Washington Constitution limits 'eminent domain' takings: Seattle (WA) Post-Intelligencer, 6/24/05

By Jennifer Langston
A U.S. Supreme Court ruling giving local governments broad powers to condemn homes to make way for economic development projects isn't likely to have a big effect in Washington [state].

The state constitution has stricter prohibitions against condemning land for private uses, legal experts said yesterday.

The Washington Supreme Court has also defined a "public use" for which a city can use eminent domain more narrowly, according to Attorney General Rob McKenna.

Local governments generally haven't been allowed to condemn a home or business and then turn around and sell it to someone in the private sector, said Hugh Spitzer, who teaches constitutional law at the University of Washington.

"Our court has said if there's real blight — dilapidated houses, juvenile delinquency, health problems, hazardous waste — then (a city) can do it," he said. "It can't just do it because they think it would be neater or better for the economy."

The city of Seattle, for instance, was blocked from using its power of eminent domain to bulldoze several businesses on land that was originally supposed to be part of the private Westlake Center mall redevelopment.

The courts did allow the city to condemn property for the plaza, because that was considered a legitimate public use, according to the Seattle City Attorney's Office.

Still, there are plenty of places — such as South Lake Union — where the city has sold property that was originally condemned for freeway extensions or other public projects that never happened, said Steve DiJulio, a land-use attorney at Foster Pepper & Shefelman.

"You have examples throughout the history of Northwest development where properties were condemned and the project failed, and it found its way by default back to private development," he said.

---

Post-Intelligencer: http://seattlepi.nwsource.com

Ruling allows land to be seized: The Detroit (MI) News, 6/24/05

Officials see the return of eminent domain as a potential boost to economic development, but Michigan laws are strict

By Joel Kurth
Always emotional but sometimes vital, eminent domain may yet have a future in Michigan. Just how much, though, is in dispute.

In a closely watched case Thursday, the U.S. Supreme Court ruled 5-4 that local governments can condemn land and compensate owners for private ventures such as shopping centers and office complexes. Michigan economic development experts cheered the decision, but lawyers said it won't impact the state's strict laws.

"It's clear that local officials know local interests better than federal judges, but it's unclear how this case will impact Michigan," said Arnold Weinfeld, director of state affairs for the Michigan Municipal League.

Property advocates said the ruling creates a clear exception for Michigan and other states that already have laws barring taking land for private use. In a landmark 2004 decision, the Michigan Supreme Court reversed 20 years of precedent and found the state constitution only allows condemnation for public projects such as parks.

"Thank God we're protected in Michigan," said Alan Ackerman, a Troy attorney who represented property owners in the case.

The U.S. Supreme Court case involved efforts in New London, Conn., to demolish houses for a Pfizer Corp. research center and Coast Guard museum.

If nothing else, the decision will lead to more Michigan court cases on the issue, said Kurt Metzger, research director of Wayne State University's Center for Urban Studies.

Michigan ranked fourth nationwide in government condemnations from 1998 to 2002. Detroit was first among cities during that time, according to a study by the Institute for Justice, a Washington D.C. Libertarian policy group.

Legally, governments can take land and compensate owners for the public good. Defining what that means, however, has sparked more than 25 years of litigation.

To some, only government-owned projects should qualify. To others, companies that bring in hundreds of jobs and tax dollars benefit the public just as much if not more.

"Communities are organic realities — living, breathing things — and when you break them up, it's very serious," said Tom Olechowski, who lives in the Poletown neighborhood of Detroit that was broken up when the city cleared land for a General Motors Corp. plant in the 1980s. "Government should only take land for the public good and there's no question that was not the case with Poletown."

Michigan courts disagreed in a 1981 ruling that cleared the way for the plant. The decision impacted public policy for decades.

Among other projects, Detroit condemned land to build Comerica Park and Ford Field.

Last year, Michigan's highest court reversed the Poletown decision and barred Wayne County from using eminent domain to seize less than 50 privately owned acres for the Pinnacle Aeropark, a planned 1,300 acre office park and hotel complex in Romulus.

"Sometimes, condemnation is the only avenue for assembling land for private developers in the urban core," said Mulugetta Birru, the county's director of economic development.

Writing for the majority, Justice John Paul Stevens footnoted last year's Michigan Supreme Court case and noted that nothing "precludes any state from placing further restrictions on its exercise of the takings power."

The exemption clearly means Michigan's limits remain, but that doesn't mean some cities won't still try to condemn land for shopping centers, said Lee J. Strang, a professor at Ave Maria School of Law.

"If you live in Grosse Pointe, you don't have anything to worry about. It's people whose houses aren't that valuable and don't produce that much tax dollars who should watch out," he said.

---

Detroit News: www.detnews.com

Ratner Discusses Possibility Of Using Eminent Domain To Help Build Brooklyn Arena: NY1 (New York NY), 6/24/05

By Monica Brown
Developer Bruce Ratner visited the borough Friday to talk about his controversial plan to build a basketball arena, an apartment complex and office towers.

Ratner owns the Atlantic Terminal Mall in downtown Brooklyn, but his ownership of the New Jeresy Nets is what's got the neighborhood concerned. He plans to build a 21-acre arena for the team, as well as housing and commercial space.

A ruling made by the U.S. Supreme Court Thursday would allow Ratner to use the power of eminent domain to get the land he still needs to complete his project. That means local governments would have the power to seize homes and businesses against the will of their owners.

“Our whole goal is to try to buy the land and get people happy and relocate them, and have renters in new apartments at the same kind of price, brand new apartments, but if necessary the government will use eminent domain,” Ratner said Friday.

On Thursday, the U.S. Supreme Court ruled that local governments can seize private property against the will of its owner, and give it to private companies to develop. In Ratner's case, that would mean a 21-acre arena for the Nets and an apartment complex in place of the Atlantic Rail Yards and the surrounding properties.

While some business and apartment owners have already sold to Ratner, the ones who haven't could be kicked out if the city resorts to eminent domain. Ratner says that could be for the greater good of the neighborhood.

“In many cases throughout this country you have cities where there's a need for jobs and a need for houses, and you have areas that are not in great shape, they are blighted, economically down, and it's been a tradition in this country, a way to redo that is through development and creating jobs, and eminent domain is a necessary part of that,” he said.

But at issue for residents is whether or not this neighborhood is actually on a downward turn.

“Prospect Heights is a thriving neighborhood that does not need this kind of development to further its growth,” said area resident Daniel Goldstein. “It's been growing for about a decade now. There are million-dollar apartments here. I’m not saying that's the greatest thing, but that does show that it is growing and it is economically vibrant.”

And at Freddy's [a pre-prohibition tavern that could be taken if the Ratner project goes through], lifelong Dean Street residents wonder why, and when, they might be kicked out of their homes.

“We are being told by the government where we have to live. It's un-American,” said neighborhood resident James Maloblocki.

Mayor Michael Bloomberg says the issue should be addressed on a case-by-case basis.

“Nobody thinks we shouldn't have eminent domain for some purposes,” said the mayor. “The issue is, is development one of the appropriate purposes?”

Daniel Goldstein and his neighbors say they will not give up without a fight. They say they will take their battle to court, if necessary.

---

NY1: www.ny1.com

A looser rein on eminent domain: Milwaukee (WI) Journal Sentinel, 6/23/05

High court affirms use in developments; local projects may benefit

By Tom Daykin
The power of the government to seize private property for commercial developments - used throughout the Milwaukee area to help build shopping malls, business parks and other projects - was strengthened by a narrow U.S. Supreme Court decision issued Thursday.

