By Nancie G. Marzulla and George Grenzer
Imagine that you have spent decades tending to a ranch, planting crops, or carefully managing a plot of timber. One day, a letter arrives: the federal government has designated your property as “critical habitat” for an endangered species. From now on, you cannot develop, harvest, or otherwise use the land in certain ways. The government does not buy your land, but they have essentially taken away all its value.
For decades, landowners in this position have faced a frustrating truth. Under the Endangered Species Act (ESA), the government can effectively strip the use of property without paying any sort of compensation. However, that may soon change.
The Trump administration has recently signaled a possible shift—one that could treat ESA restrictions as a “taking” under the Fifth Amendment and require just compensation to the landowner. If implemented by the White House, such an executive order would be one of the most significant property rights victories in modern U.S. history.
Under the Endangered Species Act (ESA), the government can effectively strip the use of property without paying any sort of compensation. However, that may soon change.
The Endangered Species Act: A Brief History
The Endangered Species Act was signed into law in 1973 during an era of newly heightened environmental awareness. Irresponsible hunting practices and interference with natural habitats pushed numerous species such as the bald eagle, bison, and polar bear to the brink of extinction. In response, Congress acted with near-unanimous support to ensure that future generations would inherit an America that was rich in biodiversity.
The original, core tenets of the ESA are simple. The Act is meant to prevent the extinction of imperiled species through preserving and restoring the ecosystems of these species, and its mechanisms and procedures are based in science rather than politics to guide decision-making.
Specifically, the ESA grants the U.S. Fish and Wildlife Service (FWS) and NOAA fisheries these powers:
- Listing species as endangered or threatened
- Designating critical habitats or geographic areas as essential to the survival of vulnerable species
- Restricting certain activities that could harm the species or damage its habitat
Once a species and its habitats are protected by the ESA, the government can halt projects, deny permits, require costly mitigation measures, and outright prohibit certain land uses regardless of whether the species is on or ever will be physically present on the property.
From these procedures, the ESA delivered substantial conservation victories in its early years. For example, the bald eagle and peregrine falcon recovered, and the American alligator was removed from the endangered species list. These are textbook examples of the federal government mobilizing to meet an urgent ecological need.
The ESA delivered substantial conservation victories in its early years. For example, the bald eagle and peregrine falcon recovered, and the American alligator was removed from the endangered species list. These are textbook examples of the federal government mobilizing to meet an urgent ecological need.
Evolution of ESA Use and Its Impacts: Enforcement “Whatever the Cost”?
Over the decades, however, the reach of the ESA and its complexity have exponentially grown. In 1978, the Supreme Court in Tennessee Valley Authority v. Hill, 437 U.S. 153 (1978), stated that endangered species were to be protected “whatever the cost.” The TVA court noted that, under the ESA, “[a]gencies in particular are directed by §§ 2(c) and 3(2) of the Act to “use . . . all methods and procedures which are necessary” to preserve endangered species. 16 U.S.C. §§ 1531(c), 1532(2) (emphasis added).” TVA at 185.
Critics say that it is no longer just a shield for wildlife, but a web of bureaucracy, lawsuits, and political maneuvering.
In recent years, the ESA has been plagued by many issues regarding its use and regulations:
- Bureaucratic Delays: Listing, delisting, and permitting decisions can drag on for years
- Overbroad Habitat Designations: Critical habitat can be extensively mapped across thousands of acres. Even if an endangered species does not currently inhabit a plot of land, that land can still be regulated if it is designated as a potential habitat for the species in the future
- Litigation as Political Tactic: Advocacy groups use ESA lawsuits to halt energy projects, logging operations, or land developments that often do not harm endangered species populations
Testimony before the House Natural Resources Committee (see video below) paints an even starker picture, with landowners and members describing how the ESA can depress land values, stop projects in their tracks with no compensation, and demand costly compliance measures with little to no measurable benefits to any species.
Sean Vibbert, a sixth-generation Oregon farmer, testified that recent ESA rulings and delays surrounding the Oregon spotted frog had consistently prevented him from having water for his crops. Without an irrigation system, his land could no longer be used productively, and he had no recourse to recover financial losses.
