4.11.1. Riparian Lands and the Federal Navigational Servitude.Special valuation rules apply in acquisitions affected by the navigational servitude, a dominant federal easement over the nation’s navigable waters.1047 Arising under the U.S. Constitution, the federal navigation servitude is a preexisting limitation on the ownership of the flow of navigable waters and underlying streambeds.1048 This has important ramifications for the compensation due not only for navigable waters, which encompass the entire streambed up to the high-water mark, but also for riparian fast lands (upland) lying above the high-water mark.1049 In addition, by federal statute, Congress has increased compensation above what the Constitution requires in certain acquisitions of fast lands.1050 These constitutional and statutory requirements establish when market value due to a property’s access to or use of navigable waters can be considered, and when it must be disregarded, in appraisals for federal acquisitions relating to navigation. 

Origins of the Navigational Servitude.Although the federal navigation servitude affects compensation under the Fifth Amendment, it arises from Congress’ power to regulate commerce under Article I of the U.S. Constitution.1051 “Commerce includes navigation”1052—and so the Commerce Clause “confers a unique position upon the Government in connection with navigable waters.”1053 As a result, the great inland waterways have long been deemed national assets rather than the private property of riparian owners: they are “the public property of the nation.”1054 And while lands adjacent to or beneath navigable waters may be owned by states or individuals, their ownership “is always subject to the servitude in respect of navigation created in favor of the federal government by the constitution.”1055 

The Commerce Clause “speaks in terms of power, not of property.”1056 The navigational servitude “encompasses the exercise of this federal power with respect to the stream itself and the lands beneath and within its high-water mark.”1057 Accordingly, when the United States properly exercises its navigational servitude, no property is taken within the meaning of the Fifth Amendment, and no compensation is due.1058 

Navigable Waters.While the term navigable waters is significant in different areas of the law, only its meaning in the context of the navigational servitude is relevant here.1059 The basic standard is navigability in fact.1060 Waterways are “navigable in fact when they are used, or are susceptible of being used, in their ordinary condition, as highways for commerce.”1061 But this threshold question is not the end of the inquiry: for purposes of compensation under the Fifth Amendment, “the Supreme Court has rejected a mechanical test imposing the [navigational] servitude on all waters navigable in fact.”1062 Thus, whether the navigational servitude applies under federal law to a specific body of water that is navigable in fact must be determined on a case-by-case basis.1063 Arising mainly (but not only) in inverse takings claims, this determination cannot be made by the appraiser; legal instructions are required.1064 

Scope of the Navigational Servitude.The navigational servitude extends “to the entire bed of a stream, which includes the lands below ordinary high-water mark.”1065 It “applies to all holders of riparian and riverbed interests.”1066 Accordingly, property within the bed of a navigable stream is always subject to the potential exercise of the navigational servitude.1067 And while the navigational servitude does not extend beyond the high-water mark, it does affect the compensation for fast lands acquired by the United States in connection with navigation.1068 

Whether the federal project prompting an acquisition is related to navigation is determined by Congress or the agency officials to whom Congress has delegated this authority— primarily the U.S. Army Corps of Engineers.1069 “If the interests of navigation are served, it is constitutionally irrelevant that other purposes may also be advanced.”1070 Accordingly, “[o] nce Congress determines that an action will improve or protect navigation, the Government may rely on the navigation servitude to accomplish that action.”1071 And federal courts have repeatedly held that proper exercise of the navigation servitude stems from the purposes of the federal project as a whole rather than the immediate facts of a specific acquisition.1072 Indeed, the United States may “block navigation at one place to foster it at another.”1073 

Congress may also decide not to assert the navigational servitude in a specific acquisition or project—in other words, Congress may authorize payment of compensation above what the Constitution requires.1074 But “[s]uch a waiver of sovereign authority will not be implied . . . . [I]t must be ‘surrendered in unmistakable terms.’”1075 

Elements of Value Under the Navigational Servitude.Market value that is “attributable in the end to the flow of the stream—over which the Government has exclusive dominion”— is not compensable under the Fifth Amendment.1076 Similarly, any market value that arises from access to or use of navigable waters is allocable to the public, not to private owners.1077 Paying compensation for such values would permit private owners to receive windfalls to which they are not entitled under the Fifth Amendment.1078 Accordingly, while access to navigable waters may enhance the market value of fast land, any such value must be disregarded in federal acquisitions pursuant to the navigational servitude, except as provided below.1079 Under this established principle of law, “all value attributable to the riparian location of the land” is excluded from consideration under the Fifth Amendment.1080 As a result, when the United States acquires riparian fast lands in an exercise of its power to control commerce, elements of value that are not compensable under the Fifth Amendment include: port site value;1081 power site or power development value;1082 value due to riparian rights of access to navigable waters;1083 irrigation value;1084 and recreational value for boating, fishing, and hunting.1085 Any value arising from a property’s access to or use of navigable waters must therefore be disregarded in valuations for federal acquisitions relating to navigation— except as required by 33 U.S.C. § 595a, the federal statute discussed below.1086 

Statutory Modification. Congress modified the compensation rule disregarding value due to water access or use from consideration in 1970, with the enactment of 33 U.S.C. § 595a.1087 This statute specifically authorizes compensation for market value due to water uses—that is, for more than what the constitution requires—for lands above the high-water mark that are actually acquired by the United States.1088 But the statute does not allow compensation for loss of water access from property not acquired by the United States (remainder property),1089 nor for any property below the high-water mark.1090 The statute also made “no change in existing law with respect to the offsetting of special [direct] benefits to remaining real property against the just compensation” to be paid.1091 As a result, § 595a has different implications for total and partial acquisitions.1092 

