Kansas Supreme Court holds no takings claims for prohibition of commercial wind energy conversion systems but leaves open possibility of Commerce Clause claims
This case arises out of the plaintiffs’ desire to construct wind farms on their property in the county of Wabaunsee. The county had so specific zoning regulations regarding wind farms except that any structure above a certain height—presumably the height of a wind turbines—would require a conditional use permit. Thus, to resolve the issue, the Board of County Commissioners issued a temporary moratorium on the construction of wind farms with an exception for issuance of a conditional use permit. This moratorium was originally valid for 120 days but was re-issued at least five times. Eventually, the board adopted a zoning amendment allowing Small Wind Energy Conversion Systems (SWECS) but prohibiting Commercial Wind Energy Conversion Systems (CWECS) except with a conditional use permit. Meanwhile, the plaintiffs had entered into an agreement to allow CWECS wind farms on their respective properties. The plaintiffs sued the board, seeking a declaration that the board’s decision was void. Similarly, Intervenors, who own no land rights but purport ownership in wind rights, joined the suit. The case ultimately made it to the Kansas Supreme Court where various claims were dismissed. On remand, the lower court dismissed the remaining claims and the plaintiffs appealed.
On this appeal to the Kansas Supreme Court, the only remaining claims are Takings Clause, inverse condemnation, and the Commerce Clause. The court first deals with the alleged Takings Clause violation. Plaintiffs allege a taking of their right to develop CWECS on their property, and the intervenors claim taking of their contractual interests to wind rights. The court discusses the Takings Clause, recognizing that a regulation could amount to a taking if the regulation went “too far.” Whether a regulation goes too far, explains the court, is a sui generis, factual inquiry. To resolve the takings claim, the court deals with each of plaintiffs’ arguments.
Plaintiffs’ first issue is whether the lower court applied the proper legal standard to a takings claim. The standard employed by the lower court was reasonableness, which, according to the supreme court was inappropriate. The lower court improperly held that since the board’s amendments of the zoning regulations was reasonable, there was no takings claim. The supreme court finds the opposite: if the action was unreasonable, there would be no taking because the action would be void. Thus, the supreme court finds the lower court’s standard improper.
Next, the court discusses whether plaintiffs have a vested right to deem a taking. In order to prevail on a takings claim, explains the court, the plaintiff must have an actual vested interest or right in the property taken; more than an expectation of future benefit. Here, the court finds, plaintiff’s purported interest before the moratorium was conditioned upon obtaining a conditional use permit. Thus, the court finds that since the issuance of a conditional use permit is discretionary, plaintiffs have no vested rights to the CWECS. After discussing a series of cases on this point, the court admits that none directly involved a moratorium. The court holds, however, that its reasoning does not change because of the existence of a moratorium: first because there was no vested right even before the moratorium, and second, because moratoriums are often used while a board makes a final decision on a more permanent policy. Thus, since plaintiffs have no vested interest, the court holds that they have no viable Takings Clause claim. Similarly, since no vested rights are found, the court holds that there must be no inverse condemnation—because that too requires either the loss of property or loss of a right.
The second issue for the court is whether the board’s amendment violates the Commerce Clause. The court begins its discussion by differentiating between the two possible Commerce Clause violations: a facial violation and whether “the burden imposed on such commerce is clearly excessive in relation to the putative local benefits.” The court begins with the facial challenge; whether there is any differential treatment that benefits in-state competitors and overly burdens out-of-state competitors. Since the court finds zoning amendment affects all CWECS equally, the court holds that the amendment does not violated the Commerce Clause on its face.
Next, the court examines whether the burden on commerce is clearly excessive compared to the benefits derived. To make this determination, the court applies the Pike test: (1) the nature of the benefits of the statute, (2) the burden on commerce, and (3) whether or not the burden is excessive. After examining case law and combing through the record, the court finds little relevant evidence. Since the lower court chose not to apply the required Pike test, they did not allow the parties to conduct proper discovery. The court explains that the balancing of the factors should be determined as a matter of law and, thus, remands the issue to the lower court to allow discovery and make findings related to Pike.
Finally, the court briefly explores arguments presented by the parties that have no merit. Although the board argues that their zoning regulation is not within the protections of the Commerce Clause because it is related to land use, the court rejects that argument. The court makes it clear that there is no “more basic element of interstate commerce than electric energy.” Next, in a related argument the court rejects defendant’s argument that Pike should not apply because Congress passed a series of laws allowing violations of the Commerce Clause. In response to defendant’s argument, the supreme court explains that the Commerce Clause will apply unless Congress has clearly and unambiguously stated that it does not.
Thus, the court affirms the dismissal of the takings claim and the facial commerce clause challenge, and remands the second commerce clause examination to be weighed under Pike after proper discovery.
Zimmerman v. Bd. of Cnty. Comm’r of Wabaunsee Cnty., 264 P.3d 989 (Kan. 10/21/2011).
This opinion can be accessed at: http://www.kscourts.org/Cases-and-Opinions/Opinions/SupCt/2011/20111021/98487.pdf
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