The court ruled 5-4 that local governments can buy property, even when it isn't blighted, as long as the owner is fairly compensated.

That power, known as "eminent domain," has existed since the United States was founded, and has been used by government to obtain land for public projects such as highways and schools. The power, also referred to as "condemnation," allows local governments to take the land even if the owner isn't willing to sell, as long as the property owner is fairly compensated.

The condemnation power has been expanded over the past several decades to include projects where governments will buy "blighted " properties - such as vacant buildings - and then sell them to new owners who develop the parcels privately. That creates jobs and property tax revenue for a community.

An expansion of condemnation was challenged by a group of New London, Conn., residents whose homes are slated for destruction to make room for an office complex. They had argued that cities have no right to take their land except for projects with a clear public use, such as roads or schools, or to revitalize blighted areas.

The court's ruling, however, upholds this expanded power of eminent domain.

Up to local officials
Writing for the court, Justice John Paul Stevens said local officials, not federal judges, know best in deciding whether a development project will benefit the community.

"The city has carefully formulated an economic development that it believes will provide appreciable benefits to the community, including - but by no means limited to - new jobs and increased tax revenue," Stevens wrote in an opinion joined by Justices Anthony Kennedy, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer.

"It is not for the courts to oversee the choice of the boundary line nor to sit in review on the size of a particular project area," he added.

Justice Sandra Day O'Connor issued a dissent, arguing that cities should not have unlimited authority to uproot families, even if they are provided compensation, simply to accommodate wealthy developers.

"Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random," she wrote. "The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms."

O'Connor was joined in her opinion by Chief Justice William H. Rehnquist, as well as Justices Antonin Scalia and Clarence Thomas.

Ruling welcome
Developers, city economic development officials and commercial real estate attorneys - including some involved with eminent domain cases - have been waiting for the decision.

Condemnation has been used for such Milwaukee-area projects as the Valley Business Center, a new business park being developed in Milwaukee's Menomonee Valley; the redevelopment of Bayshore Mall, in Glendale, into Bayshore Towne Center, a mix of stores, restaurants, offices and condominiums; and the remodeling of the former Younkers building at Southridge Mall, in Greendale, into new stores, such as Steve & Barry, Linens 'n Things and Cost Plus World Market.

The court's ruling was welcomed by community officials such as Richard Maslowski, Glendale city administrator. The Glendale Community Development Authority has played a major role in the Bayshore project, which is under construction north of W. Silver Spring Drive and east of N. Port Washington Road.

"It clears some legal clouds we were beginning to experience for Bayshore," Maslowski said.

Negotiations on relocating some of Bayshore's tenants have been delayed lately, Maslowski said.

He believes the attorneys for some tenants were deliberately postponing meetings in hopes of using a court ruling that would have curtailed condemnation powers. Such a ruling would have given tenants additional leverage to negotiate better terms for their relocation, Maslowski said.

The court's ruling to uphold the expanded right of condemnation should "eliminate that cloud," Maslowski said.

Milwaukee uses eminent domain "only as a last resort," said Department of City Development spokeswoman Andrea Rowe Richards.

But condemnation is an important and powerful tool, she said, citing the Valley Business Center, which recently landed a Palermo Villa Inc. frozen pizza facility. The business park is expected to eventually have 800 to 1,200 jobs, replacing a former rail yard.

In West Allis, officials have been seeking the revitalization of West Allis Towne Center, an underused shopping center at W. Greenfield Ave. and S. 70th St. The possible use of condemnation to accomplish that goal could have been eliminated as an option if the Supreme Court had ruled differently, said John Stibal, West Allis development director.

Property rights concerns
Strengthening the power of eminent domain raises concerns about the rights of private property owners, said John D. Finerty, a Milwaukee real estate attorney.

In the case of West Allis Towne Center, a condemnation proceeding could be used to seize the property, and then resell it to another developer, Finerty said.

That could amount to a community preferring one developer over another, he said.

State law does give property owners and tenants certain rights in condemnation cases.

A government that wants to condemn a property must pay for the property owner's appraisal of the parcel. After a government seizes property and pays for it, the property owner may then appeal to the courts to seek additional money. Also, the government must relocate a property owner's business to a comparable property, and pay for the relocation costs.

Stibal doesn't expect the ruling to have any major effects on the negotiations that occur when West Allis gets involved in condemnation cases.

---

Journal Sentinel: www.jsonline.com

Lawmakers consider providing protections against eminent domain: Newsday, 6/24/05

By Susan Haigh, Associated Press
[Connecticut] Gov. M. Jodi Rell and some legislative leaders promised Friday to review the state's eminent domain laws after the U.S. Supreme Court ruled that New London can take homes for a private development project.

Thursday's 5-4 decision broadens the eminent domain power, granting local governments broad rights to seize private property to generate tax revenue. But the court also ruled that states can restrict that power.

State House Minority Leader Robert Ward, R-North Branford, said he plans to resurrect a bill that died last session that would prevent the taking of property in Connecticut for economic development.

"Now that we know the Supreme Court will not give private homeowners this level of protection, the legislature should," Ward said.

At least eight states — Arkansas, Florida, Illinois, Kentucky, Maine, Montana, South Carolina and Washington — already forbid the use of eminent domain for economic development unless it is to eliminate blight. Other states either expressly allow private property to be taken for private economic purposes or have not spoken clearly to the question.

Rell said she asked her staff to contact Ward to talk about introducing legislation in the next legislative session, which opens in February. Rell said she has mixed emotions about the court ruling.

"I can certainly understand the economic development concerns, but I'm certainly also sympathetic with the people," she said. "I think if we can strike a good balance and if there's legislation that would address that, then I'm more than willing to look at it."

Ward's bill, which died during this year's regular legislative session, would allow eminent domain to be used for blight removal, although Ward said he has concerns about how "blight" might be defined.

House Speaker James Amann, D-Milford, said also has concerns about the taking of private property and said he is willing to consider legislation next year.

But at least one legislator, Sen. Tony Guglielmo, R-Stafford, is calling on legislative leaders to act during the current special session, saying the ruling will have a "monumental impact" on homeowners' rights everywhere.

"We have an opportunity in the legislature to correct something I find to be very discriminatory," he said.

But many urban lawmakers, including those from the New London area, support the high court's ruling.

"Their opinion obviously upholds the fact that economic development is considered a public use," said State Sen. Andrea Stillman, D-Waterford, said Thursday. "I'm glad for the city because now the city can move forward with development. But, I feel very sad for the people whose homes are there and now will sell their properties and move on,"

Amann said he would not want to "interfere with anything that's happening in New London, but I think it's worth investigating."

Amann recalled that several waterfront homes in Milford were taken by eminent domain in the 1960s, supposedly for a beach. That project, however, became a landfill. In 1994, the site was eventually reopened as Silver Sands State Park.

"I think it might be smart for us to investigate it and strengthen the laws to protect more homeowners' rights," he said.

---

Newsday: www.newsday.com

Public Power for Private Gain: Reader's Opinion, 6/26/05

By Kathy Tripp
Until recently, “public use” was understood by everyone – courts, local governments, and the average citizen – to have an established meaning. Eminent domain was used only for projects that would be owned by and open to the public – things like roads, hospitals and public buildings.

