Friday, June 24, 2005

So much for the Great American Dream.

From the Institute For Justice:

"Susette Kelo dreamed of owning a home that looked out over the water. She purchased and lovingly restored her little pink house where the Thames River meets the Long Island Sound in 1997, and has enjoyed the great view from its windows ever since. The Dery family, down the street from Susette, has lived in Fort Trumbull since 1895; Matt Dery and his family live next door to his mother and father, whose parents purchased their house when William McKinley was president. The richness and vibrancy of this neighborhood reflects the American ideal of community and the dream of homeownership.

Tragically, the City of New London is turning that dream into a nightmare.

In 1998, pharmaceutical giant Pfizer built a plant next to Fort Trumbull and the City determined that someone else could make better use of the land than the Fort Trumbull residents. The City handed over its power of eminent domain—the ability to take private property for public use—to the New London Development Corporation (NLDC), a private body, to take the entire neighborhood for private development. As the Fort Trumbull neighbors found out, when private entities wield government’s awesome power of eminent domain and can justify taking property with the nebulous claim of “economic development,” all homeowners are in trouble."



KELO et al. v. CITY OF NEW LONDON et al.


No. 04—108.Argued February 22, 2005–Decided June 23, 2005


After approving an integrated development plan designed to revitalize its ailing economy, respondent city, through its development agent, purchased most of the property earmarked for the project from willing sellers, but initiated condemnation proceedings when petitioners, the owners of the rest of the property, refused to sell. Petitioners brought this state-court action claiming, inter alia, that the taking of their properties would violate the “public use” restriction in the Fifth Amendment’s Takings Clause. The trial court granted a permanent restraining order prohibiting the taking of the some of the properties, but denying relief as to others. Relying on cases such as Hawaii Housing Authority v. Midkiff, 467 U.S. 229, and Berman v. Parker, 348 U.S. 26, the Connecticut Supreme Court affirmed in part and reversed in part, upholding all of the proposed takings.

Held: The city’s proposed disposition of petitioners’ property qualifies as a “public use” within the meaning of the Takings Clause. Pp. 6—20.

(a) Though the city could not take petitioners’ land simply to confer a private benefit on a particular private party, see, e.g., Midkiff, 467 U.S., at 245, the takings at issue here would be executed pursuant to a carefully considered development plan, which was not adopted “to benefit a particular class of identifiable individuals,” ibid. Moreover, 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.” Id., at 244. Rather, it has embraced the broader and more natural interpretation of public use as “public purpose.” See, e.g., Fallbrook Irrigation Dist. v. Bradley, 164 U.S. 112, 158—164. Without exception, the Court has defined that concept broadly, reflecting its longstanding policy of deference to legislative judgments as to what public needs justify the use of the takings power. Berman, 348 U.S. 26; Midkiff, 467 U.S. 229; Ruckelshaus v. Monsanto Co., 467 U.S. 986. Pp. 6—13.

(b) The city’s determination that the area at issue was sufficiently distressed to justify a program of economic rejuvenation is entitled to deference. The city has carefully formulated a development plan that it believes will provide appreciable benefits to the community, including, but not limited to, new jobs and increased tax revenue. As with other exercises in urban planning and development, the city is trying to coordinate a variety of commercial, residential, and recreational land uses, with the hope that they will form a whole greater than the sum of its parts. To effectuate this plan, the city has invoked a state statute that specifically authorizes the use of eminent domain to promote economic development. Given the plan’s comprehensive character, the thorough deliberation that preceded its adoption, and the limited scope of this Court’s review in such cases, it is appropriate here, as it was in Berman, to resolve the challenges of the individual owners, not on a piecemeal basis, but rather in light of the entire plan. Because that plan unquestionably serves a public purpose, the takings challenged here satisfy the Fifth Amendment. P. 13.

(c) Petitioners’ proposal that the Court adopt a new bright-line rule that economic development does not qualify as a public use is supported by neither precedent nor logic. Promoting economic development 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. See, e.g., Berman, 348 U.S., at 24. Also rejected is petitioners’ argument that for takings of this kind the Court should require a “reasonable certainty” that the expected public benefits will actually accrue. Such a rule would represent an even greater departure from the Court’s precedent. E.g., Midkiff, 467 U.S., at 242. The disadvantages of a heightened form of review are especially pronounced in this type of case, where orderly implementation of a comprehensive plan requires all interested parties’ legal rights to be established before new construction can commence. The Court declines to second-guess the wisdom of the means the city has selected to effectuate its plan. Berman, 348 U.S., at 26. Pp. 13—20.

