Shop owner gets to stay put: St Louis (MO) Post-Dispatch, 5/26/05

By Jake Wagman

A St. Louis auto mechanic whose repair shop was targeted for acquisition to make way for a "Media Box" will get to keep his land after all.

The board of directors for Grand Center, the development agency that presides over the cultural district of the same name, voted Thursday to drop its eminent domain suit against Gentle "Jim" Day, owner of Royal Auto Repair.

"It's a very, very happy day in my life," Day, 58, said from his shop.

For 20 years, Day made his $1,222 monthly mortgage payment. He took title to the land last year. By then, however, he was mired in a court dispute with Grand Center over whether he should be forced to sell so the agency could add an artistic attraction to the area around Grand Boulevard in midtown.

Day's plight became public this year. And Day, the son of Arkansas sharecroppers, received an outpouring of support from opponents of eminent domain. On Thursday, a table near his cluttered office at the repair shop bore news clippings about his eminent domain fight and contact information for the local alderman.

Eminent domain is the power granted in the Fifth Amendment of the Constitution that allows local governments to acquire private property for public benefit.

The U.S. Supreme Court is expected to rule soon on a Connecticut case that could curtail that right, potentially affecting several projects in the St. Louis region and hundreds nationwide.

Day's situation has parallels to the circumstances surrounding Kelo v. New London, Conn., which questions whether eminent domain can be used as a tool for economic development.

In Day's case, that power went to Grand Center, a nonprofit organization run by former St. Louis Mayor Vincent Schoemehl.

The St. Louis Board of Aldermen three years ago named Grand Center as the "master developer" of a swatch of land near St. Louis University, roughly bordered by Forest Park Avenue and Delmar Boulevard. That gave the agency broad control over land use, including the ability to dispense tax incentives, approve or reject building designs and to acquire land.

Schoemehl wanted to see Day's triangle of land between Spring Avenue and Olive Street turned over to a private developer.

Envisioned was a building with a design studio and residential units that would have some sort of "multimedia component," thus dubbed a Media Box.

But on Thursday, Schoemehl said the Grand Center board unanimously followed his recommendation to drop the eminent domain suit against Day. Other Grand Center sites will be scouted for the proposed building, he said.

Schoemehl had been under political and public pressure to reach an amicable settlement with Day after the Post-Dispatch reported the dispute in February. Among those seeking a resolution was the alderman in the ward, Mike McMillan, and U.S. Rep. William Lacy Clay Jr.

Schoemehl would not say whether he would use eminent domain in future land deals.

"I don't have an opinion on that," Schoemehl said.

St Louis Post-Dispatch: www.stltoday.com

MBTA pays $200K in eminent domain case: Cohasset (MA) Mariner, 5/27/05

By Samantha Brown

The Massachusetts Bay Transportation Authority [MBTA] has paid a settlement 10 times that of their original offer to a Cohasset couple whose land was taken by eminent domain as part of the Greenbush line construction.

William and Huguette Stone were the owners of a vacant lot at 383 South Main St., of which the MBTA took a portion by eminent domain last November. The government has the right to take private land by eminent domain for public use, and there is usually compensation awarded to the owner in return.

Although the MBTA originally offered $20,000 for the property, the couple's attorney Peter E. Flynn of Saugus said a complaint was filed in Norfolk Superior Court and an agreement has been reached, paying compensation to the Stones in the amount of $200,000.

"We were thrilled to obtain ten times the MBTA's original offer and present the Stones with a check for an additional $200,000," said Flynn, adding it was especially important for his clients that they were able to come to a resolution quickly, "while also avoiding lengthy, costly, and uncertain litigation."

The land was taken from the Stones Nov. 1, 2004, and at that time the MBTA felt its offer of $20,000 was proper compensation. However, Flynn said the Stones were not happy with the settlement and filed a complaint in Norfolk Superior Court Dec. 7.

Although litigation was filed, Flynn said, "Negotiations with the MBTA continued, which allowed us to come to an agreement quickly and withdraw the complaint before further pursuing the litigation."

The complaint alleges the compensation was "inadequate and does not reflect the fair market value of the property taken, and/or damages to the plaintiff's remaining property." Flynn explained the land is reasonably suited for some limited development, but that "Any development would encounter issues relating to the presence of wetlands, access, and a right of way over a railroad line," once construction of the Greenbush line is complete.

