1 THE FEDERALIST NO. 71, at 432 (C. Rossiter, ed. 1961).

2 125 S. Ct. 2655 (2005).

3 See, e.g., Homeowners Lose on Property Rights, USA TODAY, July 1, 2005 at 13A (2005 WLNR10380910); Debra J. Saunders, Your Home Can Be Pfizer’s Castle, SAN FRANCISCO CHRONICLE,June 30, 2005 at B9 (2005 WLNR 10281573); Kennedy’s Vast Domain: The Supreme Court’sReverse Robin Hoods, WALL STREET JOURNAL, June 24, 2005, available at http://www.opinionjournal.com/editorial/feature.html?id=110006862 (visited Nov. 28, 2005).

4 HR 340 (2005).

1

The “Backlash” So Far: Will CitizensGet Meaningful Eminent Domain Reform?

By Timothy Sandefur

It is a just observation, that the people commonly intend the public good. This oftenapplies to their very errors. But their good sense would despise the adulator whoshould pretend that they always reason right about the means of promoting it. Theyknow from experience that they sometimes err; and the wonder is that they so seldomerr as they do, beset, as they continually are, by the wiles of parasites and sycophants,by the snares of the ambitious, the avaricious, the desperate, by the artifices of menwho possess their confidence more than they deserve it, and of those who seek topossess rather than to deserve it.

—Alexander Hamilton1

I. INTRODUCTION

The United States Supreme Court’s decision in the eminent domain case of Kelo v. NewLondon2 was greeted with anger and frustration in the popular media and in the halls of Congress.Editorials and magazine articles expressed popular outrage at the idea that a person’s property canbe condemned and transferred to another private party for development and private profit.3 TheHouse of Representatives passed a resolution, by a vote of 365 to 33, expressing “the gravedisapproval of the House of Representatives regarding the majority opinion of the Supreme Court.”4

The public outcry reaction startled some political leaders and legal thinkers, such as ProfessorThomas W. Merrill, who testified to the Senate that he considered it “remarkable” and “quitestunning,” that there was such an “overwhelming reaction” against the Kelo decision, and that thereaction had “really sobered [him] quite a bit.” After “giv[ing] a great deal of thought to what it is

5 Testimony before the United States Senate Committee on the Judiciary, Sept. 20, 2005, (2005WLNR 14949094).

6 See, e.g., Diane Mastrull, Backlash to Ruling on Eminent Domain, PHILADELPHIA INQUIRER, Nov.14, 2005, available at http://www.philly.com/mld/inquirer/13160672.htm (visited Jan. 25, 2006);Tim Jones, Walls Built Against Eminent Domain, CHICAGO TRIBUNE, Nov. 22, 2005 (2005 WLNR18871704).

7 See Kelo, 125 S. Ct. at 2668.

8 See, e.g., County of Wayne v. Hathcock, 684 N.W.2d 765 (Mich. 2004).

9 The Castle Coalition, a Washington, D.C., offshoot of the Institute for Justice (which representedthe property owners in the Kelo case) maintains a list of proposed bills at http://www.castlecoalition.org/legislation/states/index.asp (visited Nov. 23, 2005).

10 Dan Walters, Eminent Domain Bills Are Stalled, Except One for Casino Tribe, SACRAMENTO BEE,Sept. 16, 2005 at A3 (2005 WLNR 14647451).

2

about the decision that has caused this,” Merrill finally decided that “the nub of the problem is thatthe American people believe that property rights are invested with moral significance.”5

This moral outrage about government transferring property from people who own it to otherprivate parties for their own use came to be called the “Kelo backlash,” and news reports andeditorials declared throughout the fall of 2005 that this backlash was leading to statutory reforms inmany state legislatures.6 Following Justice Stevens’ suggestion in the Kelo opinion that states couldprovide greater protection for property owners than the federal courts provided,7 and recognizing thatsome state courts had imposed stricter limits on eminent domain through the “public use”requirements in state constitutions,8 activists and legislators in 38 states began working on changingstate laws regarding property seizure.9

Unfortunately, so far, the backlash has produced mixed results. In the 10 months since Kelowas decided, fourteen states have enacted legislation regarding eminent domain. Of these new laws,nine provide little or no protection for property owners. Some proposals even appear to have beenconsciously designed, in the words of one commentator, as “disingenuous” attempts “to pretend todo something about eminent domain without actually doing anything to upset the apple cart.”10 Onthe other hand, laws recently enacted in Indiana, South Dakota, Georgia, Pennsylvania, and Florida,some legislation proposed in Congress, and ballot initiatives proposed in Michigan, Florida, andCalifornia, do include significant limits on eminent domain. These bills give reason to hope thatmeaningful reform is on the horizon. But if those states are to avoid the mistakes made in Alabama,Texas, Delaware, Ohio, and other states, lawmakers must learn to resist the pressure to includeloopholes and exceptions that betray the promise of protection for property owners.

In this article, I will survey these new laws, as well some other proposals which are pendingor which failed to pass into law, to see how many proposals for eminent domain reform promise farmore than they deliver. After a brief background on the law of eminent domain after Kelo, and the

11 See, e.g., Van Horne’s Lessee v. Dorrance, 2 U.S. (2 Dall.) 304, 312 (C.C.D. Pa. 1795).Considerable confusion exists regarding the phrase “the despotic power,” which originated withWilliam Blackstone. See 1 William Blackstone, COMMENTARIES *160. Contrary to what manymodern commentators think, see e.g., Steven E. Buckingham, Comment: The Kelo Threshold:Private Property and Public Use Reconsidered, 39 U. RICH. L. REV. 1279, 1296 (2005); Roger Pilon,Can American Asset Forfeiture Law Be Justified?, 39 N.Y.L. SCH. L.REV. 311, 320 (1994),Blackstone (and Justice Patterson in Dorrance) was not referring to eminent domain itself as “thedespotic power.” Rather, Blackstone regarded sovereignty, of which eminent domain is an attribute,as the despotic power; as the “supreme, irresistible, absolute, uncontrolled authority,” 1 WILLIAMBLACKSTONE, COMMENTARIES * 49, which could “do every thing that is not naturally impossible,”and which “must, in all governments, reside somewhere.” Id. at *161. The degree to which thisinterpretation of sovereignty could be validly applied to the United States, which was based largelyon the philosophy of “Mr. Locke, and other theoretical writers” whom Blackstone rejected, id., wasa matter of considerable dispute in nineteenth century America. In his 1803 edition of Blackstone’sCommentaries, St. George Tucker went to great lengths to refute the Blackstonian view thatlegitimate government could ever have “despotic power.” American governments, Tucker wrote,are based on the view that government’s power is always delegated to it by the people, which meansthat its powers are limited by natural rights, and therefore that it cannot actually be “despotic.” See,e.g., 1 ST. GEORGE TUCKER, ED., BLACKSTONE’S COMMENTARIES APP. A (1803). But Tucker’s view

(continued...)

3

public reactions to that decision, I explore each bill in sequence. I then conclude with someobservations as to the two biggest obstacles faced by those hoping for serious eminent domainreform: the political influence of powerful redevelopment proponents, and the lack of seriousphilosophical support for opposition to the outcome of Kelo. In the end, my view is pessimistic.Eminent domain abuse is a symptom of a profound cultural and philosophical breakdown. Thismeans that truly fixing the problem posed by Kelo will take much more than political action.

II. EMINENT DOMAIN AFTER KELO

A. The Background Prohibition on Private Takings

Eminent domain—the government’s authority to force a property owner to sell his or her landto the government for “just compensation”—has long been regarded as one of the most jarring andintrusive of government’s powers. Early in American history, political and legal thinkers describedit as an attribute of sovereignty, which was itself described as “the despotic power.”11 But the

11 (...continued)was not shared by all, and the Blackstonian concept of sovereignty became increasingly popularthroughout the nineteenth century. See WILLIAM FREEHLING, PRELUDE TO CIVIL WAR: THENULLIFICATION CONTROVERSY IN SOUTH CAROLINA 160-62, 171 (1966). In any case, it is clear that“the despotic power” was not simply a pejorative term for eminent domain.

12 I explore the philosophical background of eminent domain issues more thoroughly in “Mine AndThine Distinct”: What Kelo Says About Our Path, 10 CHAP. L. REV. __ (forthcoming, 2007).

13 James Madison, Sovereignty (1835) in 9 WRITINGS OF JAMES MADISON 570-571 (G. Hunt ed.,1910).

14 See THE FEDERALIST No. 51, supra note 1 at 324 (James Madison) (where “the stronger factioncan readily unite and oppress the weaker, anarchy may as truly be said to reign as in a state of nature,where the weaker individual is not secured against the violence of the stronger.”)

