Amicus Curiae Brief — Suitum v. Tahoe Regional Planning Agency

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No. 96-243

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7

In The

Supreme Court of the United States

October Term, 1996

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BERNADINE SUITUM,

V.

Petitioner,

TAHOE REGIONAL PLANNING AGENCY,

Respondent.

7

On Writ Of Certiorari

To The United States Court Of Appeals

For The Ninth Circuit

SJ

BRIEF AMICUS CURIAE OF

THE LEAGUE TO SAVE

LAKE TAHOE

IN SUPPORT OF RESPONDENT

TAHOE REGIONAL PLANNING AGENCY

S

E. CLEMENT SHute, Jr.*

Curisty H. Taytor

ELLIsOoN Foik

SHuTe, MIHALY & WEINBERGER

396 Hayes Street

San Francisco, CA 94102

Tel: (415) 552-7272

Attorneys for Amicus Curiae

League to Save Lake Tahoe

“Counsel of Record

TABLE OF CONTENTS

INTEREST OF AMICUS CURIAE

SUMMARY OF ARGUMENT

ARGUMENT

THE TRPA PROGRAM REPRESENTS A VALID

EXERCISE OF THE GOVERNMENT'S POWER TO

REGULATE LAND USE TO PROTECT UNIQUE

AND SENSITIVE NATURAL RESOURCES

The Lucas “Total Taking” Analysis is

Inapplicable Here

After Lucas, A Takings Claim Must Stull

Consider The Balance Between the

Governmental Interest At Stake and the Impact

of the Land Use Regulatory Program on the

Property Owner. 7

The Tahoe Program Was Developed Over

Many Years In Response to Extensive

Scientific Evidence Demonstrating That

Development in The Lake Tahoe Basin Is A

Primary Cause of the Decline of Water Quality

in Lake Tahoe ) 10

The Water Quality of Lake Tahoe is

Threatened by the Impacts of

Development 10

The Land Use Regulatory Program at

Tahoe is Carefully Designed to

Address the Water Quality Impacts of

Development in the Basin 13

a. Early Attempts by TRPA to

Protect the Lake Were

Unsuccessful. ......... 13

b. TRPA’s 1987 Regional Plan

Represents the Consensus of

Most Constituencies in the

1 | errr, 16

D. Petitioner's Property Retains Substantial Value

And Under The TRPA Program, Petitioner Has

Valuable Property Rights ............ 18

E. The TRPA Program Has Not Interfered With

Petitioner's Reasonable Investment

a PL 22

I. THE TAHOE PROGRAM ACHIEVES AN

UNPARALLELED RECIPROCITY OF

ADVANTAGE AMONG PROPERTY OWNERS IN

THES BARE ow cc ccccvcccesseuneeueeen 24

CONCLAIIIIIN occ cc cccecesececceneeh waa 28

es

il.

CASES

Agins v. City of Tiburon

ee ccc cece ccces 7

California v. Tahoe Regional Planning Agency;

League to Save Lake Tahoe vy.

Tahoe Regional Planning Agency

766 F.2d 1308 (9th Cir. 1985) .......... 1, 15, 16

Carter v. Chotiner

EE Ee )

Consolidated Rock Products Co. v. Los Angeles

370 P.2d 342

appeal dismissed 371 U.S. 36 (1962) ........... 8

Goldblatt v. Hempstead

ee cece ek ccccace: 7-9

Hadacheck v. Sebastian

Wale ces obidecteccecccc. 7

Keystone Bituminous Coal Ass'n v. DeBenedictus

ee ee cis c ck ececccces 7-9

Kleppe v. New Mexico

Se Dec cca tcc ceciccce< 24

Lucas v. South Carolina Coastal Council

S505 U.S. 1003 (1992) .............. 4-10, 23, 24

Miller v. Schoene

ccc ccccee 7,9

Newhall Land and Farming Co. v.

Superior Court

23 Cal. Rptr. 377 (Ct. App. 1993) ............. 9

Nollan v. California Coastal Commission

Ga a, Ge ee oc kccndentccdshsecsawet 6

Penn Central Transp. Co. v.

City of New York

Gp eh. POSEN oc ccevececuvene’ 6-8, 22, 24

Pennsylvania Coal Co. v. Mahon

ey Ges SUPE ccocacscecccesence 6, 7, 24

People ex rel. Younger v.

County of El Dorado

487 P.2d 1193 (Cal. 1971) ............. 1, 3, 10

Suitum v. Tahoe Regional Planning Agency

80 F.3d 359 (9th Cir.)

cert. granted 117 S.Ct. 293 (1996) ......... 20, 27

Tahoe-Sierra Preservation Council v.

State Water Resources Control Board

259 Cal.Rptr. 132 (Ct. App. 1989)... 2.0.2... 12

STATUTES

SO GME. 6 COMMIS .c . sb. c cxccaewndcdadesceut 13

1985 Nev. Stat. 585, § 7

amended by 1987 Nev. Stat. 444§3 ............... 19

Tahoe Regional Planning Compact, Pub. L. No. 91-148, 83

> | £=BeayYerrrrr Terrier... cer? te 14

Tahoe Regional Planning Compact, Pub. L. No. 96-551, 94

SR, PED kc ccouss vnsdedeédasuwuns 15, 16, 21

iv.

TRPA REGULATIONS

Tahoe Regional Planning Agency, Land Use Ordinance

Sy eee Ge SEE 6 6680S ce cbdedcictews obsess 14

Tahoe Regional Planning Agency, Regional Plan for the Lake

Tahoe Basin, Code of Ordinance and Rules of

Procedure (adopted May 27, 1987) ............ 4, 16, 17

Tahoe Regional Planning Agency, Regional Plan for the Lake

Tahoe Basin, Goals and Policies

(adopted Sept. 17, 1986) ........... 4, 11, 16, 17, 25, 26

Tahoe Regional Planning Agency, Water Quality Management

Plan for the Tahoe Region (adopted Nov. 30, 1988) ..... 24

OTHER AUTHORITIES

John Ayer, Water Quality Control at Lake Tahoe: Dissertation

on Grasshopper Soup, | Ecology L.Q. 3 (1971) ..... 11, 13

Robert G. Bailey, U.S. Forest Service, Land Capability

Classification of the Lake Tahoe Basin, California~-Nevada: A

Guide for Planning (1974) .................... 14, 15

Chris Bowman and Patrick Hoge, Runoff, Air Pollution Cloud

Waters of Crystal-Clear Lake, Sacramento Bee,

De NE WSUS hee bweser des cde weéuacude 25, 26

Chris Bowman «ad Patrick Hoge, Sides Agree on Plan for

Mountain Mecca, Sacramento Bee, Dec. 8, 1996 ....... 27

Richard J. Fink, Public Land Acquisition for Environmental

Protection: Structuring a Program for the Lake Tahoe Basin,

18 Ecology L.Q. 485 .............. 11, 13-19, 22, 25, 26

Charles R. Goldman and Earl R. Byron, California State Water

Resources Control Board, Changing Water Quality At Lake

Tahoe: The First Five Years of the Lake Tahoe Interagency

Monitoring Program (Tahoe Research Group, Institute of

Ecology, University of California Davis,CA)........ 10-13

Charles R. Goldman, et al., Decadal, Interannual, and Seasonal

Variability in Enrichment Bioassays at Lake Tahoe, California-

Nevada, USA, 50 Canadian J. of Fisheries and Aquatic Sci.

