AUGUSTA, Maine — The Legislature failed to act late Friday on a contentious bill that seeks to rewrite Maine’s land-use rules to allow property owners to sue the state if any new regulations lead to a 50 percent loss in property value.
The House had narrowly approved LD 1810 early last week in a mostly party-line vote that followed nearly two hours of debate.
Members said one Republican House member, Rep. Gary Knight, R-Livermore Falls, switched his vote from “nay” to “yea” after being aggressively lobbied by GOP leadership. That vote proved to be the difference.
However, when the bill went to the Senate on Friday, it never went to an up-or-down vote. Instead, the Senate voted narrowly to keep the measure on the table, which means it could be taken up when the Legislature resumes in mid-May.
House and Senate leaders had said that their intent was to clear everything that was not budgeted-related, but LD 1810 has been a priority for some Republicans.
Currently, if a land-use or environmental regulation diminishes property values, the owner has no recourse. As written, LD 1810 creates a process by which landowners can take action.
The first step in the process outlined in the bill would be mediation. If unsuccessful, a lawsuit could be filed but could be limited to challenging future state-level land-use laws. In other words, existing regulations are exempt from challenge, including local municipal ordinances and all regulations dealing with health, safety and nuisance matters.
Any loss in value would have to be determined by before-and-after appraisals by independent, professional real estate appraisers. Damages would be capped at the state tort level of $400,000.
“This is not about cashing in on state regulations,” said Rep. Andre Cushing, R-Hamdpen, who shepherded the bill through the process. “In the vast majority of cases, the problem can likely be solved by granting a waiver to the regulation or some other practical accommodation.
“We are simply asking future Legislatures to recognize that their actions can — and at times do — impact property owners’ ability to use or develop their land.”
The bill was drafted by Catherine Connors, a Pierce Atwood attorney who specializes in regulatory takings. Some Democrats have criticized her involvement since she stands to benefit from the new law.
Opponents also said the change would increase lawsuits considerably, pit landowners against taxpayers and make special-interest lawyers rich. Worse, they said, is that the bill could allow agencies and courts to waive land use rules and regulations for any kind of development.
Rep. Chuck Kruger, D-Thomaston, pointed to a case in Oregon where the state was unable to pay a $203 million claim and was then forced to waive the law for a developer to allow mining, a geothermal plant and a resort near a national monument.
“This bill creates a new legal cause of action,” added Rep. Bob Duchesne, D-Hudson, during floor debate on Wednesday. “That’s what America needs: more ways to sue each other.”
Follow BDN writer Eric Russell on Twitter @BDNPolitics.