Through much negotiation, the $200,000 settlement was reached, and the Stones filed a notice of voluntary dismissal in Norfolk Superior Court March 15. Flynn said he and his clients are very happy with the outcome, adding while construction of the Greenbush line is somewhat controversial, it is a "worthy project."

spokesman Joseph Pesaturo said in order to build the Greenbush line, the MBTA has taken roughly 90 pieces of property by eminent domain throughout the entire 17-mile Greenbush corridor. There have been 30 eminent domain cases negotiated with property owners and nine property owners, including the Stones, have challenged the MBTA's taking price and have filed lawsuits.

The Greenbush Line is the third leg of the Old Colony Railroad Restoration Project, and is being built as mitigation for the Central Artery/Tunnel Project in downtown Boston. The project will stretch for 17 miles and once complete, will restore train service from Scituate to South Station. The project is intended to reduce automobile traffic on the congested highways leading into the city. According to the MBTA, the project will cost roughly $479 million including planning, engineering, land and permitting costs, along with the cost of construction and new trains.

Cohasset Mariner: www2.townonline.com/cohasset


"Super Slab" opponents making pitch to Owens: The Denver (CO) Post, 5/24/05

The governor has hinted at a veto for one of two bills intended to block a huge toll road on the plains

By Colleen Slevin, Associated Press

Eastern Plains residents who have fought plans to build a private toll road near their homes are trying to pressure Gov. Bill Owens to sign legislation that would make it more difficult to build such highways.

Opponents of the so-called "Super Slab" project plan to rally Saturday at the state Capitol and also have been e-mailing the White House and the Republican National Committee to draw attention to their cause.

Owens has hinted he could veto at least one of the two bills lawmakers rushed to pass before heading home - a measure that would bar private companies from forcing landowners to sell their land in order to build roads.

Ray Wells, the man behind the project, which is officially called the Front Range Toll Road, has said Senate Bill 230 would block such projects because a few landowners could refuse to sell.

Owens has said he fears it could prevent future private road projects at a time when the state doesn't have enough money to pay for transportation needs.

"No bulldozers are lining up in Elbert County this summer. There is plenty of time to study what should be done," Owens spokesman Dan Hopkins said Friday.

Sharon Croghan, a rally organizer from Adams County, said many people from eastern Colorado have supported Owens because they see him as an advocate of private-property rights. She said vetoing the bills would be inconsistent.

"We're trying to make the point to the governor that this is really important to us. We think a private corporation having that power unchecked is wrong," she said.

Owens, who supported the public-private partnership that built the E-470 toll road east of Denver, is less concerned about the second bill, Hopkins said. House Bill 1342 would require private road projects to follow the same environmental and other regulations required of public roads.

Croghan and rally organizer Patty Sward of Elbert County said they don't support Wells' current proposal but recognize that another road may be needed to help ease congestion partly caused by people who have moved to the country but commute to work in Denver.

They just don't want to see a private company making all the decisions about where and how it should be built.

"When you take that government oversight piece out of it, you're talking David versus Goliath and you're also taking David's slingshot away," Sward said during a telephone interview as she sat in stop-and-go traffic on Interstate 25.

Denver Post: www.DenverPost.com


Agency may buy Monte del Lago: Monterey (CA) Herald, 5/21/05

The Housing Authority has researched seeking a court order to declare eminent domain

By Joe Livernois

Residents in a North County mobile home park heard encouraging news Friday night in their fight against the corporate owner of their park.

Officials from the Monterey County Housing Authority told tenants of the Monte del Lago park that declaring eminent domain on the property might be possible, depending on how it's appraised. The appraisal is expected to be completed within two months.

"The appraisal will be a huge factor," said Starla Warren, a Housing Authority official who has been investigating numerous scenarios that could help residents fend off steadily escalating rents.

Residents first came to county officials two years ago, after the owner of Monte del Lago started terminating leases and ratcheting up rents on the spaces. Tenants own and make mortgage payments on their mobile homes, but must lease the ground on which the homes sit at Monte del Lago.

The 310-home park is owned by Equity Lifestyle Properties of Chicago, a public company that specializes in buying up undervalued properties.

Resident Bill Hellam on Thursday received notice from Equity Lifestyle that his rent will increase soon to $875, an increase of $350. Hellam is 87 and has lived at Monte del Lago for 24 years.

After determining that it will not pursue a rent control ordinance that would stanch the rent increases, the Board of Supervisors asked the Housing Authority to investigate alternatives. The agency operates housing complexes for low-income and aging residents throughout Monterey County.

