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The “takings” clause of the Fifth Amendment of the U.S. Constitution requires the government to pay compensation to owners of private property when their land is appropriated for public uses such as building roads. In early cases, only the physical invasion of private property for public use was considered a just taking. For example, in 1871, in the case of Pumpelly v. Green Bay Co., the court ruled that when dam construction flooded private property, the loss of property was considered a taking. Conversely, regulatory action that affected the economic value of the property, such as rezoning legislation that forced an operating business to close, was not considered a taking.

A major shift in takings jurisprudence occurred in 1987 when the Supreme Court had to rule ...

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