In addition, this title ensures that property owners rights are considered and respected when agency decisions or actions are taken pursuant to these two laws by providing an administrative appeals process that we don't have today. The process calls for the owner to be given access to the information collected, a description of the way the information was collected, yes, and an opportunity to discuss the accuracy of the information.

Lastly, it requires the agency itself to determine whether a taking has occurred and, if so, to compensate the private property owner for the loss in fair market value of the property.

A property owner who is deprived of at least a third or more of the fair market value would be entitled to receive compensation under our bill. The agency would be required to pay the fair market value of the property if purchased or the difference between the fair market value of the property without the restrictions and the fair market value of the property with restrictions.

In closing, Mr. Chairman, I would like to quote two insightful, but diametrically opposed, philosophers. The first is from Friedrich von Hayek, most commonly associated with Austrian economics. He once said, "The system of private property is the most important guaranty of freedom, not only for those who own property, but scarcely less for those who do not." Mr. Hayek understood that the most basic tenet of a free society starts with private property rights.

Even Karl Marx realized this. The Communist Manifesto written in 1848 states, "*** the theory of Communists may be summed up in the single sentence; Abolition of private property."

Make no mistake, Mr. Chairman, regulatory takings effectively abolish private property rights. Karl Marx knew it, Friedrich von Hayek knew it, and the American people know it.

Mr. Chairman, I also have a statement from Senator Nickles, who is a co-sponsor of this section of the bill with me, and he asked me to ask that it be placed in the record after my testimony. Senator THURMOND. Without objection, that will be done. [The prepared statement of Senator Nickles follows:]

PREPARED STATEMENT OF SENATOR DON NICKLES

Mr. Chairman, of all the freedoms we enjoy in this country, the ability to own, care for, and develop private property is perhaps the most crucial to our free enterprise economy. In fact, our economy would cease to function without the incentives provided by private property. So sacred and important are these rights, that our forefathers chose to specifically protect them in the Fifth Amendment to the U.S. Constitution, which says in part, “nor shall private property be taken for public use, without just compensation.

Unfortunately, some federal environmental, safety, and health laws are encouraging government violation of private property rights, and it is a problem which is increasing in severity and frequency. We would all like to believe the Constitution will protect our property rights if they are threatened, but today that is simply not true. The only way for a person to protect their private property rights is in the courts, and far too few people have the time or money to take such action. Thus many citizens lose their Fifth Amendment rights simply because no procedures have been established to prevent government takings.

Many people in the federal bureaucracy believe that public protection of health, safety, and the environment is not compatible with protection of private property rights. I disagree. In fact, the terrible environmental conditions exposed in Eastern Europe when the Cold War ended lead me to believe_that_property ownership enhances environmental protection. As the residents of East Berlin and Prague know

all too well, private owners are more effective caretakers of the environment than communist governments.

Yet the question remains, how do we prevent overzealous bureaucrats from using their authority in ways which threaten property rights? The bill that is before us today, The Omnibus Property Rights Act of 1995, addresses this issue in several ways. First, it requires the government to assess whether existing or proposed regulations result in an unconstitutional taking of property prior to acting. Second, it requires compensation if any property that is taken for public use without the consent of the owner is devalued by 33 percent or more. Third, it creates a streamlined cause of action by which property owners can obtain compensation for the taking of their property.

The Omnibus Property Rights Bill of 1995 also includes provisions of the Private Property Owners Bill of Rights, S. 239, that Senator Shelby and I introduced in January of 1994. S. 239 targets two of the worst property rights offenders, the Endangered Species Act and the wetlands permitting program established by Section 404 of the Clean Water Act.

The Private Property Owners Bill of Rights, requires Federal agents who enter private property to gather information under either the Endangered Species Act or the wetlands permitting program to first obtain the written consent of the landowner. While it is difficult to believe that such a basic right should need to be spelled out in law, overzealous bureaucrats and environmental radicals too often mistake private resources as their own. Property owners are also guaranteed the right of access to that information, the right to dispute its accuracy, and the right of an administrative appeal from decisions made under those laws.

The enforcement of the Endangered Species Act and the wetlands provisions in the Clean Water Act is part of a growing and disturbing trend of “big-brother” intrusion into the lives and businesses of private citizens. From the northern spotted owl to the American burying beetle, the Endangered Species Act is being manipulated by extremists to stop development on public and private lands without regard to economic impact or citizen's rights.

Although the spotted owl has received most of the attention, no less threatening is the disruption caused by lesser known species. In Oklahoma, the prairie mole cricket delayed state highway projects for months before scientists discovered that the cricket's population was not threatened. Similarly, the endangered American burying beetle forced redesign and rerouting of a major gas pipeline in southeastern Oklahoma. Although these examples do not approach the economic significance of the spotted owl, they clearly illustrate the flawed construction of the Endangered Species Act.