268 Conn. 1, 843 A. 2d 500, affirmed.

Stevens, J., delivered the opinion of the Court, in which Kennedy, Souter, Ginsburg, and Breyer, JJ., joined. Kennedy, J., filed a concurring opinion. O’Connor, J., filed a dissenting opinion, in which Rehnquist, C. J., and Scalia and Thomas, JJ., joined. Thomas, J., filed a dissenting opinion.


Never Mind the Kelo, Here's Scott Bullock
The attorney who argued the landmark eminent domain case surveys the blight
in the wake of the Supreme Court's decision. A Reason interview.

Tim Cavanaugh

Scott Bullock, senior attorney at the Institute for Justice, represented the plaintiffs before the U.S. Supreme Court in the landmark eminent domain case Kelo vs. City of New London. He spoke with Reason in the wake of yesterday's decision in favor of the city.

Reason: Are you surprised by the decision?

Scott Bullock: Well I was surprised. It was rather shocking that a majority of the Supreme Court would permit this type of abuse. We're in an America where, as Justice Sandra Day O'Connor points out, church property can be taken for a Costco, a farm can be turned into a factory, and a neighborhood can be leveled for a shopping mall. Most people cannot believe that this can happen in this country and the Supreme Court gave sanction to that with their decision.

Reason: What did you make of Justice Anthony Kennedy's vote against the plaintiffs?

SB: Yeah, it was surprising. I mean here's a guy who once wrote "individual freedom finds tangible expression in property rights." For him to be in a decision that fundamentally violates the right to own and enjoy your property, I think, is disgraceful.

Reason: Is there any recourse to the plaintiffs now?

SB: There is. There are going to be battles on two fronts. One, we're going to do everything in our power to keep these people in their homes. And we're going to explore all options to do so. But one thing that's coming out of this opinion that's very clear is that people are furious about this. And the anger comes from the left, right, libertarians, and everybody in between. People cannot believe that the court sanctioned something like this. So, I think that the growing grassroots rebellion against this is going to gain momentum. And I think that you'll see litigation about this in state courts, where the battle will largely be, at least for the time being. And you'll see a number of legislative changes though both legislatures and then also through the initiative process, as well. And we'll be there every step of the way to make sure that these abuses stop.

Reason: Given how many frivolous Constitutional amendments get proposed there days, why isn't there a serious movement for an amendment that would more narrowly define eminent domain powers?

SB: There's already discussion of doing so. And, as I said, this is a time to really think big about these issues because it's clear that a narrow majority of the Supreme Court has given the potential for businesses and local governments to work together to take people's land. And I think it was a real wake-up call to people that something has to be done about this. And hopefully we'll see some major changes.

Reason: How is this going to affect lower court decisions in other eminent domain cases, such as the Michigan Supreme Court's reversal of the Poletown decision last year?

SB: What's important to point out is that even the majority admitted that state courts are free to interpret their own provisions in a manner that's more protective of property rights. Thankfully, every state Constitution has prohibitions against private takings and a requirement that takings be for public use. And, only six states have held that economic development condemnations are Constitutional. Nine have held that they are not. And most states have not addressed it.

Reason: States that have ruled in favor include Connecticut, presumably?

SB: Connecticut, Kansas, Maryland, Minnesota, New York and North Dakota: Those are the states that have said that this is acceptable to their state constitutions. Nine states have said that it's not. And then, most states have not addressed it. So, state courts, when this issue comes before them, are free to give greater protections to property owners and hopefully stop this practice in their states.

Reason: Speaking of private economic development, the import of the decision has largely been seen as clearing the way for seizures for private economic development, but that's not really unprecedented. Even railroads were private endeavors. So are we seeing something new here or does this decision just affirm the status quo?

