Whose House Is It Anyway?
By: Reed Karaim Source: AARP Bulletin Today Date Posted: November 2005
Until June, Americans hadn't given much thought to eminent domain, the right of government to forcibly acquire private property. That changed when the U.S. Supreme Court ruled, 5-4, against Susette Kelo and six of her neighbors in the most highly publicized property rights case in years. The city of New London, Conn., won the right to buy land from Kelo and the other property owners so it could be developed into a 90-acre residential and office building waterfront development with a resort hotel and conference center
If the property owners and their backers lost the legal battle, they triumphed in the court of public opinion. Front-page and top-of-the-news stories largely cast the ruling as a significant expansion of the government's power to seize property, an expansion that an overwhelming majority of Americans don't like at all, polls showed. Not surprisingly, Congress rushed to introduce legislation that would limit the use of eminent domain. Twelve states considered their own measures, according to the National Conference of State Legislatures; three passed laws, and many more states are expected to take up the issue next year.
There are starkly different views about the significance of the court's ruling. The Institute for Justice, a libertarian legal group that represented the homeowners, has called Kelo v. the City of New London a sea change. The institute's website links to 32 eminent domain cases around the country it says prove that "the floodgates are opening to abuse." But most, if not all, of the cases existed before Kelo, and it is uncertain what impact the ruling will have on them. Existing state laws and procedures still have to be followed in eminent domain cases.
The National League of Cities, which supports the Supreme Court decision as an affirmation of current practice, doubts the ruling has promoted new home seizures. Nonetheless, press reports indicate some local officials feel emboldened by the decision. In Lodi, N.J., where the borough has been seeking to condemn two trailer parks to make way for new development, Mayor Gary Paparozzi was quoted calling Kelo "a shot in the arm" for the borough.
Lost in the heated rhetoric has been a look at how eminent domain actually works. "The media has tended to paint this purely as an issue of property rights," says Susan Ann Silverstein, an AARP attorney. "But when it comes to public policy implications, it's really a matter of balancing community interests and individual rights."
The Fifth Amendment to the U.S. Constitution says government shall not take private property "for public use, without just compensation." The federal courts have allowed the states wide latitude in deciding what constitutes "public use," not only allowing eminent domain for traditional government projects such as roads and bridges, but also for economic development and urban renewal of "blighted" neighborhoods.
In Kelo the city didn't claim the litigants' working-class neighborhood along the Thames River was blighted. The city contended that the new jobs and tax revenue it expected from redeveloping the waterfront was a public use that justified the transfer of property to a private developer.
AARP filed a brief supporting the property holders. In promoting policies that allow Americans to age in place as active members of the community, the organization has been concerned that older and minority residents often heavily populate neighborhoods condemned under eminent domain.
Still, Silverstein believes Kelo's impact may be overstated. The ruling, she says, doesn't allow a local government to seize property simply because it wants to give it to someone more powerful. "The mayor can't come in and say, 'John Smith, I'm giving your house to so-and-so because he's going to build a bigger mansion that we can tax at a higher rate,' " she says. "It has to be part of some larger plan to improve the community."
Given the court's emphasis on the open, public process that led to New London's redevelopment plan, some legal scholars believe the ruling actually tightens the reins on government. "I read it as changing the signal for using eminent domain for economic development purposes from a bright green light to a yellow flashing light," says John D. Echeverria, executive director of Georgetown University Law Center's Environmental Law and Policy Institute.
Echeverria says the ruling simply reaffirmed established precedent. While eminent domain should "not be taken lightly and should be used sparingly," he says, it's an essential government tool that has allowed everything from highways to urban revitalization.
Chris Duerksen, managing director of Clarion Associates, a national land-use consulting firm based in Denver, worries the public has been led to believe eminent domain is primarily used to take property from the powerless. It can be used to protect the less powerful as well. One famous case that also went to the Supreme Court, in 1984, allowed Hawaii to prevent a few very large landowners from dominating the real estate market on the islands, making it easier for average people to own homes.
"There are all kinds of examples where a single wealthy property owner tries to extort some exorbitant price from the local government," Duerkson says, "and it's only the threat of eminent domain that allows a project to proceed that will benefit lots of people."
But Duerksen and other experts also agree there have been abuses, and parts of eminent domain law deserve renewed scrutiny. Some say the question of "just compensation" should be carefully considered to make sure property owners are treated fairly. And loosely defined blight designations can too easily be used to condemn older neighborhoods, says Elizabeth Merritt, an attorney at the National Trust for Historic Preservation.
But she is skeptical of federal legislation, believing eminent domain is best handled at the state level, where lawmakers are closer to the consequences. "It's very healthy having a public dialogue about what's appropriate in eminent domain," Merritt says. "What will come out of the state legislatures is likely to be good reform."
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