NIMBY Lawsuit Accidentally Abolishes City's Entire Zoning Code

Plus: The Supreme Court declines to hear major eviction moratorium case, Maine passes zoning reform, and why tourist traps are good, actually.

Happy Tuesday, and welcome to another edition of Rent Free. This week's stories include:

• The Supreme Court's decision not to take up a major challenge to Los Angeles' COVID-era eviction moratorium
• Maine passes a suite of zoning reforms.
• The urbanist case for tourist traps

But first, our lead item on how a challenge to slightly more permissive zoning rules in Charlottesville, Virginia, led to the accidental abolition of zoning in the town.

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NIMBY Lawsuit Ends Up Deleting City's Entire Zoning Code

The comedy of errors unfolding from a lawsuit challenging Charlottesville, Virginia's new zoning code took a surprisingly libertarian turn last week when a judge's ruling ended up voiding all the city's zoning regulations.

The lawsuit, filed by neighborhood activists in early 2024, challenges the Charlottesville City Council's decision to allow apartment buildings in more areas of the city and "middle housing" development in formerly single-family-only neighborhoods.

The plaintiffs, who are alleging the city failed to coordinate the zoning changes with infrastructure planning, appeared to score a total victory last week when Charlottesville Circuit Court Judge Claude Worrell ruled that, because the city missed a key filing deadline, the new code had to be scrapped.

But now, local media outlets are reporting a surprising twist. Charlottesville had to repeal its old zoning code before passing the new one. With the new code now voided and the old one off the books, the city officially now has no zoning code to speak of.

In other words, a NIMBY lawsuit challenging a slightly more liberal zoning code has resulted in complete zoning abolition.

Critics of zoning like to point out that many of the things people think they like about zoning—rules regulating the health and safety of new buildings, stormwater runoff, etc.—actually have nothing to do with zoning at all.

Charlottesville's accidental zoning abolition is a great illustration of that point.

As Charlottesville Tomorrow reports, building codes and other related regulations remain on the books. But the zoning code's rules about where apartments can be built, how tall they can be, how many units they can include, etc. are gone.

​​"If there's no ordinance, then we don't even need site plans," Justin Shimp, the head of a local engineering firm, told Charlottesville Tomorrow. "You would simply say, I want to build an apartment building, and I would turn the building permit into the building department, and if it met the [state] building code, they would approve it, and you would build an apartment building."

Unfortunately for zoning critics, the city is doing what it can to prevent a blossoming of new unzoned development while it scrambles to reinstitute a zoning code.

City planning staff told Charlottesville Tomorrow that they will delay any processing of building applications that "involve zoning" until they receive "further legal and procedural clarity."

One Charlottesville city councilor told 29 News that until a new zoning code is adopted, the city's goal of incentivizing more affordable housing and walkable neighborhoods is at risk.

Hardly. Currently, the city has the best possible set of rules for creating walkable, affordable neighborhoods. Absent zoning, builders can technically construct whatever type of housing they wish, without any reference to arbitrary height, density, and use restrictions.

If the city were to let the status quo stand, it'd see more housing and more types of housing built. Homebuyers and renters could avail themselves of more housing options and lower home prices.

Instead of trying to revive its slightly more permissive zoning rules, the city should just sit back and enjoy the fruits of a free market in home construction.

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The Supreme Court Won't Hear a Major Property Rights Case. Justices Thomas and Gorsuch Aren't Happy.

The U.S. Supreme Court's decision last week to not take up landlords' challenge to the City of Los Angeles' COVID-era eviction moratorium sparked a rare, lengthy dissent from Justices Clarence Thomas and Neal Gorsuch, who both argued that the court should have agreed to hear the case and the underlying property rights issues it raised.

"This issue is important and recurring," wrote Thomas, in a dissent from the Court's denial of the writ of certiorari in the case GHP Management Corp. v. City of Los Angeles that Gorsuch joined.

"Given the sheer number of landlords and tenants, any eviction moratorium statute stands to affect countless parties. And, the end of the COVID–19 pandemic has not diminished the importance of this issue. Municipalities continue to enact eviction moratoria in the wake of other emergencies," continued Thomas.