15 Id. at 322.

16 See Cass R. Sunstein, Naked Preferences and the Constitution, 84 COLUM. L. REV. 1689 (1984).

17 Magna Carta ¶ 39 (1225).

4

Lockean political philosophy of the American founding necessarily limited the government’sauthority.12 as James Madison put it, “the sovereignty of the society as vested in & exercisable bythe majority, may do anything that could be rightfully done by the unanimous concurrence of themembers; the reserved rights of individuals . . . in becoming parties to the original compact beingbeyond the legitimate reach of sovereignty, whenever vested or however viewed.”13

What Madison meant was that governments are created to protect people from those whomight commit crimes or torts against them. In the old parable of the state of nature, people createa social compact so as to protect themselves against robbery or other wrongs, so that they do nothave to spend their time and energy defending themselves. But this means that the government itselfmust be designed so as not to fall into the hands of those very wrongdoers. If government were tobecome perverted into a tool whereby wrongdoers could commit crimes or torts against innocentcitizens, Madison believed, then the people would be no safer than they were in the state of nature;the government would not be performing its defining function.14 Government must therefore bedesigned not only “to control the governed,” but also “to control itself.”15

Among the ways of preventing government from becoming a mere tool by which politicallysuccessful groups could grant themselves “naked preferences”16 at the expense of other citizens, wasthe requirement that laws be general. If the legislature could write particular laws that granted favorsto particular groups, the likelihood was increased that factions would exploit the state’s coercivepower for their own private benefit. This generality requirement found one of its earliest expressionsin the Magna Carta, which declared that “no freeman shall be . . . disseised of his freehold” except“by the law of the land.”17 This provision, wrote the English jurist Sir Edward Coke, was intendedto prevent “the damnable and damned proceedings” whereby the sovereign might “make and marre

18 2 E. Coke, INSTITUTES *55, reprinted in 2 THE SELECTED WRITINGS OF SIR EDWARD COKE 868(S. Sheppard, ed.2003).

19 Id. at *50, in id. at 858.

20 See, e.g., 1 WILLIAM BLACKSTONE, COMMENTARIES * 70 (“if it be found that the former decisionis manifestly absurd or unjust, it is declared, not that such a sentence was bad law, but that it wasnot law; that is, that it is not the established custom of the realm, as has been erroneously determined.And hence it is that our lawyers are with justice so copious in their encomiums on the reason of thecommon law, that they tell us, that the law is the perfection of reason, that it always intends toconform thereto, and that what is not reason is not law.”)

21 See further THOMAS COOLEY, A TREATISE ON CONSTITUTIONAL LIMITATIONS WHICH REST UPONTHE LEGISLATIVE POWER OF THE STATES OF THE AMERICAN UNION 351-413 (1868). I discuss thegenerality requirement of the Due Process Clause more fully in Is Economic Exclusion a LegitimateState Interest? Four Recent Cases Test the Boundaries, 14 WM. & MARY BILL RTS. J. ___(forthcoming, 2006).

22 Property (1792) reprinted in JAMES MADISON: WRITINGS 515 (Jack Rakove ed. 1999).

23 See, e.g., Calder v. Bull, 3 U.S. (3 Dall.) 386, 388 (1798).

24 87 U.S. 655, 663 (1874).

5

lawes at his pleasure.”18 In other words, the “law of the land” provision meant that a person couldnot be disseised “but by due Proces[s] of the Common law.”19

Under the “law of the land” clause, the government’s use of force in the service of purelyprivate ends was seen as not actually law, but as merely a use of force.20 To qualify as law, thegovernment’s use of force must be engaged in the service of a genuinely public goal, rather than theprivate aggrandizement of politically successful groups. This generality requirement wasincorporated into the Constitution of the United States through the Due Process Clause of the FifthAmendment, with the term “due process” being understood as synonymous with “law of the land”clause.21 And this generality requirement explains why James Madison believed that government“is instituted to protect property of every sort . . . . This being the end of government, that alone isa just government, which impartially secures to every man, whatever is his own.”22

Early American judges who followed Locke’s and Madison’s views on this subject held thatthe very nature of government prohibited it from employing its coercive power to enrich politicallysuccessful groups at the expense of their political competitors.23 After the Civil War, when anotherDue Process Clause was imposed on the states through the Fourteenth Amendment, the SupremeCourt understood the generality requirement quite well. “There are limitations on such power whichgrow out of the essential nature of all free governments,” wrote Justice Samuel Miller in LoanAssociation v. Topeka.24 If the legislature were to “enact that the homestead now owned by A.should no longer be his, but should henceforth be the property of B,” it would violate the DueProcess Clause, because “[t]o lay with one hand the power of the government on the property of the

25 Id. at 664.

26 Truax v. Corrigan, 257 U.S. 312, 376 (1921) (Brandeis, J., dissenting). See further MICHAELMCGERR, A FIERCE DISCONTENT: THE RISE AND FALL OF THE PROGRESSIVE MOVEMENT INAMERICA, 1870-1920 (2003); RICHARD A. EPSTEIN, HOW PROGRESSIVES CHANGED THECONSTITUTION (2006).

27 For a more thorough discussion of the Progressive and New Deal changes in attitudes towardprivate property and eminent domain, see Timothy Sandefur, A Natural Rights Perspective onEminent Domain in California: A Rationale for Meaningful Judicial Scrutiny of “Public Use,” 32SW. U. L. REV. 569 (2003); Sandefur, Mine and Thine Distinct, supra note 12.

28 291 U.S. 502 (1934).

29 348 U.S. 26 (1954).

30 Munn v. Illinois, 94 U.S. (4 Otto) 113, 126 (1876).

6

citizen, and with the other to bestow it upon favored individuals to aid private enterprises and buildup private fortunes, is none the less a robbery because it is done under the forms of law and is calledtaxation. This is not legislation. It is a decree under legislative forms.”25 But with the rise of theProgressive Era and the regulatory welfare state that it ushered in, this generality requirement wouldlargely be erased from Constitutional law.

B. The Twentieth Century Abandons Limits on Eminent Domain

From Calder in the 1790s to Loan Association in the 1870s, many courts came to see lawsor acts which “took from A. to give to B.” as the paradigmatic abuse of government authority. Thisabuse was generally held to be prohibited by the Due Process Clause. But during the TwentiethCentury, attitudes toward government’s proper role in economic life changed drastically. Beginningin the Progressive era, intellectual leaders came to view government, not as an impartial institutionfor protecting individual rights, but as an active participant in the process of “remolding” the “rightsof property and the liberty of the individual” so as to “meet the changing needs of society.”26 Thedrastic shift in constitutional interpretation during the New Deal simply harvested the drasticintellectual changes that the Progressives had planted.27

The twentieth century evolution of attitudes toward private property and eminent domain isreflected in two cases above all: Nebbia v. New York28 in 1934, and Berman v. Parker29 twenty yearslater. In Nebbia, the Supreme Court upheld a state law setting a minimum price for the sale of milk.At that time, the Court’s precedent allowed government to regulate the prices charged in contractsbetween two private parties only when the product or service in question was “affected with a publicinterest.”30 But in Nebbia, the Court shuffled off a half century of case law and held that this test was

31 Nebbia, 291 U.S. at 536-38.

32 Id. at 537.

33 Id.

34 304 U.S. 144, 152, n.4 (1938).

35 This is the proper answer to a point brought up by Justice Stevens in a recent article reflecting onKelo and other decisions. See John Paul Stevens, Learning on the Job, 74 FORDHAM L. REV. 1561(2006). Justice Stevens contends that “a purely literal reading of the Takings Clause would limit itscoverage to a guarantee of just compensation,” and that it “does not prohibit any taking of privateproperty.” Id. at 1566-67. Strictly speaking, that is correct, because the prohibition on privatetakings comes in the Due Process Clause. Yet respecting this principle would require honoringsubstantive due process principles in a way few modern federal judges are willing to do. SeeMichael J. Phillips, The Slow Return of Economic Substantive Due Process, 49 SYRACUSE L. REV.917, 968-69 (1999) (“embracing economic substantive due process would require that liberals rejectsome deeply ingrained beliefs and practices....[and] admit that the supposedly malign and ignorantreactionaries on the old Court knew things about business and government that they and theirProgressive forbears were unwilling or unable to see.”)

7

no longer viable.31 Instead, states would now be “free to adopt whatever economic policy mayreasonably be deemed to promote public welfare, and to enforce that policy.”32 Nebbia placed onlythe loosest limits on legislatures, holding that “[i]f the laws passed are seen to have a reasonablerelation to a proper legislative purpose, and are neither arbitrary nor discriminatory,” the Court wouldhold them constitutional.33 This was the origin of the “rational basis” standard, under which virtuallyany government act is permitted. In United States v. Carolene Products,34 the Court retreatedslightly from that decision, holding that in some circumstances a more meaningful judicial scrutinymight be appropriate, but laws regulating private property or economic activity are still evaluatedunder the lenient rational basis standard.

