States May Raze Court’s Domain Ruling

Policy makers from Texas to New Jersey have similar responses to last month’s Supreme Court ruling that makes it easier for the government to seize private property through eminent domain: no thanks.

The decision was seen initially as a loss for private property owners, but it may lead to a backlash. A groundswell of support for homeowners and property rights has galvanized state legislatures to rein in eminent domain authority.

The June 23 ruling in Kelo v. City of New London granted greater condemnation authority purely for economic development. Property seizures had previously been permitted for public uses – railroads, military bases or utilities – and for cleaning up urban blight.

But the court went out of its way to note that its decision doesn’t keep states from restricting or banning eminent domain. At least eight states – Arkansas, Florida, Illinois, Kentucky, Maine, Montana, South Carolina and Washington – had already restricted the use of eminent domain for economic development except to remove blight before the Kelo case reached the Supreme Court in 2004. Utah and Nevada limited the authority of eminent domain earlier this year in anticipation of the court ruling.

State supreme courts in six others – Connecticut, Kansas, Maryland, Minnesota, New York and North Dakota – have held that eminent domain authority can be used for private economic development.

States that take action against property seizures for economic development will prescribe cases when local governments can’t use eminent domain, said J. Michael Bitzer, a professor of political science at Catawba College in Salisbury, N.C. “That’s typically going to be the most effective approach, just to say, ‘Thou shalt not do this,'” Bitzer said.

With fewer than 10 state legislatures still in session, only Texas and Minnesota have legislation ready for action this year, according to Larry Morandi, a land use expert at the National Conference of State Legislatures .

During a special session convened to resolve school funding issues, Texas’ House on July 12 unanimously approved a constitutional amendment that would ban eminent domain from extending to economic development. The Senate passed a law the next day that would do the same. Each chamber’s plan requires the approval of the opposite to go forward. If the Senate approves of the amendment, Gov. Rick Perry’s (R) signature would send voters to the polls on Nov. 8 for the final say.

The Court’s timing – the decision was announced after most legislatures had adjourned for the year – and not a lack of interest means that there won’t be more immediate legislation. Morandi said he expects “a big influx beginning in January.”

States are considering the following range of measures:

• Senate Republicans have called for a special session in Connecticut to restrict the use of eminent domain. But a June 28 attempt to amend the state’s two-year $31.2 billion budget to limit such condemnation laws failed in the Democratic-controlled Senate in a 22-11 party-line vote. The House, also controlled by Democrats, defeated the provision 82-50. Democratic lawmakers have cautioned against acting too quickly.
• Alabama Gov. Bob Riley (R) plans on calling a special session this month to restrict property seizures for economic development.
• Georgia Gov. Sonny Purdue (R), Missouri Gov. Matt Blunt (R) and legislators in Florida, Oklahoma and New Hampshire have created committees to study eminent domain and make recommendations on how to protect private property owners. An attempt to ban the use of eminent domain for private developments in Georgia failed last year.
• A series of bills in New Jersey would require elected redevelopment boards and would prohibit city or county employees from serving on redevelopment boards that govern the city or county that employs them.
• Illinois will address the issue in the fall veto session when Sen. Steve Rauschenberger (R) introduces legislation that would require the state assembly and the governor to sign off on eminent domain cases for private development. Virginia Sen. Mark Obenshain (R) has promised to introduce legislation in the next session to restrict eminent domain.

The decision has created unlikely political allies. Liberals, concerned that large companies may exercise political muscle to seize land for development in predominantly impoverished and minority neighborhoods, have united with conservatives, distressed over the government’s right to grab private property from one individual and give it to another. But developers caution against a backlash, which they claim facilitates growth in dilapidated parts of town.

In Congress, Sen. John Cornyn (R-Texas) has introduced legislation to exclude economic development as a valid pretext for seizing property. A similar bill has been introduced in the House. Representatives voted 231 to 189 to bar federal funding for property seizures in an amendment to a spending bill and expressed “grave disapproval” at the high court’s decision in a resolution that passed 365 to 33.

But not everyone is pursuing a legislative remedy.

Logan Darrow Clements, a libertarian activist from California, has filed to acquire the New Hampshire house of Justice David Souter, who voted in the five-person majority in Kelo. Clements has proposed that he can net more tax gains for Weare, N.H., if he is allowed to build a luxury hotel, and an accompanying “Just Desserts Cafe,” to illustrate the erosion of Americans’ individual liberties.