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Federal Historic Preservation Law: A Research Pathfinder for Legal Practitioners (in entirety as Doc file.)
Advanced Legal Research, George R. Jackson, Reference Librarian, University of Minnesota Law Library, May 10, 2004

Grand Central Station, New York City

B. Summary of Historic Preservation Law 

In the past several decades, Americans have become increasingly aware of the importance of the nation's historic structures and sites. A general interest in the preservation of these sites and structures arose in the 1960s, a time when preservationists and the public at large became concerned about the destruction of both buildings and natural features caused by urban renewal, the interstate highway system, and other massive public works projects. 1 Many of them turned to the law as a means to ensure the protection of their architectural heritage.  

Historic preservation law has its roots in the basic land-use-planning notion of zoning.  Zoning is "the division of land into districts having different regulations." 2 The concept is a relatively new one.  New York City adopted the nation's first zoning ordinance in 1916. 3 New York's plan stemmed from nuisance law, the earliest form of land use control. 4 At its base, the doctrine of nuisance affords an individual remedies for any unreasonable interferences with the use and enjoyment of his or her land. 5   

Most nuisance cases historically involved the establishment of a commercial or industrial use within a residential area. 6 Over time, judges came to realize that, while not inherently injurious, some uses, like factories and refineries, were nuisances per se in certain neighborhoods. 7 In other words, even before zoning, courts were comfortable concluding that because of their geography or pattern of development, particular localities are "properly and primarily devoted to certain activities and that the introduction of incompatible activities must be deemed unreasonable." 8 A comprehensive set of regulatory ordinances like New York City's, then, merely codifies this notion by dividing the city into three use districts: residential, commercial, and industrial. 9 Indeed, "[z]oning is recognizing through law and ordinance the fact that all parts of a city are not alike and that for the purpose of health, morals or the general welfare of the community, they should not be alike." 10 

Historic preservationists saw an opportunity in the fact that government may regulate land use "for the purpose of health, morals or the general welfare of the community." They began to push legislatures to regulate the alteration of historic properties, because they believed that their integrity benefited the "general welfare" of communities.  But as historic preservation ordinances became commonplace, owners of historic property — many of whom felt that they were no longer able to use their property in the most profitable way possible — began to question whether the government must subsidize the preservation of historic properties.

In Penn Central Transportation v. City of New York 11, the Supreme Court answered the subsidization question in the negative, thereby providing legal justification necessary for the vast majority of the country's historic preservation ordinances.  Penn Central Transportation Company (Penn) brought suit to overturn a decision by the Landmarks Preservation Commission of the City of New York (Commission) denying a permit to build an office building above New York's famed Grand Central Station (Grand Central).  The company based its argument on the Fifth Amendment of the United States Constitution, which provides that "private property [shall not] be taken for public use, without just compensation." 12 Specifically, Penn maintained that by designating Grand Central a public landmark, New York was regulating the station to such an extent that it was as if the city "took" part its property.   

The Court began by framing the issues at hand: First, was there a "taking" as understood by the Fifth Amendment?; second, if there was a "taking," was there "just compensation"? 13 The first issue was viewed as dispositive, and as such, there was no need to address the second. 14 In order to place Penn's concerns in context, the Court started its analysis with a review of relevant Fifth Amendment jurisprudence — or, stated another way, what the Court has thought constituted a "taking" in the past. 15  The Court defined the "taking" clause as a guarantee "designed to bar Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole." 16 But it noted that over the years, the Court has not been able to develop any "set formula" to determine the exact nature of — all fairness and justice. 17 Instead, the Court's "taking" decisions have been extremely fact driven. 18

There is a recurrent theme, however, in many of these individual cases. The Court pointed out that it has long condoned land use regulations that adversely affect property interests as long as the regulations have "the health, safety, morals, or general welfare" of society in mind. 19 Zoning laws, like those discussed above, are the classic example; 20 a "taking" does not result when an individual property owner cannot build a factory in her backyard (which would probably be economically advantageous), because society as a whole is benefited by the opportunity to live in safe and stable residential areas.  But does historic preservation further such general societal interests?  Fortunately for this analysis, the Court, only two years before, recognized that a local government may enact land use restriction to preserve the "character and desirable aesthetic features of a city." because it "enhance[s] the quality of life." 21   