Ee re ee ee 3, 10, 11

Charles R. Goldman, The Eutrophication of Lake Tahoe: A

Serious Increase in Algal Growth Accompanied by an

Alarming Decline in Transparency (Report to the Senate Select

Committee on Tahoe, March 6, 1984) ............54. 11

Stephen R. Johnson & Associates, Inc., Tahoe Basin Act Land

Acquisition Program Appraisal Summary and Certification,

Assessor's Parcel No. 130-211-31 (Oct. 9, 1989) .. 18, 19, 27

Kelly v. Tahoe Regional Planning Agency, No. 22913, Slip.

Op., (Nev. Sup. Ct., July 8, 1993);

Agepiate ©. GBA ww. ccc ccccccccccvesecvese 17, 23, 27

Minutes of the Meeting of the Legislative Commission's

Committee to Continue the Review of the Tahoe Regional

Planning Compact (June 6 & 7, 1994) ..... 0... ..45.. 20

Resources, Community, and Economic Development Division,

U.S. General Accounting Office, GAO/RCED-95-22, Forest

Service Land Acquisitions Within the Lake Tahoe Basin (Oct.

ED cok wasdoced cb cede bie anle c6edeeus beees 15

vi.

INTEREST OF AMICUS CURIAE

The League to Save Lake Tahoe (the “League") is a

nonprofit membership organization dedicated to preserving the

environmental balance, scenic beauty, and _ recreational

opportunities of the Lake Tahoe Basin--"an area of unique and

ee ee ee oo

California-Nevada border."

El Dorado, 487 P.2d 1193, 1194 (Cal. 1971). Formed in 1957 in

response to the environmental degradation occurring in the Tahoe

Basin, the League comprises a cross section of the Lake Tahoe

community: property owners, businesses, environmentalists, and

local residents.

The League has long advocated a comprehensive

approach to protecting the sensitive resources of the Lake Tahoe

Basin. In 1984, the League, along with the State of California,

challenged the adoption by the Tahoe Regional Planning Agency

("TRPA") of a new regional plan, on the grounds that the plan

failed to achieve the environmental goals of the Congressionally-

approved Tahoe Regional Planning Compact ("1980 Compact”).

Lake Tahoe v. Tahoe Regional Planning Agency, 766 F.2d 1308

(9th Cir. 1985) [hereinafter California vy. TRPA). Finding that the

regional plan did not meet the requirements of the 1980 Compact,

the district court issued a preliminary injunction barring the

approval (with certain narrow exceptions) of any development in

the Tahoe Basin until TRPA developed a regional plan that

would protect the ecology of the Lake. The ninth circuit upheld

the district court's ruling and its issuance of a preliminary

injunction. Id.

Following issuance of the preliminary injunction, TRPA

initiated a broad-based consensus process to develop a regional

plan that would comply with the requirements of the 1980

Compact. This process, in which the League was an active

participant along with other parties representing the bread range

of interests affected by land use decisions in the Lake Tahoe

Basin, resulted in TRPA’s adoption of the 1987 regional plan.

Although the League was concerned that aspects of the 1987

regional plan, such as the transfer of development rights (or

“TDR") program at issue here, would increase the overall level

of development in the Basin, the League accepted the plan as a

compromise that would help to assure necessary environmental

protections.

Believing that TRPA has been too willing to permit

development at the expense of the environment, the League has

often found itself on the opposite side of TRPA during the many

battles to protect the Lake Tahoe environment. In addition to its

suit over the 1984 regional plan, the League has sued TRPA over

the agency's failure to ensure that transportation funds are spent

on public transportation,

League to Save Lake Tahoe v. Tahoe

Regional Planning Agency, No. SLT 10055 (Super. Ct. filed

1990), and more recently, over the approval of the Douglas

County Community Plan, League to Save Lake Tahoe v, Tahoe

Regional Planning Agency, No. CV S 940069 EJG/JFM (E.D.

Cal. filed 1994). These actions were successfully resolved and

resulted in improvements in TRPA’s regulatory programs.

Over time and with considerable effort from all sides, the

conflicts that shaped land use regulatory programs in the Basin

have given way to a more consensus-based approach to resolving

environmental disputes. The League has been at the forefront of

these more cooperative efforts. For example, the League has

participated in long-term negotiations over the planned

redevelopment of South Lake Tahoe, and is involved (along with

business and casino interests) in the Tahoe Transportation

Coalition which seeks to improve transportation to and within the

Basin. The League is also an active participant in ongoing

discussions of the Forest Health Consensus Group, a coalition of

governments, private landowners, and other interested parties

seeking to develop a management plan for forest lands in the

Basin.

The 1987 TRPA regional plan, the product of a lengthy

consensus process, represents in the League's view not perfection

but an acceptable balance between safeguarding individual

property rights and protecting environmental resources.

Petitioner's suit threatens this balance.

2.

Written consent to file this brief has been granted by

counsel for both respondent and petitioner, and has been lodged

with the Clerk of this Court.

SUMMARY OF ARGUMENT

Because of its spectacular natural beauty, Lake Tahoe,

located just a few hours from several major metropolitan areas,

has experienced tremendous growth since 1950 and has become

the anchor of a regional economy dependent on water recreation,

skiing, entertainment, and second homes. People ex rel.

Younger, 487 P.2d at 1195 n.3. Development in the Basin,

which has been spurred by the quality of the lake environment,

is also the primary threat to the attribute that makes Lake Tahoe

unique: the quality and clarity of the Lake’s water. Described by

Mark Twain as “a noble sheet of blue water lifted six thousand

three hundred feet above the level of the sea... [and] the

fairest picture the whole earth affords,” id. at 1194 (citing |

Roughing It (Harper & Row) chapter 22, page 15), Lake Tahoe

is one of the clearest lakes in the world.

487 P.2d at 1195 n.5 (citing S.Rep. 91-510, 91st Cong., Ist Sess.

(1969)). Sedimentation, erosion, and increased nutrient levels in

the Lake, all caused by development in the Basin, however, have

diminished the clarity and quality of the Lake’s water. Thirty

years of water quality monitoring reveals that the famous clarity

of Lake Tahoe is rapidly declining. Charles R. Goldman, et al.,

Decadal, | | and S | Variability in. Enric!

Bioassays at Lake Tahoe, California-Nevada, USA, 50 Canadian

J. of Fisheries and Aquatic Sci. 1489, 1489 (1993) [hereinafter

Goldman].

In 1987, following years of planning, debate, litigation

and finally consensus, TRPA enacted a regional plan designed to

mitigate the impacts of development, manage the rate and

location of future development, improve water quality in the

Lake, and protect the interests of property owners consistent with

these environmental goals.' TRPA’s 1987 regional plan

regulates development throughout the Basin and prohibits

development on environmentally sensitive lands, including stream

environment zones such as the area where petitioner's lot is

located. TRPA also adopted a transfer of development rights

program which allows property owners to use and receive value

for their property by transferring development from

environmentally sensitive property to lands more suitable for

development.