In the past several years, things have, drastically, changed. Now, state and city officials think they can condemn anything for any reason. They, freely, use eminent domain to benefit all kinds of private parties - as is the case with city officials in Sunset Hills, who, seemingly, are giving this developer anything he asks for- at taxpayer expense. Novus Development will make millions of dollars, while homeowners in Sunset Manor will end up assuming huge mortgages to buy less home than they already own.

Residents in Sunset Manor have lived through years of emotional hell and uncertainty that, inevitably, means nothing to their elected officials. City officials have paraded two different developers through Sunset Manor in the past six years in an attempt to rid itself of an unwanted neighborhood. Communication from residents all over Sunset Hills voicing opposition to this mall has been ignored by city officials. As well, city officials did a tremendous disservice to the residents by posing the same building restrictions for lots averaging 5300 sq. ft as are imposed for 7500 sq. ft. lots - an obvious intent to stunt growth in a neighborhood where property values, inspite of this, still continue to grow.

It is one thing to condemn an abandoned building - all would, certainly, understand that - but to sabotage an area, continually, for years - changing street structures and leaving them to crumble, allowing commercial buildings to be built in residential areas that are not built to conform with existing ordinances, and by seizing the property of tax paying citizens who work hard to comply with government ordinances and rules is a vastly different and ominous concern.

In February, the US Supreme Court heard a case that seeks to limit this government power. With respect for justice, Sunset Hills City officials should have awaited the decision from the Supreme Court before it, recklessly, proceeded to grant Novus Development, (or Novus Equities, or Novus (fill in the blank) LLC.) approval on a shopping mall that, experts say, cannot work. At the very least, city officials should have read some of these findings. Instead, they relied on their own wills and trusted the developer - the very same developer whose litigious past should have been, extensively, questioned.

Sometimes, areas are declared blighted that have no blight but might become blighted in the future. Such is the case for Sunset Manor. In Sunset Hills, there are many smells of conflicts of interest. Imagine that one company can complete a study of blight, issue requests for proposals, update zoning ordinances and the city’s comprehensive land use plan, while being paid to “conduct inspections over several years of properties” that the city has no invoices for. Someone had to pay for those inspections.

The simple fact is that Sunset Hills is allowing the developer to use force to replace middle-income citizens with richer ones and small businesses with larger ones. The “jobs and taxes” justification gives an unlimited field for exercise of government power and an even greater chance to abuse it. There is something very wrong with this. This is, as a Supreme Court Justice called it in the 1700s, a “despotic power.”

The Framers of the U.S. Constitution were, keenly, aware of this potential for despotism, and that’s why they placed two vital constitutional limits on eminent domain power. First, government cannot take land without paying for it; “just compensation” must be paid. Second, government may take property only for “public use.” So, how did the words “just compensation” and “public use” become so diluted? How did the word “blight” become a word with a “made up as you go” definition?

Sunset Hills city officials determination of blight defies what any normal person would call blight. They say that the land is not being used to its full potential - in other words, someone else wants to build something more profitable there. That “someone else” will help quench the hunger for tax dollars, added personal incentives, and subsidies.

Power without any checks, inevitably, leads to abuse, and eminent domain is certainly no exception. Cities can offer other people’s property to lure or reward favored developers. Developers love eminent domain because they don’t have to bother with negotiating for property; they can pick anywhere they want, rather than anywhere they can buy. It’s just easier to take property by force or threat and the compensation they have to pay is, usually, less than they would pay on the open market.

Sunset Hills City officials are, clearly, abusing the power of eminent domain and must be held accountable. Tax payers should be given the opportunity to vote on specious projects that could, potentially, end up placing the burden of payment in their laps.

Several municipalities have challenged redevelopment and won, thus averting threats of eminent domain. Eminent domain abuse won’t stop by itself. It will take community activism and a constitutional commitment by politicians and judges, but this will not happen in time to save Sunset Manor.

---

Kathy Tripp: imdadoc@charter.net

Kelo as Opportunity: Reader's Viewpoint, 6/24/06

By Norman MacLeod, Port Townsend WA
Joseph Farah wrote, in World Net Daily
(www.worldnetdaily.com/news/article.asp?ARTICLE_ID=44960):

"...Congress has the power, should it ever have the courage to use it, to set aside a ruling like this and permanently enjoin the court from ever ruling in the future against the well-enshrined, inalienable, well-documented, constitutionally protected right to own and enjoy property."

Congress, on the whole, does not have much in the way of courage. Congress has to be pushed into doing things. The squeakiest wheel is the one that gets oiled.

The US Supreme Court has provided us with the opportunity with their 5-4 ruling in Kelo v the City of New London. If all the property rights and allied organizations and their members work together, we have enough power to push the issue and force legislation.

This ruling is in the public eye now. The time to strike is when the iron is hot. We all need to contact our Senators and Congressional Representatives and demand legislation specifically designed to uphold the property rights aspects of the Fifth and Fourteenth Amendments to the United States Constitution.

When writing to insist on this legislation, we need to quote extensively from the Founding Fathers on their ideas about the sanctity of property rights and their importance to protecting and maintaining the Republic. We need to build a library of those writings and become steeped in them, so that we can use the Founders' own words in pushing the issue. We need to get all of our otherwise uninvolved neighbors and family members involved in this effort, too, and we have to force the issue as quickly and intensively as possible, so that the majority who signed onto this travesty get a quick understanding that the nation's citizens are watching them, and watching them closely.

If we are worried about a runaway judiciary, let's look at this as a key opportunity: the gift that was needed, as it were. It's time to get Congress actively involved in the occasional process of restoring full balance to the power of each of the three branches of our government.

We need to get this going now, so that legislation can be passed into law prior to the 2006 elections. If the Supreme Court is going to provide us with this grand a gift, we can't let the challenge go unanswered.

Let's see whether or not the nation's citizenry still have the power we were given in our Constitution. I think we do, but only if we make full use of it now. If we don't, we might not still have that power tomorrow.

---

Norman MacLeod: gaelwolf@waypt.com

New Jersey Eminent Domain Law Blog

William J. Ward, Esq, a principal of Carlin & Ward (Florham Park NJ), is now publishing the New Jersey Eminent Domain Law Blog. This Internet resource features legal commentary on legislative issues and cases from the New Jersey Superior Courts to the United States Supreme Court, and their effect on New Jersey residents and business owners.

The blog is dedicated to informing the general public, as well as attorneys and real estate professionals, about current condemnation and redevelopment procedures and their impact on private property.

Mr Ward honed his skills as a Deputy Attorney General, litigating cases for the Department of Transportation and as secretary and general counsel for the New Jersey Sports and Exposition Authority. After twenty years as the leader of the eminent domain practice in a law firm in Hudson County, he established a new firm with John J. Carlin, Jr. in 2002. Mr. Ward’s practice is concentrated exclusively in eminent domain litigation and appeals. He represents residential, business, and commercial clients in matters including real estate property valuation, access modification, relocation, condemnation, and riparian claims. He handles cases for property owners against condemning authorities including municipal, state, and redevelopment agencies. His extensive career spans more than three decades in this practice are. He has appeared before the federal courts, the N.J. Superior, Appellate and Supreme Courts. Articles about his verdicts and settlements have frequently appeared in the New Jersey Law Journal.