The Court continued that a regulation, despite the presence of an acceptable governmental purpose, might create a "taking" if it "so frustrate[s]" an "investment-backed' economic expectation." 22 To illustrate this proposition, the court cited Pennsylvania Coal v. Mahon. 23 In that case, the plaintiff-mining company sold a house (at a discount, no doubt) on the condition that it could forever mine the coal underneath the property. 24  After the sale, the State of Pennsylvania passed an ordinance prohibiting the mining of land under inhabitable structures. 25 While the Court found the Pennsylvania statue to further an important public policy — to minimize the possibility that homes will collapse on their inhabitants — it concluded that the regulation amounted to a "taking," because it had the same effect as a complete destruction of the company's rights; without being able to mine, the company could not expect any return on its investment. 26  

Penn's primary "taking" argument rested on this line of reasoning. 27 Penn did not object to the benefits of landmarking a property, but the company did contend that maintaining Grand Central's landmark status "so frustrates" its ability raise revenue from the station that the applicable regulations amount to a "taking." 28  The airspace above Grand Central is an extremely valuable property interest. Like the mining company's rights in Pennsylvania Coal, above, Penn reasoned that, since its two proposals to build office space over the station were denied, the "gainful use" of its "air rights" has been effectively destroyed. 29 The Court did not agree. In a bold move, the Court stated "'[t]aking' jurisprudence does not divide a single parcel into discrete segments and attempt to determine whether rights in a particular segment have been entirely abrogated." 30  Rather, to determine whether a regulation amounts to a "taking," the Court concluded that it is necessary to look at the "parcel as a whole," meaning, for Grand Central, the entire city tax block that had been designated as a landmark site. 31 Viewed from this angle, it was clear to the Court that Penn's "taking" claim was invalid, because the company's ability to operate a railroad terminal — as it had done for the last sixty-five years — had not been affected by the regulations accompanying its landmark designation. 32 

The importance of the Court's decision that the restrictions imposed did not curb the reasonable beneficial use of Grand Central cannot be overstated; 33 it was this decision that helped spur considerable growth in the adoption of preservation ordinances by cities and towns throughout the United States. 34

Notes

  1. NORMAN TYLER, 44 HISTORIC PRESERVATION (W. W. Norton 2000).
  2. EDWARD M. BASSET, ZONING 9 (Russel Sage Found., 1940) (1936).
  3. Id. at 20-21. The City, driven by an understanding that, among other things, “the conformation of Manhattan island tended to produce buildings of great height and to cause congestion of housing and street traffic,” id. at 23, knew that regulating only the height of buildings could only solve so many problems. City officials were also concerned with the introduction of “improper uses” into otherwise homogeneous areas, which generally resulted in the “premature depreciation of settled localities.” Id. at The officials began, then, to explore the possibility of a more comprehensive plan that would, under state police power, regulate the use of buildings and land, in addition to height. Id. at 23-27. The novelty of this plan was that it provided for different regulations in different districts. Id. at 26.
  4. See DANIEL R. MANDELKER, LAND USE LAW § 1.04 (4th ed. 1997).
  5. DANIEL R. MANDELKER & JOHN M. PAYNE, PLANNING AND CONTROL OF LAND DEVELOPMENT: CASES AND MATERIALS 58 (5th ed. 2001) (citing Prosser).
  6. MANDELKER, supra note 4, § 1.04.
  7. MANDELKER & PAYNE, supra note 5, at 59-60.
  8. Id. at 60.
  9. See MANDELKER, supra note 4, § 1.04.
  10. CIVIC DEVELOPMENT DEPARTMENT, CHAMBER OF COMMERCE OF THE UNITED STATES, ZONING: A STATEMENT OF PRINCIPLES AND PROCEDURE 11 (1929) [hereinafter PRINCIPLES].
  11. 483 U.S. 104 (1978).
  12. U.S. CONST. amend V.
  13. Penn Central, 438 U.S. at 122.
  14. Id.
  15. See id. at 123-128.
  16. Id. at 123 (quoting Armstrong v. United States, 364 U.S. 40, 49 (1960)).
  17. Id.
  18. Id.
  19. Id. at 124.
  20. See id. at 125.
  21. Id. at 129 (citing New Orleans v. Duke, 427 U.S. 297 (1976)).
  22. Id. at 127.
  23. 260 U.S. 393 (1922).
  24. Penn Central, 438 U.S. at 127.
  25. Id.
  26. Id.
  27. Penn’s other arguments are beyond the scope of this brief summary.
  28. See id. at 129.
  29. See id. at 130.
  30. Id.
  31. Id.
  32. See id. at 136.
  33. See NORMAN TYLER, 84 HISTORIC PRESERVATION (W. W. Norton 2000).
  34. See National Trust for Historic Preservation, A Layperson’s Guide to Historic Preservation Law, SG040
  35. ALI-ABA 1, 24 (2001) (stating that there were only 500 preservation ordinances in 1978; today, there are more than 2,300).