LITTLE ROCK — A bill that would allow property owners to seek compensation if zoning decisions or other government actions lower their property values failed to clear a House committee on Thursday.
Senate Bill 367 by Sen. Jim Hendren, R-Gravette, received seven “yes” votes and seven “no” votes in the House Judiciary Committee. It needed 11 votes to pass out of the 20-member committee.
Under the bill, if a zoning ordinance or other local or state law causes the fair market value of private property to decrease by 25 percent or more, the property would be considered to have been taken for public use and the owner could seek compensation.
“This piece of legislation has got such a high threshold,” Hendren told the committee. “You know what this piece of legislation basically says? You cannot screw people.”
The bill is opposed by the Arkansas Municipal League, the Association of Arkansas Counties and the Sierra Club.
Municipal League lawyer Mark Hayes testified that the bill would create legal nightmares for local governments. As an example, he said that if a sexually oriented business tried to open in a commercially zoned area next to a residential area, people living near the business could claim their property values would be diminished by granting the business a permit, while the business could argue that not granting the permit would diminish the value of its property.
“It’s a conundrum that we can’t get out of,” Hayes said.
Glen Hooks of the Sierra Club said the bill would have a chilling effect on all zoning, inhibiting local governments from taking actions to improve the quality of life in Arkansas communities.
Hendren took to Twitter during the opponents’ testimony, at one point tweeting, “Municipal League Lawyer speaking against property rights bill-trying not to grab him by the throat.”
Hendren said later the tweet was “just a sarcastic crack.”
He said he did not immediately know whether he would try again with the bill.
“I’m going to work and see whether or not we can come to something that makes people satisfied with it,” Hendren said.