What’s more, Martha Williams, Director, U.S. Fish and Wildlife Service, Department of the Interior, testified before the House Committee on Natural Resources, Subcommittee on Water, Wildlife, and Fisheries on the “ESA at 50: The Destructive Cost of the ESA.”
Testimony before the House Natural Resources Committee paints an even starker picture, with landowners and members describing how the ESA can depress land values, stop projects in their tracks with no compensation, and demand costly compliance measures with little to no measurable benefits to any species.
Even the current administration has faced problems with the ESA. “Alligator Alcatraz,” a new immigration detention facility in Southwestern Florida, was halted by a federal judge after several interest groups claimed the building structures would negatively affect the endangered Florida panther species in the region. The facility is stuck in limbo as it awaits a decision about its compatibility with environmental policies.
The ESA has dramatically evolved since its original passage in 1973. What began as focused species-protection policy has, in many cases, become a powerful but blunt instrument which often helps project opponents, not actual endangered species.
Possible Reform: Recent Actions from the Trump Administration
During his first term in office, President Trump narrowed the definition of “habitat” under the ESA to require that economic and societal impacts be considered when classifying species as endangered, and he returned more management authority to state governments.
There are reports coming out of the current administration suggesting that the President may issue another Executive Order redefining ESA restrictions on otherwise lawful property use as a compensable “taking.”
There are reports coming out of the current administration suggesting that the President may issue another Executive Order redefining ESA restrictions on otherwise lawful property use as a compensable “taking.”
Fifth Amendment “Taking” Rule and Potential Applications
The Fifth Amendment of the U.S. Constitution mandates that “private property” shall not “be taken for public use, without just compensation.”
Traditionally, “taking” meant physically seizing land, but courts have historically recognized regulatory takings when government rules effectively strip away all or most economic use of property. In the 1922 seminal case of Pennsylvania Coal Co. v. Mahon (1922), the Supreme Court ruled that a law limiting the mining of coal near support structures had the effect of “appropriating and destroying [the coal’s value].” This degree of destruction ran afoul of the Fifth Amendment.
If Trump were to recategorize ESA regulations as Fifth Amendment takings, it could mean:
- Landowners Paid for Lost Use: Farmers, ranchers, and developers could recover the fair market value of the property rights they have lost
- Agencies Forced to Weigh Costs: Every new endangered species habitat designation could carry a budget impact, encouraging more precise, science-based decision-making
- A Fairer Balance between Conservation and Property Rights: Landowners with endangered species on their land would no longer be singled out to bear the entire cost of providing the public benefit of species protection
While some critics say this change could drive up costs and decrease conservation, many supporters argue that it simply restores fairness. If the public wants the benefit of habitat conservation and endangered species protection, then the public should share the costs.
A Promising Future for Property Rights Expansion
If the ESA reforms which the Trump administration has suggested were to become a reality, they could be one of the largest property rights expansions in decades. Currently, landowners whose ability to use their property has been taken must go to court and sue to invalidate the government actions, such as a critical habitat designation, which can be costly and time-consuming. Or a landowner could bring a taking case in the U.S. Court of Federal Claims and seek just compensation for the taking resulting from a critical habitat designation or permit denial. Again, this can be costly and time-consuming.
Many landowners simply absorb the cost of species protection. An executive order as suggested could make seeking just compensation in the Court of Federal Claims more streamlined, limiting costs and speeding up the process:
- Ranchers sidelined by grazing restrictions could be paid for lost pasture use
- Timber owners barred from harvesting could receive market-value compensation
- Developers frozen out of building by critical habitat maps could recover their investments
For decades, the ESA has asked individual landowners to carry the burden of protecting species for public good without sharing the cost. A taking-based compensation approach would flip that relationship on its head and make species protection a shared national responsibility rather than a private sacrifice.
Far more than a simple policy tweak, this possible change could drastically realign property rights, conservation, and constitutional law. For those whose livelihoods depend on their land, it could be the change they have been long awaiting.
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Nancie G. Marzulla is a founding partner of Marzulla Law, LLC, focusing on property rights takings litigation in the U.S. Court of Federal Claims. Nancie’s litigation practice concentrates on water rights, takings, and contract claims in the U.S. Court of Federal Claims. She also has extensive experience in handling matters involving property, water, environmental law, Indian tribal claims, development, and natural resources in trial courts, courts of appeal, and the Supreme Court.