---

New Jersey Eminent Domain Blog: www.njeminentdomain.com

Looking on the bright side of Kelo: Pacific Legal Foundation, 6/24/05

By Timothy Sandefur
Kelo is, obviously, a deplorable example of what happens when we start tinkering with property rights to begin with. Once someone says “it’s okay to steal the property of a rich man and give it to a poor man,” it’s not long before the rich man figures out how to exploit that power himself. This is what explains the apparent paradox of the supposedly liberal members of the Court writing an opinion that vastly expands the opportunities for corporate welfare programs at the expense of the poor and underrepresented. The only solution to this problem is to take property rights seriously for everybody, and to recognize the fact that government has no business stealing things from people who earn them, and giving them to people who do not—white or black, rich or poor, politically powerful, or politically weak.

That being said, there is room for optimism. Kelo really does little that Berman v. Parker, 348 U.S. 26 (1954), did not already do. Berman was an obscenity—a bitter decision written by one of the Court’s greatest antagonists to property rights, that asserted such explosive dicta as “when the legislature has spoken, the public interest has been declared in terms well-nigh conclusive,” id. at 32—and it was unanimous.

Hawaii Housing v. Midkiff, 467 U.S. 229 (1984), was almost as deplorable. There, the Court held that public use is “coterminous with the scope of a sovereign’s police powers,” id. at 240, meaning that the clause provided no more protection than the Due Process clause already does. And of course, that involved a practically insurmountable degree of judicial deference: “There is, of course, a role for courts to play in reviewing a legislature’s judgment of what constitutes a public use...[b]ut...it is ‘an extremely narrow’ one.... [D]eference to the legislature’s ‘public use’ determination is required ‘until it is shown to involve an impossibility....’ [W]here the exercise of the eminent domain power is rationally related to a conceivable public purpose, the Court has never held a compensated taking to be proscribed by the Public Use Clause.” Id. at 241. And it was unanimous.

Unless I’m seriously mistaken, Kelo represents the first time since the Civil War that any Justice of the Supreme Court has ever seriously defended the proposition that the Public Use Clause limits the power of eminent domain. This, I think, is reason for optimism. Not only that, I don’t even know of any lower court decisions that criticize Berman outright. I think it is a genuine accomplishment to have four members of the Court so severely criticize cases that are unquestionably controlling, unanimous, and so extremely opposed to the dissenters’ point of view.

Consider—Berman was unanimous and its holding crystal clear. The same can’t even be said of such atrocities as Dred Scott, Korematsu, Plessy, or Nebbia. Can you imagine, fifty years after the holdings in those cases, four justices writing as powerful a dissent challenging those cases? I cannot.

There’s all this talk about the property rights revolution being dead. While it’s true that talk of such a “revolution” was quite overblown to begin with, and that cases like San Remo, Lingle, and Kelo, were all losses for property owners, we can’t lose sight of the fact that legal revolutions start slowly. Justice Field’s dissent in Slaughterhouse was eventually to (more or less) win the day; Justice Holmes’ dissent in Lochner (which nobody joined at the time) was eventually to prevail. In Kelo, we have managed to persuade almost half of the court that the Public Use Clause is meaningful—a proposition that the Supreme Court has never embraced before, and has resoundingly and unanimously rejected in the past.

Making lemonade? Sure. Kelo is a severe loss, and is execrable constitutional interpretation. But baby steps, people. Baby steps.

---

Timothy Sandefur: tms@pacificlegal.org

THE KELO EFFECT: New Jersey Eminent Domain Law Blog, 6/23/05

Supreme Court Defeats Property Owners in Eminent Domain Decision 5-4

By William J Ward, Esq

“Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms.” – Justice Sandra Day O’Connor, dissenting

Today the Eminent Domain trilogy is complete. In May, the Supreme Court affirmed long standing regulatory takings stands in Lingle v. Chevron USA. Today, Kelo v. New London affirms long standing decisions regarding takings for public use in Midkiff and Berman. And last Monday, in San Remo v. San Francisco, the Court said property owners could not litigate in both the state and federal courts at the same time. In other words, don’t call us, and we won’t call you.

The decision was 5-4 in favor of the City of New London, Connecticut and affirmed the Supreme Court of Connecticut. Justice Stevens wrote for the majority with Justices Souter, Ginsberg, Kennedy, and Breyer concurring.

Justice Kennedy wrote a separate concurring opinion which did not address the “scope of the project” rule as we anticipated. Justice Stevens, who delivered the opinion of the Court, suggested that the ball was in the court of the state legislatures as to defining what property could be taken for public use:

“We emphasize that nothing in our opinion precludes any State form placing further restrictions on its exercise of the takings power. Indeed many States already impose ‘public use requirements’ that are stricter than the federal baseline.”

The impact on current New Jersey practice is negligible. Redevelopment projects will move forward and private property rights will be subservient to what the Court has deemed the public good — development and economic benefit, such as increased taxes.

What could New Jersey do? We would like to see amendments to the Local Redevelopment Housing Law (LRHL) which places a cap on the length of time that a declaration of blight (now, declaration of “area in need of redevelopment”) would be effective. We suggest that five to six years would be an appropriate amount of time for a municipality to declare blight and institute a redevelopment project.

In far too many instances, such as Long Branch and Asbury Park, the blight declarations go back ten years or more. This is an unconscionable burden to the property owners within the affected area. They cannot sell, except at a discount; they are reluctant to invest in their properties because of the fear of Eminent Domain; and many municipalities neglect to enforce their building codes once the areas have been determined to be blighted. This only exacerbates the impacts on the property owners.

We’ve had many inquiries today concerning what the property owner can do. The only answer is for the property owner to be vigilant regarding proposed municipal action and to participate in and contest the blight studies when they are presented to the municipal Planning Board. If the property owner sits on their rights and does not do this, they will have a very difficult time filing a Prerogative Writ suit contesting the municipal action.

The law requires an appeal of the municipal action within 45 days of the adoption of the ordinance authorizing blight or “an area in need of redevelopment.” This is the first step toward condemning the properties. Many owners come to us well after the municipal action was undertaken. Often, they were not even aware of the municipal action and received no notice of the proposed ordinance.

Absent a viable Prerogative Writ suit on the blight declaration, property owners will be left with what they have in every condemnation case: A contest over what amount of money constitutes just compensation, and payment of relocation assistance to owner/occupants dislocated by the public project.

In her dissent, Justice O’Connor said:

"Under the banner of economic development, all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded, i.e. given to an owner who will use it in a way that the legislature deems more beneficial to the public – in the process."

Flashback to February and the oral argument, when Justice O’Connor asked: “Motel 6 and the city thinks, well, if we had a Ritz-Carlton, we would have higher taxes. Now is that okay?”

The simple answer, according to five Supreme Court justices, is yes.

But, we’ll leave the light on for ya.

---

New Jersey Eminent DomainLaw Blog: www.njeminentdomain.com

Ruling supports eminent domain: (Brazoria County TX) Facts, 6/24/05

By Michael Smith
A split U.S. Supreme Court issued a 5-4 ruling Thursday that could put more wind in the sails of the Freeport marina project plan backed by city officials and developers.

In Kelo et al v. city of New London, the court upheld a March 2004 Connecticut state court ruling and ordered that a local government's power of eminent domain can trump individual property rights to seize land for economic development.

Eminent domain is a government entity's power to take or condemn property it
deems is necessary for "public use." Thursday's ruling is significant because it includes economic development in the definition of public use.

The decision comes at the end of a five-year legal journey. Susette Kelo and other homeowners filed suit against the city of New London, Conn., in 2000 to prevent it from taking their property to build a hotel and conference center complex.

