement." This myth should sway no one because obviously a property owner who is compensated for losses caused by the federal government is different in kind from the person who simply receives a government handout.

The second myth is that the Act would increase the deficit. Again, there is no basis for this view. CBO has scored the Act as revenue neutral, largely because any compensation awarded under the Act must be paid out of the operating budget of the agency that imposed the regulation and not out of any fund set up specifically to cover judgment awards.

The third myth is that the Act will require compensation for polluters and others who engage in noxious uses of their property. I am happy to say that this myth also is without foundation because the Act expressly provides that no compensation is required if the restricted use is a nuisance under the common law of the State in which the property is located. Since such use rights do not inhere in the owner's title to begin with (as they are not recognized at common law) restrictions on such uses do not impinge on the property owner's rights.

One final myth I would like to address is the claim that the Act is "anti-environment." Mr. Chairman, the Act does not ban environmental regulation. Indeed the issue raised by property rights legislation is not whether a clean environment, preservation of pristine wilderness and so on are worthy goals. Instead the issue is whether the burdens associated with those societal benefits shall be borne by a few unlucky landowners or by society, through its government. Simple justice demands that society pay for societal benefits.

Mr. Chairman, none of these myths match reality because the "Omnibus Property Rights Act" aims only to protect the well-grounded rights of property owners. If we are serious about protecting the liberties of the American people against governmental intrusion we must enact laws that effectively protect them from that intrusion. This bill will do exactly that and in a measured, reasonable manner.

The CHAIRMAN. With that, we will recess until further notice. [Whereupon, at 1:55 p.m., the committee was adjourned.]

THE OMNIBUS PROPERTY RIGHTS ACT
OF 1995: HOW DOES IT HELP UTAHNS?

SALT LAKE CITY, UT.

The committee met, pursuant to notice, at 10:15 a.m.,_in_room 303, Utah State Capitol, Salt Lake City, ÚT, Hon. Orrin G. Hatch (chairman of the committee), presiding.

OPENING STATEMENT OF HON. ORRIN G. HATCH, A U.S.
SENATOR FROM THE STATE OF UTAH

The CHAIRMAN. Today we will consider private property, specifically the unjust seizures of private property. Make no mistake. This hearing is not a hearing on the importance of safeguarding the environment, which I—which I do support. Nor is it about legitimately protecting wilderness areas, which I also support. Nor is this hearing about the sometimes necessary condemnation of certain private properties to benefit the common good in the building of necessary highways and schools, which are routinely compensated. What this hearing involves is the uncompensated taking of private property that has, in some cases, been in families for generations, takings by Federal regulations.

Tomorrow is the Fourth of July. It's America's Independence Day. Our forebearers fought a revolution to protect certain liberties that they felt were founded not on the ruler's largesse, but on a higher law. In order to ensure that those basic rights would never be infringed, the Founders enshrined them in the Bill of Rights. One of those rights was written into the fifth amendment which says, nor shall private property be taken for public use without just compensation." The fight to maintain that right goes on in our society.

❝***

A well-intentioned desire on the part of Federal regulators to protect a wide variety of interests has led to a dramatic increase in the amount of private property that is effectively taken by devaluation. To be clear, not every Federal regulation amounts to a taking. Furthermore, some regulations which infringe on property rights are worthwhile. However, when a regulation does have the effect of taking private property, the owner of that property should receive just compensation. Anything less is a violation of a basic liberty heralded in the Constitution and specifically written in the Constitution. Frankly, I find it hard to believe that some people claim that compensating Americans for a government taking is such a novel concept. After all, no one disputes the laws that pro

vide financial compensation when a person's land is condemned for a highway. The same principles should apply when land is drastically devalued when Federal bureaucrats declare it a wetland.

In order to correct this infringement on the rights of the citizens of Utah, I have worked with Senator Dole, Senator Bennett and several other Members of Congress to produce the Omnibus Property Rights Act of 1995. This bill requires that when the Federal Government commits a taking of property, that it compensate the owner of the property.

