(Watch a companion video on this issue here.)
Michael and Chantell Sackett were building their dream home on less than two-thirds of an acre of land near Priest Lake in northern Idaho. They owned a small business nearby and had been looking forward to the day when they could stop renting — they purchased the property in 2005 for $23,000. In 2007, gravel was being laid in preparation for the pouring of a concrete foundation.
However, construction screeched to a halt upon the order of three agents of the Environmental Protection Agency. The property was a federally protected “wetlands,” the Sacketts were told, and they were served with a compliance order to immediately restore the property to its prior condition.
In fact, the EPA compliance order went even further. Relying on authority it claimed to have received under the Clean Water Act, EPA officials prescribed a set of conditions that went beyond the prior condition of the property when the Sacketts purchased it.
The Sacketts were ordered to plant “native scrub-shrub, broad-leaved deciduous wetlands plants and [have the property] seeded with native herbaceous plants.” Further, they were ordered to fence the property and monitor plant growth for three years.
All of this came as quite a shock to the Sacketts because their sliver of land was located in a platted residential subdivision with water and sewer hook-ups, and was bordered by roads on the front and rear and existing homes on either side.
There wasn’t any natural running or standing water on the property. None of the surrounding homes in the community were designated as having occupied wetlands.
The Sacketts conducted regulatory due diligence before they bought the property. Even the U.S. Army Corps of Engineers had been consulted. After buying the property, they applied for and received all of the pertinent local permits to build a residential dwelling as local zoning ordinances permit.
The EPA compliance order ended all of their hard work and saddled them with exorbitant financial costs. They faced monstrous-level fines — currently set at $37,500 for each day they failed to comply with the order.
Today, the Sacketts owe more than $40 million in fines.
Knowing there was an obvious mistake, the Sacketts attempted to administratively resolve the matter. They requested from the EPA documentation that would identify the property as wetlands. The federal government’s online wetlands inventory did not list their property, so the Sacketts asked the EPA to set aside its compliance order.
The EPA refused, claiming the Sacketts had no standing to question the agency’s decision.
The Sacketts faced a dilemma. It would have cost more to comply with the EPA order than the original purchase price of the property. So, they offered to surrender the property to the agency. The EPA refused and insisted the couple comply with the order.
This forced the Sacketts to file a lawsuit. They wanted their day in court to prove their property was not wetlands. The Fifth Amendment’s Due Process clause offers them this very protection: “No person shall be … deprived life, liberty or property, without due process of law.”
They did not get their day in court.
A U.S. District Court judge ruled against the Idaho couple in August 2008 and granted the EPA’s request to dismiss the couple’s lawsuit and ordered a judgment in favor of the agency.
The agency had argued that affected parties did not have the right to judicial review of the agency’s orders, as this would “disserve” the interest of the government. The Sacketts, the EPA argued, must first comply with the compliance order and return the property to the condition as dictated by the EPA, apply for a wetlands development permit, be denied that permit, and only then could they have their day in court. Not surprisingly, such a cumbersome process usually takes several years and costs hundreds of thousands of dollars.
The Sacketts continued with their legal action, but lost their appeal with the U.S. Ninth Circuit Court of Appeals in September 2010. The appeals court affirmed the lower court’s dismissal. The Sacketts’ request for a rehearing en banc was denied two months later.
The couple then appealed to the U.S. Supreme Court. In June 2011, the Supreme Court agreed to hear Sackett v. Environmental Protection Agency.