New London city officials cited higher tax revenues and economic improvement as the project's goal.

In his majority opinion, Justice John Paul Stevens wrote local officials should decide whether development projects benefit communities. States can pass additional laws restricting condemnations if necessary, he wrote.

"It is not for the courts to oversee the choice of the boundary line nor to sit in review on the size of a particular project area," Stevens wrote.

Justice Sandra Day O'Connor argued in the dissenting opinion that the ruling gives large corporations and developers a dangerous amount of influence in the political process.

"As for the victims, the government now has a license to transfer property from those with fewer resources to those with more," O'Connor wrote.

While the case is based in Connecticut, the ripple effect will be felt nationwide and in Freeport, where the city's marina project has been stalled by legal action.

Western Seafood Co. is battling the city of Freeport and the Freeport Economic development Corp. over 330 feet of the company's property along the Old Brazos River that the city wants for a marina.

Wright Gore III, son of the company's president, has said the land is crucial to his family business since shrimp boats offload their catch there.

The city and developers say the $7 million project - paid for by $6 million committed by the city and $1 million by private developer Walker Royall - will net eight times the $50,000 in revenue the city gains from the 1,800-foot strip of land.

Between 100 and 150 jobs will be produced by the first of the two-phased construction, said Lee Cameron, executive director for the Freeport Economic Development Corp.

O'Connor's dissent is on target in theory, but accountability of elected officials keeps the political process free of undue influence, Cameron said.

"If they were to exercise (eminent domain) to the extreme, then they wouldn't be in office for very long," Cameron said.

Gore filed suit to block Freeport in 2003. U.S. Southern District Judge Samuel Kent ruled in favor of the city in August, and the case has been stalled in the U.S. 5th Circuit Court awaiting the outcome of the Kelo case.

John Hightower, a Houston attorney who represents Freeport and its economic development group, said his office will notify the U.S. 5th Circuit Court of Appeals in New Orleans of the decision to get the case moving again.

The Kelo ruling gives his clients a little more weight going into the process, Hightower said. "The courts continued to hold that governmental entities have wide
discretion in how to use their condemnation powers," Hightower said.

Gore maintains the purpose of Western Seafood's suit is not meant to impede progress.

"We are for anything that could possibly bring prosperity to the city of Freeport, but not at the expense of losing our jobs and our businesses of over 50 years," Gore said.

The second phase of the project would double the size of the facility and future plans include a possible condominium complex nearby, Cameron said.

No condemnations are planned for the placement of the condos, he said. "We wouldn't have done these if we weren't forced to," Cameron said.

Freeport City Manager Ron Bottoms said the city is ready to move forward and hopes the ruling will encourage Western Seafood to negotiate.

"We would still rather settle this thing out of court but we've never gotten close before," Bottoms said. "Now, hopefully there's a little more motivation for them to sit down with us."

Gore said negotiation always has been an option, but Royall and the city haven't budged during previous talks.

While a disappointing setback, Gore said Western Seafood plans to continue the fight.

The city has other condemnation suits pending against the company, and Gore said the legal standoff is far from over. "The most important part at this juncture is the court of public opinion," he said.

Gore said O'Connor's dissenting opinion accurately captures what is happening in Freeport and leaves homes, businesses and churches vulnerable to the city's grab.

"In this case, it's purely for the benefit of a private developer who would be given title to our property," he said. "In that case, no one is safe."

The voting breakdown of the Supreme Court's 5-4 ruling in favor of allowing local governments to seize property through eminent domain for economic development projects.

IN FAVOR: Stevens, Souter, Ginsburg, Breyer, Kennedy

OPPOSED: O'Connor, Rehnquist, Scalia, Thomas

---

The Facts: www.thefacts.com

Freeport moves to seize 3 properties: Houston (TX) Chronicle, 6/23/05

Court's decision empowers the city to acquire the site for a new marina

By Thayer Evans
With Thursday's Supreme Court decision, Freeport officials instructed attorneys to begin preparing legal documents to seize three pieces of waterfront property along the Old Brazos River from two seafood companies for construction of an $8 million private boat marina.

The court, in a 5-4 decision, ruled that cities may bulldoze people's homes or businesses to make way for shopping malls or other private development. The decision gives local governments broad power to seize private property to generate tax revenue.

"This is the last little piece of the puzzle to put the project together," Freeport Mayor Jim Phillips said of the project designed to inject new life in the Brazoria County city's depressed downtown area.

Over the years, Freeport's lack of commercial and retail businesses has meant many of its 13,500 residents travel to neighboring Lake Jackson, which started as a planned community in 1943, to spend money. But the city is hopeful the marina will spawn new economic growth.

"This will be the engine that will drive redevelopment in the city," City Manager Ron Bottoms said.

Lee Cameron, director of the city's Economic Development Corp., said the marina is expected to attract $60 million worth of hotels, restaurants and retail establishments to the city's downtown area and create 150 to 250 jobs. He said three hotels, two of which have "high interest," have contacted the city about building near the marina.

"It's all dependent on the marina," Cameron said. "Without the marina, (the hotels) aren't interested. With the marina, (the hotels) think it's a home run."

Since September 2003, the city has been locked in a legal battle to acquire a 300-by-60-foot tract of land along the Old Brazos River near the Pine Street bridge as well as a 200-foot tract and 100-foot tract along the river through eminent domain from Western Seafood Co. and Trico Seafood Co.

Eminent domain is the right of a government to take private property for public use upon payment of the fair market value.

The tracts of land would be used for a planned 800- to 900-slip marina to be built by Freeport Marina, a group that that includes Dallas developer Hiram Walker Royall. He would buy the property from the city and receive a $6 million loan from the city to develop the project.

Freeport Marina would then invest $1 million in the project and contribute a 1,100-foot tract of land, valued at $750,000, to it before receiving the loan.

Western Seafood spokesman Wright Gore III said the wholesale shrimp company was disappointed with the Supreme Court decision, but believes the ruling does not apply to the city's eminent domain proceedings.

He said there is a provision in state law that allows residents of a city to a circulate a petition to call a vote on whether the city can take property using eminent domain.

"(This) is far, far from over," Gore said. "(We) would have liked to have seen a victory on the federal level, but it is by no means a settled issue."

Gore said Western Seafood's 30,000-square-foot processing facility, which sits on the 300-by-60-foot tract, would be forced to close if the land were seized.

That facility earns about $40 million annually, and Western Seafood has been in business in Freeport since 1946, he said.

City officials, however, have said the marina will still allow Western Seafood and Trico Seafood, which did not return telephone calls or e-mail Thursday, to operate their facilities.

In August, U.S. District Judge Samuel Kent ruled against a lawsuit filed by Western Seafood seeking to stop the city's eminent domain proceedings. The seafood company then appealed its case to the 5th U.S. Circuit Court of Appeals in New Orleans, a request that initially was denied.

The appeals court then decided it would take the case, but not rule on it until after the Supreme Court made a ruling on the New London, Conn., case.

---

Houston Chronicle: www.HoustonChronicle.com

Home seizure ruling doesn't play in Texas: Houston (TX) Chronicle, 6/23/05

After decision, an amendment is proposed to limit local powers of eminent domain

By Mike Snyder and Matt Stiles
Texas' cultural commitment to private property rights surfaced quickly Thursday as a state legislator moved to blunt the impact of a U.S. Supreme Court ruling that local governments may seize land for private development.