The Housing Authority has researched the possibility of seeking a court order to declare eminent domain on Monte del Lago and Warren presented various scenarios to the agency board Friday night. By acquiring the property, the Housing Authority could establish restrictions on rent.

With eminent domain, the agency would have to prove that its acquisition of the property is needed to advance the "public good." The agency would then pay the owner fair market value.

According to Housing Authority officials, it might be able to pull off such an acquisition if the property is not valued at more than about $30 million.

At the same time, the Housing Authority could be in for a legal battle with Equity Lifestyle Properties, which is well-known among mobile home owners as being furiously litigious.

During the past several months, Monte del Lago residents have expressed frustration with the Housing Authority because they sensed it was reticent about pursuing action on their behalf.

But residents said Friday they were impressed with Warren's presentation. And agency officials pleaded with the residents to be patient.

"The big issue for us is that we'll likely be fighting a legal battle with a huge conglomerate," said Alan Styles, chairman of the Housing Authority board. "I understand the emotion, but we need to be careful that what we do here is not going to jeopardize the clients we already have. We need to be absolutely sure what we're doing."

Residents are already starting to flee the park. Among those leaving is Joe Russo, a retired Catholic priest who led tenant efforts against Equity Lifestyle Properties. Russo said he can't afford the rent increases and is preparing to move to another park in Corning, above Chico. He said rents there are about $350 a month, about $600 less than he is paying at Monte del Lago.

But at 87, Hellam said he has no choice but to try to find a way to pay his $875 rent. He said he retains hope that the Housing Authority will find a way to ease the situation.

"I have a feeling after tonight that something is going on," he said. "There are so many people who are giving up hope, but I have a good feeling."

Monterey Herald: www.montereyherald.com

Revitalization Projects Hinge On Eminent-Domain Lawsuit: Washingon (DC) Post, 5/21/05

By Kirstin Downey

Seven years after a real estate agent came knocking at her door [in New London CT] to tell her that her house was being condemned by the city to make way for a luxury hotel and office complex, Susette Kelo, a 48-year-old nurse, is still seething with rage.

Perched stiffly at the kitchen table of the cozy Victorian cottage she refurbished "from the concrete in the basement to the shingles on the roof," Kelo pours out the story of how she has fought the city and state, taking her case all the way to the Supreme Court. "I don't like to be pushed around," she said.

Now one woman's anger and determination may affect urban revitalization projects all over the country. She and her backers say the government has overstepped; those on the other side say such actions are needed for the public good.

Kelo's lawsuit, filed with eight neighbors and financed by the libertarian advocacy group Institute for Justice, alleges that New London's plan to redevelop the waterfront area where Kelo lives is unconstitutional because the government wants to take her land for private redevelopment, not public use as the Fifth Amendment permits.

While the Constitution grants governments the power to take land for public use, it specifies only that owners be given "just compensation" for their loss. Through the years, the people on the losing end of the arrangement have disliked it; the people deciding what needs to be taken have defended it.

There is little dispute over many kinds of public land use, such as that for schools, roads and water-treatment plants. In the past five decades, however, municipalities have expanded the interpretation of "public use" to include revitalizing dilapidated downtowns, removing urban blight and boosting tourism and tax revenue.

In the Washington area, the power of eminent domain, or the threat of it, was used to spiff up Pennsylvania Avenue and to build the Metro system and the development parcels around its stations. The District hopes to redevelop a down-at-the-heels cluster of stores in Southeast Washington known as the Skyland Shopping Center into a more upscale shopping complex, and if the 16 property owners there don't agree to sell their land to the city voluntarily, city officials say they will take the land through eminent domain. That plan could die if the Supreme Court rules in favor of Kelo.

City officials around the nation are watching uneasily as the Supreme Court deliberates. D.C. Mayor Anthony A. Williams (D), who is president of the National League of Cities, said he is worried that the case could interfere with "the critical need of cities to use this tool — reluctantly — for public purpose and benefits."

Williams said the success of the Kelo lawsuit represents the growing political strength of what he views as radical property-rights activists.

"Some of these people wouldn't use eminent domain to build a highway or a railroad," Williams said.

The Institute for Justice says it accepts the use of eminent domain for roads, schools and parks and opposes it for privately owned, for-profit operations. Lawyers there say they have taken Kelo's case because they think it represents a classic case of excessive use of government power. "It's an unholy marriage between land-hungry developers and tax-hungry local governments," said John E. Kramer, an institute spokesman. Institute officials say they found 10,282 incidents of filed or threatened condemnation procedures in which land was given to private, for-profit parties, such as Target or Costco stores or casino parking lots, between Jan. 1, 1998, and Dec. 31, 2002.

