act, maintain that the statute is a valid exercise of Pennsylvania's inherent police power to regulate private industry for the public health, safety and welfare. Plaintiffs argue that the statute goes beyond police power and appropriates private property for public use in violation of the Takings Clause of the Fourteenth Amendment. Thus we are presented with a classic confrontation between private property interests and public powers of regulation since the opposing interests are well-defined and nearly perfectly equal in magnitude.
Because plaintiffs have not alleged any injury due to the enforcement of the statute, there is as yet no concrete controversy regarding the application of the specific provisions and regulations. Thus, the only question before this court is whether the mere enactment of the statute and regulations constitutes a taking. Agins v. City of Tiburon, 447 U.S. 255, 65 L. Ed. 2d 106, 100 S. Ct. 2138 (1980). For the reasons that follow, we hold that the Pennsylvania legislation and regulations do not exceed the inherent police power of the state as defined by Pennsylvania Coal and its progeny. Plaintiffs' motion for summary judgment must be denied and defendants' motion for judgment must be granted.
I. History of Case
Five coal companies and an association representing similar interests instituted this civil action challenging the constitutionality of three sections of Pennsylvania's Bituminous Mine Subsidence and Land Conservation Act, 52 P.S.A. § 1406.1 et seq, and three regulations of the Pennsylvania Department of Environmental Resources (DER) adopted under the act. Plaintiffs seek an injunction to prevent enforcement of these provisions by the DER officials.
The challenged provisions are as follows:
(1) Section 1406.4, which prohibits mining that causes subsidence damage to certain surface structures in place as of April 27, 1966, namely, any publicly-used building, residential building or cemetery.
(2) Section 1406.6, which gives the DER authority to revoke a mining permit if a company fails to pay a reasonable sum to repair subsidence damage to the structures listed in § 1406.4.
(3) Section 1406.15, which allows the owner of a structure not listed in § 1406.4 to pay a reasonable price to purchase from the coal company the underlying coal that supports the structure. This section provides for arbitration or mediation if the parties fail to agree upon a reasonable price.
(4) DER Regulation 89.145, which expands the protected structures of § 1406.4 to include: perennial streams and large impoundments of water, aquifers that serve as a significant source of public water supply, and coal refuse disposal areas. This regulation also prohibits mining under urban areas.
(5) DER Regulation 89.146, which requires coal operators to leave 50 percent of their coal in place for support under structures and features protected under § 1406.4 and DER Regulation 89.145.
(6) DER Regulation 89.147(b), which provides that, when underground mining activities reduce the value or foreseeable uses of surface land, the operator shall restore the land to its premining condition.
Plaintiffs contend that § 1406.4 and DER Regulations 89.145 and 89.146 violate (a) the Due Process Clause of the Fourteenth Amendment in that property is taken without just compensation and (b) the Contract Clause of the United States Constitution, Article I, Section 10, in that the regulations destroy private contract rights. Plaintiffs also argue that § 1406.6 and DER Regulation 89.147(b) impair private contracts in contravention of the Contract Clause. Finally, plaintiffs urge that § 1406.15 is an unconstitutional exercise of the power of eminent domain because the taking is without a public purpose.
II. The Contract Clause
Article I, Section 10 of the Constitution provides that: "No State shall . . . pass any . . . Law impairing the Obligation of Contracts. . . ." Although the language of the Contract Clause appears to be absolute, its prohibition must accommodate the inherent police power of a state "to safeguard the vital interests of its people." Home Building & Loan Association v. Blaisdell, 290 U.S. 398, 434, 78 L. Ed. 413, 54 S. Ct. 231 (1934); Energy Reserves Group v. Kansas Power & Light, 459 U.S. 400, 103 S. Ct. 697, 74 L. Ed. 2d 569 (1983). Any regulation promulgated by a state under its legitimate police powers does not violate the Contract Clause if the enactment serves a legitimate public purpose and does not simply provide a benefit to special interests. Energy Reserves Group, 103 S. Ct. at 705.
Courts generally will defer to a legislative determination of public purpose in testing legislation under the Contract Clause, except when the state enacts legislation to avoid its contractual obligations. Thus, when the state is a party to a contract, the Contract Clause is given a more absolute, literal meaning because "complete deference to a legislative assessment of reasonableness and necessity is not appropriate because the State's self-interest is at stake." United States Trust Company v. New Jersey, 431 U.S. 1, 26, 52 L. Ed. 2d 92, 97 S. Ct. 1505 (1977). Where the state is not a contracting party, "as is customary in reviewing economic and social regulation, . . . courts properly defer to legislative judgment as to the necessity and reasonableness of a particular measure." Energy Reserves Group, 103 S. Ct. at 705-06.
Justice Blackmun, speaking for a unanimous Court in Energy Reserves Group, wrote that economic and social legislation is to be analyzed under the Contract Clause through a three-step test. 103 S. Ct. at 704-05. That test was recently applied by the Court of Appeals in Troy, Ltd. v. Renna, 727 F.2d 287 (3d Cir. 1984), as Judge Gibbons explained:
The threshold inquiry is whether the state law has operated "as a substantial impairment of a contractual relationship . . . ." If the state law is found to be a substantial impairment, then a second inquiry is required: "the State, in justification, must have a significant and legitimate public purpose behind the regulation . . . such as the remedying of a broad and general social or economic problem. . . ." Finally, if such a legitimate public purpose is identified, a third query is posed: the next inquiry is whether the adjustment of the rights and responsibilities of contracting parties is based upon reasonable conditions and is of a character appropriate to the public purpose justifying the legislation's adoption.