The 1987 regional plan, which builds on earlier efforts to

protect the Basin, is the subject of petitioner's takings challenge.

The issue presented for review is whether petitioner was required

to participate in the TRPA transfer of development rights

program before she could demonstrate that her takings claim is

ripe for judicial review. Both courts below held petitioner's

takings claim not ripe. This holding is correct, as petitioner has

not made a single application to transfer her development rights,

and therefore has not received a final determination regarding the

use to which her property rights may be put under TRPA's

regulatory program.

In an attempt to circumvent the ruling of the Ninth

Circuit, petitioner argues that the TDR program does not provide

her with “use” of her property, and therefore the ripeness doctrine

does not apply. Petitioner's Brief on the Merits at 12-14, 23

[hereinafter Petitioner's Brief]. Petitioner further claims that any

application for approval under the TDR program would be futile

because the program is nothing more than a “ruse” to circumvent

this court's ruling in Lucas _y. South Carolina Coastal Council,

505 U.S. 1003 (1992). Petitioner's Brief, supra, at 23.

' — The 1987 regional plan consists of two documents: Tahoe

Regional Planning Agency, Regional Plan for the Lake Tahoe

Basin, Goals and Policies (adopted Sept. 17, 1986) [hereinafter

Goals and Policies}; and Tahoe Regional Planning Agency,

Regional Plan for the Lake Tahoe Basin, Code of Ordinance and

Rules of Procedure (adopted May 27, 1987) [hereinafter Code of

Ordinances].

To the extent the Court entertains petitioner's challenge

to the merits of TDR programs, such challenge must fail. As this

brief will explain, TRPA’s program for transferring development

rights between properties located in the Tahoe Basin is part of a

carefully constructed regulatory program designed to reduce the

documented adverse impacts of development on the water quality

of Lake Tahoe, while ensuring significant economic benefits to

all property owners in the region (including petitioner). In

preventing development on petitioner's property, TRPA has not

prohibited all use of her property nor has it deprived petitioner of

all economic value in her property. Indeed, the record below is

replete with evidence that petitioner's property retains significant

economic value. The program as a whole achieves a reciprocity

of advantage to all concerned, and, as such, falls comfortably

within the limits of constitutionally permissible land use

regulation.

ARGUMENT

I. THE TRPA PROGRAM REPRESENTS A VALID

EXERCISE OF THE GOVERNMENT’S POWER

TO REGULATE LAND USE TO PROTECT

UNIQUE AND SENSITIVE NATURAL

RESOURCES.

The TRPA program protects important government

interests, ensures that petitioner's property has substantial value,

and provides an effective means for petitioner to realize her

reasonable investment backed expectations. Therefore, under

established Supreme Court precedent, TRPA’s program does not

constitute a taking.

A. The Lucas “Total Taking" Analysis is

Inapplicable Here.

The briefs of petitioner and amici in support of petitioner

start from a faulty premise: they posit that the TRPA program is

invalid under Lucas because it prohibits development of a single

family home on petitioner's property. According to petitioner,

the TDR program is merely a ploy to avoid this Court's holding

5.

in Lucas.’ This is incorrect: in fact Lucas is inapplicable here

because TRPA’s program neither deprives petitioner of all

reasonable uses of her property, nor renders her property

valueless.

Petitioner's reliance on the categorical takings analysis of

Lucas is based on an overly narrow view of property rights that

inappropriately equates the right to "develop" property with the

right to "use" property. This Court has always viewed property

as a “bundle of rights,” which includes among other things, the

right to exclude, the right to develop, and the right to sell. Id. at

1027. All of these rights represent “uses” of property; for

example, the “right to exclude” has been described by this Court

as a “private use” of property. Nollan_v. California Coastal

Commission, 483 U.S. 825, 831 (1987). TDRs also have been

described by this Court as a use of property. Penn Central

Transp. Co. v. City of New York, 438 U.S. 104, 137 (1978) (the

“ability to use [pre-existing] air rights" through a TDR program

constitutes a potentially viable use of property.)

The relevant issue for a takings analysis is whether, under

the challenged regulation, the property owner's rights may be put

to an economically viable use. See, e.g., Lucas, 505 U.S. at 1017

("{Fjor what is the land but the profits thereof?") (citations

omitted) and at 1026 (treating the South Carolina coastal law as

"a regulation that wholly eliminated the value of the claimant's

land."); Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 414

(1922) ("What makes the right to mine coal valuable is that it can

be exercised with profit.") Often value is associated with the

right to develop; however, land that cannot be developed can

have significant value for such rights as investment, timber

harvesting, farming, or mineral extraction.

2 The TDR program was implemented in 1987--well before

the Lucas decision was issued. As a simple factual matter,

therefore, the program cannot be characterized as an attempt to

circumvent this Court’s ruling in Lucas.

6.

a In the present case, the TRPA program confers on

petitioner certain entitlements and rights to use her property in

various ways that would not be possible absent the program.

Petitioner’s ability to transfer specified entitlements represents the

development potential of her property under the TRPA program.

Petitioner has or can obtain and can transfer three separate

development rights: an “allocation” to build a residential unit; up

to four residential development rights (which can include three

bonus units because her property is located in a stream

environment zone); and land coverage rights. Although her use

of these rights may be conditioned (they must be transferred to

another property); it has not been eliminated. Furthermore,

petitioner's rights carry substantial value. See infra Section I.D.

Because petitioner possesses property rights with considerable

value, this case does not present a categorical taking under Lucas.

B. After Lucas, A Takings Claim Must Still

Consider The Balance Between the

Governmental Interest At Stake and the

Impact of the Land Use Regulatory

Program on the Property Owner.

Petitioner fails to read Lucas in the context of the

Supreme Court precedent that predates it. Lucas did not abrogate

this Court’s historic balancing approach to takings analysis.

From Pennsylvania Coal through Lucas, this Court has

consistently recognized the necessity of land use regulation to

protect a broad range of public interests. Thus, this Court has

upheld land use regulations that: order the destruction of diseased

cedar trees to prevent infection of nearby orchards, Miller vy.

Schoene, 276 U.S. 272 (1928); prevent operation of a quarry in

a residential area, Goldblatt v. Hempstead, 369 U.S. 590 (1962);

preserve historic structures, Penn Central, 438 U.S. 104; protect

open space, Agins vy. City of Tiburon, 447 U.S. 255 (1980); and

regulate coal mining to protect neighboring properties, Keystone

Bituminous Coal Ass'n v. DeBenedictus, 480 U.S. 470 (1987);

see also Hadacheck v. Sebastian, 239 U.S. 394 (1915) (barring

operation of a brick mill in a residential area).

These decisions all reflect the principle set forth in Penn

Central, that when “deciding whether a particular governmental

action has effected a taking, this Court focuses [ ] both on the

character of the action and on the nature and extent of the

interference with rights in the parcel as a whole .. . ." 438 U.S.

at 130-31; see also Keystone Bituminous, 480 U.S. at 490

(reaffirming "the important role that the nature of the state action

plays in our takings analysis" and citing Goldblatt, 369 U.S. at

594 and Consolidated Rock Products Co. v. Los Angeles, 370

P.2d 342, appeal dismissed, 371 U.S. 36 (1962)). Petitioner,

however, would do away with any inquiry into the nature of the

regulatory program at issue whenever a regulation prohibits

physical development of property. Lucas does not support such

a position.

