Habitat Preservation: A Property Rights Perspective

Habitat Preservation: A Property Rights Perspective

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The recent decision of the United States Supreme Court in the much anticipated case of Babbitt v. Sweet Home Chapter of Communities for a Great Oregon was a disappointment on many levels. For the record, some of my disappointment was personal, for I penned an amicus curiae brief whose arguments seemed to be entirely ignored by each of the three justices of the Supreme Court who wrote in the case: Justice Stevens for the Court, Justice O'Connor in concurrence, and Justice Scalia (joined by Chief Justice Rehnquist and Justice Thomas) in dissent. But the concerns go deeper than rejection and neglect, to address some very fundamental questions about the reasoning and outcome in the case itself. The substantive issue in Sweet Home is of central importance for the understanding of property rights: does the loss of habitat of an endangered species constitute a form of species harm that should be treated akin to some tort or wrong, or does the owner of the land have full rights to use or sell the habitat as he sees fit, subject only to the eminent domain power of the state? Yet this set of largely mechanical opinions, in large measure by design, did not reach the profound economic and constitutional issues raised by the broad issue of habitat protection. For the justices, the key feature of this case was one of legal pedigree: Did the secretary of the interior act pursuant to his statutory authority in putting forward the challenged regulation under the Endangered Species Act? The dominant focus of the judicial inquiry sought to square the regulation with the ESA and gave the government the benefit of the doubt along the way. Whatever one might think about the proper techniques of statutory construction, it is (or at least should be) clear that a court in construing a statute should have fewer degrees of freedom than the legislature that wrote it. It may well be that some naive form of plain meaning will not do the job in many cases, but, if so, the effort must be made to set the disputed provision within the larger context of the appropriate statute, with due consideration for the purposes for which the statute was passed. There are few general principles that prove substitutes for the best rule of statutory construction, which is a close reading of full provisions, and not an isolated examination of what is meant by a single word, whether it be discrimination in a civil rights statute, or harm in an environmental statute such as the ESA. But statutes can be amended and repealed and even clarified. Sweet Home would never have reached the Supreme Court as an exercise in statutory construction if the ESA had contained a single additional clause that said: "Provided: Habitat modification or destruction shall not be regarded as the 'taking' of an endangered species within the meaning of Section 9 of the Act." This observation about the clarity of language is meant to be substantively neutral. Thus this case would have been dispatched every bit as quickly, albeit in the opposite direction, if the ESA had stated: "Provided, that the FWS shall have full power to treat the destruction or modification of habitat as the taking of an endangered species under this Act." At some point therefore, disputes over meaning and interpretation, properly so-called, become both arid and pointless. Everyone knows what the statute means. The critical dispute is over policy and choice. This chapter takes up just this question of principle. Exactly what proviso should be engrafted on the ESA by amendment? Once that question is put forward in a forthright fashion, it is easy to draft language that avoids a judicial reprise of the Sweet Home dispute. The question is, what language? In attacking this question, I argue that the better social outcomes are achieved if the revised and refurbished ESA follows the common law rules on property rights. The full regime contains three parts. First, changes in habitat can be made at will by owners unless and until they constitute a nuisance to the property of others. Second, private parties and government agencies may purchase habitat in voluntary transactions. Third, government agencies may also exercise their takings power, conditioned on their willingness to pay just compensation. The reason for accepting this tripartite regime is purely functional. All relevant parties will operate under superior incentives if the government is required to pay compensation when it takes land for habitat preservation or restricts its ordinary use for the same purpose. The power to initiate changes must be offset by the willingness to bear the financial dislocations they induce. Facing these questions of principle is ever more vital today. The ESA has had a rocky history. Since its adoption in 1973 it has attracted avid supporters who regard the ESA as the centerpiece of a sound environmental program. It has also been scorned by equally fierce detractors who regard its operation, if not its conception, as one unmitigated disaster that should be stopped, if necessary, by prompt and wholesale repeal. The battle that began over a facial challenge to the regulation has spilled over into the halls of Congress, which until April 1996 limited the appropriations necessary for listing new species for protection under the act. Over the long haul, it is uncertain whether ESA will survive in its current form and, if not, what approach will be adopted in its stead. The Sweet Home decision is one chapter in an ongoing debate. It closes the book only on the narrow question of administrative law before it. Questions of policy are rarely divorced from questions of constitutional law, and those constitutional queries form the subject of the third section of this essay. The discussion here is in part a continuation of the normative analysis conducted in section 2. Indeed it could hardly be otherwise. The standard policy analysis worries about the creation of incentives on the various private and public actors, about the relative efficiency of public and private choice, and the impacts that decisions by one person have on the actions and welfare of others. The analysis is often couched in the language of social welfare, which itself appeals to the well-known compensation criteria of economics: did the loser receive compensation for the changes made, so that everyone was at least as well off after the change as before? Could the winners have paid the losers enough to bring them back to their previous level of welfare and still have remained better off themselves? With tests like this in operation, it is easy to see the close connection between policy and constitutional analysis. The change in legal regime constitutes the taking; and the offsetting benefits, if any, may constitute the required compensation for the associated losses. The courts have already faced, and rebuffed, various forms of takings challenges in the environmental area generally, and with endangered species in particular. The question is whether they are right to have done so.

Source Publication

Who Owns the Environment?

Source Editors/Authors

Peter J. Hill, Roger E. Meiners

Publication Date

1998

Habitat Preservation: A Property Rights Perspective

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