Building Industry Association Bay Area v. City of Oakland

Development projects do not cause a need for public art

Cases > Property Rights > Building Industry Association Bay Area v. City of Oakland
Lost: The judge rejected both the First Amendment and Fifth Amendment claims.
Case Court: Ninth Circuit

An Oakland city ordinance requires anyone building a new residential or commercial project to either create a government-approved display of art or subsidize artists to create a display elsewhere in town. PLF represents the Building Industry Association of the Bay Area in a lawsuit challenging this law as violating the constitutional prohibition on taking money as a permit condition to fund government projects that are not directly related to the construction for which the permit is sought. Moreover, the law violates the First Amendment by forcing property owners and developers to engage in expressive activity.

On behalf of the Building Industry Association of the Bay Area, PLF sued the City of Oakland, California, challenging the constitutionality of a development fee to fund public art projects. The public art law was originally intended to create business for local artists and sought to achieve this objective by conditioning all building permits on a requirement that the developer give a percentage of the project cost to a local artist to install freely accessible public art on the project. After reviewing the lawsuit, however, the city amended the ordinance to “encourage, but not require” that the developers use local artists. Nonetheless, the city’s amended law violates home and commercial builders’ First and Fifth Amendment rights.

The Fifth Amendment of the U.S. Constitution requires the government to pay just compensation when it takes property for public use. It bars cities from evading this requirement by demanding unrelated property in trade for a permit. That is, the government cannot take property – including money – to address problems unrelated to the construction project for which the permit is sought, unless it pays just compensation. The amended ordinance purports to identify “needs” created for public art, but all of them are community-based, not specifically tied to the proposed development as the constitution requires. Moreover, because the developers are forced to display art created by specially-defined “artists” when they would rather not engage in artistic expression on their property, the law violates the First Amendment as well.

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What’s at stake?

  • Cities may choose to subsidize public art with general tax revenue, but they may not force transfers of property from owners to special interests, including artists.
  • Oakland is violating constitutional protections for property rights and free speech — and unjustly raising costs for home buyers and businesses — by forcing builders of homes and commercial projects to fund art works that have no reasonable connection to any public needs created by their building projects.

Case Timeline

August 31, 2015
November 17, 2014

Case Attorneys

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