Total Acquisitions Under 33 U.S.C.§ 595a.In total acquisitions, in which the United States acquires an entire larger parcel, 33 U.S.C. § 595a creates an exception to the rule to disregard market value due to water access or use for property above the high-water mark.1093 The statute provides that in connection with any improvement of rivers, harbors, canals, or waterways of the United States: 

[T]he compensation to be paid for real property taken by the United States above the normal high water mark of navigable waters of the United States shall be the fair market value of such real property based upon all uses to which such real property may reasonably be put, including its highest and best use, any of which uses may be dependent upon access to or utilization of such navigable waters.1094 

As a result, valuations of total acquisitions under § 595a are fairly straightforward: the appraiser must consider water-dependent uses in determining the highest and best use, and the market value of fast land actually acquired should include any value due to its riparian location.1095

Section 595a does not alter the rule that no compensation is due for lands below the high-water mark.1096 Such lands include property located in the bed of a navigable stream1097 or “spoil islands” and other infilled land created by the United States’ dredging activity.1098 And this rule does not change simply because the legal description of property being acquired may include or contain some land below the high-water mark—for example, if a deed is the source of a legal description, reflecting “a measure of convenience [rather] than a waiver of the navigational servitude.”1099 Note also that § 595a does not alter or replace the scope of the project rule, which bars consideration of changes in market value due to government project influence (see Section 4.5). As a result, application of the scope of the project rule and application of § 595a are separate inquiries.1100 

Partial Acquisitions Under 33 U.S.C.§ 595a.Partial acquisitions under 33 U.S.C. § 595a require a special valuation method because Congress expressly did not authorize compensation for diminution in value of landowners’ remaining property because of lost or reduced access to navigable waters. The statute provides: 

In cases of partial takings of real property, no depreciation in the value of any remaining real property shall be recognized and no compensation shall be paid for any damages to such remaining real property which result from loss of or reduction of access from such remaining real property to such navigable waters because of the taking of real property or the purposes for which such real property is taken.1101 

As a result, in partial acquisitions of riparian land under § 595a, access to or use of navigable waters must be considered in valuing the part acquired, but cannot be considered in evaluating any damage to the remainder property.1102 Moreover, because § 595a does not alter “existing law with respect to the offsetting of special benefits to remaining real property,”1103 any direct and special benefit to the remainder property—including benefits resulting from new or enhanced access to navigable waters due to the government’s acquisition—must be considered.1104 

The portion of § 595a prohibiting consideration of damage for remainder property’s loss of riparian access has been upheld as constitutional.1105 But federal courts have not specifically addressed the appropriate valuation method to measure compensation in partial acquisitions under the statute.1106 The usual before and after valuation method for partial acquisitions1107 does not readily allow the different treatment of the part acquired and the remainder property that § 595a requires.1108 As a result, valuing partial acquisitions under § 595a may require use of a taking plus damages method—but only with appropriate legal instructions.1109 

As explained in Section 4.6.4.1, the taking plus damages method is subject to error and apt to result in improper duplication (double damage), and is therefore generally improper in valuations for federal acquisitions. Its use is recommended here solely to address the unique challenges of valuing partial acquisitions under 33 U.S.C. § 595a. As discussed above, valuations of partial acquisitions under this statute must incorporate the following: 

Each of the steps in this rare application of the taking plus damages method requires great care to ensure its results can be used for purposes of just compensation. Note also that the portion being valued at each step must be valued as part of the appropriate larger parcel (Section 4.6.1.1). 

• Estimate the market value of the part acquired, including value due to water access. The market value of the part acquired must be estimated as a part of the larger parcel. As a result, the appraiser must estimate the market value of the larger parcel based on its highest and best use, including uses that depend on access to or utilization of navigable waters, before acquisition; then allocate that value to determine the contributory value of the part being acquired.1110 

• Estimate damage (diminution in value) to the remainder property resulting from the government’s acquisition, disregarding any damage due to lost or impaired water access. That is, what is the difference in value of the remainder property before and after the acquisition, based on its highest and best use excluding uses that depend on access to or utilization of navigable waters? There may or may not be any diminution in value of the remainder resulting from the government’s acquisition that is unrelated to water use or access.1111 

• Estimate special and direct benefits to the remainder resulting from the government’s project, including those due to new or enhanced riparian access.1112 For example, such benefits include direct river access from the remainder property from which a landowner can build docks or piers (subject to applicable laws)1113 or improved bank stabilization and flood control due to a revetment project that allows remainder property to be converted to a more valuable use.1114 Any direct and special benefits resulting from the project must be offset against the total compensation to be paid.1115 

Following these steps, the ultimate calculation will reflect the market value of the part acquired (including water access) plus damage to the remainder (disregarding lost water access), offset by direct and special benefits to the remainder (including new or improved water access). 

The Navigational Servitude and Inverse Taking Claims.As the Supreme Court has observed, the navigational servitude does not create a blanket exception to the Takings Clause whenever Congress exercises its authority to promote navigation under the Commerce Clause.1116 In inverse takings claims, courts must consider the factual circumstances of each case regarding the scope of the navigational servitude to determine whether a public action has effected a taking.1117