Hours after the court's 5-4 ruling came down, Rep. Frank Corte Jr., R-San Antonio, said he would seek "to defend the rights of property owners in Texas" by proposing a state constitutional amendment limiting local powers of eminent domain, or condemnation.

Houston Mayor Bill White and Harris County Judge Robert Eckels offered assurances that the city and county do not intend to condemn land for private development projects.

But officials in the beachfront town of Freeport, south of Houston, said they would move aggressively to condemn property owned by two seafood companies to clear the way for an $8 million private marina.

The Supreme Court ruled against a group of property owners in New London, Conn., who challenged a city plan to demolish their riverfront homes to make way for offices, a hotel and other commercial buildings.

Justice John Paul Stevens, in the majority opinion, said such projects are within the scope of a clause in the Fifth Amendment to the Constitution that authorizes condemning property for "public use."

Stevens wrote that promoting economic development, the stated goal of the
New London project, "is a traditional and long accepted governmental function, and there is no principled way of distinguishing it from the other public purposes the court has recognized," such as taking land for roads, parks or libraries.

In a sharply worded dissent, Justice Sandra Day O'Connor said the majority's
interpretation of "public use" was so broad that "the specter of condemnation hangs over all property. Nothing is to prevent the state from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory."

Joining Stevens in the majority were Justices Anthony M. Kennedy, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer. Dissenting with O'Connor were Chief Justice William Rehnquist and Justices Antonin Scalia and Clarence Thomas.

The opinion said states concerned about excessive use of condemnation were free to pass laws restricting it, and Corte said he intended to do just that. Corte said he would ask Gov. Rick Perry to add the condemnation issue to the agenda of the special legislative session now under way so that the proposed constitutional amendment could appear on the November ballot.

Perry spokeswoman Kathy Walt said the governor would consider requests to add items to the agenda, but probably not until legislators resolve the school finance issue. She said Perry supports property rights and was concerned about the Supreme Court ruling.

Corte said in a news release that his proposed amendment would "limit a local governmental entity's power of eminent domain, preventing them from bulldozing residences in favor of private developers."

White and Eckels said such concerns were unfounded in Houston and Harris County. "The city of Houston has not, and likely never will, use eminent domain powers as aggressively as some cities simply for the purposes of economic development," White said in a statement. "We do respect property rights, and believe that eminent domain should not be used in a way that might simply benefit one rconomic interest versus another."

The mayor said, however, that he is pleased the court upheld the use of eminent domain to reduce blight.

Eckels said Commissioners Court has shown no inclination to condemn land for private development, and he would not support any move to do so.

The Metropolitan Transit Authority, empowered by the law that created it to condemn property within 1,500 feet of transit stations, is not "currently planning" to use that authority for projects along the Main Street light rail line or elsewhere, spokesman Ken Connaughton said.

Asked if the agency might exercise the authority in the future, Connaughton said, "Who knows what happens tomorrow? But there are no plans to do it."

Barry Klein, president of the Houston Property Rights Association, said he
considers Metro's condemnation authority excessive. He said quasi-governmental agencies such as management districts and tax increment reinvestment zones might also try to take advantage of the court ruling.

"I'm sure there are some self-servingly creative people in the leadership of
these organizations who will try to find a way to do this," Klein said.

Developer Ed Wulfe of Houston-based Wulfe & Co. said Houston's public
entities have long resisted acquiring property through eminent domain unless it was for road improvements or other public uses.

Wulfe said, however, that governments and developers can use the type of condemnation cited in the New London case as a tool to redevelop inner-city neighborhoods that stand to benefit economically.

"I think on a very, very careful and selective basis it could be used to improve neighborhoods," said Wulfe. "Whether it's creating affordable housing or jobs, it could be an interesting way to remove blight."

Matthew Deal of Lewis Realty Advisors, a property appraisal and consulting firm that deals in condemnation, said Houston's new downtown sports arenas offer a good example of the benefits of local governments taking full advantage of their eminent domain powers. The sports arenas energized parts of downtown that were "ridden with crime, boarded-up buildings and dangerous to be in," said Deal, calling the Supreme Court ruling "a score for governments and their development partners."

The case is Kelo et al v. City of New London, 04-108.

---

Houston Chronicle: www.chron.com

The US Supreme Court Misses Historic Moment: Develop, Don't Destroy Brooklyn, 6/23/05

Press release

Develop Don’t Destroy Urges Albany to Curb Eminent Domain Abuse
Today the U.S. Supreme Court rendered its decision in Kelo v. City of New London, deferring to the City of New London’s determination that the destruction of homes in a working class neighborhood in order to build a commercial development is not unconstitutional. The decision stands in sharp contrast to the unprecedented public outrage over eminent domain abuse across the U.S. Nevertheless, the decision will do little to dim civil rights advocates' efforts to curb the actions of developers–and their sponsoring state and municipal agencies–who intend on making the U.S. Constitution's Fifth Amendment a dead letter.

"Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random," Justice O'Connor wrote in the dissenting opinion. "The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms."

O'Connor's words should strike fear in the hearts of all citizens around the United States.

"Justice O'Connor is absolutely correct, and the Ratner project's use of eminent domain is a poster child for what she describes," said Daniel Goldstein, spokesperson for Develop Don't Destroy Brooklyn. "Today the Court has kept and reaffirmed the status quo, but in a severely split decision. The Court has made a federalist decision, which means it is now Albany's responsibility to curb and restrict New York's abusive eminent domain laws; here in Brooklyn and all over the state where private corporate powers are benefitting off the backs of everyday citizens."

In December 2004, Develop Don’t Destroy Brooklyn (DDDB) was one of 25 organizations that filed amici curiae briefs in support of the homeowners in Kelo. The briefs represented an extraordinary expression of solidarity among the disparate groups, cutting across racial, political, and social lines. The briefs in support of the City of New London, in contrast, were predictably filed in large part by developers and municipal agencies. To legal observers, the overwhelming public support for the homeowners and recent state court decisions reining in eminent domain abuse signaled a sea change, which the Supreme Court would likely acknowledge in its decision. Regrettably, the Court failed to seize the historic moment and tamely deferred to the City of New London’s determination that an increase in tax revenues justifies the destruction of homes.

Despite the ruling, Bruce Ratner’s plans to build a high-rise and arena complex in Prospect Heights, Brooklyn still contemplate an illegal and unnecessary use of eminent domain to force tenants, homeowners, and businesses from the footprint. DDDB spokesperson Daniel Goldstein said, "If Ratner uses eminent domain, it will be up to him to make the case that the neighborhood is blighted, which it patently is not, or the project makes economic sense, which is pure fantasy. We will pursue all legal channels available to us, and we are confident that a court of law will see the project for the boondoggle that it is." Indeed, Goldstein sat on a panel on Kelo held at the Association of the Bar of the City of New York on June 8 where even pro-eminent domain panelists were deeply disturbed by the Ratner project’s reliance on eminent domain.

DDDB calls on Albany to follow the lead of states like Utah, whose Governor on March 17 signed into law a bill effectively banning the use of eminent domain for economic development. As DDDB’s retained counsel Norman Siegel said, "So long as the Supreme Court will defer to the states, it is up to our legislators to take up the challenge in putting an end to egregious eminent domain abuse."

