Penn Central Transportation Co. v. City of New York
Penn Central Transportation Co. v. City of New York is a significant Supreme Court case centered around property rights and historic preservation. The case arose when Penn Central sought to construct a fifty-story building above Grand Central Station, which had been designated as a national landmark. The City of New York denied this request, leading Penn Central to argue that this denial amounted to an unconstitutional taking of property under the Fifth Amendment. In a 6-3 ruling, the Supreme Court upheld the city's zoning restrictions, stating that they did not excessively interfere with Penn Central’s investment-backed expectations. The decision introduced the concept that transferable development rights could potentially alleviate claims of taking or serve as compensation. The ruling highlighted the balance between private property interests and the public value of historic preservation, reflecting the Court's consideration of the broader implications of development in urban settings. This case has had a lasting influence on zoning laws and property rights debates in the context of historic conservation.
Penn Central Transportation Co. v. City of New York
Date: June 26, 1978
Citation: 438 U.S. 104
Issues: Fifth Amendment; takings clause
Significance: The Supreme Court established several important principles governing the takings impact of regulations.
After a local preservation committee made New York’s Grand Central Station a national landmark, Penn Central was denied the right to build a fifty-story building on arches over the train terminal. New York City allowed Penn Central certain “transferable development rights” to nearby transfer sites, but Penn Central was not satisfied and sued New York City, claiming that its inability to build constituted a taking and a denial of due process. By a 6-3 vote, the Supreme Court found the zoning restriction was not a taking because it did not excessively “frustrate distinct investment-backed expectations,” a phrase created by the Court that found its way into subsequent cases. The Court did not take up transferable rights directly but suggested that such rights might either mitigate the situation so a taking would not occur or act as a form of compensation. It seems obvious that the Court had the value of historic preservation in its collective mind in reaching this unusual decision.