The Omnibus Property Rights Act contains several features which combine to protect private property in a responsible and reasonable manner. The bill is faithful to existing Supreme Court rulings. Title II of the bill codifies and clarifies the area of takings law and court jurisdiction to enable the property owner to vindicate his or her rights. Title IV requires that all Federal agencies examine proposed regulations to assess the "takings impact," of those regulations. Title V creates a streamlined administrative remedy for claims arising under the much maligned Endangered Species Act and the wetlands provision of the Clean Water Act. This will help to avoid costly litigation. Lastly, and perhaps most importantly, all awards or settlements for takings claims will be paid out of agency budgets.

All these provisions will combine to achieve remarkable results. Not only will Utah property owners be equipped to defend themselves, but the Federal Government will benefit from this bill as well. By forcing the agencies to consider the costs of their takings, the agencies will steer away from unwarranted regulation. The clarifications in the law will permit both the agency and the property owner to more accurately determine what will be considered before taking or considered a taking before any litigation is necessary. Indeed, my bill may actually decrease litigation in this area of the law. Finally, by imposing the cost of the agency's action on the on the agency and not on innocent individual property owners, the agency will be certain to achieve its statutory goals with as little taking of private property as possible. This is long overdue, in my opinion.

In closing, this bill simply protects the rights guaranteed to all Americans by the expressed language of the fifth amendment. It does so fairly, reasonably, and in a way which allows us to protect the environment, as well as public health and safety.

So I welcome all of you here today. I look forward to hearing the testimony of our witnesses and look forward to moving ahead. [Senator Hatch submitted the following material:]

THE OMNIBUS PROPERTY RIGHTS ACT OF 1995-A SUMMARY

TITLE I-FINDINGS AND PURPOSES

Section 101. Findings. A statement of the current problem of extensive regulatory takings.

Section 102. Purpose. How the bill will resolve those problems.

TITLE II-PROPERTY RIGHTS LITIGATION RELIEF

Section 201. Findings. A statement of the obstacles facing property owners who are trying to vindicate their rights.

Section 202. Purposes. How Title II will remove those obstacles.

Section 203. Definitions. Defines property to include real property, water rights, contract rights, rents, interests defined as property by state law, and other interests understood as property rights under common law.

Section 204. Compensation for Taken Property. This section sets forth the elements of a takings claim. In setting the legal framework, Supreme Court precedent is heavily relied upon. The area partial takings, which is unclear is clarified with a bright line standard, requiring compensation for losses over 33 percent. No compensation is required where the regulation prevents nuisance.

Section 205. Jurisdiction and Judicial Review. This section establishes concurrent jurisdiction for takings claims in both the federal District Courts and the U.S. Court of Federal Claims.

Section 206. Statute of Limitations. Claims must be brought with in six years of the date of the taking.

Section 207. Attorney's Fees and Costs. Any prevailing plaintiff is also awarded the costs of litigation.

Section 208. Rules of Construction. Nothing in this bill prevents the States from creating additional property rights.

Section 209. Effective Date. The provisions of the bill take effect immediately upon enactment.

TITLE III-ALTERNATIVE DISPUTE RESOLUTION

Section 301. Alternative Dispute Resolution. Arbitration of takings disputes is available as an alternative to litigation.

TITLE IV-PRIVATE PROPERTY TAKING IMPACT ANALYSIS

Section 401. Findings and Purpose. A statement of policy that the government should avoid takings wherever possible.

Section 402. Definitions. Defines the terms used in this title.

Section 403. Private Property Taking Impact Analysis. Requires agencies to conduct a Takings impact Analysis for regulations which are likely to result in the taking of private property.

Section 404. Decisional Criteria and Agency Compliance. Agencies shall not issue rules which require an uncompensated taking.

Section 405. Rules of Construction. Nothing in this bill requires exhaustion of administrative remedies nor does anything in this bill act as a determination of property values.

