So, who's on top — the planners or the developers? You would think the U.S. Supreme Court would know. This court, after all, was able to decide who the president should be. But after almost a quarter century of hearing land-use "takings" cases, the Supreme Court has provided no clear answer as to who rules at the planning counter. In late June, the Supreme Court issued a split ruling — apparently in favor of property owners — in Palazzolo v. Rhode Island, No. 99-2047. At the same time, the court decided to accept a new land-use case for next year from Lake Tahoe. (For legal details on both cases, see Legal Digest.) Most of the time, the property owners have won at the U.S. Supreme Court. The breakthroughs began in 1987, when the court issued the landmark First English takings ruling and the Nollan exactions ruling, both from Southern California, in the same month. Victories by property owners are not surprising considering the fact that since the mid-80s the court has been dominated by conservative justices appointed by Republican presidents. But there have been very few slam-dunk victories that led to dramatic change. Almost all of the cases have been decided by a 5-4 vote and – as was the case with Palazzolo – sometimes one of the five majority justices has written a concurring opinion undercutting some of the majority's main points. Like so many other rulings before it, Palazzolo was a model of muddiness. The lack of clarity raises the question of what it all means — not in the realm of property rights lawyers and government attorneys, but in the real world of planners and developers. Unquestionably, the balance of power at the planning counter has shifted in the last 20 years, and almost without exception it has shifted in the developers' favor. Especially in California — where most of the takings cases originated — city attorneys and county counsels have become very cautious when developers complain about takings. The lawyers' concerns are probably leading to a cautious attitude on the part of the planners themselves. But the balance of power over the planning counter and the balance of power in the courtroom are two different things. Because the threat of a takings lawsuit — or a city attorney's fear of one — is only the first step in a three-step process. Step two is the actual filing of a lawsuit. And step three is the actual winning of a lawsuit by the property owner. Step one, the threat, is pretty common, and that is where the balance of power has shifted. Developers who threaten takings lawsuits are viewed seriously by government agencies and especially by government lawyers, who then advise their land-use planners to be cautious. Not surprisingly, however, step two – the actual filing of the lawsuit – is uncommon. And step three – winning the lawsuit – is almost unheard of. You can count the successful takings lawsuits on the fingers of one hand – or maybe two. It is almost impossible to actually prove that a taking has occurred, not least because the U.S. Supreme Court and other judges have failed to lay down a firm and consistent standard regarding what constitutes a taking. They have consistently stated that "it depends" – that is, it must be determined on a case-by-case basis. But what it depends on isn't always clear. Indeed, in the Palazzolo case the justices got lost in this very thicket by attempting to decide which of three different takings standards (previously laid out in three different Supreme Court rulings) should apply in this situation. And even when they're victorious, developers typically do not strip government agencies clean with their victories. Indeed, in the most famous takings victory — the Del Monte Dunes case, where the landowners' victory was upheld in by the Supreme Court in 1999 (see CP&DR Legal Digest, June 1999, July 1999) — the landowner got peanuts. More precisely, the landowner got $1.45 million. That may seem like a lot to you or me, but it probably does not seem like much to a development company that submitted five different development plans for a 37-acre beachfront parcel, all of which were rejected, and then spent more than a decade litigating the case. It's also not much compared with the City of Monterey's annual budget of $70 million. Heck, the lawyers' fees in a case like that are probably more than $1.45 million. But the power struggle over the planning counter is not really about whether a taking can be proven or how much money the government will pay if a taking is proven. The battle is about the cost and hassle of defending a lawsuit and the fear that you will be the one government agency that will be stuck with a doozy of a bill in the end. Which is why the Tahoe case that the Supreme Court will hear next year is so important for the future of planning practice. In a lot of ways, Lake Tahoe is the most atypical situation of land-use regulation. Land use in Tahoe is governed by a special regional agency, the Tahoe Regional Planning Agency, which covers parts of two states and was created by an act of Congress. The land-use regulations there have been extremely restrictive for more than 20 years, and regulators have been locked in mortal combat with angry property owners and aggressive lawyers for almost all of that time. Over the years, property owners have sued TRPA on all kinds of takings allegations, dealing mostly with the agency's limited allocation of single-family construction permits and the transferable development rights program, which emerged partly as a response to landowner concerns. However, the issue that the Supreme Court will hear is a surprisingly narrow one – and one of great interest to planning agencies everywhere: does a building moratorium constitute a taking of property? The history of takings allegations in Tahoe is so complicated that the Ninth U.S. Circuit Court of Appeals ruling in question (Tahoe Sierra Preservation Council Inc. v. Tahoe Regional Planning Agency, See CP&DR Legal Digest, July 2000) actually deals separately with what the judges called "Period I," "Period II," "Period III," and "Period IV." But apparently the Supreme Court will hear the relatively clean question of whether the building moratorium imposed by TRPA in 1981 constituted a taking because the moratorium lasted for three years. California specifically permits temporary moratoria so long as the period of time involved is "reasonable" and the public policy reasons for imposing a temporary building ban are compelling. And according to land-use law guru Dan Curtin, the California courts have set a high threshold to elevate a delay in the development process (including a moratorium) to the status of a taking. For example, in Landgate v. California Coastal Commission, 17 Ca.4th 1006 (1998) (see CP&DR Legal Digest. June, 1998), the California Supreme Court ruled that a two-year delay in the issuance of building permits by the Coastal Commission was a "normal delay" in the development process. The question of what is a normal delay and what is a taking has been an important one ever since the First English case was issued 14 years ago because in that case Chief Justice William Rehnquist invented the idea of a "temporary taking." Cutting through a knotty and persistent problem in takings law, Rehnquist said that if a regulation creates a taking of property and then is changed, a taking still could occur for the period of time during which the regulation was in place – if it was an unreasonably long period of time. Normal planning delays, he said, do not count. That is what gave the California Supreme Court the opportunity to conclude that two years was a normal planning delay in the Landgate case. Now, the U.S. Supreme Court will have the chance to decide once and for all what a normal planning delay is. In particular, they'll have the chance to decide whether a three-year building moratorium constitutes a normal planning delay or a taking. A clean ruling here will help determine the balance of power across the planning counter in the years to come. Of course, there is no guarantee that the Supreme Court will make a clean ruling in the Tahoe case. Clean rulings have been rare in land use to begin with, and the Tahoe ruling could get extremely muddled. For example, even though the TRPA moratorium ended in 1984, it was followed almost immediately by another three-year moratorium imposed by a federal judge — a fact that landowner lawyers have attempted to introduce into the Tahoe litigation as an additional factor in the "takings" question. So even though we will have a new Supreme Court ruling within the next 12 months, the psychology at the planning counter may well be just as confused a year from now as it is today.