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July 2005

Abuse of Eminent Domain: An Erosion of Private Property Rights

"Property is surely a right of mankind as real as liberty."
- John Adams


"The essence of Government is power; and power, lodged as it must be in human hands, will ever be liable to abuse."
- James Madison


In a blow to private property rights, the U.S. Supreme Court, on June 23rd, handed down a ruling in the landmark decision Kelo v. City of New London, which held that local governments have the power to take privately owned homes and property by employing eminent domain powers to make way for more lucrative private real estate proposals that will result in increased tax revenues.

The decision turned on the interpretation of the Takings Clause set forth in the Fifth Amendment of the U.S. Constitution, which provides in pertinent part: "Nor shall private property be taken for public use, without just compensation." In a 5-4 decision, the majority upheld the ruling of the Connecticut Supreme Court, permitting the City to take the waterfront homes and property of nine unwilling sellers for the purpose of economic development.

Justice Sandra Day O’Connor, who recently announced her retirement from the bench, wrote the dissenting opinion on behalf of the Justices who opposed the decision. Justice O’Connor expressed her sentiments in no uncertain terms: "Today the Court abandons this long held, basic limitation on governmental power. 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." She stated that the majority holding effectively deleted the words "for public use" from the Takings Clause of the Fifth Amendment. "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."

This decision erodes one of the most important constitutional guarantees provided by our founding fathers, the right to own and hold private property without the fear that it will be seized by government or other wealthy private interests. The decision is a blow to private property rights, and brings to the forefront the debate of abuse of eminent domain. This debate is particularly germaine to farmers, whose livelihoods are dependent on the protections previously afforded to the fertile land upon which they grow the crops that feed our nation. It appears that all property owners are now merely trustees of their homes and property, paying rent (property taxes) until such time as the government determines a superior use. If it is determined that someone has identified a more lucrative land use, or if it is determined that someone can make an existing land use more profitable, it is now possible for one of the over 6000 California local governmental agencies to exercise their power of eminent domain to condemn the property for itself, or to turn it over to another private interest.

Justice Stevens, writing for the majority, did leave open the ability of States to restrict the power of eminent domain, stating: "We emphasize 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."


In response to the Supreme Court ruling, and in an effort to provide Californians with greater protection than is now provided by the U.S. Constitution in light of the Kelo decision, three California lawmakers have undertaken efforts to amend the California Constitution to strengthen private property right protections. Assemblyman Doug LaMalfa and Senators Tom McClintock and Dean Florez have collectively introduced "The Homeowner & Property Protection Act", offered as Assembly Constitutional Amendment (ACA) 22 and Senate Constitutional Amendment (SCA) 15. This measure was introduced with 45 members signed on as co-authors, more than a third of the state legislature.

The proposed amendment would authorize governmental entities to take or damage private property only for a stated public use and only upon an independent judicial determination on the evidence that the condemnor has proven that no reasonable alternative exists. Further, it would require that if the property ceases to be used for the stated public use, the former owner or a beneficiary or an heir, who has been designated for this purpose, would have the right to reacquire the property for the compensated amount or its fair market value, whichever is less, before the property may be sold or transferred.

Currently, California law requires that a determination be made that the subject property is "blighted" prior to allowing private property to be taken for redevelopment purposes.

In order to pass, the proposed amendment must get two-thirds approval from both the Assembly and the Senate. After which it would be submitted to the California voters, needing a majority vote to pass. It is likely that this could occur as early as the November special election of this year, otherwise they will push for the June general election of year next.

Assemblyman LaMalfa, who introduced ACA 22 to protect private property owners and homeowners in California from the arbitrary use of eminent domain, proclaimed: "The notion that government can place a higher value on one person’s activity and use of their own assets over someone else’s is an elitist and dangerous enterprise that connotes the totalitarian thinking of a few making value judgments over the masses. I believe this is contrary to our most fundamental constitutional rights. By accepting this ruling, we would all essentially become renters and not owners of our property."

Senator McClintock stated: "That [Kelo] decision breaks the Social Compact that gives government its legitimacy and opened a new era when the rich and powerful can use government to seize the property of ordinary citizens for private gain. It may now literally take the house of a person it doesn’t like and give it to a person it does like. Stripped of all the sophistries and euphemisms, this is what it comes down to. . . . Sadly, it now falls upon the states to restore the property rights of their citizens that are no longer protected under the Bill of Rights."


Many advocates of private property rights throughout the state and the country have had similar reactions to the Kelo decision. In both the U.S. House of Representatives and the U.S. Senate, bills have been introduced that would deny the use of federal funds on any project that uses eminent domain to seize private property for development. It has been reported that legislators in as many as twenty-five other states have also begun to take steps to estop the abuse of eminent domain permitted in the Kelo decision.

Particularly interesting is the reaction of the Connecticut legislature, the state of origin for the dispute in the Kelo case, where state legislators declared a moratorium on the use of eminent domain, instructing municipalities to put all eminent domain plans on hold until such time as they have revised the law to protect the rights of private homeowners.

Two Chico City Councilors have also taken up the cause (Steve Bertagna and Larry Wahl), requesting a discussion of the city’s rules regarding eminent domain to assure that private property rights are not trampled for the benefit of another private interest.

Family Water Alliance applauds the efforts of all who are taking steps to protect our rights to our homes and property. In a state where over 6,000 local governments and agencies have the power of eminent domain; it is imperative that we set forth rules to assure that these powers are not exploited to benefit the rich and powerful to the detriment of homeowners, farmers, and property owners. This is a particularly sensitive matter in the state of California due to the current dismal fiscal condition of many local governments, who are in need of increased revenues. However, this burden should not be addressed through the reallocation of private property from unwilling sellers for projects that have the sole purpose of increasing the tax base. This does not equate to a so-called "public benefit" as reasoned by the majority of the U.S. Supreme Court. Instead, these government sanctioned abuses of eminent domain amount to a "public crisis" and an erosion of the fundamental rights upon which this country was founded.


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