In Lucas, this Court determined that government may

prohibit all use of property and render the property valueless,

without effecting a taking, where such restriction inheres in the

“law of property and nuisance.” 50S U.S. at 1029. Thus, the

balancing test of Penn Central, which evaluates the nature of the

public interest at stake and the extent to which the proposed

regulation interferes with the property owner's interest in its

property, remains critical to the takings analysis. See id. at 1029-

31. In Lucas, this Court struck this balance such that regulations

rendering property valueless must be based on the background

principles of nuisance law. Land use restrictions such as those

at issue here that do not result in a “total taking,” Lucas, 505

U.S. at 1030, of the value of property must be balanced against

the governmental interests that prompted the regulatory scheme.

These restrictions do not, however, need to satisfy the strict

requirements of the nuisance doctrine.

Indeed, even as to regulations that render property

“valueless,” members of this Court have criticized the majority's

opinion in Lucas as inappropriately limiting the government's

regulatory authority: "The common law of nuisance is too narrow

a confine for the exercise of regulatory power in a complex and

interdependent society." Lucas, 505 U.S. at 1035 (J., Kennedy

concurring). As recognized by Justice Kennedy, the validity of

land use regulations must be guided by the reasonable

expectations of the property owner balanced against the need to

enact “new regulatory initiatives in response to changing

conditions... ." Id, Where, as here, the government is faced

with "such unique concerns for a fragile land system the State

can go further in regulating its development and use than the

common law of nuisance might otherwise permit." Id.’

Justice Kennedy's concurring opinion in Lucas follows

a line of Supreme Court precedent recognizing the need for and

constitutionality of strong land use regulations to protect

important public interests. The government's authority to

regulate land use has never been limited to the ability to abate

nuisances. See, e.g., Keystone Bituminous, 480 U.S. at 492

("[T]he public interest in preventing activities similar to public

nuisance is a substantial one, which in many instances has not

required compensation.") (emphasis added). Therefore, when

addressing a claim for compensation stemming from the

destruction of cedar trees in Miller v. Schoene, 276 U.S. 272, this

Court found it need not "weigh with nicety the question whether

the infected cedars constitute a nuisance according to common

law; or whether they may be so declared by statute." Id. at 280;

see also Goldblatt, 396 U.S. at 593 ("Nor is it of controlling

significance that the ‘use’ prohibited here . . . is arguably not a

common-law nuisance.") (Citations omitted).

The fragile natural resources at Lake Tahoe and the well-

documented threats to these resources posed by development in

the Tahoe Basin place TRPA’s program well within the limits of

regulatory authority established by this Court. As detailed below,

the TRPA program grew out of the urgent need to protect the

deteriorating quality of the once-pristine waters of Lake Tahoe.

* In any event, water pollution, which has been directly

linked to development in the Tahoe Basin, constitutes a nuisance

under common law principles. See Carter vy. Chotiner, 291 P.

577, 578 (1930), Newhall Land and Farming Co. v. Superior

Court, 23 Cal. Rptr. 377, 381 (Ct. App. 1993); see also

Goldblatt, 396 U.S. at 596 (upholding restrictions on mining

below the water table).

Developed in response to a court order enforcing the mandate of

the congressionally-approved Tahoe Regional Compact, the 1987

TRPA regional plan is the result both of documented scientific

evidence and of a lengthy consensus process, which included all

of the constituencies affected. As such, the TRPA program,

which adjusts "‘the benefits and burdens of economic life’. . . in

a manner that secures an ‘average reprocity of advantage’ to

everyone concerned ... ." is constitutionally valid. Lucas, 505

U.S. at 1018.

Cc. The Tahoe Program Was Developed Over

Many Years In Response to Extensive

Scientific Evidence Demonstrating That

Development in The Lake Tahoe Basin Is A

Primary Cause of the Decline of Water

Quality in Lake Tahoe.

1. The Water Quality of Lake Tahoe is

Threatened by the Impacts of

Development.

The Lake Tahoe Basin is an area of undisputed natural

beauty. The single attribute that makes Lake Tahoe unique as a

national resource is "its remarkable clarity and enormous volume

of deep, cobalt-blue waters." Charles R. Goldman and Earl R.

Byron, California State Water Resources Control Board,

Changing Water Quality At Lake Tahoe: The First Five Years of

the Lake Tahoe Interagency Monitoring Program 2 (Tahoe

Research Group, Institute of Ecology, University of California

Davis, CA) (covering 1979-84) [hereinafter Changing Water

Quality}. In 1962, it was possible to see through the waters of

the Lake to a depth of 136 feet. People ex rel. Younger, 487 P.2d

at 1195 n.5 (citing S.Rep. 91-510 supra). Visibility in the Lake

today is only 75-80 feet. Goldman, supra, at 1490. The clarity

of the Lake nonetheless remains its outstanding feature.

Lake Tahoe's famous clarity stems from the Lake's very

low levels of nutrients such as nitrogen and phosphorus. The

natural nutrient level in Lake Tahoe is so low that historically it

prevented the growth of algae, which decreases the clarity and

10.

quality of water. Changing Water Quality, supra, at 2, 4-6; see

also Goldman at 1489. Over the last three decades, however,

levels of these substances in the Lake have increased

significantly. Changing Water Quality, supra, at 2, 4-6. These

nutrients have stimulated algae growth in the Lake, id., with the

result that since 1968, the clarity of Lake Tahoe has decreased by

F< d a0%. Richesd J. Fink, snes Ln heaniiiien

Tahoe Basin, 18 —_ L.Q. 485, 504. Algal ouuth in the

Lake has been increasing at a rate of 5.6% a year and the Lake

continues to lose its clarity at a rate of 37 meters per year.

Goldman, supra, at 1489. Lake Tahoe, “without a drastic

reduction in the nutrient loading that supports algal growth, wilt

have

Daciion ja Tismspereacy 3. (Report ¢ to the Senate Select

Committee on Tahoe, March 6, 1984).

The primary source of increased nutrients in Lake Tahoe

is the increased runoff caused by development in the Tahoe

Basin, an area of 501 square miles. Changing Water Quality,

supra, at 5, 8; Goals and Policies, supra, at iv. Development

disturbs soils, increases impervious surface coverage of natural

areas (thereby increasing the rate at which water will flow into

streams and ultimately the Lake), causes air pollution and

therefore deposition of pollutants to the Lake from the air, and

increases the use of fertilizers and other potential sources of

nutrient and water pollution, which also drain into the Lake.

Changing Water Onality, supra, at 5; van ver, Sita Saale,

Ecology L.Q. 3, 38 (1971). A 1984 study of the causes -

increased nutrients in the Lake found that "the nutrient yield from

the various Tahoe watersheds [draining into the Lake] is

generally related to the extent of disturbance of soils in those

watersheds." Changing Water Quality, supra, at 8.; see also Ayer,

Supra, at 38 (“human activities that provoke sedimentation are

probably the chief threat to the water quality of Lake Tahoe”).