---

Develop, Don't Destroy Brooklyn: http://developdontdestroy.org

Condemnation: Detroit (MI) Free Press, 6/24/05

Although there is no denying that the Supreme Court ruling is a disaster for private property rights, there is a way to fix it

The U.S. Supreme Court appeared Thursday to declare open season on private property with a decision affirming the power of governments to condemn land to make way for projects that promise economic development. But before developers and planners across Michigan start huddling over the ideal location for the next strip mall, they should note that Justice John Paul Stevens, writing for the 5-4 majority, left an out for places such as Michigan, where the state Supreme Court last year considerably tightened up government condemnation powers.

"We emphasize," Stevens said, "that nothing in our opinion precludes any State from placing further restrictions on its exercise of the takings power. Indeed, many States already impose public use requirements that are stricter than the federal baseline. Some of these requirements have been established as a matter of state constitutional law."

In a footnote, Stevens cited specifically the Wayne County case settled by the state Supreme Court last year in its landmark reversal of the 25-year-old Poletown standard for taking land. That 7-0 decision runs quite contrary to Thursday's Supreme Court ruling. The Michigan justices said the 1963 state Constitution severely limits the ability of governments to condemn private land for public use, then effectively transfer the land to another private owner for a project that promises jobs or increased tax base.

The original ruling arose from the City of Detroit's razing of a neighborhood known as Poletown to make way for a General Motors Corp. plant on the Detroit-Hamtramck border. The subsequent ruling stopped Wayne County from condemning land for its Pinnacle Aeropark project near Metro Airport.

While the state Supreme Court ruling has made it harder for Michigan communities to clear the way for what is often desirable development, it also stopped governments from acting, in effect, as real estate agents for developers who promised more than they could deliver.

The revised Michigan standard for exercising the government condemnation power known as eminent domain remains the more responsible one. The powers spelled out by the U.S. Supreme Court are too easily abused, as some Michigan governments demonstrated during the years that Poletown was the state standard.

---

Detroit Free Press: www.freep.com

Homeowners Lose Eminent Domain Case: Institute for Justice, 6/23/05

Press release

Institute for Justice Warns:
Supreme Court Leaves Homeowners Vulnerable
To Tax-Hungry Bureaucrats & Land-Hungry Developers
Today, the U.S. Supreme Court delivered a blow to home and small business owners throughout the country by allowing the government to use eminent domain to take homes so that businesses can make more money off that land and possibly pay more taxes as a result.

The Institute and its clients issued the following statements after learning of today’s decision.

Chip Mellor, the president of the Institute for Justice, said, “The majority and the dissent both recognized that the action now turns to state supreme courts where the public use battle will be fought out under state constitutions. The Institute for Justice will be there every step of the way with homeowners and small businesses to protect what is rightfully theirs. Today’s decision in no way binds those courts.”

“The Court simply got the law wrong today, and our Constitution and country will suffer as a result,” said Scott Bullock, senior attorney for the Institute for Justice. “With today’s ruling, the poor and middle class will be most vulnerable to eminent domain abuse by government and its corporate allies. The 5-4 split and the nearly equal division among state supreme courts shows just how divided the courts really are. This will not be the last word.”

“One of the key quotes from the Court to keep in mind today was written by Justice O’Connor,” Bullock said. “Justice O’Connor wrote, ‘Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms.’”

Dana Berliner, another senior attorney with the Institute for Justice, said, “It’s a dark day for American homeowners. While most constitutional decisions affect a small number of people, this decision undermines the rights of every American, except the most politically connected. Every home, small business, or church would produce more taxes as a shopping center or office building. And according to the Court, that’s a good enough reason for eminent domain.”

Mellor said, “Today’s decision doesn’t end the Institute for Justice’s fight against abuses of eminent domain. We will work to ensure not only that the property owners in New London keep their homes, but that all home and small business owners are protected from these unconstitutional land grabs by governments and their business allies. This is a terrible precedent that must be overturned by this Court, just as bad state supreme court eminent domain decisions in Michigan and Illinois were later overturned by those courts.”

Susette Kelo, one of the homeowners challenging eminent domain abuse, said, “I was in this battle to save my home and, in the process, protect the rights of working class homeowners throughout the country. I am very disappointed that the Court sided with powerful government and business interests, but I will continue to fight to save my home and to preserve the Constitution.”

Mike Cristofaro, another one of the homeowners whose family has owned property in Fort Trumbull for more than 30 years, said, “I am astonished that the Court would permit the government to throw out my family from their home so that private developers can make more money. Although the Court ruled against us, I am very proud of the fight we waged for my family and for the rights of all Americans.”

---

Institute for Justice: www.ij.org

Court widens scope of property seizure: The Christian Science Monitor, 6/24/05

It rules 5 to 4 that local governments can take homes and other property for private development

By Warren Richey
Government officials do not violate the US Constitution when they seize and demolish homes and businesses to make room for private development.

In a major decision that narrows the constitutional protection of property owners, the US Supreme Court ruled Thursday that the Fifth Amendment's Takings Clause authorizes government seizure of private property even when it merely offers a benefit to the public, rather than actual public use.

The 5-to-4 decision means that state and local officials can continue to use the government's power of eminent domain to take private property and turn it over to a private builder as a form of economic development. Writing for the majority, Justice John Paul Stevens said that a century of case law interpreting the Takings Clause "dictates" that the court adopt a permissive interpretation of the government's eminent-domain power.

In a dissent, Justice Sandra Day O'Connor warned that the ruling could bring dangerous consequences for owners of homes and other properties. "Under the banner of economic development, all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded," she writes.

The ruling is a major victory for planning and development officials in economically depressed regions struggling to spark economic renewal. The decision will make it easier to encourage some private development projects by exempting them from the usual requirement that property be purchased on the open market.

At the same time, the court's action marks a crushing defeat for a group of New London, Conn., residents who filed suit in December 2000 to block efforts by the city to seize and demolish their homes and businesses to make room for a 90-acre office, hotel, and housing complex. Facing the wrecking ball are 15 homes and businesses owned by seven families in the city's Fort Trumbull neighborhood.

Scott Bullock, a lawyer with the Institute for Justice, which represented the homeowners, said the court's decision marks "a sad day for the country and a sad day for the Constitution."

"The fight against eminent-domain abuse will now turn back to the state supreme courts, where the battle will be fought out under state constitutions," he says. "We and many other people will be there to fight [on behalf of] homeowners."

City officials said the riverfront project was necessary to boost New London's sagging tax base, and thus it qualified as an economic development project, justifying the city's use of its eminent domain power.

Residents countered that the project was a land grab, since their property was being turned over for $1 a year to a private developer who would retain all profits from the completed project. The benefit to the city was an anticipated boost to local tax rolls.

The Constitution's Fifth Amendment says that private property may be taken by the government if fair compensation is paid to the owner. But there is a second requirement: The property may be taken only if it is for "public use."

The precise issue before the Supreme Court was whether a privately owned development project amounts to a "public use" of the homeowners' former properties.

Such public uses include a public highway, public school, or military base. Public use also includes the taking of property for privately owned businesses such as railroads, power companies, and other firms that need contiguous land to offer regulated services to the public. Elimination of urban blight has also been identified as a public-use taking.

The New London case raised the most controversial application of public use.

"While the city is not planning to open the condemned land - at least not in its entirety - to use by the general public, this court long ago rejected any literal requirement that condemned property be put into use for the public," Justice Stevens writes.

"Promoting economic development is a traditional and long accepted function of government," Stevens writes. "There is no principled way of distinguishing economic development from other public purposes."