The abandonment of meaningful protection for property rights and economic liberty underthe Due Process Clause shifted the focus in eminent domain cases. Property owners now focusedmore on the “Public Use” Clause of the Fifth Amendment, instead. This was not how theAmendment was designed to function. The prohibition on private takings was originally located inthe Due Process Clause; the phrase “for public use” served merely a predicate to the justcompensation requirement. The takings clause per se provided for compensation in cases in whichthe taking had already been established as legitimate under the Due Process Clause; that is, it onlydeclares what to do once a taking has been established as not being a private taking.35 The demiseof economic substantive due process in the 1930s, however, forced litigants to contend that achallenged condemnation was not a “public use” and was therefore unconstitutional.

Twenty years after Nebbia imposed the rational basis standard on the Due Process Clause,though, the Supreme Court imposed the rational basis test on Public Use Clause in Berman. In thatcase, the Court unanimously upheld Washington D.C.’s authority to seize private property and

36 Berman, 348 U.S. at 33-34 (“Appellants argue that this makes the project a taking from onebusinessman for the benefit of another businessman. But the means of executing the project are forCongress and Congress alone to determine, once the public purpose has been established. The publicend may be as well or better served through an agency of private enterprise than through adepartment of government . . . . We cannot say that public ownership is the sole method ofpromoting the public purposes of community redevelopment projects.”) (citation omitted).

37 Id. at 32. See also id. at 33, in which Douglas cites Day-Brite Lighting, Inc. v. State of Missouri,342 U.S. 421, 424 (1952), a case which did cite Nebbia for the proposition that states “may withinextremely broad limits control practices in the business-labor field.” Id. at 423.

38 See Sandefur, Natural Rights Perspective, supra note 27 at 599-609.

39 Id. See also RICHARD A. EPSTEIN, TAKINGS: PRIVATE PROPERTY AND THE POWER OF EMINENTDOMAIN 163-64 (1984) (“The surplus created by political life is distributed not only at the formationof the state but also during the course of its operation. When the state acquires private property forpublic use, the public use requirement should ensure the ‘fair’ allocation of surplus by preventingany group from appropriating more than a pro rata share.”).

8

transfer it to other private parties who might use that property more profitably.36 Although JusticeWilliam Douglas did not cite Nebbia in his opinion for the Court, he adopted the same rationale ofjudicial deference on economic and property matters, declaring that “when the legislature hasspoken, the public interest has been declared in terms well-nigh conclusive,” and that “thelegislature, not the judiciary, is the main guardian of the public needs to be served by sociallegislation.”37 Under Berman, the eminent domain power was awarded the same red carpet “rationalbasis” treatment that the regulatory power had received the New Deal era.

Adapting the rational basis test to the language of the Public Use Clause, however, requiredsome ingenuity (or dis-ingenuity). The word “use,” after all, is fairly specific, and not clearlysynonymous with “benefit.” Berman and cases like it were forced to broaden the term “use,”therefore, and they found an excuse for doing so in nineteenth century cases involving railroads andmill-streams, in which some courts had allowed government to condemn property for the use ofprivate corporations and businesses, on the theory that railroads and mills were essentially publicutilities.38 Courts that allowed these condemnations had put some meaningful limitations on eminentdomain, of course, in that they required the government to regulate the railroads and mills thatreceived the benefits from eminent domain; these regulations would ensure that private businessesdid not merely exploit government power for their own profit.39 Berman, however, dispensed withthat requirement. It held merely that “public use” and “public benefit” were synonymous, and that

40 See Berman, 348 U.S. at 32. This process is even more obvious in Poletown NeighborhoodCouncil v. Detroit, 304 N.W.2d 455 (Mich. 1981), in which the Michigan Supreme Court relied onthe railroad cases for the proposition that public use and public benefit were synonymous terms,while simultaneously ignoring the limits that those cases had imposed. See Timothy Sandefur, AGleeful Obituary for Poletown Neighborhood Council v. Detroit, 28 HARV. J.L. & PUB. POL’Y 651,654-60 (2005).

41 467 U.S. 986 (1984).

42 Id. at 1014.

43 467 U.S. 229 (1984).

44 Id. at 242-43. See EPSTEIN, supra note 39 at 181 (1984) (“No antitrust expert thinks ‘oligopoly’because there are ‘only’ seventy or twenty-two or eighteen landowners in a given market.”).

45 Midkiff, 467 U.S. at 241.

46 Id. at 241-42.

9

the legislature was the only body capable of determining what acts would benefit the public.40 Inshort, the legislature became, in all but he most extreme cases, the judge of its own extent of power.

After Berman, the Supreme Court heard only a handful of cases involving the “public use”limitation. Two cases in 1984 upheld takings of property against the argument that they constitutedprivate takings. In Ruckelshaus v. Monsanto Co.,41 the Court affirmed Congress’ power to force achemical company to divulge its secret formulas to its competitors, on the grounds that if a takingof property “has a conceivable public character,” it satisfied the Constitution.42 In Hawaii Housingv. Midkiff,43 the Court held that the state could condemn property from landlords and sell it to tenantsat discount rates, because the state was attempting to break up large estates held by an “oligopoly”of 80 landowners.44 Once again, the Court employed the “rational basis” test, noting that “where theexercise of the eminent domain power is rationally related to a conceivable public purpose, the Courthas never held a compensated taking to be proscribed by the Public Use Clause.”45 Since breakingup large landholdings was, in the legislature’s opinion, a benefit to the public, the condemnationswere constitutional.46

C. The Kelo Case

Having overthrown both the Due Process and Public Use limitations on the condemnationpower, it was predictable that in the 2005 case of Kelo v. New London, the Court would again affirmthe state’s power to condemn private homes and transfer the property to private developers to“revitalize” the local economies. The city of New London, Connecticut, not a prosperous town, hadbeen chosen as the site for a Pfizer pharmaceutical plant in the late 1990s, shortly before SusetteKelo bought her pink Victorian dream house in the quaint neighborhood of Fort Trumbull. Cityofficials hoped that the new plant would serve as the anchor for a redevelopment project that would

47 See Brief of Petitioners, Kelo v. New London (No. 04-108) at 4 (“The development plan envisionsseveral possible future uses for [parcel] 4A, including...undefined ;uses that support the statepark . . . .’ During trial, no witness could explain what ‘Park Support’ meant and all witnessesadmitted that it could be a wide range of possible but undefined uses.”)

48 Kelo, 125 S. Ct. at 2662-63.

49 Id. at 2665. Note the absence of any supporting citation or argument for this statement.

50 See id. at 2667-68.

51 Id. at 2668.

52 Id. at 2668 n.23.

53 Id. at 2668 n.22 (citing Hathcock, supra note 8).

54 Id. at 2667.

55 See id. (“the hypothetical cases posited by petitioners can be confronted if and when they arise.”)

10

include stores, restaurants, and a convention center. The specifics of the plan were never very clear,and bureaucrats were not sure what they would do with much of the seized land,47 but in any case,they contended, the redevelopment project would benefit the public, and therefore the Public UseClause was satisfied.

The Supreme Court, in a 5-4 decision, agreed. The railroad and mill cases, wrote JusticeStevens, had established that the term “public use” could not be interpreted literally; rather, the Courtwould adhere to the “broader and more natural interpretation of public use as ‘public purpose.’”48

And what sorts of activities qualify as “public purposes”? “Promoting economic development is atraditional and long accepted function of government,” Stevens asserted.49 Since the redevelopmentplan was rationally related to such promotion, it was constitutional, and the Court would not imposeany standard of scrutiny more stringent than the rational basis test.50

Stevens acknowledged the “hardship that condemnations may entail,” and emphasized thatstates were still free to adopt greater limitations on the eminent domain power than those imposedby the Kelo decision.51 In particular, he pointed out that California law requires officials to declarethat property is “blighted” before they may seize it,52 and that the Michigan Supreme Court haddeclared that the state’s Constitution prohibited eminent domain from being used to benefit privateparties.53 But as far as the federal Constitution is concerned, no such limitations apply. Only a caseinvolving “a one-to-one transfer of property, executed outside the confines of an integrateddevelopment plan”54 could violate the Public Use requirement.55

This last point is important to keep in mind, if we are to see how some of the state lawsrecently enacted in reaction against Kelo fail to provide any serious protection for homeowners. Itis already the law, both before and after the Kelo decision, that states may not condemn property

56 See Kelo, 125 S. Ct. at 2661-62 (“the City would no doubt be forbidden from taking petitioners’land for the purpose of conferring a private benefit on a particular private party. Nor would the Citybe allowed to take property under the mere pretext of a public purpose, when its actual purpose wasto bestow a private benefit.”)

57 See generally James W. Ely Jr., “Poor Relation” Once More: The Supreme Court and theVanishing Rights of Property Owners, 2005 CATO SUP. CT. REV. 39, 53-69.

