Unearthing the Denominator in Regulatory Taking Claims

Abstract

In 1986, David Lucas purchased two beachfront lots on a South Carolina barrier island with the expectation of constructing single-family homes. His building plans violated no existing regulations. In fact, many of the neighboring parcels already had permanent homes similar to those Lucas wished to construct. Two years later, the South Carolina Legislature enacted the Beachfront Management Act, which prohibited the building of any permanent residential structures on the lots. Lucas's plans were completely frustrated, and the value of his two lots plummeted to almost nothing. In Lucas v South Carolina Coastal Council, the Supreme Court held that David Lucas had suffered a taking of his property for which the Fifth Amendment would guarantee him just compensation.' The Court announced that although government may generally restrict the use of private property without compensation, a taking occurs when the regulation denies all economically beneficial or productive use of land.2 What the Court did not decide, however, is how to determine the relevant parcel of land that is subject to the regulatory