No less absurd are the impacts of the wetlands provisions in the Clean Water Act when inappropriately applied by government bureaucrats. The Creek Turnpike in Tulsa was endlessly delayed because the U.S. Corps of Engineers "discovered" about four and a half acres of "wetlands" in the proposed construction zone. In spite of the fact that the Turnpike Authority offered to purchase and give to the government more wetlands than the road would fill, the Corps objected. It was estimated that if all the so-called wetlands had to be bridged it would raise the turnpike's cost by $14 million. In addition, each day of delay cost about $20,000. Although this issue was finally resolved, the process added unnecessary delay and costs to a much needed project.

Both the Private Property Owners Bill of Rights and the Omnibus Property Rights Act of 1995 guarantee compensation for a landowner whose property is devalued by a federal action under the Endangered Species Act or wetlands permitting program. An administrative process is established to give property owners a simple and inexpensive way to seek resolution of their takings claims. If we are to truly live up to the requirements of our Constitution we must make this commitment. I believe this provision will work both to protect landowners from uncompensated takings and to discourage government actions which would cause such takings.

Mr. Chairman, the time has come for farmers, ranchers, and other landowners to take a stand against violations of their private property rights by the federal bureaucracy. The Omnibus Property Rights Act of 1995 will help landowners take that

stand.

Senator SHELBY. Mr. Chairman, I would be glad to respond to any questions, and I am sure that the Senator from Delaware has probably got a couple of hundred, but I am due over on the House side in a few minutes to testify on another matter. If you will excuse me, I will be glad to answer for the record.

Senator BIDEN. Mr. Chairman, I wouldn't want to deny the House the opportunity to hear the Senator, and I just want to know if you find that guy who found the van Gogh painting, tell him leave the house and keep the painting. He can make a lot more money. [Laughter.]

Senator SHELBY. If I find the man and the house, we will move in together. [Laughter.]

Senator THURMOND. Thank you for your testimony, Senator. We are glad to have you with us.

Senator THURMOND. We will now turn to panel III. We will ask all of these witnesses to come forward. Mr. Keith W. Eckel, President of Pennsylvania Farm Bureau, if you will take the seat on the end; Ms. Merrily Pierce, Second Vice President of Fairfax County Federation of Citizens Association; Mr. Joseph L. Sax, Counselor to the Secretary of the Interior; Mr. Jonathan H. Adler, Director of Environmental Studies, Competitive Enterprise Institute; Professor Richard G. Wilkins of BYU Law School.

We are very pleased to have all of you people with us.

We are going to allow you to take 5 minutes to make a statement, and then we will put the rest of your statement in the record, so as to give time to the members of the Committee to ask questions.

Mr. Eckel, you may proceed.

PANEL CONSISTING OF KEITH W. ECKEL, PRESIDENT, PENNSYLVANIA FARM BUREAU; MERRILY PIERCE, SECOND VICE PRESIDENT, FAIRFAX COUNTY FEDERATION OF CITIZENS ASSOCIATION, MCLEAN, VA; JOSEPH L. SAX, COUNSELOR TO THE SECRETARY OF THE INTERIOR, WASHINGTON, DC; JONATHAN H. ADLER, DIRECTOR OF ENVIRONMENTAL STUDIES, COMPETITIVE ENTERPRISE INSTITUTE, WASHINGTON, DC; AND RICHARD G. WILKINS, BRIGHAM YOUNG UNIVERSITY LAW SCHOOL, PROVO, UT

STATEMENT OF KEITH W. ECKEL

Mr. ECKEL. Mr. Chairman, my name is Keith Eckel, and I am from Clarks Summit, PA. I am a farmer in Clarks Summit, and I represent the American Farm Bureau of Federation here today. I serve on their board of directors and as a member of their executive committee.

I am involved in a vegetable and grain operation in Clarks Summit, and I would ask the Chairman that our written statement be made part of the record.

Senator THURMOND. Without objection, that will be done, and that will be the case with all of you. Your full statements will go on the record, so it is a brief presentation to 5 minutes.

Mr. ECKEL. Indeed, it is an honor to testify before the Judiciary Committee this morning. I come to you with strong concerns on behalf of farmers and ranchers as far as the infringement on private property rights occurring in America today.

I assure you, without question, that one of the main concerns of my members and my fellow farmers is the infringement on private property rights by government regulatory action.

I come here today, Mr. Chairman, to congratulate you on your support of this legislation, which I believe is critically important to the agricultural community. I come here also puzzled, puzzled that there is a belief that private property rights is an antithesis to environmental protection and quality. I firmly believe that it is not an antithesis, but indeed its most important support.

I invite you to come to Pennsylvania to visit my farm, to visit the farms of my neighbors, view the contour strips, view the diversion terraces that have been installed and recognize that farmers, who are investing in their future, believing that that investment is safe and protected for their children without fear of that land or its use being taken away from them, has caused them to make those investments and then tell me that respect for private property rights is an antithesis to environmental quality.