58 See Government of Guam v. Moylan, 407 F.2d 567, 568-69 (9th Cir. 1969) (“On urban renewalcondemnations . . . the whole scheme is for a public agency to take one man’s property away fromhim and sell it to another. The founding fathers may have never thought of this, but the process hasbeen upheld uniformly by latter-day judicial decision.”)

59 Sandefur, Natural Rights Perspective, supra note 27 at 659-67.

11

simply to transfer it to another private party for that party’s exclusive gain.56 Kelo did not declarethat government could engage in “one-to-one” transfers. What Kelo did say (and what endangersthe private property rights of all Americans57) is that the term “public use” is satisfied whenever acondemnation and private transfer of property can benefit the public in any conceivable way, and thatthe legislature will receive almost total deference from the judiciary when it declares that such atransfer is a public benefit. Although the Court has always claimed that direct transfers of privateproperty for private use are unconstitutional, it has broadened the definition of “public use” to sucha degree that almost any transfer, no matter how private it actually is, can be rationalized as a publicbenefit. And it has increased the degree of judicial deference to the point that all but the mostpatently corrupt legislative assertions of “public benefit” will escape detection. After Kelo, alegislature need merely declare that a private taking “improves the economy” or “creates jobs,” andit can evade the supposed limits on the condemnation power by asserting that the taking is rationallyrelated to a conceivable public benefit.

D. How Eminent Domain Is Used To Combat “Blight”

To understand the public outcry over Kelo, and to assess the effectiveness of attempts toreform the use of eminent domain, it is first important to understand how eminent domain is usedfor “economic redevelopment.” Unlike condemnations for the construction of highways or postoffices, economic redevelopment condemnations are undertaken with the purpose in mind oftransferring property from its present owner to a new owner who will use the property moreprofitably.58 Generally, governments undertake such projects on the theory that the more profitablenew use will create jobs, spur economic growth in the city, and ultimately raise the localgovernment’s tax revenue.

The theory of economic development condemnations begins with the concept of “blight.”Originally a term for a plant disease, the term “blight” was first applied to neighborhoods during theProgressive era,59 by urban planners who conceived of cities as similar to living organisms: when

60 This Progressive notion of government as fostering economic development went hand-in-handwith other Progressive attitudes toward land use regulation, such as zoning, which Progressiveintellectuals devised as a social engineering device for ensuring proper racial balances inneighborhoods. See generally Eric Claeys, Euclid Lives? The Uneasy Legacy of Progressivism inZoning, 73 FORDHAM L. REV. 731 (2004).

61 Sometimes, the developer contacts the government agency first, however. For example, inNorwood v. Horney, 830 N.E.2d 381, appeal granted, 835 N.E.2d 375 (2005), the private developer,Rookwood Partners, approached the city government and “repeatedly pressed Norwood to invokeits eminent-domain powers.” 830 N.E.2d at 384. See also STEVEN GREENHUT, ABUSE OF POWER:HOW GOVERNMENT MISUSES EMINENT DOMAIN 138-59 (2005) (noting that “[t]his is howgovernments now routinely operate, taking property from small owners and giving them to big ones,and treating the victimized owners shabbily. It’s no aberration.” Id. at 144.)

62 See Sharon Simonson and Timothy Roberts, Blight Ruling Won’t Stop City, SILICON VALLEY/SANJOSE BUSINESS JOURNAL, April 8, 2005, available at http://www.bizjournals.com/sanjose/stories/2005/04/11/story1.html (visited Nov. 23, 2005).

63 David T. Kraut, Note: Hanging Out the No Vacancy Sign: Eliminating the Blight of VacantBuildings from Urban Areas, 74 N.Y.U. L. REV. 1139, 1162 (1999).

12

a neighborhood failed to perform up to the standard required by the “needs of the public,” it was upto the government to intercede and alter the economic situation so as to improve the neighborhood.60

Today, this attitude remains the keystone of economic development projects. Under the lawsof most states, redevelopment through eminent domain works as follows: when confronted by a“deteriorating” or economically underperforming neighborhood, city planners seek the attention ofa developer who would be willing to locate in the area if given enough incentives.61 Officials areoften required to draft a redevelopment plan before proceeding; such a plan will include fact-findingby consultants, who are hired to advise the city on whether a specified area is “blighted.” Theseconsultants are too often willing to tell cities whatever they want to hear; in one recent Californiacase, a trial court rejected the findings of a consultant that had performed what it euphemisticallycalled a “windshield survey” of a neighborhood to determine whether it was blighted.62 Awindshield survey, of course, means that the consultant simply drove through the neighborhoodbefore writing up a report declaring the neighborhood blighted.63

The requirement that government declare a neighborhood “blighted” before condemningproperty might protect property owners against government overreaching, if the definition of“blight”were precise enough to prevent the government from taking any but the most dangerous orextremely distressed property. Unfortunately, many states, such as California, have defined “blight”in terms so vague that officials are free to declare virtually any property “blighted.” Consider someof the factors listed in the definition of “blight” in California’s Redevelopment Law:

64 Cal. Health & Safety Code § 33031.

65 See, e.g., Redevelopment Agency v. Rados Brothers, 95 Cal. App. 4th 309 (2001) (allowing acondemnation under a 30-year-old blight designation).

66 In Boelts v. City of Lake Forest, 127 Cal. App. 4th 116 (2005), the California Court of Appeal heldthat a 14-year old blight designation was no longer valid. But “[i]n doing so” the court “stress[ed]that our decision today is grounded in the particular facts before the trial judge . . . . The area wasoriginally part of the unincorporated area of a county, and it was the county that adopted an originalredevelopment plan . . . . Then, 14 years later and after the area had been incorporated into the cityof Lake Forest, the city adopted an amendment to the 14-year-old redevelopment plan adding thepower of eminent domain . . . .” Id. at 122-23. Boelts provides little hope for property owners notin such a unique situation.

67 Mesdaq v. Superior Court of San Diego County (Cal. Supreme Ct. No. S132386).

13

Factors that . . . substantially hinder the economically viable use . . . of buildings . . .[including] substandard design, inadequate size given present standards and marketconditions, lack of parking, or other similar factors.

Adjacent or nearby uses that are incompatible with each other and which prevent theeconomic development of . . . the project area.

The existence of subdivided lots of irregular form and shape and inadequate size forproper usefulness and development that are in multiple ownership.64

Such amorphous standards make it possible to declare property blighted whenever officials believeit is failing to produce revenue at a level that they would like to see.

Not only are the standards for defining “blight” so vague as to allow merely unattractive orunproductive property to be declared blighted, but there is no legal requirement placing a time limiton blight designations.65 Although it seems likely that condemning property under a very old blightdesignation could violate the basic standards of fairness protected by the Due Process Clause, thereappears to be no reported case holding that a blight designation has gone stale. Under the law ofCalifornia and other states, blight designations can remain on the books indefinitely.66 Nor can theybe challenged in a later proceeding, even if the once-blighted neighborhood has improved in theinterim due to private efforts. In Mesdaq v. Superior Court, the owner of a fashionable cigar storein San Diego’s upscale Gaslamp District tried to challenge the condemnation of his property on thegrounds that the blight designation was no longer valid. Through the efforts of himself and otherbusinessmen, the property had gone from blighted to an expensive shopping area frequented bytourists and even Governor Arnold Schwarzenegger, who enjoyed some cigars at Mesdaq’s store.The trial court refused to entertain his evidence and the Court of Appeal affirmed.67 In short, if aproperty owner fails to avoid a blight designation, he is unlikely to prevail in any subsequentproceeding, or obtain any meaningful judicial review later on.

68 128 Cal. App. 4th 1123 (2005).

69 Id. at 1137-38.

70 Id. at 1141.

71 Cal. Health & Safety Code § 33362.

72 Evans, 128 Cal. App. 4th at 1141. Officials later reinserted the Mitchell Block into a differentredevelopment area. Id. at 1141 n.2.

73 For an explanation of Tax Increment Financing, see Todd A. Rogers, Note: A DubiousDevelopment: Tax Increment Financing and Economically Motivated Condemnation, 17 REV. LITIG.145 (1998).

