The Police Power and the Takings Clause
54 Pages Posted: 15 Jun 2005
One of the more enduring puzzles in constitutional law is the problem of regulatory takings, and it has become something of a ritual to begin articles on the issue by noting the widespread confusion that the doctrine has caused. This Article seeks to clarify the regulatory takings debate by examining the scope and nature of the police power and discussing its relationship with the Just Compensation Clause.
The recent increase in federal regulation notwithstanding, the regulatory takings doctrine is primarily the product of challenges to state police power regulations. But despite the centrality of the police power to the problem of regulatory takings, an observation made nearly one hundred years ago still holds true today: No phrase is more frequently used and at the same time less understood. Contemporary regulatory takings jurisprudence is plagued by misunderstandings about the police power, in part because no one has seriously attempted to analyze or define the police power since 1907 - fifteen years before the landmark regulatory takings case Pennsylvania Coal v. Mahon was decided by the United States Supreme Court.
The uncertainty and confusion over the police power, however, is unnecessary. The term police power was introduced and defined by the Supreme Court, and has a clear meaning as a concept of American constitutional law - though one that unfortunately has been ignored in contemporary takings jurisprudence. The purpose of this Article is to explore the precise nature of the police power and its lessons for clarifying the regulatory takings debate.
Part I of this Article addresses the question: What is the police power? It begins by discussing the early federalism cases in which the Supreme Court introduced and defined the phrase police power to be synonymous with the entirety of the states' sovereign power. It then examines the practical development of police regulations in the state courts, including the landmark decision Commonwealth v. Alger and the evolution from community-based common-law regulation toward the modern regulatory state. Finally, it discusses various attempts to limit the scope of the police power, from Lochner-era substantive due process to various academic definitions of the police power based on political theory. Part I concludes that the police power, as a concept of American constitutional law, is synonymous with the entirety of the sovereign power of the states that remained after the constitutional grant of limited powers to the federal government.
Part II discusses the interaction between the police power and the Just Compensation Clause. It begins with the ambiguous foundation of modern regulatory takings, Justice Holmes's cryptic opinion in Pennsylvania Coal v. Mahon. Placing the holding in Mahon in the context of Holmes's prior writings on the police power and his substantive due process dissents shows that Holmes understood the broad scope of the police power while at the same time rejected the formalistic rule that exercises of the police power could never be takings. Part II then examines the historical record and text of the Just Compensation Clause, and concludes that the central holding in Mahon - that exercises of the police power can in some circumstances be takings - is correct when an exercise of the police power renders the property in question valueless, but not when the exercise of the police power results in a lesser diminution of the property's value.
Part II then looks to the nature and scope of the police power, and the history and text of the Just Compensation Clause, to make a few observations that help to clarify the regulatory takings problem. Much of the confusion in regulatory takings is due to a misunderstanding of the nature and scope of the police power, which has led to the regulatory takings question being framed in incorrect terms. Most significantly, recognition that the broad scope of the police power is not tied to the prevention of harm helps demonstrate that the character of the government act in question should have no place in the regulatory takings inquiry, and that its central role in contemporary regulatory takings cases is misplaced. When properly stated, the regulatory takings question should simply ask whether the government act has rendered the property in question valueless - if the answer is yes, then compensation is due. Finally, Part II concludes that despite their analytical incoherence, the Supreme Court's contemporary takings cases have reached results that are consistent with both the historical record and text of the Just Compensation Clause.
Keywords: Takings, police power, mahon, holmes, just compensation, substantive due process, lochner, alger, freund, teideman
JEL Classification: K11, K32
Suggested Citation: Suggested Citation