Landowners lose on appeal in challenge to Tahoe environmental laws

SAN FRANCISCO - About 450 Lake Tahoe landowners lost a major property rights case Thursday. A federal appeals court tossed out their claim that environmental laws to protect the lake unconstitutionally deprived them of the use of their land.

A panel of the 9th U.S. Circuit Court of Appeals ruled 3-0 that, because the local ordinances banned development for less than three years, they were not severe enough to be unconstitutional.

''It is clear ... that the temporary moratorium imposed by these regulations did not deprive the plaintiffs' land in the Lake Tahoe Basin of either all of its 'value' or all of its 'use,''' wrote Judge Stephen Reinhardt in the opinion. ''These regulations preserved the future developmental use of the property. This future use had a substantial present value.''

The landowners plan to ask a larger panel of the court to set aside the opinion and reconsider, said Sandra Fetterolf, the assistant to the landowners' main attorney. The attorney, Lawrence L. Hoffman, was on vacation and unavailable for comment.

Because the 43-page opinion thoroughly reaffirmed the common use of temporary development bans, it was welcomed by a wide array of city, county and state governments.

Oregon, Washington, Arizona, and Montana, as well as associations of California cities and counties, submitted briefs in favor of the local regulatory agency, the Tahoe Regional Planning Agency.

Rochelle Nason, a lawyer for the League to Save Lake Tahoe, said the decision will help rebuild the famously clear alpine lake, which has been clouded as development washes nitrogen-laden soil into the water.

''The system in place now prevents new damage while we're trying to repair the old damage. This decision allows us to continue doing that,'' she said.

Her 4,500-member organization has spearheaded preservation efforts, including the distribution of the ''Keep Tahoe Blue'' bumper stickers, ubiquitous in Northern California.

Eric Grant, a lawyer for the Pacific Legal Foundation, which supports stronger property rights, said the decision would encourage governments to become abusive.

''I expect we'll see more cities using a rolling series of temporary moratoria to more or less achieve a permanent moratorium,'' he said.

The controversy started in 1981, when ordinances temporarily prohibited construction in the most environmentally sensitive areas around the lake, which straddles the California-Nevada line.

The laws were a stopgap measure set to expire with adoption of a long-term plan to limit soil run-off. Since mid-century, nitrogen from the soil has been feeding algae that deprive fish of oxygen and ruin the water clarity.

The temporary ban lasted just over 2 years, until the permanent plan was approved.

But the permanent plan was immediately blocked in court by the California state government, which argued it was not protective enough. The court ordered that no building be approved until the case was resolved. The injunction remained in force until a replacement long-term plan too effect in 1987.

In the lower court, Presiding U.S. District Judge Edward C. Reed Jr. of Nevada agreed with the landowners, all of whom had undeveloped plots.

Reed ruled that the Tahoe Regional Planning Agency had illegally deprived the owners of the use of their land from the time the first construction moratorium was passed until the courts blocked all construction in 1984. But he said the agency was not responsible for the court's ban on construction. He also ruled that the agency could not be sued for the 1987 plan because the lawsuit was filed too late.

The appeals court agreed with Reed on all points except for his ruling that an illegal taking occurred between 1981 and 1984.

The appeals judges ruled that, because property owners' future development rights had a value on the open market even during the moratorium, they could have sold their land and thereby ''used'' it. To win their case, the landowners would have had to show that they were deprived of all use of the land, said the judges.

The case is Tahoe-Sierra Preservation Council Inc. v. Tahoe Regional Planning Agency, 99-15641 and 99-15771.

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The opinion can be read at http://www.ce9.uscourts.gov/