Stevens's majority opinion was joined by Justices Anthony Kennedy, David Souter, Ruth Bader Ginsburg, and Stephen Breyer.

Justice O'Connor was joined in her dissent by Chief Justice William Rehnquist and Justices Antonin Scalia and Clarence Thomas. She writes that the high court has opened the door for cities to in effect turn over private property from one person to another.

"Today, nearly all real property is susceptible to condemnation on the court's theory," she says. "Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random."

"The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms," she says. "As for the victims, the government now has license to transfer property from those with fewer resources to those with more. The Founders cannot have intended this perverse result."

In a separate dissent, Justice Thomas says that the court's ruling erases the public-use clause from the Constitution. "Today's decision is simply the latest in a string of our cases construing the public use clause to be a virtual nullity, without the slightest nod to its original meaning," he writes.

David King, a professor at Quinnipiac School of Law in Hamden, Conn., says O'Connor's dissent is "an exaggeration."

"This case is quite consistent with the court's jurisprudence of the last 50 years," he says. "I don't think this is something the average American has greatly to fear."

In siding with city planners against the homeowners, the high court declined to draw a bright-line distinction between projects involving a public use and those implicating a public purpose. The court said a project that benefits the public in some way can rise to the level of public use needed to satisfy constitutional protections of private property.

State supreme courts have been divided on the public-use issue. Eight have ruled that private economic development does not amount to a public use and have barred condemnations in such cases. They are Arkansas, Florida, Illinois, Kentucky, Maine, Michigan, South Carolina, and Washington.

Six state high courts have ruled that private economic development projects are a public use. Those states are Kansas, Maryland, Minnesota, New York, North Dakota, and Connecticut.

In March 2004, the Connecticut Supreme Court ruled that the New London project was a public use because it is aimed at bringing higher tax revenues and jobs to the economically depressed city. The state high court employed an expansive reading of the term. Public use can mean "public usefulness, utility, or advantage, or what is productive of general benefit," the state high court said.

---

The Christian Science Monitor: www.csmonitor.com

Supreme Court Decision in Eminent Domain Case a Victory for Cities: National League of Cities, 6/23/05

Press Release

By Sherry Conway Appel
Cities across America will be able to continue to use the power of eminent domain -one of their most effective tools for ensuring economic development - under a US Supreme Court ruling issued today. In upholding the city of New London in the Kelo v. City of New London case, the Supreme Court reaffirmed that cities can continue to take private land for private development if it will fulfill a "public purpose."

"The National League of Cities (NLC) is pleased that the Supreme Court upheld 50 years of precedent today, allowing local officials the continued use of eminent domain to bolster depressed economic neighborhoods," said NLC President Anthony A. Williams, mayor of Washington, DC. "It's important to note that the Court did not expand the power, but reaffirmed its current use, which has been indispensable for revitalizing local economies, creating much-needed jobs, and generating revenue that enables cities to provide essential services. With cities and towns facing ever-shrinking resources, we need all the help we can to redevelop our neighborhoods and provide jobs for our citizens."

Williams said, "Eminent domain is not a power to be used lightly. We must be sensitive to those who may be displaced. However, as part of a legislative process, with citizen input and discussion, it is one of the most powerful tools city officials have to rejuvenate their neighborhoods." Williams said that the redevelopment of the Skyland Shopping Center in southeast Washington is an area where eminent domain could be used for the good of the entire community since it would bring in 300 jobs and $3.3 million in new tax revenue annually.

NLC officials responded to concerns raised in the opinion that the power could be improperly used by pointing out the significant checks and balances offered through the legislative process. "City officials use the power of eminent domain very selectively and very carefully," said Indianapolis, Indiana, Mayor Bart Peterson, NLC's 2nd Vice President. "Generally, property is taken only in the context of an overall economic development project that will provide significant benefits to a neighborhood. This usually involves public hearings or some other type of public process. In addition, the Constitution's Just Compensation requirement ensures that cities treat property owners fairly, as do state and federal laws that govern the use and limits of eminent domain. And the media demands that we be accountable."

NLC officials acknowledge that regardless of today's ruling, the Kelo case foreshadows greater scrutiny and accountability going forward when municipalities use eminent domain for economic development purposes.

Eminent domain has been upheld through 50 years of judicial rulings, including seven previous cases in the Supreme Court and is used to help cities assemble parcels into developable tracts.

Williams noted that eminent domain has been especially effective in cities and towns in mature and older communities that often do not have sufficient undeveloped land. "Where would Baltimore be without the Inner Harbor, Kansas City without the Kansas Speedway, Canton, Mississippi, without its new Nissan plant?," Williams said of recent economic projects that used eminent domain. "We applaud the Court for allowing us to continue to use this important tool."

---

National League of Cities: www.nlc.org/home

Supreme Court Expands Power of Eminent Domain: Los Angeles (CA) Times, 6/23/05

By David G. Savage
The Supreme Court gave local governments broad power today to bulldoze homes and other private property to make way for business development, a ruling that could encourage more city-backed plans to replace small stores with big-box retailers.

The 5-4 ruling upheld a plan by officials in a coastal Connecticut town to condemn nine homes of longtime residents that would be replaced with an office complex and a marina.

The dispute between the homeowners and the city officials became a classic test of government power versus individual rights. It pitted a community's hopes for economic rebirth against an individual's right to keep one's home.

Economic development emerged as the clear winner.

The high court's opinion goes further than before in allowing the government to invoke its "eminent domain" and to seize private property from unwilling sellers.

The Constitution says government may take private property "for public use" if it pays the owners "just compensation." Originally, public use meant the land was used for roads, canals or military bases. In the 19th century, railroads were permitted to take private lands because they served the public.

In the mid-20th century, the court said officials could condemn homes and stores in "blighted" areas as part of a redevelopment plan. That 1954 decision helped trigger various urban renewal projects across the nation.

In today's decision, the court went a step further and said officials need not claim they were condemning blighted properties or clearing slums. Now, as long as officials hope to create jobs or raise tax collections, they can seize the homes of unwilling sellers, the court said. This "public purpose" is a "public use" of the land, the court said in Kelo vs. New London.

The justices said they were unwilling to "second guess" local officials on what is best for their communities.

"Promoting economic development is a traditional and long accepted function of government," said Justice John Paul Stevens.

Judges should give city councils and state legislatures "broad latitude in determining what public needs justify the use of the takings power," he added.

Justices Anthony M. Kennedy, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer joined him.

The dissenters said the court was ignoring the basic rights to private property that were written into the Constitution.

Justice Sandra Day O'Connor said all property was now potentially subject to seizure.

"Nothing is to prevent the state from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory," she said.

Justice Clarence Thomas said that the impact of these redevelopment plans falls heaviest on the poor, minorities and the elderly.

"Over 97% of the individuals forcibly removed from their homes by the 'slum clearance' project upheld by this court (in 1954) were black," Thomas said.

Suzette Kelo, the New London, Conn. homeowner who sued to save her home, said she was "very disappointed the court sided with powerful government and business interests."

Dana Berliner, one of her attorneys at the Institute for Justice in Washington, called it a "dark day for American homeowners. Every home, small business or church would produce more taxes as a shopping center or office building. And according to the court, that's good enough reason for eminent domain."

---

Los Angeles Times: www.latimes.com

Supreme Court rules against Kelo

More on this soon. But for now, the multi-part text of this defeat for the rights of all Americans is on-line at:
www.iconworldwide.com/emdo/04-108