Property rights, regulatory taking, and compensation: Implications for environmental protection

The 104th Congress considered several proposals requiring compensation for regulatory actions that diminish property values. Aimed primarily at weakening environmental protection, the bills focus on property rights independent of the public benefits from regulation. By significantly broadening the constitutional standard far compensation, the bills generate a government liability well in excess of compliance costs and thus discourage regulatory agencies from carrying out their mandates. The bills would increase transactions costs and undermine the efficient provision of environmental qualify, public safety, and other public goods.