(Washington, D.C.)—The Fifth Amendment requires that when the government physically takes private property it must provide just compensation. But whether the Fifth Amendment requires just compensation be paid when the government imposes regulations that restrict an owner’s ability to use his own property is a more complicated question. Last week, the Liberty Justice Center filed an amicus brief in United Water Conservation District v. United States asking the U.S. Supreme Court to make clear that when the government takes private property for its own use or the use of a third party it is a physical taking, not a regulatory taking, and the Fifth Amendment requires that the government pay just compensation.
The United Water Conservation District (UWCD) has an undisputed property right under California law to divert and use a fixed amount of water from a particular river. This case originated in 2023, when the federal government took a large portion of that water to facilitate fish migration by sending water downstream. A lower court said that because the government did not completely cut off UWCD’s water or make UWCD give back water it had already taken, it was not a physical taking, but rather a “regulatory takings,” which requires a heightened showing for a property owner to obtain compensation under the Fifth Amendment.
The “regulatory takings” test attempts to balance factors like the economic impact of the regulation, its interference with reasonable investment-backed expectations, and the character of the government action. Physical appropriations do not require analysis of these additional factors and thus receive heightened protection. In this case, the lower court’s holding would require a property owner that suffered a physical taking to provide an economic harm beyond what the Fifth Amendment requires. This could mean property owners get no payment even when the government physically takes a protected property right.
The Liberty Justice Center’s brief explains that the Supreme Court provides that a physical taking is considered a taking without regard to the economic impact on the property owner. The brief further explains that treating physical takings like regulatory ones wrongly adds a tough, multi-part test that can leave property owners with no payment. James Madison himself recognized the importance of just compensation, so much so that he included in the U.S. Constitution in the Fifth Amendment: “nor shall private property be taken for public use, without just compensation.”
“There’s no greater intrusion on private property rights than the government literally physically taking the property, and we hope the court clarifies that, where the government engages in physical appropriation, that is a taking under the law requiring just compensation,” said Reilly Stephens, senior counsel at the Liberty Justice Center.
The lower court’s decision confusing physical takings and regulatory takings shows why the Supreme Court’s guidance is needed. Without the Court’s intervention, property owners across the country are more susceptible to having their property taking by government without just compensation.
The Liberty Justice Center’s filing in UWCD v. United States can be found here.