14

Once a blight report is drafted, and a developer chosen, officials finalize a redevelopmentplan, including such things as artist renditions of the projected shopping mall (or whatever theultimate project might be). City officials then approve the proposal by adopting a resolution of“blight” as well as the plan itself. In some states, including California, a city must hold publichearings before approving such a resolution. But this procedural requirement is also not a seriousrestriction on the power of eminent domain. In the recent case of Evans v. San Jose,68 for example,the public hearing was attended by over 120 property owners, each of whom was allowed twominutes to speak.69 One of them, Elaine Evans, submitted a letter containing several objections tothe proposed redevelopment plan, and particularly focusing on one element of that plan called “theMitchell Block”. At that hearing, the city removed the Mitchell Block from its plan and thereafterignored her letter entirely, even though it also included objections to other aspects of the plan.Mrs. Evans, of course, did not think it necessary, at the raucous hearing, to take the time to “notifythe City that [she was] continuing to assert the objections set forth in the Mitchell Block letter.”70

The city then approved its redevelopment plan. Later, Mrs. Evans filed other objections to the plan,only to discover that she was barred by the special, short statute of limitations which applies uniquelyto challenges to redevelopment plans.71 The Court of Appeal held that, after the city deleted theMitchell Block from the project, Mrs. Evans letter was “no longer before the City Council,” and thatMs. Evans was under a duty to reiterate all of her general objections if she wished to preserve themfor judicial review.72

The redevelopment plan having been adopted, and the property declared blighted, the nextsteps are simply administrative: appraisals are sought of the properties targeted for condemnation,and the property owner is notified that if she refuses to accept the city’s offer of purchase, the citywill proceed through eminent domain. Property owners rarely seek to defend themselves in court,since they know that the chances of success are slim. Once the property is condemned, it can beleased or resold to a developer for a token amount, because, under a mechanism called “TaxIncrement Financing,” cities are able to recoup the cost of a condemnation by taxing the developerwho moves in.73

74 Jennifer J. Kruckeberg, Can Government Buy Everything?: The Takings Clause and the Erosionof the “Public Use” Requirement, 87 MINN. L. REV. 543, 543 (2002).

75 C.G.S.A. § 8-125. Connecticut courts have held that these factors are the definition of “blight.”See Kelo v. City of New London, 268 Conn. 1, 33 (2004), aff’d, 125 S. Ct. 2655 (2005).

76 See Kelo, 268 Conn. at 14-17 (citing C.G.S.A. § 8-186).

77 C.G.S.A. § 8-189.

78 See Brief for Petitioners, Kelo v. New London, No. 04-108, at 3.

79 Kelo, 125 S. Ct. at 2661 (quoting Kelo, 268 Conn. at 54).

15

Thus the present system of economic development through eminent domain works bycombining government’s coercive powers with the economic influence of private businesses.Together, these groups conspire to deprive property owners of their land, and devote it instead touses that are more profitable to both the government and the private developer. As attorney JenniferKruckeberg puts it, “[c]orporations, using cities as their personal real estate agents, are proposingthe following assignment: ‘Find me your most prominent location, get rid of what is on it, help mepay for it, and maybe you will be lucky enough to have me move to your city.’”74

Like California, Connecticut’s eminent domain laws, which gave rise to the Kelo case, allowfor the redevelopment of neighborhoods that are “deteriorated, deteriorating, substandard ordetrimental to the safety, health, morals or welfare of the community.”75 Like California,Connecticut officials are required to adopt a development plan before condemning property foreconomic redevelopment.76 Such a plan must include, among other things, “a description of thepresent condition and uses of [the targeted] land,” a “description of the types and locations of landuses or building uses proposed for the project area,” a “plan for relocating project-area occupants,”and “a statement of the number of jobs which the development agency anticipates would be createdby the project.”77

State officials fulfilled these requirements in Kelo when they adopting the Fort TrumbullMunicipal Development Plan on January 18, 2000.78 This plan divided the targeted area into sevenparcels, of which three would be devoted to office space; one would be used for a hotel andconference center; one would be made into new residences and, perhaps, a Coast Guard museum;and one for stores. The use of much of remaining parcel, parcel 4, had not been decided by the timeof the Supreme Court’s decision—contrary to the Court’s later statement that the redevelopment planwas “‘carefully considered.’”79

The bottom line is that while some states impose procedures limiting how redevelopmentauthorities may condemn property, these procedures provide little protection for property owners.Definitions of “blight” are generally vague enough to allow condemnation of almost any property.Public hearing rules do not provide property owners with meaningful opportunities to object, butcreate various traps and tricks that bar judicial review. Sometimes, special statutes of limitations andevidentiary rules apply, that also bar property owners from realistic judicial review. And blight

80 This is not to say that there are no limits at all. Political outrage seems to have become a primaryprotection for private property owners. This was certainly the case in Lakewood, Ohio, when thecity declared a clean, middle class neighborhood “blighted” because, among other things, the homeslacked two-car garages and central air conditioning. After 60 Minutes reporter Mike Wallace pointedout that the mayor’s own home was “blighted” under these standards, the voters revoked theredevelopment plan and allowed the homeowners to remain. GREENHUT, supra note 61 at 243.

81 See, e.g., Peter Hardin, Eminent-Domain Outcry Spans Politics, RICHMOND TIMES DISPATCH, Sept.12, 2005, at A1 (2005 WLNR 14441582); T.R. Reid, Property Rights: Eminent Domain: HotLegislative Topic, MIAMI HERALD, Sept. 11, 2005, at B (2005 WLNR 14289193).

82 See, e.g., Michael Gardner, Lawmakers Rethink Land-Seizure Laws: High Court Ruling Leadsto Groundswell in State, Proposed Moratorium, SAN DIEGO UNION-TRIBUNE, August 17, 2005, atA1 (2005 WLNR 13066242) (quoting John Shirey, representative of California RedevelopmentAssociation, as saying “There’s a hue and cry about how bad things are in California. Yet Kelochanged nothing.”)

83 The commonness of condemnations that benefit private parties was revealed in a 2003 report byDana Berliner, one of the attorneys representing Susette Kelo. See DANA BERLINER, PUBLIC POWER,PRIVATE GAIN (2003) available at http://www.castlecoalition.org/report/ (visited Nov. 23, 2005)(describing approximately 10,000 incidents of eminent domain being used, or threatened, againstproperty owners for the benefit of private developers.)

84 Many of these polls are collected at http://www.castlecoalition.org/announcements/kelo-polls-6-28-05.asp.

16

designations are generally not time limited, and can remain on the books indefinitely, until a citydecides to condemn the subject property. Even if the property owner manages to overcome theseobstacles, courts employ a deferential standard of review under which property owners can rarelyprevail in cases which fall short of actual corruption.80 If they are to provide serious protection forproperty owners, reform efforts must address all of these fundamental problems.

III. IS THE KELO BACKLASH ACCOMPLISHING ANYTHING?

Public reaction to the Kelo ruling was swift and fierce.81 Although defenders of the decisionrightly noted that it did not change the law,82 but was consistent with fifty years of precedent, thepublic reaction made it clear that many Americans had not known that such condemnations go onas often as they do.83 Public opinion polls found overwhelming opposition to the Court’s decision.84

The outrage crossed party lines. Conservative Republicans, traditional supporters of property rights,were understandably outraged at the threat that the broad use of eminent domain posed to home andbusiness owners, but liberal Democrats were also angered at the Court’s willingness to allow wealthyand powerful lobbyists to enrich themselves at the expense of poor and middle class citizens.National Review editor Rich Lowry captured this bipartisan anger when he reported on his interview

85 Rich Lowry, “Mad Max” Stands with the Right, NATIONAL REVIEW ONLINE, Aug. 5, 2005,available at http://www.nationalreview.com/lowry/lowry200508050737.asp (visited Nov. 23, 2005).

86 See, e.g., Gary Andres, The Kelo Backlash, WASHINGTON TIMES, Aug. 29, 2005, available athttp://www.washingtontimes.com/op-ed/20050828-100444-1733r.htm (visited Nov. 23, 2005);Ronald D. Utt, Kelo Backlash Could Lead to Restoration of Property Rights Lost to Smart Growthand Eminent Domain Abuses, Heritage Foundation WebMemo #781, June 29, 2005, available athttp://www.heritage.org/Research/SmartGrowth/wm781.cfm (visited Nov. 23, 2005); Hands Off OurHomes, THE ECONOMIST, Aug. 20, 2005, at 71 (2005 WLNR 13089676).

87 Available at http://www.governorpress.alabama.gov/pr/pr-2005-08-03-01-propertyrights- photo.asp (visited Nov. 23, 2005).

17

with Democratic California Congresswoman Maxine Waters: “[T]he famously fire-breathingleft-wing congresswoman from Los Angeles has emerged in recent weeks as one of the nation’s mostoutspoken defenders of property rights,” wrote Lowry. “‘Government should be in the business ofprotecting private property,’ she told me in an interview, sounding every bit a member of thefree-market group the Club for Growth. ‘Private property is precious in America.’”85 In the monthsthat followed, legislators in 38 states proposed more than 98 bills to limit the use of eminent domainat the state level.

As of the time of this publication, fourteen states have enacted legislation in response to theSupreme Court’s decision in Kelo. These laws, and the other proposed bills, have been widely hailedas examples of salutary democratic reaction to the Supreme Court’s decision.86 But a closerexamination reveals that nine of these laws have created little meaningful protection for propertyowners; they generally impose minor bureaucratic burdens on redevelopment officials, or ratifyvague definitions of terms such as “public use,” thereby allowing government agencies to continueemploying eminent domain to benefit private developers. By contrast, new laws enacted in SouthDakota, Indiana, Georgia, and Florida, and initiatives pending in Michigan, Florida, and California,as well as legislation pending in the United States House of Representatives, do create substantialprotections for property owners. If these bills are passed, they may give real strength to the Kelobacklash.

