## Facts

- Machipongo Land and Coal Company and related owners held coal estates within the Goss Run watershed in Clearfield County, Pennsylvania.
- Under the Pennsylvania Surface Mining Conservation and Reclamation Act, the Environmental Quality Board designated portions of the watershed “unsuitable for surface mining” to protect environmental and water-quality interests.
- The designation effectively barred surface mining of certain coal interests within the restricted area, allegedly eliminating the economic value of those coal estates.
- The owners brought a constitutional takings claim seeking compensation under the U.S. and Pennsylvania Constitutions.
- After earlier appellate rulings excused administrative exhaustion for the takings claim and returned the matter for judicial resolution, a trial court found a compensable regulatory taking by treating the restricted coal estate as the relevant property and concluding the owners lost all economically viable use of that interest.
- The Commonwealth Court affirmed the taking determination, and the Commonwealth appealed to the Pennsylvania Supreme Court.

## Issues

1. Whether designating land “unsuitable for surface mining” constituted a compensable regulatory taking of the owners’ property.
2. How to define the relevant parcel for takings analysis: the restricted coal estate alone or the owners’ property interests considered as a whole.
3. Whether the claim should be analyzed as a categorical total-taking under *Lucas* or under the multi-factor balancing test of *Penn Central*.

## Decision

- The Pennsylvania Supreme Court reversed the Commonwealth Court and remanded.
- The Court held the lower courts improperly defined the relevant property by isolating the restricted coal estate rather than applying the “parcel as a whole” approach.
- On the properly framed parcel, the record did not establish a categorical taking because the owners had not shown deprivation of all economically beneficial use.
- The Court directed that the claim, if pursued, be evaluated under *Penn Central* principles rather than a *Lucas* per se theory, and found the existing record insufficient to support compensation under the correct analysis.

## Legal Principles

- Takings analysis generally requires evaluating the “parcel as a whole,” not a segmented property interest selected to maximize apparent loss.
- A categorical regulatory taking under *Lucas* requires denial of all economically beneficial use of the relevant parcel; serious diminution in value alone is insufficient.
- When the alleged deprivation is less than total, the *Penn Central* factors guide the inquiry, including economic impact, interference with reasonable investment-backed expectations (measured against a backdrop of existing regulation), and the character of the governmental action.
- Environmental and land-use restrictions aimed at preventing public harm are typically treated as police-power measures, weighing against a finding of a compensable taking absent an unusually severe intrusion.

## Conclusion

The court rejected a takings finding because the lower courts improperly narrowed the denominator to the restricted coal estate; using the parcel-as-a-whole framework, the mining prohibition did not qualify as a *Lucas* total taking and instead called for *Penn Central* balancing, under which compensation was not established on the record.


Machipongo Land & Coal Co. v. Commonwealth, 799 A.2d 751 (Pa. 2002)