Development in stream environment zones ts particularly

destructive because streams in the Basin drain directly into the

Lake; as a result, development on properties immediately adjacent

to water courses results in the unimpeded transport of sediment

and associated —s to the Lake. See ery eae

259 Cal. Rptr. 132, 136-37 (Ct App. 1989) donde — of

development in stream environment zones «© water quality).

Petitioner's property is no exception; in eariy !anuary 1997 the

lower one-third of petitioner's property was covered with water

as the soil was saturated and Mill Creek overflowed from storms

in the Basin. This water flows directly into Lake Tahoe, taking

all manner of pollutants with it.

Although petitioner and amici attempt to downplay

pollution of the Lake as a trivial aesthetic issue (see, e.g., Brief

Amicus Curiae of the Tahoe-Sierra Preservation Council, Inc. in

support of petitioner at 7 [hereinafter TSPC Brief]),* increased

algae production caused by nutrient loading not only clouds the

Lake water, it causes eutrophication and has other long-term

environmental impacts. Changing Water Quality, supra, at 6.

Eutrophication ts a serious water pollution problem that decreases

available oxygen supply “to the point where aquatic organisms

can no longer survive in the deeper waters." Id.’ In addition,

* — Belittling the importance of Lake clarity, an amicus also

implies that the TRPA restrictions are designed only to ensure

that a "9-inch white disk lowered from a boat near the center of

the Lake" can be seen at a certain depth by the human eye. See

TSPC Brief, supra, at 7 n.1. Lake clarity is measured by use of

a "Secchi disk"--a 9 inch white disk that is lowered into the water

until it disappears. Changing Water Quality, supra, at 7. "This

transparency measure is traditional in limnology [the study of

inland waters] and oceanography and has stood the test of time

because of its surprising accuracy." Id.

* The Federal Water Pollution Control Act recognizes

eutrophication as a source of water pollution through its

regulation of pollutants that deplete the amount of oxygen

12.

_

"[t}he nuisance of algae-enveloped rocks becomes particularly

obvious each spring when the dense growth of attached algae

{caused by increased ient levels] breaks off, floats to the

surface, and dies, forming decaying algal mats." Id; see also

Ayer, supra, at 9 (siltation from “extensive land

disturbance . . . changes the lake's pristine blue to a chocolate

brown"). “Three decades of research reveals that Lake Tahoe is

undergoing eutrophication at a rate far above that which would

occur naturally.” Fink, supra, at 503.

Thus, Lake clarity is an important indicator of the water

quality and health of the Lake--quality which has been

significantly impaired by development in the Basin.

2. The Land Use Regulatory Program

at Tahoe is Carefully Designed to

Address the Water Quality Impacts

of Development in the Basin.

a. Early Attempts by TRPA to

Protect the Lake Were

Unsuccessful.

Because of its large size, the 190 square mile Lake was

at first able to absorb the considerable impacts of population

growth, development, and associated pollution. However, in the

1960s it became clear that the water quality of the Lake was

threatened. Ayer, supra, at 28-30. In response to growing

evidence that development in the Basin was contributing

significantly to water quality degradation, in 1966, the states of

California and Nevada imposed a ban on disposal of wastewater

within the Tahoe Basin. Fink, supra, at 504. Under this

agreement all sewage is transported out of the Tahoe Basin. Id.

Then, m 1969, through ratification of the Tahoe Regional

Compact (the "1969 Compact"), Congress approved establishment

of TRPA--the first regional entity authorized to regulate the

available to animal life in a water body. 33 U.S.C. § 1314(ay4).

13.

impacts of development on Lake Tahoe. Tahoe Regional

Planning Compact, Pub. L. No. 91-148, 83 Stat. 360 (1969).

TRPA, pursuant to the 1969 Compact, undertook its first

regulatory efforts with the adoption of a regional land use plan

in 1971 and a land use development ordinance in 1972. Tahoe

Regional Planning Agency, Land Use Ordinance (adopted Feb.

10, 1972) [hereinafter 1972 Ordinance]; Fink, supra, at 50S. The

land use plan, which formed the basis of the 1972 Ordinance,

was developed with the assistance of the United States Forest

Service and incorporated what is now referred to as the Bailey

system--a land capability rating system designed to restrict

development of environmentally sensitive lands while allowing

development of appropriate areas. Fink, supra, at SOS. The

Bailey system categorized land in the Basin according to its

suitability for development based on the land’s sensitivity to soil

erosion, its degree of slope, and the proximity to streams or high

water tables. Id. Based on these factors, lands were ranked on

a scale of | to 7 and were assigned a limit on impervious surface

coverage such as buildings or pavement. Robert G. Bailey, U.S.

Forest Service, Land Capability Classification of the Lake Tahoe

18-22 (1974).

Basin, California-Nevada: A Guide for Planning

Under the Bailey system, 76% of the land in the Basin was

eligible for only 1% coverage. Fink, supra, at 50S. Of particular

importance to the present case, land within what is now referred

to aS a stream environment zone was eligible for only 1%

coverngs under Bailey. Bailey, supra, at 19, 22; 1972 Ordinance

§ 6.2.0.

* Petitioner asserts, without record support, that her land

capability classification under the Bailey system was level 6.

Petitioner's Brief, supra, at 2 n.1. However, as discussed below,

the Bailey system did not classify individual parcels, but

identified large geographic areas that fell into different land

classifications based on soil type, erosion hazard, and proximity

to streams and wetlands. Bailey, supra, at 5; Resources,

Community, and Economic Development Division, U.S. General

Accounting Office, GAO/RCED-95-22, Forest Service Land

Acquisitions Within the Lake Tahoe Basin 5 (Oct. 1994), see also

14.

Although the land use ratings under the Bailey system

would have severely restricted development, under the 1969

Compact, TRPA was not effective in regulating development--no

matter what its environmental impacts.’ In 1980, in response to

increasing conflict over development and its adverse

consequences, Nevada and California agreed to amend the

Regional Compact. Fink, supra, at 506. Congress ratified the

1980 Compact. Tahoe Regional Planning Compact, Pub. L. No.

96-551, 94 Stat. 3233 (1980). Under the 1980 Compact, TRPA

was required to establish “environmental threshold carrying

capacities” for the resources in the Basin and was prohibited from

approving development that would prevent the achievement of

these thresholds. Id. at 507;* California v. TRPA, 766 F.2d at

1315-16. TRPA adopted the required thresholds in 1982, and in

1984, TRPA adopted a new regional plan.

Because it did not include sufficient implementation

measures to ensure attainment of the adopted environmental

thresholds, the 1984 regional plan was immediately challenged by

the State of California and the League to Save Lake Tahoe.

California_vy. TRPA, 766 F.2d 1308. Finding that the

congressionally-approved 1980 Compact required TRPA to

demonstrate that new development did not impede the attainment

of the environmental thresholds, the district court issued an

injunction that effectively prohibited any new development

approvals in the Basin pending adoption of a valid plan. The

ninth circuit affirmed. Id.

The ninth circuit's decision in California _v. TRPA

emphasizes the role of TRPA and its land use planning process

in controlling the adverse environmental impacts of development

Section 1.E., infra.

” For a discussion of the limits of the 1969 Compact, see

Fink, supra, at 506-07.

* The League to Save Lake Tahoe was actively involved

in the formulation of the 1980 Compact.