A. Meaningless Reforms

1. Alabama

On August 3, 2005, Alabama became the first state to respond to the Kelo decision whenGovernor Bob Riley signed S.B. 68A. “A property rights revolt is sweeping the nation and Alabamais leading it,” Riley declared at the signing ceremony.87

88 Available at http://www.legislature.state.al.us/SearchableInstruments/2005fs/Bills/SB68.htm(visited Nov. 23, 2005).

89 Code of Alabama § 11-47-170 (b) (emphasis added).

90 Id. § 24-2-1(a)(2).

91 Id. § 24-2-1(a)(3).

92 Id.

18

S.B. 68A88 added two sections to the Alabama State Code. After reaffirming the power ofeminent domain, the operative paragraph of the first section declares that

Notwithstanding any other provision of law, a municipality or county may notcondemn property for the purposes of private retail, office, commercial, industrial,or residential development; or primarily for enhancement of tax revenue; or fortransfer to a person, nongovernmental entity, public-private partnership, corporation,or other business entity. Provided, however, the provisions of this subsection shallnot apply to the use of eminent domain by any municipality, housing authority, orother public entity based upon a finding of blight in an area covered by anyredevelopment plan or urban renewal plan pursuant to Chapters 2 and 3 of Title 24,but just compensation, in all cases, shall continue to be first made to the owner.89

The section goes on to reaffirm the state’s authority to use eminent domain to support public utilities,or to construct traditional public uses such as roads or public parks.

The italics highlight the primary weakness of the Alabama measure. Although it forbids theuse of eminent domain for private uses or solely to enhance tax revenue, it continues to permit theuse of eminent domain for redevelopment pursuant to two chapters of Title 24 of the Alabama Code,sections devoted to urban renewal and redevelopment projects.

Chapter 2 of Title 24 targets neighborhoods which “impair economic values and taxrevenues, cause an increase in and spread of disease and crime and constitute a menace to the health,safety, morals and welfare of the residents of the state.”90 It allows “the clearance, replanning andpreparation for rebuilding of these areas and the prevention or the reduction of blight.”91 The“clearance”—i.e., condemnation—of such areas is declared to be a “public use[] and purpose[] forwhich public money may be spent and private property acquired.”92 The chapter specificallyauthorizes a government “housing authority . . . or any incorporated city or town” to use eminentdomain

(1) . . . [t]o acquire blighted areas, which are hereby defined as areas, including slumareas, with buildings or improvements which, by reason of dilapidation,obsolescence, overcrowding, faulty arrangement or design, lack of ventilation, lightand sanitary facilities, excessive land coverage, deleterious land use or obsolete

93 Id. § 24-2-2.

94 Id. § 24-3-2(b).

95 Id. § 24-3-2 (c)(2).

96 Id. § 24-3-3 imposes the same procedural requirements on urban renewal plans as are provided forredevelopment plans by § 24-2-4.

19

layout, or any combination of these or other factors, are detrimental to the safety,health, morals or welfare of the community;(2) To acquire other real property for the purpose of removing, preventing orreducing blight, blighting factors or the causes of blight . . . . [and](4) To sell or lease land so acquired for uses in accordance with the redevelopmentplan . . . .93

Chapter 3 gives similar authority to officials to “plan and undertake urban renewalprojects,”94 including the authority to “eliminat[e] (and . . . prevent[] . . . the development or spread)of slums or blighted, deteriorated or deteriorating areas.” Among the things that cities may do to“prevent the development of deteriorating areas” are the following:

Acquisition of real property [through eminent domain] and demolition, removal orrehabilitation of buildings and improvements thereon, where necessary to eliminateunhealthful, unsanitary or unsafe conditions, lessen density, reduce traffic hazards,eliminate obsolete or other uses detrimental to the public welfare, or to otherwiseremove or prevent the spread of blight or deterioration or to provide land for neededpublic facilities.95

Before exercising the power to “acquire,” or “demolish,” or “remove” buildings which are“obsolete” and “detrimental to the public welfare,” city officials must create a redevelopment orurban renewal plan.96 Such a plan must “provide[] an outline for the development or redevelopmentof [the targeted] area and [must be] sufficiently complete:

(1) To indicate its relationship to definite local objectives as to appropriate land usesand improved traffic, public transportation, public utilities, recreational andcommunity facilities and other public improvements;(2) To indicate proposed land uses and building requirements in the area; and(3) To indicate the method for the temporary relocation of persons living in suchareas and also the method for providing, unless already available, decent, safe andsanitary dwellings substantially equal in number to the number of substandard

97 Id. § 24-2-4.

98 Blankenship v. City of Decatur, 115 So.2d 459, 463 (Ala. 1959). Accord, Gober v. Stubbs, 682So.2d 430, 435 (Ala. 1996).

99 This appears to have been the case, for example, in City of Birmingham v. Tutwiler Drug Co., Inc.,475 So.2d 458 (Ala. 1985), in which the court acknowledged that “city employees charged withcollecting data and drawing up the proposed resolution . . . [did so] in a manner calculated to makethe condition of the buildings appear as poor as possible.” Id. at 465. Still, the court employed adeferential standard of review to uphold the city’s actions. Id. at 465-66.

100 Kelo, 125 S. Ct. at 2669 (Kennedy, J., concurring).

20

dwellings to be cleared from said area, at rents within the financial reach of theincome groups displaced from such substandard dwellings.97

There are no special requirements for public participation in the drafting of such a report, buteven if there were, this requirement is a procedural barrier that is quite easy for city officials to cross.The requirements impose no limit on the uses to which private property may be put as part of aredevelopment plan. Such a plan may include substantial redistribution of property to privatedevelopers. As is true in many other states, even non-blighted, commercially viable property maybe condemned through a redevelopment plan if it is part of a neighborhood that is declared blighted:“the mere fact that some of the buildings in the area are standard and substantial does not require thatthey be omitted from the operation of the project.”98 And since Alabama’s redevelopment lawsallow not only for the eradication of slums, but also for the “prevention” of “deteriorating” areas,redevelopment authorities are free to condemn property solely for the purposes of improving thelocal economy.

The breadth of redevelopment authority under Alabama law is therefore quite clear: underTitle 24, city officials may declare property “deteriorating” whenever it fails to perform economicallyup to an standard that they would prefer to see. Officials may then draft a redevelopment plan, adoptit by a city council vote, and proceed to condemn homes and businesses for economic development.99

None of this is changed by SB 68A. It specifically preserves the operation of Chapters 2and 3 of Title 24 without alteration. The new law simply reiterates that the state may condemnproperty only after it has followed the relatively simple procedure of declaring the area blighted andpreparing a redevelopment plan. These are not serious obstacles to determined developers andbureaucrats. All that the Alabama reform measure seems to do is to prohibit direct transfers ofproperty from A to B for B’s benefit alone; the state is now required to declare, with some minimalplausibility, that the transfer will benefit society in some general way. In this, SB 68A is reminiscentof Justice Kennedy’s suggestion in his Kelo concurrence, that “court[s] applying rational-basisreview under the Public Use Clause should strike down . . . taking[s] that, by a clear showing, [are]intended to favor a particular private party, with only incidental or pretextual public benefits.”100 ButJustice O’Connor’s critique of this suggestion applies with equal force to SB 68A:

101 Id. at 2675-76 (O’Connor, J., dissenting) (citation omitted).

102 Taylor v. Porter & Ford, 4 Hill 140, 145-46 (1843).

103 Codified as Tex. Gov. Code Chapter 2206, et seq.

21

Whatever the details of Justice Kennedy’s as-yet-undisclosed test, it is difficult toenvision anyone but the “stupid staff[er]” failing it. The trouble with economicdevelopment takings is that private benefit and incidental public benefit are, bydefinition, merged and mutually reinforcing. In this case, for example, any boon forPfizer or the plan’s developer is difficult to disaggregate from the promised publicgains in taxes and jobs . . . . How much the government does or does not desire tobenefit a favored private party has no bearing on whether an economic developmenttaking will or will not generate secondary benefit for the public. And whatever thereason for a given condemnation, the effect is the same from the constitutionalperspective-private property is forcibly relinquished to new private ownership.101

