## Facts

- United Artists’ Theater Circuit, Inc. owned the Boyd Theater in Philadelphia.
- The Philadelphia Historical Commission designated the Boyd Theater as a historic building, including both its exterior and interior features.
- The designation restricted alteration and demolition and required preservation at the owner’s expense, enforceable through criminal penalties.
- United Artists challenged the designation as an uncompensated taking under Article I, § 10 of the Pennsylvania Constitution.
- In a 1991 decision in the same litigation, the Pennsylvania Supreme Court held the ordinance’s nonconsensual historic designation of private property was an unconstitutional taking.
- The City sought reargument, and the court limited reargument to whether historic designation constituted a taking under the Pennsylvania Constitution; the court also addressed the Commission’s authority to designate interiors.

## Issues

1. Whether designating a privately owned building as historic without the owner’s consent constitutes a taking requiring just compensation under Article I, § 10 of the Pennsylvania Constitution.
2. Whether the Philadelphia Historical Commission had statutory authority under the City’s Historic Preservation Ordinance to designate and regulate the building’s interior features.

## Decision

- The court held that historic designation without owner consent is not, by itself, a taking requiring compensation under Article I, § 10.
- The court withdrew its earlier 1991 conclusion that the ordinance effected a per se unconstitutional taking.
- Applying a fact-specific regulatory-takings analysis, the court concluded the designation did not deprive the owner of all, or essentially all, economically viable use and was not unduly oppressive.
- The court held the Historical Commission exceeded its statutory authority by designating the interior of the Boyd Theater as historic.
- The court vacated the interior designation while leaving the exterior designation intact.

## Legal Principles

- Regulatory takings claims under the Pennsylvania Constitution require a fact-specific inquiry; historic designation is not automatically a compensable taking.
- Courts consider the character of the governmental action, economic impact, and interference with reasonable investment-backed expectations (consistent with Penn Central factors).
- Pennsylvania’s regulatory-takings framework also considers: (1) the public interest served, (2) the necessity of the regulation to achieve that interest, and (3) whether the regulation is unduly oppressive.
- Historic preservation is a legitimate exercise of the police power when authorized by law and reasonably applied.
- Administrative agencies must act within the scope of authority granted by their enabling ordinance; regulation of interiors requires clear authorization.

## Conclusion

The Pennsylvania Supreme Court held that nonconsensual historic designation does not constitute a per se taking under Article I, § 10 and, on the record, did not require compensation, but it limited the City’s action by vacating the historic designation of the theater’s interior as beyond the Historical Commission’s statutory authority.


United Artists' Theater Cir., Inc. v. City of Phila., 635 A.2d 612 (Pa. 1993)