15.

in the Tahoe Basin. Specifically, the ninth circuit held that the

1980 Compact requires TRPA not only to adopt environmental

threshold carrying capacities for the Tahoe Basin, but also to

ensure that these thresholds are met. Id. at 1313, 1315-16

(quoting 1980 Compact art. v(g)).

b. TRPA’s 1987 Regional Plan

With the 1984 issuance of the district court injunction,

conflict over development versus environmental protection in the

Tahoe Basin reached its peak. In an effort to break an impasse

that had characterized the Tahoe land use planning process since

the 1969 Compact, TRPA convened a consensus process to

develop a new regional plan. This consensus workgroup was

composed of all the key constituencies affected by TRPA

planning decisions, including representatives of federal, state, and

local governments, the League, the Tahoe-Sierra Preservation

Council, the North and South Shore Chambers of Commerce, the

League of Women Voters, and the Tahoe Sierra Board of

Realtors. See preface to Goals and Policies, supra. The

consensus workgroup met for a year and, for the most part, was

able to agree on the policies and goals that should guide

development in the Basin; the recommendations of the consensus

workgroup were adopted by the TRPA Governing Board in 1986

and implemented in TRPA’s 1987 regional plan and Code of

Ordinances. Fink, supra, at 508.

The agreements of the consensus workgroup established

the basic framework for the land use program that now regulates

petitioner's property. This 1987 regional plan does not represent

a dramatic departure from earlier programs to regulate land use

in the region, but builds on these prior efforts. For example, the

consensus workgroup developed a new land capability rating

system for residential parcels to replace the Bailey system. This

new program, the Individual Parcel Evaluation System (or

"IPES"), required a lot by lot analysis of the suitability of parcels

for residential development throughout the Basin. Each lot was

16.

then assigned a point score based on its development suitability.

Building on the land use classification techniques developed

under the Bailey system, IPES determined suitability for

development based on the parcel’s erosion hazard, runoff

potential, accessibility, water influence areas, condition of the

watershed, ability to revegetate, and need for water quality

improvements in the vicinity of the parcel. Goals and Policies,

supra, at VII-4. Each lot was given an IPES score after a site

visit by a team of experts consisting of a soil scientist, a

watershed expert, and a planner. Fink, supra, at 510.

Under the 1987 regional plan, 2,000 lots were permitted

to be developed for residential use during the first six years of

the Plan. Id. at 509. Lots required a minimum IPES score of

725 to be eligible for development. Kelly v. Tahoe Regional

Planning Agency, No. 22913, Slip. Op. at 8 (Nev. Sup. Ct.,

July 8, 1993), Appellate R. 66A. This minimum IPES score was

established based on the recommendation of a technical advisory

committee and was designed to ensure that the minimum score

was immediately above the ranking of the most sensitive parcels.

Goals and Policies, supra, at VII-6. However, as agreed during

the consensus process, local county jurisdictions could lower this

minimum eligibility number provided that, among other things,

the jurisdiction could show that it had implemented a water

quality monitoring program and made “demonstrable progress”

towards installing water quality improvements in that jurisdiction.

Id. Thus, under the 1987 regional plan and IPES, parcels

originally classified as undevelopable because they had scores

below the minimum IPES cut off point could become eligible for

development.

The other key area of agreement reached through the

consensus process included support for the transfer of

development rights program now challenged by petitioner. Goals

and Policies, supra, at VII-14 to VII-17; Code of Ordinances,

supra, ch. 20, J.A. at 45-57.

Thus, contrary to petitioner's arguments, TRPA’s

decision to prohibit development in stream environment zones 1s

not arbitrary (Petitioner's Brief, supra, at 23), but is one element

17.

of a “complex and extremely comprehensive,” Fink, supra, at

509, regulatory system grounded in scientific fact and political

consensus. The exercise of TRPA’s regulatory authority to

prevent water pollution and to protect a sensitive natural resource

falls within the realm of important governmental interests that

justify even stringent land use regulations. TRPA’s plan balances

the need to protect fragile resources with the desire to preserve

private property rights. Under this program petitioner's attempt

to establish a taking fails.

D. Petitioner’s Property Retains Substantial

Value And Under The TRPA Program,

Petitioner Has Valuable Property Rights.

Petitioner purchased her property on September 7, 1972

for $4,500. Stephen R. Johnson & Associates, Inc., Tahoe Basin

Act Land Acquisition Program Appraisal Summary and

Certification, Assessor's Parcel No. 130-211-31, at 6

(Oct. 9, 1989) [hereinafter Suitum Appraisal].’ On

March 16, 1990, the State of Nevada offered petitioner $35,000

for her property as part of its land acquisition program

established after the 1987 regional plan was adopted."

Supplemental Johnson Aff. { 12, J.A. at 141. As mandated by

9

This appraisal was conducted by the State of Nevada in

1989 in response to petitioner’s expression of interest in selling

her property to the State.

'° Amici criticize TRPA for failing to use state acquisition

programs "to purchase the remaining undeveloped lots in the Mill

Creek drainage... ." See, e.g., TSPC Brief, supra, at 16.

TRPA does not control the state land acquisition programs, and

in any event, as the record shows, Nevada did make an

independent offer to purchase petitioner's property under its

acquisition program. J.A. at 141. Indeed, Appendix C to the

amic*.s brief submitted by Tahoe-Sierra Preservation Council

indicates that numerous parcels in petitioner’s subdivision were

purchased by Nevada or the United States, while petitioner chose

to retain her parcel.

Ce ee er Ee

Nevada law, this offer represents the fair market value of

petitioner's property on July 1, 1980, prior to the adoption of the

1980 Compact. 1985 Nev. Stat. 585, § 7, amended by 1987 Nev.

Stat. 444 § 3.'' The appraisal assumed petitioner could build a

home on her property. Suitum Appraisal at 4. The offer was not

accepted.

As fully discussed in the parties’ briefs, petitioner

possesses several property rights under the TDR program. These

include the rights to:

1. Compete for and transfer a_ residential

development allocation.

2. Transfer up to four residential development

rights, including up to three bonus rights.

3. Transfer the land coverage rights that would

otherwise be allowed on her property to owners

of developable lots.

These rights have a value that has been estimated to range

between $40,000 and $51,500. Suitum v. Tahoe Regional

Planning Agency, 80 F.3d 359, 363 (9th Cir.), cert. granted 117

'' Amicus Curiae Institute for Justice asserts that the

Nevada offer is an attempt to buy petitioner’s property for less

than its fair market value. Brief of the Institute for Justice as

Amicus Curiae in Support of Petitioner at 14-15. However,

petitioner was offered $35,000 for a lot that she purchased for

$4,500. The 1980 valuation date used by the State of Nevada

generally represents the peak value of property in the Basin prior

to implementation of the 1987 regional plan, and ensures that lots

are purchased based on their pre-regulation value. Fink, supra,

at 522 n. 258, (citing Dept. of Conservation and Natural

Resources, Nev. Div. of State Lands, Final Report and

Recommendations of the Commission on Land Acquisition in the

Tahoe Basin 69 (1987)).

19.

S.Ct. 293 (1996). The extent of the permissible use of

petitioner’s property has not yet been determined because she has

not attempted to obtain or transfer any of these entitlements;

however, it is clear that the development rights give petitioner

substantial value in her property.