The Kelo case arose when New London, an old and scruffy city seeking to jump-start its economy, turned to urban redevelopment. Once a whaling center second only to New Bedford, Mass., and then a shipping and manufacturing hub, New London has slowly lost its industrial and commercial base.

In 1997, Pfizer Inc., the giant pharmaceutical firm that makes such drugs as Zoloft, Viagra and Celebrex, began discussions with state and local officials about a $300 million research plant in New London that would bring 2,000 jobs. It was the first time a major manufacturer had expressed interest in moving to New London in more than 100 years.

In a March 1999 letter, George M. Milne Jr., president of Pfizer's Central Research Division, wrote that the company's New London expansion "requires the world class redevelopment planned for the adjacent 90 acres," which included Kelo's neighborhood, encompassing about 115 properties. Milne said Pfizer needed a 200-room waterfront hotel, a conference center, a physical fitness area, extended-stay residential units and 80 units of housing.

Kelo learned about the government's plan for her property when a real estate agent showed up on her doorstep in early 1998, telling her that her home was scheduled for demolition and that she had better sell quickly. Kelo bought the two-bedroom, one-bathroom house for $53,000 in 1997. The real estate agent offered her $68,000. Kelo told the agent to get off her property. Other area residents were easier to persuade.

The issue of compensation was a sticking point. When Kelo bought her house, the Fort Trumbull area was run down, wedged between a decommissioned military installation and a ramshackle marina, near a malodorous sewage-treatment plant. But by the time demolition of the neighborhood began, there was a blue-chip corporate research center and an attractive waterfront park with bike trails and green lawns. The sewage smell had abated. And when Pfizer decided to build a state-of-the-art day care center for the children of its employees, the corporation bought homes near its compound, paying prices considerably higher than the previous going rates. One house reportedly sold for $400,000. Kelo said the final government offer she received was $125,000.

In a statement, Pfizer said it is not a party to the suit and has no stake in its outcome. It said it had been a "good citizen" in New London and is now the city's largest taxpayer.

Kelo decided to fight the condemnation and got support from area activists who also opposed the project. With the backing of the Institute for Justice, Kelo and eight other property owners sued and won at the Connecticut Superior Court, but the city appealed to the state Supreme Court, which sided with the city. In February, the U.S. Supreme Court held oral arguments on the case, and a ruling is expected sometime this spring.

No construction has occurred at the site because prospective developers were frightened away by the lawsuits and controversy, said New London city manager Richard M. Brown.

In the meantime, the city's financial plight has worsened. In a recent budget statement, Brown reported that the city lost $1 million in expected tax revenue, partially because the Fort Trumbull neighborhood that had once paid taxes has been destroyed. The city's budget had relied on projected building permit fees that never materialized. Homeowners will likely face higher taxes, city officials said. The city took another blow last week, when the Pentagon announced plans to close the U.S. Naval Submarine Base, one of the city's largest employers, eliminating 7,096 military jobs and 952 civilian jobs.

For Kelo, not much of a victory is possible. Her house faces a gated state park with the modernist, six-story Pfizer research headquarters looming overhead. The blocks where her neighbors lived are a flattened expanse of dusty, rock-strewn soil with a handful of remaining structures poking out desolately. A nearby vacant lot is a dumping ground for smashed and abandoned buses and burned-out cars.

"It was always a quiet neighborhood," Kelo said. "Now it's just quieter. I don't like the fact they're all gone, but what can you do?"

Washington Post: www.washingtonpost.com

Eminent domain taking is upheld: The Cincinnati (OH) Enquirer, 5/21/05

Appeals court finds Norwood acted properly

By Sharon Coolidge

The city of Norwood [OH] properly used eminent domain when it seized five properties off Interstate 71, saying the homes and businesses on the land were deteriorating and posed a danger to the community, the 1st District Court of Appeals ruled Friday.

Norwood handed over the land to Anderson Real Estate and Miller-Valentine Group after seizing the properties, citing a study that found the property was deteriorating. They are building a $175-million complex of offices, shops, residences and restaurants. The developers have bought 65 other properties in the area bounded by I-71 and Edmondson and Edwards roads, most of which have already been razed.

The ruling upheld a June 2004 decision by Hamilton County Common Pleas Court Judge Beth Myers.