Section 406. Statute of Limitations. Suits must be filed within six years of the submission of a Takings impact Analysis.

TITLE V-PRIVATE PROPERTY OWNERS BILL OF RIGHTS

Section 501. Findings and Purpose. A recognition of takings committed by the Clean Water and Endangered Species Acts.

Section 502. Definitions. Defines the terms used in this title.

Section 503. Protection of Property Rights. Agencies must develop rules to protect the rights of private property owners.

Section 504. Property Owner Consent for Entry. Agencies may not enter private property without the consent of the owner.

Section 505. Right to Review and Dispute Data Collected from Private Property. An agency may not use data collected on private property without the owner having been given access to the data and an opportunity to dispute its accuracy.

Section 506. Right to an Administrative Appeal of Wetlands Decisions. Creates an administrative appeal of a determination that land is a wetland or a denial of a permit to fill.

Section 507. Right to Administrative Appeal Under the Endangered Species Act of 1973. Provides for an administrative appeal by property owners of a determination that their land is a critical habitat or denial of a permit for an incidental take.

Section 508. Compensation for Taking of Private Property. Action under either of these acts which satisfies the criteria of section 204 of this act is a taking, requiring compensation.

Section 509. Private Property Owner Participation in Cooperative Agreements. Requires the agency to notify property owners whose land is subject to an Endangered Species management agreement.

Section 510. Election of Remedies. Property owners retain the right to preserve all other remedies.

TITLE VI-MISCELLANEOUS

Section 601. Severability. If any part of this act is held unconstitutional, the remainder shall not be affected.

Section 602. Effective Date. The bill takes effect on enactment.

Our first panel this morning will consist of Mrs. Nellie Edwards from Provo, UT; Mr. Larry Gardner from St. George, UT; and Mr. Edward D. Smith from Centerville, UT. So we would ask you to take the three chairs up there, if you will, the three of you. I'm happy to welcome all of you here this morning and we look forward to taking your testimony.

Nellie Edwards is a property owner from Provo. Her land was condemned by the city as part of the airport expansion project. However, she only received a small fraction of the land's actual value because her land had been designated a wetland by the Corps of Engineers. So welcome Mrs. Edwards, we're happy to have you here.

Larry Gardner, I will introduce Larry after Mrs. Edwards finishes her testimony, so let's begin with you.

PANEL CONSISTING OF NELLIE EDWARDS, PROVO, UT; LARRY GARDNER, ST. GEORGE, UT; AND EDWARD D. SMITH, CENTERVILLE, UT

STATEMENT OF NELLIE EDWARDS

Mrs. EDWARDS. Thank you, Senator Hatch. I'm pleased to be here this day and I would really like to take just a few moments to thank you for your love and kindness and the how good you've been to me and what-tell you what a wonderful staff I think you have

er.

The CHAIRMAN. I think we need to pull those mikes a little clos

Mrs. EDWARDS. I wanted to tell you how grateful I am for the love and kindness you've shown to my family and I, and tell you that I've never worked with a more wonderful staff than what you have working with you.

The CHAIRMAN. Thank you so much.

Mrs. EDWARDS. My name is Nellie Edwards and I'm from Provo, UT. My husband, Phil Edwards, and I have been ranchers for many years. Our farm is located on the east shore of Utah Lake and boarders the Provo River as it flows into Utah Lake. We have been property owners in Utah for 50 years.

Three years ago my husband passed away. Shortly thereafter I was informed that my land had been condemned by Provo City. This land was to be used for my retirement, but instead I was told they planned to use my land to enlarge an existing extremely profitable campground near the lake. I didn't have much choice in the matter because the laws were clearly on their side. Today I walk down on the land and see the mobile trailer hookups.

Just before my husband passed away he told me to protect this lakefront property because of its prime location and to not let anyone take it away from me. I have taken this latest condemnation particularly hard because this is the third time that the Government has condemned property which belonged to this family.