PENN CENTRAL TRANSPORTATION CO. V. NEW YORK CITY

'''Penn Central Transportation Co. v. New York City''', was a landmark United States Supreme Court decision on compensation for regulatory takings.

Contents

Background

Issue

Holding

See also

Background

New York City controlled historic properties not through acquisitions but rather through land-use decisions concerning standards, controls and incentives. Any changes to landmarks had to be approved by one of three certificates: one of no effect, or appropriateness, or insufficient returns. Under the zoning law, owners of landmark properties could transfer development rights to other land. Penn Central wanted to develop office space atop the Terminal, and proposed two plans to be certified by the Commission. Both plans were rejected, the Commission stating that protection of a landmark should not involve its destruction, and that any building in the airspace above the Terminal would interfere with its “majestic approach” and cut off views.

Issue

Whether a city may, as part of a comprehensive program to preserve historic landmarks, place restrictions on the development of individual landmarks without effecting a “taking” requiring “just compensation”?

Holding

The court decided that there was not a taking requiring just compensation under the Takings Clause of the Fifth Amendment when the government designated the Grand Central Terminal building in New York City as a historical landmark, thereby stopping a proposed office tower to be built over the terminal.
The decision also established a test incorporating three significant factors to determining whether government regulation amounted to a taking: (1) The effect of the regulation on the value of the property, (2) the extent to which the reasonable investment-backed expectations of the property owner have been interfered with, and (3) the character of the government action.

See also

★ List of United States Supreme Court cases, volume 438