SB: It's very different from something like a railroad. A railroad typically follows a very narrow strip of land. Railroads and utilities are what are known in the law as something called common carriers. So even though they might be privately owned, they're really the equivalent of public bodies because everybody, the public, has an equal right to them. Everybody has a right to the utility line. And they're very tightly controlled by public officials, so they're really the equivalent of public bodies; that's why the court upheld them. Here, we're talking about ordinary private uses of land—taking somebody's home for a Costco, taking Church property to give to another private owner. That's why this opinion is so sweeping and it's so far removed from even what the courts did in the railroad cases, or even in the situations involving blight. Because even in those cases, the government had to show that there was some type of harmful condition to that land before it was justified for condemnation. Here, the court said, whatever land the developers happen to desire is up for grabs.

Reason: The irony is that we're in this period of resurgence for American cities. Most major cities are doing better now than they have in decades, and arguments about urban blight are a hard to make. Given yesterday's lifting of the need to prove an area is blighted, how do you expect that to play out?

SB: I think it puts more and more properties up for grabs because here it will be dependent, not on whether or not the property is blighted, but whether it happens to be desired by private parties. So you're going to see people of less economic means, poorer folks, middle class folks who happen to live in the city and live in desirable neighborhoods that are going to be targeted by these types of takings. That's the real travesty of this, and that's one of the strongest points made by Justice O'Connor and Justice Thomas, that this is going to fall hardest on people of limited financial means. And it's going to be to the benefit of the wealthy and government.

Reason: One of the disheartening aspects of this decision is that two of the four dissenters are not long for the court. Justice William Renquist is pretty ill and Justice O'Connor is said to be close to retiring. Do you have any predictions about how a change in the Supreme Court composition will affect property rights?

SB: Well, I don't know. These things are always hard to predict. Look at Justice Kennedy's track record on property rights. But this is also the case where you could have a member of the court that might be more of the left, but might come to a very different decision from what some of the more liberal members of this court decided. As I mentioned, there are a number of people who are concerned about civil liberties, concerned about decisions that affect the poor, minorities, who are outraged about this.

One point you hear from some people who are trying to defend this decision is that the government went through a planning process in this case and this is part of a well-developed plan. The idea that having a plan and going through a planning process protects property owners in any way is completely disconnected from reality. I mean, every development in this country has a planning process. You can't just show up in an open field one day and say, "Well I'm here to build my office park." Everything in this country has to go through a process, has to be announced, has to have hearings, and to think that this provides any protection for property owners who face the loss of their homes and small businesses is nonsense. And it shows how some members of this Court and how some defenders of this policy don't understand how these things really pan out in the real world.

Reason: Can you give some examples of other eminent domain abuses among the 10,000 cases you guys have cited?

SB: I'll give you one primary example that's brewing in Long Branch, New Jersey right now, where a group of people want to hang on to their working-class beach homes. They've worked very hard to get their modest bungalows along the shore. These houses were purchased just by working class folks in Newark and other places, and now many of the elderly residents live there full-time; these are their dream homes. And the City of Long Branch is just proposing taking these people's homes and transferring them to wealthier home-owners. They want to tear them down and build million-dollar condominiums for people right along the shore in northern New Jersey. And so it's a classic example of taking the property of poorer folks and giving it to wealthier folks, and using it for the same purpose. It's just a transfer of wealth between home owners. It's a classic example of eminent domain abuse and one that I think will be litigated in the very near future.

Reason: Is that going to be a new wrinkle, that the property is going to be used for the same purpose?

SB: Well, possibly. There are a number of ways to challenge these types of takings. And I'm sure there will be many issues that are brought up in that case and some of the other ongoing controversies.

Reason: Where are the real outrages happening? Is New London more typical, or is something like Washington, D.C.'s stadium grab a more characteristic situation?

SB: The problem is that there are so many examples of eminent domain abuse. It's hard to find one that captures it entirely. New London was a classic example of this, but there are several others as well. They typically fall under two categories: One, is when the government takes land just simply to produce more tax revenue. That was the situation that was going on in New London. The other thing is what we call the abuse of blight laws. An example of that is a case we were involved in in Lakewood, Ohio, where the government uses blight laws simply as a means to an end. They're not really concerned about conditions in the neighborhood; they simply want to have it declared blighted so they can get the property and transfer it to private developers. The criteria that the City of Lakewood used to get the neighborhood declared blighted included such things as that the homes were lacking central air conditioning, didn't have an attached two-car garage, or lacked full bathrooms. It was really a means to an end, and the abuse of blight laws is an ongoing controversy and also encompasses a lot of the examples we point to of eminent domain abuse.


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