"The Ohio Supreme Court requires that we give the definition of 'blighted area' a liberal interpretation," wrote 1st District Court of Appeals Judge Mark Painter.

"Once a legislative determination of blight has been made, courts are required to and should be zealous in giving such determination by the city great weight.

"We will not substitute our judgment for that of the legislative body of the city," Painter added.

The decision addressed two properties specifically - a rental home on Delmar Avenue owned by Joe Horney and a home on Atlantic Avenue owned by Joy and Carl Gamble.

But the same argument applies to a third property, the Kumon Math and Reading Center on Edmondson Road.

The owners of Wilker Design on Edwards Road are appealing the city's use of eminent domain separately and the owner of Hyde Park Holistic Center on Edmondson Road has since dropped his appeal.

The Washington, D.C.-based Institute for Justice, a public-interest law firm which represents Horney and the Gambles, said it will ask the Ohio Supreme Court to take the case. Ohio's high court has already said the properties in question cannot be destroyed until the issue is resolved.

Horney and the Gambles have vowed to continue to fight against the taking of their property.

"The appeals court's decision opens the floodgates to further abuse of eminent domain," said Bert Gall, an attorney at the Institute for Justice. "Under its decision, developers are free to buy out a city's power of eminent domain for private development projects. The United States and Ohio constitutions forbid that result, and we are confident that we will prevail at the Ohio Supreme Court."

Norwood's attorney, Tim Burke, said he doesn't expect the Ohio Supreme Court to take up the case.

"Given four judges have all looked at the case and all have decided in favor of the city of Norwood, I think it reduces the likelihood that the Ohio Supreme Court will take jurisdiction over the case," Burke said. "Frankly, I really hope people recognize the fight is just about over and maybe it's time for everyone to move on and allow this project to go forward."

Attorney Richard Tranter, who represents Anderson Real Estate and Miller-Valentine Group, added, "This decision confirms that Norwood's urban renewal process was open, deliberative and served the community interest."

Although the developers cannot touch three properties involved in the appeal, they are close to completing the demolition of the other 68 structures on the 10-acre site, which is the first step of Rookwood Exchange.

Tranter would not comment on when building will begin.

Friday's unanimous appellate decision by Painter, Lee H. Hildebrandt Jr. and Robert Gorman said the city did not abuse its discretion in finding that the area was in danger of deteriorating into a blighted area.

"In our system of government, we require judicial deference to be given to a city council's decisions," Painter wrote. "...legislatures are better able to assess what public purpose should be advanced by the exercise of eminent domain."

The appellate court pointed out that the Norwood council considered several factors, including traffic congestion, noise, diversity of ownership, safety issues because of dead-end streets and the quality of residential living in the area at night because of lights from nearby developments.

After hearing what Norwood considered, Myers found the city had sound reasoning in taking the property. The appellate court agreed.

The Institute of Justice also argued that Norwood's urban renewal plan didn't comply with city code, that eminent domain can't be used to eliminate deteriorating conditions and that the city was using the deteriorating designation to mask the real reason for wanting the property.

The appellate court found no merit in those arguments.

Norwood Mayor Tom Williams said he's pleased with the appeals court's decision. "A Common Pleas Court judge and three appellate court judges have said that Norwood followed the law in the action we took," he said. "It's time for this project to move forward."


Fall 2002: Anderson Real Estate and Miller-Valentine Group begin talking about Rookwood Exchange, a $175 million shopping and office complex off Interstate 71.

August 2003: Norwood City Council accepts an urban renewal plan that finds property in the area is deteriorating, thus can be seized through eminent domain.

November 2003: Norwood files to take the five properties through eminent domain. Owners of the other 65 properties needed for the project agreed to sell.

September 2003: The property owners file a lawsuit in Hamilton County Common Pleas Court challenging the eminent domain action.

June 2004: Hamilton County Common Pleas Judge Beth Myers ruled the city properly used eminent domain power.

February 2005: The Ohio Supreme Court says three of the properties in question cannot be destroyed until the appeals process is finished.

The Cincinnati Enquirer: http://news.enquirer.com

Debate Pits Private Property Against Powers of the State: Online Wall Street Journal, 5/19/05

Later this spring, the Supreme Court is expected to issue an opinion on the power of governments to seize private property.

