Woman’s Suit Tests Law on Environmental Protection

Bernadine Suitum is 82 and uses a wheelchair, but when she lost her bid to build a modest home on a small lot at Lake Tahoe she became a symbol for a nationwide movement challenging the government’s power to say what people can and can’t do with their land.

Next week the U.S. Supreme Court will hear Suitum’s petition in a case that could sharply crimp the ability of federal, state and local authorities to block new construction in order to protect wetlands, endangered species, coastal resources and mountain wilderness.

The case pits the rights of an ailing widow against the environment of Lake Tahoe, and tests the legal theory that protection of a fragile natural treasure takes precedence over the property rights of someone as sympathetic as Suitum.

For decades the water of Lake Tahoe has been steadily losing the wondrous clarity that has drawn the acclaim of explorers and travelers since John Fremont described it as the “Lake of the Sky” in 1844.

Sediment-rich runoff from logging, road building and real estate development has been filling the lake with nitrogen and phosphorous. That, in turn, has spurred algae growth, which clouds the lake.

Now, say local officials, a ruling in favor of Suitum and against the Tahoe Regional Planning Agency could nullify a program to curb building in sensitive areas that absorb pollutants, preventing them from sluicing into the lake.

“The program would become prohibitive, and our ability to protect the lake would vanish,” said Douglas Wheeler, California’s secretary of resources.

Suitum’s property is part of an area known as a stream environment zone, which, according to the planning agency, acts like a wetland, catching runoff and filtering out the phosphorous and nitrogen that are causing the lake to lose more than one foot of clarity each year.

The regional planning agency, a joint powers authority of California and Nevada created by Congress to regulate lakeside development, has designated about 10% of the real estate around the lake as a stream-side environment where no building should occur.

But Suitum’s lawsuit is causing a ripple effect well beyond the Tahoe Basin. The U.S. solicitor general, the governors of eight states, including California and Nevada, the National League of Cities and half a dozen major environmental and historic preservation groups have filed briefs.

They say Suitum got a fair deal and to rule otherwise would do away with one of the most effective and equitable tools for compensating landowners whose property is restricted to help the environment. The approach has been used widely, including in the Santa Monica Mountains.

When the Tahoe Regional Planning Agency denied Suitum the right to build on her property in Incline Village on the northeast side of the lake, a spokeswoman said, it offered her a deal that many other property owners have accepted as compensation.

In what is known as a transfer of development rights, she was offered the chance to sell her building rights to another Tahoe property owner whose land is not as environmentally sensitive. In return for the sale price, the second owner would be permitted to build a bigger house or more structures than are currently allowed by the planning agency.

In such a deal, Suitum would retain title to her land and reserve the right to sell it as an unbuildable lot--for example, to a neighbor who might want the extra land as a buffer. Suitum’s property, less than half an acre, has homes on three sides of it.

Suitum instead filed suit against the regional planning agency.

Two lower courts sided with the agency against Suitum. The agency argued that since she had never tried to market her development rights, she could not legally claim that she had been denied just compensation.

Suitum’s lawyers scoff at the idea that she could get anything approaching fair market value, even if she were able to sell both development rights and the unbuildable lot.

“At best the [planning agency] is offering partial compensation,” said R.S. Radford, a lawyer for the conservative Pacific Legal Foundation in Sacramento who is arguing her case before the Supreme Court.

“A transfer of development right is a cheap way of avoiding just compensation,” Radford said.

No one argues that Suitum would get far less for her development rights than she would if she could sell a buildable lot in Incline Village.

On a steep slope spilling down to the water’s edge, the village is one of the toniest neighborhoods surrounding the lake. Former junk bond impresario Michael Milken and Las Vegas resort magnate Stephen Wynn are among the owners of lakefront estates here.

While Suitum’s property on Mayhew Circle is small and lacks a lake view, real estate agents estimate its value would exceed $200,000 if it could be built on. The state of Nevada in 1990 offered to pay her $35,000 for the lot.

In the past, the U.S. Supreme Court has asserted that property owners must be denied all of the value of their land before an unconstitutional “taking” has occurred.

Recognizing that Suitum would get some money by selling her development rights, her lawyers do not argue that she has lost all of the value of her property. Instead, they say that by losing the use of her land she has been deprived of her 5th Amendment rights.

“We are saying it isn’t a matter of dollars and cents,” Radford said.

The 5th Amendment does not specify value or use. It simply says private property shall not be taken for public use without just compensation.

In its most famous ruling on the issue of transfer of development rights, the court in 1978 upheld them as a form of just compensation. In that instance, Penn Central Transportation Co. was prohibited from constructing a 50-story office building on top of New York’s Grand Central Station, a historic landmark.

The transfer of development rights offered Penn Central the chance to exceed existing height limits at a different site, which would allow a more valuable building to be erected there.

However, in that case Penn Central was not losing all use of its property, since its ownership and operation of the famous railroad station were not being challenged.

If the court agrees with Suitum that she has lost all practical use of her property, more questions remain to be answered, lawyers say.

Does the 5th Amendment apply in a situation where someone has been denied all use, but not necessarily all the value of their property? And what, then, constitutes just compensation?

Lawyers for the Tahoe planning agency argue that Suitum is not entitled to full market value because that value reflects the benefits of the regulation Suitum is contesting.

In other words, property at Lake Tahoe commands a premium price because environmental regulations have created a shortage of buildable lots, at the same time protecting water quality and making the area more desirable.

“Suitum wants all the advantages of regulation and none of the disadvantages,” said Rachelle Nicolle, chief counsel for the Tahoe planning agency.

If Suitum prevails and government agencies are forced to pay full market value for land they want to protect, officials say, they won’t begin to be able to afford the cost of protection--at Tahoe and many other places.

“If the court rules broadly in favor of Suitum,” said Wheeler, “all compensable regulations, in California and elsewhere, are brought into question.”

In California, Wheeler said, such a ruling could deal a serious setback to the future of Natural Communities Conservation Planning--a program that offers partial compensation to developers who agree not to build on land that is home to endangered plant and animal species.

The program has become a national model for protecting sensitive habitat, including that of the threatened gnatcatcher in Orange and San Diego counties.

The Tahoe agency allows just 300 new homes to be built around the lake’s 75-mile perimeter each year. About 1,000 people have been prevented from building on their lots, according to Nicolle. Many of them, she said, have chosen to sell their development rights.

But hundreds of others have joined in a suit against the planning agency, and their claims could be affected by the outcome of Suitum’s case.

“I know it is a hardship for people who bought without knowing what was going to happen, but the damage to the lake from all the runoff is so phenomenal something had to be done,” Nicolle said.

Suitum and her late husband bought their land in the early 1970s. The regulations banning construction in stream environment zones went into effect a decade later, years after most of their neighbors had built homes.