Although petitioner characterizes the TDR program as a

“ruse,” (Petitioner's Brief, supra, at 30), at least one amicus

appearing in support of petitioner has recognized the value of

TDRs. At public legislative hearings in Nevada, a representative

of the Tahoe-Sierra Preservation Council complained that “the

cost of a residential development right is close to $30,000" and

therefore too expensive. Minutes of the Meeting of the

Legislative Commission’s Committee to Continue the Review of

the Tahoe Regional Planning Compact at 14 (June 6 & 7, 1994)

(testimony of Mary Gilanfarr, Executive Director, Tahoe-Sierra

Preservation Council). As a result, the Council urged the State

of Nevada to sell the development rights associated with parcels

the state had purchased under its land acquisition program, in

order to lower the prices of development rights currently sold on

the open real estate market. Id.

Evidence in the record supports the observations of Ms.

Gilanfarr that TDRs have been sold for considerable value.

Supplemental Johnson Aff. ¥ 13, J.A. at 141-43. In 1993, at the

time petitioner's action was before the district court, several

residential allocations had been sold in the Incline Village area

of Washoe County (where petitioner’s property is located) at

prices ranging from $17,000 to $25,000 each. Id. | 13(b), J.A.

at 142." Also in 1993, 56 residential allocations plus

12

The manner in which the TRPA program creates a

market for these developments rights is discussed below in

Section II.

Although none of the 1993 transfers were from

unbuildable properties that received allocations through the TRPA

1993 drawing (Petitioner’s Brief, supra, at 5 n.5), the evidence

produced by TRPA demonstrates that there is a market for TDRs.

20.

development rights were in escrow in Incline Village for $32,000

each. Id. J 13(c), J.A. at 142.

Moreover, TDRs continue to sell in the Tahoe Basin and

in Washoe County in particular. According to the TRPA permit

database,'* 27 residential allocations were transferred in the

Basin between 1994 and 1996. Of these, five were in Washoe

County. TRPA’s public records show that 45 development

rights, 17 of which were located in Washoe County, were

transferred during that same period. Further, between 1994 and

1996 a lot owner seeking a transferable residential allocation for

a property below the IPES line stood a very good chance of

receiving it. In 1995, for example, six residential allocation

rights were available to undevelopable properties in Washoe

County, and only five lot owners sought them. Once again, in

1996, all of the parties that sought residential allocation were

awarded one; four of these allocations were transferred to other

properties. Thus, it is factually incorrect to argue, as petitioner

does, that the TDR program is a “ruse” or that her application to

transfer development rights under this program would have been

meaningless.

E. The TRPA Program Has Not Interfered

With Petitioner’s Reasonable Investment

Expectations.

As stated above, petitioner's takings claim is defeated by

the substantial value her property retains. Moreover, her claim

must be evaluated in light of her reasonable expectations. Penn

Furthermore, and contrary to petitioner's claim (id.), the record

shows that residential development rights from parcels located in

stream environment zones have been transferred to other lots.

Scholley Aff. 9 15, J.A. at 148.

14

TRPA retains a daily log of all permit applications.

Scholley Aff. 4 13, J.A. at 147. This database is a public record.

1980 Compact, art. III(i).

21.

Central, 438 U.S. at 130-31. Again, this inquiry fails to support

petitioner's takings theory.

At the time petitioner purchased her property, TRPA had

already begun to implement its first regional plan and land use

development ordinance for the Basin. This program incorporated

the Bailey system, and imposed a temporary moratorium on

development on the 82 percent of lands in the Basin which were

classified under Bailey as sensitive class |, 2, 3 lands or stream

environment zones. Fink, supra, at 506 n.139. The 1971 plan

and 1972 ordinance followed years of study of water quality

problems in the Basin and regulatory action to mitigate these

problems, such as the prohibition on sewage disposal in the Basin

and the adoption of the first Tahoe Regional Compact in 1969.

The prohibitions now applicable to petitioner's property are not

inconsistent with those set forth in the land use plans that were

in effect at the time petitioner purchased her property.

Petitioner asserts, without any factual support in the

record, that her land was designated as land capability

classification 6 under the Bailey system. Petitioner's Brief,

supra, at 2 n.1. Although in 1971 TRPA published a map of

land capabilities classifying broad geographic areas according to

the Bailey system, this map was not determinative of an

individual parcel’s suitability for development under the Bailey

system. As specifically stated on the map,

This study does not suggest that development

should occur on the locations shown. It merely

reveals which lands meet the criteria that have

been selected. In addition, because of the scale

of the map and the maps from which it was

compiled, land capability levels within individual

map units may not be uniform. For example,

along stream courses that meet the criteria for

class_1b {stream environment zone], although

shown on the map as class 7. It is therefore

necessary that the final land capability

classification for individual parcels should be

22.

- ee

based on detailed site evaluation and more

detailed application of the land capability

criteria.

Lake Tahoe Basin Land Capabilities, Planning Guide Map, 1971,

prepared by U.S. Forest Service and TRPA. Thus, as specifically

announced by TRPA, the Land Capability Map did not indicate

all areas, such as stream environment zones, that were subject to

the coverage restrictions established under the Bailey system.

The Supreme Court of Nevada in an unpublished 1993

opinion reviewed and rejected a claim that the development

restrictions of the 1987 regional plan effected a taking. Kelly,

Slip.Op., Appellate R. 66A. Nevada Court based its holding in

part on its conclusion regarding the reasonable expectations of a

1966 purchaser of land in the Basin. It determined that early

studies about the environmental problems associated with rapid

growth at Lake Tahoe were sufficient to provide a property

owner who purchased land in the Basin in 1966 with “adequate

notice that his development plans might be frustrated.” Id. at 15.

The Kelly court also held the plaintiff's property retained

substantial value even though the 1987 Plan prohibited

development on multiple parcels owned by plaintiff. Id.

In sum, and contrary to petitioner’s characterization, the

TDR system is an integral part of a regulatory program

developed over many years in response to serious environmental

problems that have threatened the very attribute that makes Lake

Tahoe such a valuable natural and economic resource. This

system was not suddenly dropped on property owners in 1987

and certainly it was not developed as a way to circumvent Lucas.

TRPA’s regulatory program strikes a balance between advancing

the important governmental interests at stake in preserving the

quality of the Lake, and accommodating the rights of property

owners. As such, the 1987 regional plan, including the TDR

program, represents a constitutionally valid regulatory system.

23.

II. THE TAHOE PROGRAM ACHIEVES AN

UNPARALLELED RECIPROCITY OF

ADVANTAGE AMONG PROPERTY OWNERS IN

THE BASIN.

The 1987 regional plan assures an economic “reciprocity

of advantage" to all parties. This Court has determined that such

"reciprocity of advantage” is a significant consideration justifying

a regulatory system. Pennsylvania Coal, 260 U.S. at 415; see

Lucas, 505 U.S. at 1018. The current Tahoe program, forged out

of years of political conflict and then consensus in the Basin, is

explicitly designed to balance “the benefits and burdens,” Penn

Central, 438 U.S. at 124, of residents in the Basin in order to

protect the resource upon which the entire community depends --

and which is of considerable importance to the entire nation."