The closely watched case centers on a New London, Conn., economic development plan. The city wants to use eminent domain to build offices, a hotel, condominiums and parking where houses now stand, arguing that its plan has economic benefits in new jobs and property-tax revenue. But opponents maintain that the project isn't a legitimate public use, saying it unjustly takes private property for a project that will benefit other private interests.

As a warm-up to the court's decision, which is expected sometime before the end of term June 30, economist blogger Don Boudreaux and Harvard Law professor David Barron debate the theories underlying eminent domain and public use of private property.

Don Boudreaux writes: Secure private property rights are the foundation of liberty and commerce — the chief pillars of our civilization. Such rights give each of us the elbow room necessary to develop our unique talents and to think and act in whatever peaceful ways we like, even if others find our thoughts and actions to be disagreeable. Security of these rights also encourages the mutually beneficial exchanges upon which economic prosperity depends, in large part by preventing property transfers that aren't mutually beneficial.

Suppose I think that I value my neighbor's car more than he values it. The only way for me (or anyone else) to be sure is for the law to require me to secure my neighbor's consent to sell his car to me. If I could simply take his car without his consent as long as I agreed to pay the car's blue-book value, there's no guarantee that this property transfer is mutually beneficial. My taking my neighbor's car without his consent is thievery, pure and simple. No economy rises above subsistence without a widespread, hard and fast requirement of mutual consent for property transfers.

Contrary to much modern mythology, nothing about government renders its violations of property rights less objectionable than those of common thieves and vandals. If the city of New London, Conn., is permitted to confiscate property belonging to others, even if it is required to pay fair market value to the former owners, ordinary people will be less secure in their persons and possessions.

And the general populace, if not the local government, will be poorer than otherwise. How could it not be so? If government is permitted to confiscate property rather than purchase it, the presumption must be that government values the property less highly than it is valued by the private owners from whom it is taken. Even if in a particular case this presumption doesn't hold (although we can never know when such a particular case arises), the policy of permitting government to take property without the consent of its owners inevitably encourages thievery by the state.

David Barron writes: Thanks, Don, for getting us going — and in such sweeping terms. It's hard to know what to make of grand claims about the importance of the right to property necessarily conflicting with the government's power to take it — given that the right to property grew up along with the government's authority to exercise the power of eminent domain. The very same Constitution that precludes the government from depriving people of their property without due process of law makes it perfectly clear that the government can take that property for a public use so long as it pays just compensation. The founders were no slouches when it came to property rights. The American historian Charles Beard made a career making that point. But you make them sound like the outspoken leftist John Reed (played by Warren Beatty in the movie "Reds") and his fellow travelers.

So, is it the case that we can't have secure property and permit eminent domain? If so, what's the evidence for that? Seems like we are doing pretty well economically without the constraint. And, in fact, as the Supreme Court has set forth an ever more deferential approach to the government's assertions of authority to engage in eminent domain — in cases such as Hawaii Housing Authority v. Midkiff and Berman v. Parker — economic growth hasn't seemed to falter. Nor, from what I can tell, has a general sense of being secure in one's property taken much of a hit. If anything, market fetishization is on the upswing.

That doesn't mean there are no hard questions when it comes to eminent domain. The Supreme Court is presented with a potentially difficult one at the present moment. The case concerns whether the city of New London can take private property (while compensating) and then make it available for private development. That action at least raises an issue about whether the government is conforming to the Constitution, which requires takings to be for a public use. I think the court should uphold the exercise of eminent domain in that case. I am quite confident you don't. But from your first post, it seems like you think that the government couldn't take the property even if it was going to build a public road or an airport or any number of clearly public uses.

Does our tradition of respect for private property really mean that the government can be held hostage to any holdout who wants to preclude the development of a government highway? Perhaps you think the Constitution should be amended to preclude the government from exercising eminent domain in all cases. If so, I think the "empirical burden" ball to show that would do more harm than good is in your court.

Don writes: Fortunately, while the security of property rights is reduced by decisions such as Midkiff — which gives enormous deference to legislative maneuvers that forcibly transfer property from Private Citizen A to Private Citizen B — property rights remain, by and large, secure in the United States. Indeed, I'm sure that even a Supreme Court victory for the city of New London won't cast us into the dark ages.

As Adam Smith wisely observed upon learning some bad news, "There is a great deal of ruin in a nation." A society as civil and as dynamic as the U.S. can endure and even prosper despite instances of corruption, malfeasance, and petty tyranny.

But the fact that government confiscations of private property aren't so widespread in the U.S. to prevent economic growth doesn't justify such confiscations. To the extent that these seizures occur, they make us less free and less prosperous than we would otherwise be.

