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2010] Derailing Penn Central 871
only to have them rejected as seriously flawed. 5 Nevertheless, this
Note argues that the Court’s current method of regulatory takings
analysis is fraught with so many issues that one cannot help but believe
that a better, sounder, approach must exist.
To illustrate the problems created by the Court’s current approach
to regulatory takings, this Note examines a hypothetical situation.
After years of carefully saving, John decided to invest in a small
business and purchase a popular trailer park for $400,000. He rented
out each lot, and the steady flow of rent payments promised to provide
John with a profit. All indications were that John had made a
wise investment.
However, John was notified that the town had enacted a zoning
ordinance prohibiting trailer homes. 6 The town believed that such
properties were an eyesore and that new residents would be attracted
to the area now that the trailer parks were gone. Unfortunately, the
regulation did not coincide with John’s interests. He had invested his
hard-earned life savings in the park, and although John could sell the
property, the zoning ordinance had caused the property’s value to
plummet to $100,000.
The economic deprivation, caused directly by government action,
seemed manifestly unfair to John, and he promptly brought an inverse
condemnation suit, claiming that the regulation constituted an unconstitutional
taking of his property. He argued that the Fifth Amendment
required that he be given just compensation for the
government’s taking of his land. Unfortunately, John faces a difficult
task and must overcome the complex, unclear, and often burdensome
law of regulatory takings.
5 See Tahoe-Sierra Pres. Council, Inc. v. Tahoe Reg’l Planning Agency, 535 U.S. 302,
333–34 (2002) (rejecting a proposed rule for land use restrictions, advanced by the Institute of
Justice as amicus curiae, that would replace Penn Central).
6 It is understood that, in practice, the zoning ordinance would likely include an amortization
period to protect against a compensable taking.
Some states permit the discontinuation of nonconforming uses without compensation
after the owners have had a reasonable time to enjoy the fruits of the uses and,
in effect, a reasonable opportunity to recoup their investments. Amortization constitutes
a form of transition relief; it is a form of delayed implementation of a new
legal regime.
Jonathan Remy Nash & Richard L. Revesz, Grandfathering and Environmental Regulation: The
Law and Economics of New Source Review, 101 NW. U. L. REV. 1677, 1731–32 (2007) (footnotes
omitted). It is possible, however, that the town would choose not to include an amortization
period because it prefers the immediate removal of the trailer parks. This example is provided
to explore what would happen under current takings law to property owners like John should a
town opt not to include an amortization period.