Certainly, the 1987 regional plan includes many stringent

provisions governing land use in the Basin; petitioner, however,

is not the only person who must bear the burden of these

regulations. Every person, every business, and all the local

governments in the Basin live with TRPA’s strict environmental

regulations, and they do so because protection of Lake Tahoe is

critical to the value of their land and the viability of the regional

economy. In addition to the development restrictions at issue

here, key elements of the 1987 Plan include a general prohibition

on new subdivisions of land in the Basin, Goals and Policies,

'S The governmental interest in preservation of the

environmental balance at Lake Tahoe is heightened by the fact

that more than 70% of the land in the Basin is publicly owned.

Tahoe Regional Planning Agency, Water Quality Management

Plan for the Tahoe Region 8 (adopted Nov. 30, 1988); see

Kleppe_v. New Mexico, 426 U.S. 529 (1976) (federal

government has broad power to regulate private property

affecting public lands). In complying with its responsibility

under the Congressionally-adopted 1980 Compact to achieve

specified environmental thresholds, TRPA is carrying out the

federally sanctioned effort to regulate land use for the protection

of important publicly owned property and resources.

24.

tcl,

supra, at II-9; a limitation on new commercial development to a

total of 400,000 square feet during the first 10 years of the Plan,

id. at VII-12; a limit of 300 new residential units to be permitted

each year, (Barnett Aff. 7 10, J.A. at 98); strict limits on the

amount of impervious surface coverage for new development,

Goals and Policies, supra, at II-13; the requirement that capital

improvement projects by local governments (such as road

building) include best management practices to control runoff, id.

at VII-21; and a requirement that new and existing developments

pay mitigation fees for erosion and runoff control projects, id. at

VIl-17. The TRPA program also requires owners of existing

development that exceeds the new coverage standards to reduce

coverage on environmentally sensitive properties as a condition

of modifying their existing improvements. Fink, supra, at 511.

The land use system at Lake Tahoe also includes several

features designed to mitigate the economic impacts of TRPA's

regulatory program on those property owners who would be most

adversely impacted by certain provisions, such as the prohibition

on construction in stream environment zones. For example,

Nevada and California and the United States Forest Service all

have land acquisition programs. Id. at 513. In the past 15 years,

these ongoing programs have spent over $200 million to acquire

environmentally sensitive parcels throughout the Tahoe Basin.

Chris Bowman and Patrick Hoge, Runoff, Air Pollution Cloud

Waters of Crystal-Clear Lake, Sacramento Bee, Dec. 8, 1996, at

A8.

The TDR element of the 1987 regional plan, as endorsed

by members of the consensus workgroup, is also designed to

distribute the burden of the TRPA regulatory program. This

TDR program balances the benefits and burdens of the Tahoe

regulatory system, because many of the restrictions that affect all

property owners create incentives for the purchase of transferable

rights. For example, the limit on the number of residential

allocations issued each year creates a market for the sale of

allocations. Property owners who cannot build on their land may

still compete for and sell residential allocations, which command

a substantial sum in the market. Supplemental Johnson Aff.

q 13, J.A. at 141-43; see also Section I.D., supra. Similarly,

25.

TRPA generally grants only one residential development nght per

legal lot; however, owners of property designated for multi-

family residential development may build an additional unit for

each development right that they buy from another property

owner. Scholley Aff. 4 14, J.A. at 147. Owners of land in

stream environment zones are eligible for up to 3 bonus

development rights, which they are permitted to sell under the

TDR program. Id, 415, J.A. at 148. Finally, owners of

buildable property who wish to add more than the land coverage

permitted under IPES, may do so by buying coverage rights from

other property owners. Barnett Aff. 5, J.A. at 96. Under this

regulatory system, property owners with buildable lots are

motivated to buy necessary allocations, development rights, and

coverage rights, creating a market that benefits property owners,

like petitioner, with unbuildable stream zone land.

Moreover, property owners are not the only parties who

have participated in mitigating the impacts of development on the

Lake. In addition to the $200 million spent so far on land

acquisition, government agencies have invested more than $100

million in projects designed to reduce erosion from roads in the

Basin. Bowman & Hoge, supra, at A8. Recently, voters in

California and Nevada authorized bond measures that will make

another $30 million available for water quality improvements in

the Tahoe Basin. See TSPC Brief, supra, at 16 n.6. This

considerable (and continuing) expenditure of public money has

gone to remedy a problem caused largely by private development.

Fink, supra, at 538-39.

Finally, as set forth in the goals and policies of the 1987

TRPA Regional Plan, which reflects the agreements reached

during the consensus process, “[m]aintenance of the social and

economic health of the region depends on maintaining the

significant scenic, recreational, education, scientific, natural and

public health values provided by the Lake Tahoe Basin.” Goals

and Policies, supra, at I-1. As recognized by the Nevada

Supreme Court when addressing a property owner’s challenge to

TRPA’s development restrictions on his land, “‘every single one

of Mr. Kelly's lots will eventually diminish in value if Lake

Tahoe is despoiled. IPES is a burden, surely, but it also conveys

26.

significant personal benefits to each landowner it serves."" Kelly,

slip op. at 15, Appellate R. 66A.

The best evidence of the beneficial impact of the TRPA

program on property values, even those that cannot be built upon,

is that found in the record below. The evidence produced below

indicates that, under the 1987 regional plan, the value of

petitioner's transferable development nights (including the nght

to sell an allocation) was between $40,000 and $51,500--for an

investment of $4,500. Suitum, 80 F.3d at 363; see also Suitum

Appraisal, supra, at 6. Although petitioner's property might be

more valuable if she were permitted to build upon it and the rest

of the existing regulatory system remained in place, it is not at

all clear that her property would be more valuable without the

system altogether.

If it were not for the considerable regulatory efforts made

to reduce the impacts of development on the Lake, the very

characteristics that make Lake Tahoe such a desirable and

valuable place to live and own property would be destroyed.

Recognition of this fact led to the compromises that now form

the basis of TRPA’s regulatory program. This program has

become an accepted fact of life for most property owners and

environmentalists in Lake Tahoe, who have after years of debate

struck a balance between “‘upgrading the community and

environmental benefits."" Chris Bowman & Patrick Hoge, Sides

Agree _on Plan for Mountain Mecca, Sacramento Bee,

Dec. 8, 1996, at Al. Clearly, the effort to protect the

environmental resources of Lake Tahoe has involved

commitments and sacrifices by everyone in the Basin; it is not a

burden shouldered disproportionately by individual property

owners, and it is not a burden shouldered disproportionately by

petitioner.

27.

CONCLUSION

For the reasons set forth above, amicus curiae the League

to Save Lake Tahoe respectfully requests that this Court affirm

the ruling of the Ninth Circuit Court of Appeals.

Dated: January 8, 1997

P\LEAGU\MATI\EFO20 PLD

Respectfully submitted,

E. CLEMENT SHUTE, JR.”

CHRISTY H. TAYLOR

ELLISON FOLK

SHUTE, MIHALY & WEINBERGER

396 Hayes Street

San Francisco, CA 94102

Tel: (415) 552-7272

“Counsel of Record for

Amicus Curae

LEAGUE TO SAVE LAKE TAHOE

28.