David's right that the framers of the U.S. Constitution were "no slouches when it comes to property rights." By and large, I admire their handiwork. But I do wish that they would have rejected eminent domain. As David correctly notes, government asserts that it needs this power in order to prevent its projects from being hamstrung by private owners "holding out" strategically for unjustly high payments.

While such problems are imaginable — and, no doubt, would occasionally occur — I doubt that they are significant enough to entrust politicians with the power to take private property (even if such takings require payment of fair market value). America is planted thick, for example, with private housing developments on large contiguous plots of land that developers manage to assemble without confiscating others' properties. If private developers can achieve such outcomes, there's no reason government officials can't do so.

For those who fancy that government's projects are uniquely important, or for those who imagine that holding government office makes someone unusually saintly or trustworthy, entrusting government with power that we would never entrust to our neighbors or other private citizens might seem sensible. To me, it's dangerous, unjustified, and unjustifiable.

David writes: Looks like our disagreement remains at the threshold — whether any exercises of eminent domain are ever justifiable.

Don suggests that they always result in social loss, and he points to the fact that developers manage to assemble master-planned communities with some regularity without resorting to the exercise of eminent domain. So, he suggests, why should the government be privileged to get land for less than it's worth? After all, it could always buy it at a price the seller would accept. Doesn't that mean that every exercise of eminent domain makes the world poorer?

Sounds plausible, but a few points in that regard:

The first is that these master-planned communities share a common feature — they are located near public roads, which exist only because the power of eminent domain exists. So it's actually not the case that these private developers acted without the aid of the government confiscating someone's property. Could we really have these developments if the private developers themselves had to assemble all of the necessary transportation infrastructure to get people from home to work as well? Indeed, even property that is taken is often property that itself benefited along the way from prior exercises of eminent domain — be they exercises of eminent domain that helped make it possible for the railroad to deliver the construction materials for the building of the home in the first place, etc.

The basic conceptual problem, in other words, seems to me to remain for those who oppose the eminent domain power simpliciter: Eminent domain and private property are more co-dependent than you'd think. So, in permitting eminent domain, we aren't just tolerating a drag on the system. We are upholding a practice that makes the system work as well as it does.

The second point concerns the fact that these master-planned developments are sprouting up further and further out into exurbia. One reason that places like New London occasionally resort to eminent domain is to revitalize a close-in city. It by no means clear that restricting eminent domain — insofar as it precludes cities from revitalizing themselves — makes us all better off if it just ensures that sprawling growth results. The literature on the costs of sprawl is itself sprawling, of course, and it is surely open to differing interpretations. But given the room for debate, why wouldn't we think that democratic processes are a good mechanism for making judgments about how to proceed when the best way of achieving social welfare is by no means clear? Seems to me we have a pretty deep tradition of looking to democratic processes to make such judgments all the time — even when they impose costs on private property owners. I don't think Don means to be calling all forms of property regulation into question, but I'm not sure I see how he isn't.

One final point. As a lawyer, now in dialogue with an economist, I am interested in your view as to whether there is anything to the distinction between takings for "public use" in the classic sense (say, for a public road) and takings in which the government gives the property over for private development (as in New London). Justice Kennedy at oral argument in the New London case kept suggesting the economists would think there is nothing to that distinction. Each kind of exercise of eminent domain is either equally good or bad. But is that right? Do you see a difference between the two — a difference that would make you even more hostile to what the city of New London is doing in particular than to what the framers of our Constitution authorized governments to do more generally?

Don writes: It's true that privately built housing communities depend upon road and sewer systems, which typically are built by government. But this observation doesn't address my argument that eminent domain is unnecessary. The fact that housing developers routinely acquire large contiguous plots of land without eminent domain — that is, by buying individual plots from private owners — suggests that government doesn't need eminent domain to build roads and to do whatever else it does.

Unlike David, I trust democratic mechanisms much less than I trust the rules of private property. If the city of New London, for example, can confiscate private property without the owners' consent, government officials have too little incentive to bargain in good faith with property owners to find out if mutually advantageous deals are possible. Government will confiscate property rather than pay market prices for it. And politicians will pander to special-interest groups eager to gain at the public expense.

The fact that government is democratically elected might put some restraint on use of this power — or it might not. If a majority of voters in New London perceive that they can gain by directing the city fathers to confiscate private property owned by voters in the minority, why should we trust that the city will seize private property only if doing so yields significant benefits to the public at large?