The landlord petitioners in the case argued that Los Angeles' eviction moratorium, which prevented them from evicting delinquent and nuisance tenants, amounted to an uncompensated physical taking of their property. Their lawsuit claimed they were owed $20 million in compensation.

To make their case, the landlords cited the 2021 Supreme Court decision in Cedar Point Nursery v. Hassid, which held that a California law allowing union organizers access to farm properties was a physical taking.

In two separate cases, federal circuit courts have relied on Cedar Point when ruling that eviction moratoriums were in fact physical takings.

In its ruling in the GHP Management case, however, the U.S. Court of Appeals for the 9th Circuit disagreed.

Relying on the 1992 Supreme Court case of Yee v. Escondido, the 9th Circuit reasoned that an eviction moratorium was not a taking but rather a permissible economic regulation landlords had effectively consented to by voluntarily placing their property on the rental market.

In his dissent, Thomas took a dim view of the 9th Circuit's reasoning, writing that "under the logic of Cedar Point, and our Takings Clause doctrine more generally, an eviction moratorium would plainly seem to interfere with a landlord's right to exclude."

Because there is a circuit split on the issue, Thomas said the Supreme Court should take up the case. He's not the only one who'd like to see the Court provide more clarity on how its recent Taking Clause rulings apply to the rental property context.

Early last month, the U.S. Court of Appeals for the Federal Circuit denied the federal government's request to rehear the case Darby Development Company, Inc. v. United States, in which landlords have successfully argued that the federal COVID-era eviction moratorium was a taking for which they're owed compensation.

Landlords are claiming some $20 billion in compensation in the Darby case.

In a concurring opinion in that case, a federal circuit court judge, while denying the government's request for a rehearing, wrote that "the issue in this case, which goes to the scope of the Takings Clause, would benefit from Supreme Court guidance."

The federal government still has the option of petitioning the Supreme Court to hear the Darby case. That's one potential avenue via which the Supreme Court could provide more clarity on whether eviction moratoriums do, in fact, count as a physical taking.

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Maine Passes Major Zoning Reforms

Maine is the latest state in the union to pass a suite of state-level zoning reforms that allow more housing in more places.

The reforms approved by the Legislature last week include a new law requiring localities to allow residential developments in commercial zones. A separate law restricts cities from requiring more than one off-street parking space per residential unit in "designated growth areas."

Lawmakers also passed a more comprehensive bill limiting localities' density restrictions on smaller multifamily developments and generally prohibiting them from regulating "middle housing" development more strictly than single-family homes.

"We really think it will open the door for new types of housing, whether it's a triplex or a quadplex that just aren't getting built these days, like they were maybe 75 years ago as workforce housing in Maine," Laura Mitchell, executive director of the Maine Affordable Housing Coalition, told Maine Public Radio.

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Tourist Traps Are Good, Actually

In Reason's latest print issue, I argue that tourist "traps" are good and you should feel no shame in visiting them on your next vacation. Seeing the major landmarks is one way we tourists can show an appreciation for the urban agglomeration that gives rise to cities in the first place:

There's only so many great artists and great pieces of art in the world. Urbanism's agglomerative pull means many of them end up in a handful of superstar cities. Millions of tourists then follow. The Mona Lisa wasn't painted in Paris. She lives there nonetheless because that's where the eyeballs and the money are. Paris, in other words, exists for you to go see the Mona Lisa. To say that you won't go see the Mona Lisa because that's what everyone does in Paris is to miss the point of Paris.

You can read the whole thing here. Subscribe to Reason to read the entirety of our summer travel issue.

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Quick Links

• City Journal's Judge Glock writes about how red states are losing their housing edge.
• Also in City Journal, Eric Kober writes about why New York City's affordable housing is falling apart.
• Law firm Holland & Knight provides some analysis on California's latest reforms to its development-killing environmental review law.
• Asterisk Magazine has a piece on the Georgist roots of American libertarianism that should be of interest to both the "land value tax would solve this" crowd and the "taxation is theft" crowd.
• Is Austin-San Antonio America's newest megaregion?