In fact, Mr. Chairman and members of the Committee, I believe that just the reverse is true and that today we should use today as an opportunity to recognize that we can work with an observation of private property rights in a direction toward increased environmental quality in the confines of the legislation that is proposed.

Simply this legislation does three things, at least as I understand it. No. 1, it says to government, simply look before you leap. It says to the regulators, it says to the legislators, before you pass legislation, before it is implemented and the regulations are developed, analyze what impact that is going to have on private property rights and recognize that there, in fact, is a cost involved.

Two, it indicates that there needs to be an expeditious appeal system. I have a friend. His name is Bill Stamp. He is the president of the Rhode Island Farm Bureau. He, for 10 years, has struggled with wetland regulations. He is an honest, hard-working farmer. But as a result of those regulations and no attention being paid to his private property rights and his pursuit of his constitutional rights, on January 1, his farm will be foreclosed on, not because he is not a successful farmer, but because he cannot negotiate the costs of complying with the regulations and pursuing his constitutional rights. That, in fact, is what the second provision of this legislation would do.

And, thirdly, it does call for compensation. And, after all, gentlemen, is it not true that if it is in the public interest, it absolutely should be at the public cost, and if it is too expensive for the public at large, how is the individual property owner expected to pay that bill?

I believe very strongly that private property rights are a basic tenet of our economic and political freedom, and there are two ingredients that I think are critical in protecting our environmental quality; one, is the care of the landowner, and who has more concern for the land than that person from whom his living will come and his children's living will come?

And the second concern is that private property, in fact, is the basis for our economic development. Gentlemen, if central government regulatory control without respect for private property_rights was an answer to environmental quality, then Eastern Europe would be a shining example of environmental quality.

In contrast, visit Pennsylvania. See our farms. See what private property owners have done to invest in their land and improve that land for their children.

Thank you, Mr. Chairman.

[The prepared statement of Mr. Eckel follows:]

PREPARED STATEMENT OF KEITH ECKEL ON BEHALF OF THE AMERICAN FARM BUREAU

In the current regulatory climate at all government levels, the right to own and use private property has become an afterthought. The so-called "property rights movement" of the 1990s is nothing more than a reaffirmation of where we started 200 years ago. Look-before-you-leap and takings compensation legislation are simply attempts to move the rights of property owners back to where they once were and where the Constitution intended.

First of all, Mr. Chairman, farmers and ranchers care deeply about their land and the environment. It is a tragedy that the current regulatory process in this nation has come to the point that legislative action is necessary. Farmers and ranchers can and will provide the widest possible spectrum of environmental protection if their right to property is secure and they are freed from the disincentives under which they currently operate.

LEGISLATIVE REFORM

Legislation should require the federal government to do three simple things. First, it should require consideration of the impact on private property when government actions are contemplated. That is the concept of look-before-you-leap. We are mystified at the negative reactions that so many have to such a simple idea. This would introduce some measure of fiscal responsibility and estimate some of the costs of actually accomplishing a policy goal.

Second, the legislation should require that when actions are taken and owners of private property have lost constitutionally protected rights, a process be in place to provide for administrative appeal of decisions or go directly to court for relief. Under the current system, few property owners have the money or time to struggle with the bureaucracy and the courts. There has to be a way to sort out the facts and arrive at decisions in a timely and cost-effective manner.

Third, when property has been taken in violation of the standards set by the Constitution, there must be compensation. The Fifth Amendment recognizes that there will be times when the rights of property owners will have to give way to the wider needs of government policy. It provides just compensation as a solution, not a perfect one, but one that is acceptable.

Farming and ranching are land-intensive operatior for the production of crops and livestock. Land is by far the single most valuable asset in most farm or ranch operations. Private property ownership is often referred to as a "bundle of rights," that includes the right to own property, the right to use property and the right to dispose of property. The sum total of this “bundle of rights” comprises the value of the property. Regulations that restrict property uses often restrict the ability of that property to be transferred, owned and used in the ways desired by the property

owners.

Farm and ranch lands are particularly vulnerable to land use restrictions because there are fewer alternatives for the use of such lands than there might be for other types of commercial property. In most cases, farming and ranching is the only viable economic use of the property, and its value derives from use as a farm or a ranch. This is particularly true in those many locations that have agricultural district programs that tax such lands on their use as agricultural lands with the understanding that they will remain agricultural lands.

COMPENSATION

The Framers of the Constitution recognized the tension that sometimes exists between the rights of private property owners and the desires of government to regulate for the public interest. They crafted a clear solution that accommodates the interests of both sides through the Fifth Amendment. The Fifth Amendment allows the federal government to appropriate private property for public use but only on the condition that the private property owner be compensated for the loss of that property. Significantly, the Fifth Amendment does not limit the right to compensation to cases where all of the value of property is taken for the public use, or even