\u3ci\u3ePenn Central\u3c/i\u3e in Retrospect: The Past and Future of Historic Preservation Regulation

The U.S. Supreme Court’s 1978 decision in Penn Central Transportation Co. v. City of New York is one of the best known cases in the Property Law canon. The Court there held that the refusal of the New York City Landmarks Preservation Commission to permit the owner to erect a 50-storey tower on top of Grand Central Terminal did not effect a taking of private property requiring the payment of compensation. The decision now is more than forty years old. Taught since then in most first-year Property classes, Penn Central endures as the foundation of the modern application of the Takings Clause of the Fifth Amendment to public regulation of land use Of course, the academic literature on the rationale for and the propriety of the regulatory takings doctrine is massive; scholars have sifted its doctrinal innovations and shortcomings. Not surprisingly, academic commentators have found Justice Brennan’s opinion for the Court lacking in doctrinal clarity and theoretic depth. Nonetheless, the Court has returned to Penn Central repeatedly because it reflects the enduring center of the Court’s conflicting views about imposing constitutional limits on the regulation of property use. The context of the litigation as it came to the Supreme Court helps explain that paradox: it was written to hold a diverse, tenuous majority of the Court. But all this attention still understates the continuing significance of the decision. Penn Central is the most important decision on historic preservation law ever rendered in the United States. By validating stringent preservation restrictions on an addition to an individual landmark in the heart of the most voracious real estate market in the nation, the decision opened the way for a massive growth in the scope and intensity of municipal historic preservation law. Preservation in turn has shaped leading U.S. cities, as they have taken on new identities in a postindustrial society. The case is at least as important for its liberation of historic preservation law and the effect of that on U.S. cities, as for its statement of the regulatory takings doctrine. A reconsideration of Penn Central both highlights the growth of historic preservation regulation in urban land use law and clarifies the acceptable interpretive scope of the takings clause. Penn Central was decided at a nadir in urban prospects, as deindustrialization and White flight had brought many U.S. cities to points of chaos and insolvency. But at the same time, a new urban economy based on technology, media, and knowledge had begun to grow. For industries based on sophisticated services and creativity, recruiting talented and educated workers became more critical than legally protected spaces for industrial production and shipping. Land use laws based on separating competing uses of land became less important, while fostering an urban environment with cultural and aesthetic appeal to highly mobile and educated workers became paramount. Urban renewal and highway construction were largely abandoned; cities used planning and regulation to encourage mixed use, walkable, culturally dense neighborhoods. In this context, historic preservation offered a legal means to encourage a lively urban environment. This paper aims to explain how the Penn Central decision marks a crucial fulcrum in the evolution of land use law. The Court faced a new form of land use regulation--the historic preservation of a privately-owned landmark building in the urban center. The owners framed their challenge under the still inchoate regulatory takings doctrine, a decade before an increasingly conservative court sought to refashion it as a tool to restrain innovations in environmental law. The paper argues that what was intended as a modest opinion holding together a skittish majority to sustain the protection of a beloved train station by amalgamating landmark regulation to the traditional deference afforded zoning laws, resulted in a broad constitutional permission for historic preservation and other emerging land use regulatory tools. To make this case, it will first present a narrative account of the litigation, illuminated by historic context and examination of the internal deliberation of the justices as shown in the papers of Justices Lewis Powell and Harry Blackmun. The paper will then discuss the elements that combined to produce a decision apparently modest but of broad consequence. It then argues that Penn Central created the constitutional foundation for a new era in land use law, characterized by new forms of historic preservation and, more broadly, by urbanistic attention to physical and cultural context rather than by separation of uses. The paper also recognizes, however, that the continuing evolution of cities present issues and challenges for historic preservation law not anticipated in 1978: economic inequality, persistent racial segregation, and climate change suggest that historic preservation law must evolve to adapt to present urban realities