Requiring legislative bodies to declare a neighborhood blighted before condemning it andtransferring it to another private user cannot solve the problem of private takings for two reasons:first, because the problem of private takings is a qualitative question of justice. Insulating aninjustice with bureaucratic procedural requirements simply cannot transform it into a just act. Andsecond, because although procedural mechanisms can sometimes create checks-and-balances whichprevent abuse, this does not work when the procedural requirements can be fulfilled by the sameagency that commits the abuse to begin with. Requiring the same city council which seeks to takethe property to first declare that property blighted is an illusory protection. As New York SupremeCourt put it in an eminent domain case in 1843, “[t]he people have [declared that] . . . ‘No memberof this state shall be disfranchised, or deprived of any of the rights or privileges . . . unless by the lawof the land . . . .’ The words ‘by the law of the land,’ as here used, do not mean a statute passed forthe purpose of working the wrong. That construction would render the restriction absolutelynugatory, and turn this part of the constitution into mere nonsense. The people would be made tosay to the two houses . . . ‘You shall not do the wrong, unless you choose to do it.’”102

2. Texas

On September 1, 2005, Texas Governor Rick Perry signed SB 7B,103 a long bill which insome ways repeats the errors of the Alabama legislation, and in other ways, does seriously improveprotections for Texas property owners. SB 7B amended Texas’ eminent domain laws to prohibit“the use of eminent domain” if the taking:

(1) confers a private benefit on a particular private party through the use of theproperty;(2) is for a public use that is merely a pretext to confer a private benefit on aparticular private party; or

104 Tex Gov. Code § 2206.001(b).

105 See Kelo, 125 S. Ct. at 2661-62 (“the City would no doubt be forbidden from taking petitioners’land for the purpose of conferring a private benefit on a particular private party. Nor would the Citybe allowed to take property under the mere pretext of a public purpose, when its actual purpose wasto bestow a private benefit.”)

106 TEX. CONST. Art I sec. 17.

107 Hous. Auth. of City of Dallas v. Higginbotham, 143 S.W.2d 79, 84 (Tex. 1940) (“this court hasadopted a liberal view concerning what is or is not a public use.”); Accord, Hardwicke v. City ofLubbock, 150 S.W.3d 708, 714 (Tex. App. 2004).

22

(3) is for economic development purposes, unless the economic development is asecondary purpose resulting from municipal community development or municipalurban renewal activities to eliminate an existing affirmative harm on society fromslum or blighted areas under:

(A) Chapter 373 or 374, Local Government Code, other than an activity describedby Section 373.002(b)(5), Local Government Code; or

(B) Section 311.005(a)(1)(I), Tax Code.104

As with the Alabama law, the exceptions provided for in subsection 3 undo many of thepromised protections of subsections 1 and 2. Under the Fifth Amendment’s Public Use Clause, evenafter Kelo, it is already unconstitutional for states to employ their eminent domain power to “confera private benefit on a particular private party” or to do so under a pretext.105 The problem is that“public benefit” is defined so broadly, and that legislatures are given so much judicial deference, thatalmost any private benefit can be rationalized as being public benefits, and hence evade the supposedlimits on eminent domain.

Although the Texas Constitution declares that property may only be taken for a public use,106

the state’s courts, like federal courts, have interpreted the “public use” requirement to allow thetransfer of condemned property to private parties so long as doing so benefits the public in someway.107 Consequently, the state’s laws allow for the condemnation of property and the transfer ofthat property to private developers for their own profit, on the theory that this will create jobs orotherwise improve society. In fact, chapters 373 and 374 of Texas’ Local Government Code—whichcover “community development” and “urban renewal,” respectively—are unusually explicit in thedegree to which they allow for private entities to benefit from the use of eminent domain.

Section 373.005 permits the “acquisition” of property for a wide variety of purposes.Property may be condemned if it is “blighted, deteriorated, deteriorating, undeveloped, or

108 Tex. Local Gov. Code § 373.005(b)(1)(A) (emphasis added).

109 Id. § 373.005(b)(1)(C).

110 Id. § 373.005(b)(1)(D).

111 Id. § 373.005(b)(1)(E). “Other public purposes” are also listed in § 373.003.

112 Id. § 373.005(b)(4).

113 Id. § 373.005(b)(8).

114 Id. § 373.005(b)(15)(A).

115 Id. § 374.002(b).

116 Id. § 374.002(c).

117 Id. § 373.005(25)(D).

23

inappropriately developed from the standpoint of sound community development and growth”108; ifit “is appropriate for . . . the beautification of urban land”;109 “for the provision of recreationalopportunities or the guidance of urban development”;110 or if the property “is to be used for . . . otherimprovements eligible for assistance under this chapter or is to be used for other public purposes.”111

The Local Government Code explicitly allows for condemnation so as to “assist[] in andfinanc[e] . . . private acquisition of those properties for rehabilitation,”112 and for “disposition, bysale, lease, donation, or otherwise, of real property acquired under this chapter.”113 It goes on toauthorize local governments to engage in “activities that are conducted by . . . private entities if theactivities are necessary or appropriate to meet the needs and objectives of the communitydevelopment plan, including . . . acquisition of real property.”114

Chapter 374 also authorizes local governments to use eminent domain to take property fromprivate parties whose use of the property does not satisfy planners, and to give, lease, or sell thatproperty to private entities who then use the property for their own profit. It allows for the “publicacquisition of real property” so as to “prevent the spread of [blight]” and for “the disposition ofproperty acquired in affected areas and incidental to the purposes stated by this subsection,”115 andreiterates that “private enterprise [should] be encouraged to participate in accomplishing theobjectives of urban renewal to the extent of its capacity and with governmental assistance asprovided by this chapter,”116 which seems specifically to invite private enterprises to join withgovernment agencies in employing eminent domain for “economic development” projects. If thiswere not clear enough, the Code goes on to permit “the disposition by the municipality of propertyacquired in an urban renewal area for use in accordance with an urban renewal plan, including thesale or initial lease of the property at its fair value.”117

These and other sections make clear that under Texas law, eminent domain may be used tocondemn private property that fails to perform economically, and to transfer, lease, or sell that

118 See, e.g., Maher v. Lasater, 354 S.W.2d 923, 925 (Tex. 1962) (“the ultimate question of whethera particular use is a public use is a judicial question to be decided by the courts.”)

119 Higginbotham, 143 S.W.2d 79 at 83 (1940).

120 Id.

121 See BERLINER, supra note 83 at 193-94.

122 Tex. Local Gov’t Code § 334.041(b).

123 Id. § 251.001; see also id. § 261.001(a) (granting counties authority to condemn property for“another public purpose authorized by law”);

124 Id. § 272.001(i).

125 See Tex. Gov’t Code § 2206.001(c)(6) (allowing condemnation for “a sports and communityvenue project approved by voters at an election held on or before December 1, 2005, under Chapter

(continued...)

24

property to private developers who use the property for their own profit. The state legislature hasdeclared that doing this is a benefit to the public and therefore a “public use” under the TexasConstitution. Although Texas courts have often claimed that a legislative declaration that a use ispublic is not dispositive,118 the reality is that these courts apply such a degree of deference to thesedeclarations that they will intervene only in cases where the transfer of property is “clearly andpalpably” private,119 something which is extremely unusual. This deference is reinforced by thecourts’ declaration that “[t]he mere fact that the advantage of the use inures to a particular individualor enterprise, or group thereof, will not deprive it of its public character.”120 Decisions like thesehave allowed Texas cities to condemn property for such private projects as the North East Mall inHurst, Texas, a project which resulted in the acquisition and destruction of 127 homes.121

There are, however, two significant improvements in the Texas reform measure. First,although it allows condemnations under chapters 373 and 374 of the Local Government Code tocontinue unaltered, it does limit the use of eminent domain as provided for by other Texas statutes.The state’s laws allow cities to condemn property to construct sports stadiums,122 or to provide“librar[ies],” “auditorium[s],” “market house[s],” “recreational facilit[ies],” or “for any othermunicipal purpose the governing body considers advisable.”123 Texas even explicitly allows localgovernments receiving federal economic development grants to “lease or convey [condemned]land . . . without the solicitation of bids, to a private, for-profit entity or a nonprofit entity . . . if theland or interest will be used by the private, for-profit entity . . . in carrying out the purpose of the . . .grant . . . if the [city] adopts a resolution stating the conditions and circumstances for the lease orconveyance and the public purpose that will be achieved.”124 All of these provisions are nowrestricted by SB 7B. This was made clear by the fact that, at the last minute, some craven legislatorsamended the bill specifically to allow the Dallas Cowboys to continue with their plan to condemnprivate property for the construction of a football stadium.125

125 (...continued)334 or 335, Local Government Code.”)

126 Id. § 2206.001(e).

127 Dyer v. Texas Elec. Serv. Co., 680 S.W.2d 883, 884 (Tex. App. 8 Dist. 1984).

128 See further Kelo, 125 S. Ct. at 2684 (Thomas, J., dissenting) (“There is no justification, however,for affording almost insurmountable deference to legislative conclusions that a use serves a ‘publicuse.’ To begin with, a court owes no deference to a legislature’s judgment concerning thequintessentially legal question of whether the government owns, or the public has a legal right to use,the taken property . . . . [I]t is most implausible that the Framers intended to defer to legislatures asto what satisfies the Public Use Clause, uniquely among all the express provisions of the Bill ofRights.”)

