September/October 2018 Issue
Also in this issue: Court of Appeals Upholds Constitutionality of Municipal Smart Meter Program | Public Service Commission Approves First Financial Assistance Program for Private Lead Service Line Replacements
Wisconsin Supreme Court Affirms There is No Compensable Property Right to Visibility in Billboard Case
On June 19, 2018, the Wisconsin Supreme Court affirmed in Adams Outdoor Advertising Limited Partnership v. City of Madison that the right to visibility from a public road is not a recognized property right for the purpose of an unconstitutional takings claim. In a 4 – 3 decision, the Court held that a billboard company was not entitled to compensation from the City after the City constructed a bridge blocking visibility of a billboard from a major highway.
Adams owns a billboard on a small, unusually-shaped parcel of land adjacent to a major highway known locally as “the Beltline.” One panel of the billboard faces east and the other west allowing for separate advertising signs. Adams bought the land in 2007 for $200,000. In 2013, the City built the Cannonball Bridge, a pedestrian and bicycle bridge adjacent to, but not on, Adams’ property. The bridge now obstructs the view of the west-facing billboard panel from Beltline traffic, and Adams contends it can no longer sell advertising space on that panel.
According to an appraiser hired by Adams, before the bridge was built the land was worth $1,460,000 and after it decreased to $720,000. Adams sued the City for depriving them of all economically beneficial use of the west-facing side of its billboard, entitling them to just compensation for private property taken for public use under the “takings clause” — the Fifth Amendment of the U.S. Constitution and Art. 1 § 3 of the Wisconsin Constitution.
At the Supreme Court, Adams argued that its right was not one relying on the right to be seen, but a right to continuing “a preexisting use of its property.” To put Adams’ argument into perspective, a homeowner whose ability to see across the street, blocked by a bus stop is not deprived of the essential function of their home, but as a billboard company, Adams’ sole purpose for the property is to be seen and visibility is essential to achieving that purpose. The Court rejected this argument, holding that the essence of Adams’ asserted property interest is based on a right to visibility and that the right to visibility of private property from a public road does not give rise to a protected property interest.
The Court’s Reasoning
The Court agreed with the City that “[a]lthough [a property owner] may sustain consequential damages in so far as [a] street improvement will somewhat obstruct or interfere with ingress and egress, and the view to and from their land to the vehicular traveled portion of the street, that is not a taking of private property for public use.” The Court relied heavily on its previous decision in Randall et al., v. City of Milwaukee, which reasoned that public thoroughfares, including highways, are dynamic spaces that must change and adapt over time. Randall concluded that the public rights in streets are paramount to those of private landowners.
The Court also considered similar decisions in other jurisdictions. In particular, in Regency Outdoor Advert., Inc. v. City of Los Angeles (2006), the California Supreme Court rejected a billboard owner’s takings claim which asserted that when the City planted palm trees, it reduced visibility of its billboards, constituting a taking. The Regency court explained that courts generally rely on three justifications for the “virtually unanimous” rule that there is no right to be seen from a public road: (1) road improvements limiting visibility are foreseeable; (2) the government has the authority to maintain and improve the road system; and (3) the abridgment of the right to reasonable access and an outlet is an owner’s only right meriting compensation when the government acts to improve a road.
Justice Rebecca Bradley, writing for the dissent, argued that the majority erred when it defined the property interest at issue as a right to visibility. The dissent argued an alternative frame for the property interest: Adam’s interest in the advertising permit for the west side of the billboard. An unconstitutional taking occurs when government denies all economically viable use of a person’s property. A permit is considered real property for takings purposes. The dissent further reasoned that the real value of the property was in the advertising permits. The bridge construction eliminated the entire value of the advertising permit for the west side of the billboard, and thereby, constituted an unconstitutional taking. In a footnote, the majority discounted this argument, noting it was not raised or argued by Adams or the City.
This is an important decision for municipalities. As the League of Municipalities argued in its amicus brief in this case, a decision in favor of Adams would have handed owners of the vast numbers of billboards that exist alongside public highways across the state a constitutionally protected demand on state and local government bank accounts. Moreover, a new visibility property right would not logically stop at billboard advertising but would extend to the much larger pool of all commercial activities that line public highways and can claim some economic value from public highway visibility.
— Kathryn Pfefferle
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