By obliging all persons — including government officials — to pay voluntarily agreed upon prices for any properties acquired, we best ensure that worthwhile transfers of property rights occur and that transfers that aren't worthwhile are avoided.

David writes: The government could build a statewide highway by just bargaining with landowners along the route? What about the owner of the last parcel in the road's path? Is the market value of that parcel whatever that property owner wants to charge? Suppose the owner wants whatever the fair market value of the parcel was before construction on the roadway began plus the entire budget for the roadway's cost now that the owner knows the road is being built? Why is it socially efficient to make society pay that premium?

But even if a flat ban on eminent domain is inefficient, there are hard cases. Can a city take a $200,000 house to permit a developer to build one for a $1 million, claiming the move would be good for the local tax base? Once we dispense with a flat ban on eminent domain, though, our choice is either to have judges do the sorting between good and bad takings or to have the people themselves do it through their elected representatives. Our nation's past experience with judges second-guessing the legislature's economic policies has been pretty dim. So, on balance, I'd cast my lot with the people.

Don writes: You raise an interesting point — usually called the "hold-up problem" — in which a single property owner can hold a project hostage and extract maximum gain. But in reality, because there is almost always more than one way to build a road or to site a large development, there usually isn't any one property owner who can hold the project hostage. This is one reason why private developers commonly succeed in assembling large parcels without using eminent domain.

Moreover, ingenious strategies exist to avoid the hold-up problem. For example, a buyer can negotiate sales contracts contingent upon the buyer acquiring all necessary parcels of land. With such contracts, no one landowner is ever in a position to hold-out strategically for the full value of the project.

You ask, David, whether a legislature should be able to take a $200,000 house to build a $1 million dollar project that increases the tax base. My answer to that (and I hope the Supreme Court reaches the same conclusion in Kelo) is an emphatic no.

One reason is practical: If there really is such a discrepancy in value, the project will take place anyway, as I've argued above. But the second reason is my skepticism about of legislators' ability to dispassionately represent "the people." Which people, after all, are represented? Conflicts exist between those who would benefit from higher tax revenues (for example, developers who would be awarded lucrative contracts funded with these higher tax revenues) and those who lose — namely, property owners whose properties are seized. Politicians are simply too likely to pander to special-interest groups. The more unrestrained is government's power to use eminent domain, the more likely will our country be one marked by too many shopping malls and too few desirable, if not necessarily highly taxable, alternative uses of land.

David writes: Even the contingency contract you describe permits the landowner to extract a premium. If the contract price isn't more than the amount the government would owe as just compensation, then the government could just take and pay without complaint from the property owner. So the question for me is why society should bear the extra cost.

Absent evidence that net social welfare declines unless the government bears the extra cost, efficiency analysis simply can't prove that eminent domain is bad rather than good. And the necessary evidence just doesn't exist.

Our debate ultimately turns on differing views of government regulation. After all, there's no reason to trust government when it engages in zoning but not when it engages in eminent domain. Certainly zoning can "take" plenty of value from property owners. But we've generally recognized that regulation also can create value in property, and for many decades constitutional law has proceeded from that premise. That's partly why zoning generally raises no constitutional problem. And why eminent domain shouldn't either.

But to close on a point of (near) agreement, I grant that taking the $200,000 home causes real concern. Even John Reed might have a problem with that one, and the Supreme Court has long said that you can't take from A to give to B even if you can take for a public use. So I won't be at all surprised if the court makes some noises to that effect, even as it upholds New London's right to redevelop.

David Barron is a professor at Harvard Law School. His writings focus on the legal powers of local governments, federalism and the separation of powers, and he also researches property law and urban sprawl. Barron was a law clerk for Judge Stephen Reinhardt of the U.S. Court of Appeals for the Ninth Circuit and Justice John Paul Stevens of the U.S. Supreme Court. Prior to teaching, he was an attorney-adviser during the Clinton administration in the Office of Legal Counsel in the U.S. Department of Justice. Barron received his bachelor's in history and his law degree from Harvard.

Don Boudreaux is chairman of the economics department at George Mason University and has held the position since 2001. He previously was president of the Foundation for Economic Education and taught at George Mason and Clemson University. His research centers on the nature of law, antitrust law and economics, and international trade. Boudreaux blogs regularly (with fellow Econoblogger Russ Roberts) at Café Hayek. He received his doctorate in economics from Auburn University and his law degree from the University of Virginia.

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