In 2021, the Supreme Court decided Cedar Point Nursery v. Hassid, a landmark case that established a new categorical rule in takings law: When the government enacts a regulation authorizing a temporary invasion of a property owner’s land, it effects a per se taking under the Fifth Amendment for which it must pay just compensation.
This Note explores the implications of this decision for the constitutionality of rent regulations.
New York City has a long history of robust rent regulation laws.
In 2019, the state legislature passed the Housing Stability and Tenant Protection Act (HSTPA), which further strengthened the city’s rent regulation regime.
Landlords immediately launched a series of legal challenges to the law under the Fifth Amendment, all of which were dismissed based on Supreme Court precedent upholding rent control as constitutional.
After Cedar Point, however, this precedent appears less certain. The plaintiffs whose suits were dismissed have since appealed, citing Cedar Point as confirmation that New York City’s rent regulation regime constitutes a compensable taking under the Fifth Amendment.
This Note analyzes the various approaches that the Second Circuit, or any court considering an analogous regulation, could take when applying Cedar Point to the rent regulation context. Part I provides context for this discussion by reviewing the regulatory and physical takings doctrines under the Fifth Amendment, describing rent control and various academic arguments that have been advanced for and against it, and detailing the legal challenges levied against rent regulation regimes under the Fifth Amendment. Part II considers the impact of the HSTPA on New York’s rent regulation laws, describes the unsuccessful challenges to its constitutionality prior to Cedar Point, discusses the Cedar Point decision as a turning point in takings law, and surveys the renewed appeals brought against the HSTPA after the decision came down. Part III presents various analytical alternatives the court could pursue and considers the normative implications of each approach. Under a maximalist approach, the court could find that the HSTPA infringes on the landlord’s “right to exclude” and is thus a compensable taking under Cedar Point. Under a minimalist approach, the court could apply one of the Cedar Point exceptions to uphold the HSTPA as constitutional. Ultimately, this analysis reveals that adopting the maximalist approach is at odds with Supreme Court precedent, whereas the minimalist approach accords with settled law. This Part further argues that the minimalist approach is not only the best reading of the Cedar Point opinion as a doctrinal matter but is also more desirable from a policy perspective because it preserves the government’s ability to address housing affordability and to enact antidiscrimination housing laws. This Note therefore concludes that the Cedar Point exceptions both can and should be read to encompass legislation regulating relations between landlords and tenants.