129 Press Release, Gov. Perry Signs New Law Protecting Property Rights, Aug. 31, 2005, availableat http://www.governor.state.tx.us/divisions/press/pressreleases/PressRelease.2005-08-31.3313(visited Nov. 28, 2005).

25

The second improvement in SB 7B is its limitation on the deference accorded tocondemnation decisions. It declares that “the determination by the governmental or private entity”that a proposed condemnation “does not involve” a forbidden private taking “does not create apresumption” which courts are obliged to follow.126 In simpler terms, a legislative declaration thata taking is for a public use shall not receive judicial deference. This is probably the most significantpart of the legislation, given the threat that such deference poses to property owners. In the past,Texas courts have declared that “where the legislature has declared a certain act to be for a publicuse, such declaration must be given weight by the courts,”127 which makes it difficult for propertyowners to prevail. By eliminating this presumption, SB 7B provides for genuine judicial review ofthe legitimacy of takings. This is welcome, given the fact that judicial deference is a major factorcontributing to the abuse of eminent domain.128

Although when signing the bill, Governor Perry announced that SB 7B “means mom and popbusinesses and residential property must be willingly sold—not unfairly seized—when a project’spurpose is private profit-making,”129 the reality is far more mixed. SB 7B does limit some aspectsof government’s authority to take property, and eliminates the harmful deference which courts haveafforded to legislative declarations of public use. But, as with the Alabama reform law, the Texasmeasure leaves enormous loopholes by allowing condemnations to proceed under the state’scommunity development and urban renewal statutes.

130 Available at http://www.legis.state.de.us/LIS/lis143.nsf/vwLegislation/SB+217 (visited Nov. 28,2005).

131 SB 217, § 1, codified at 29 Del. C. §9505.

132 SB 217 § 2, codified at 29 Del. C. § 9503.

133 31 Del. C. §§ 4501 et seq.

134 See Nicole Stelle Garnett, The Public-Use Question as a Takings Problem, 71 GEO. WASH. L.REV. 934, 976 (2003) (“at the very least, predelegation notice and debate of enabling legislationwould enhance the effectiveness of ‘voice’ by enabling opposition to organize and force legislaturesto listen to dissent from within the community before the delegation/condemnation deal wassealed.”)

26

3. Delaware

S.B. 217,130 signed by Governor Ruth Ann Minner on July 21, 2005, is little more than aparagraph long. It declares that:

Notwithstanding any other provision of law to the contrary, the acquisition of realproperty through the exercise of eminent domain by any agency shall be undertaken,and the property used, only for the purposes of a recognized public use as describedat least 6 months in advance of the institution of condemnation proceedings: (i) ina certified planning document, (ii) at a public hearing held specifically to address theacquisition, or (iii) in a published report of the acquiring agency.131

The bill also amends a section of the law to pay for the attorneys’ fees of parties whose property istaken through eminent domain.132

Unlike the Texas and Alabama laws, Delaware’s measure contains no exceptions forcurrently existing urban renewal statutes.133 It requires that a condemning agency must declare thepublic use to be served by the condemnation at least six months before the condemnation,presumably to allow citizens sufficient time to rally opposition to a potential condemnation.

While this cooling-off period may have its advantages,134 there are three major flaws whichdoom this provision to being at best a minor protection for property owners. First, the provision doesnot affect the definition of a “public use” in any way, even though that is the fundamentalcontroversy involved in discussions over the abuse of eminent domain. Second, while allowing thepublic an opportunity to protest the condemnation of property is certainly to be preferred, the securityof private property rights cannot be entrusted to the political process entirely. Third, a six-monthcooling off period may prove unworkable without exceptions, which may doom this provision tobeing amended and eventually repealed.

The definition of “public use” is, of course, at the heart of the entire controversy over eminentdomain. The Delaware reform measure simply refers to “a recognized public use.” But the state’s

135 Wilmington Parking Auth. v. Land with Improvements, Situate in City of Wilmington, NewCastle County, 521 A.2d 227, 231 (Del. 1986).

136 Id. at 233.

137 Randolph v. Wilmington Hous. Auth., 139 A.2d 476, 483 (Del.1958).

138 Id.

139 31 Del. C. §§ 4501(3)(d) and (e).

140 See BERLINER, supra note 83 at 51.

141 See, e.g., GREENHUT, supra note 61 at 12-19, 248-76 (detailing examples of political oppositionwhich stopped eminent domain abuses).

27

courts have held that “agencies of the State may condemn private property [and transfer it to privateparties] provided that the primary purpose of the condemnation is to benefit the public.”135 If “theparamount benefit to be obtained by [a redevelopment] project” is to be enjoyed by a private party,then the condemnation is not permitted,136 but at the same time, Delaware courts have held thatdevelopments that “confer an incidental benefit upon private persons” are not invalid, and it is “notuncommon” for “public uses [to be] combined with private uses or benefits.”137 In fact, “[t]heredevelopment of cleared slum areas by private ownership has become a recognized feature of slumclearance.”138

The state’s “Housing and Slum Clearance” law defines blight as including “[a]reas . . . withbuildings . . . which by reason of dilapidation, obsolescence . . . overcrowding, faulty arrangementor design in relation to size, adequacy, accessibility or usefulness . . . deleterious land use or obsoletelayout . . . or any combination of these or other factors are detrimental to the safety, health, morals,or welfare of the municipality or community,” or areas where “[a] growing or total lack of properutilization of areas caused by the condition of the title, diverse ownership . . . and other conditions,resulting in a stagnant and unproductive condition of land potentially useful and valuable forcontributing to and serving the public health, safety and welfare.”139 Although Delaware officialsappear not to have abused the power of eminent domain to benefit private parties,140 the potential forabuse is obvious. Under present law, state officials could engage in exactly the type ofredevelopment projects that gave rise to the Kelo litigation. Without defining “public use” withgreater strictness, the Delaware reform measure will do little to prevent future abuses.

The six-month requirement is likely to give residents of affected neighborhoods the timenecessary to rally in opposition to an exercise of eminent domain, and such political opposition has,in other cases, proven effective in restraining abuses of eminent domain.141 But political oppositionis simply not enough to prevent the abuse of this power. As Justice Robert Jackson famously noted,“[t]he very purpose of a Bill of Rights was to withdraw certain subjects from the vicissitudes ofpolitical controversy, to place them beyond the reach of majorities and officials and to establish themas legal principles to be applied by the courts. One’s right to . . . property . . . may not be submitted

142 West Virginia State Bd. of Educ. v. Barnette, 319 U.S. 624, 638 (1943).

143 See William A. Fischel, The Political Economy of Public Use in Poletown: How Federal GrantsEncourage Excessive Use of Eminent Domain, 2004 MICH. ST. L. REV 929, 951.

144 THE FEDERALIST No. 25, at 167 (C. Rossiter, ed., 1961).

145 Available at http://folio.legis.state.wi.us/cgi-bin/om_isapi.dll?clientID=38379757&headingswithhits=on&infobase=bills05.nfo&jump=AB657&softpage=Document#JUMPDEST_AB657 (visitedApr. 5, 2006).

146 Id. at § 1, adding Wis. Stat. 32.03(6)(a).

28

to vote; they depend on the outcome of no elections.”142 While it is gratifying to see citizensprotesting the abuse of their rights and challenging such abuses at the ballot box, this is not a signof constitutional health. Citizens should not be forced to do such things to protect their propertyfrom government seizure. If citizens must get government permission to preserve their homes andbusinesses, then they do not have property rights at all, but merely permissions, which depend onlyon the number of supporters they can muster on election day.

Finally, the six-month requirement seems likely to be an ineffective limit in some futureinstance of eminent domain abuse. The prevalence of so-called “quick take” measures143 reveals thatin many circumstances, a strict waiting period is simply not considered possible, and it is easy toconceive of at least some emergency instances in which it would be legitimate for government tocondemn property more quickly. In such a circumstance, it is far more likely that an exception willbe written into the sixth-month requirement than that the state will abide by it in the face ofextraordinary pressure. As Alexander Hamilton once observed, “[w]ise politicians will be cautiousabout fettering the government with restrictions that cannot be observed, because they know thatevery breach of the fundamental laws, though dictated by necessity, impairs that sacred reverencewhich ought to be maintained in the breast of rulers towards the constitution of a country, and formsa precedent for other breaches where the same plea of necessity does not exist at all, or is less urgentand palpable.”144

4. Wisconsin

Wisconsin’s newly enacted A.B. 657145 also provides weak protection for property owners.Although purporting to restrict the definition of “blight,” the bill simply declares that governmentcan seize property that is “detrimental to the public health, safety, or welfare” due to “dilapidation,deterioration, age or obsolescence,” “faulty lot layout in relation to size,” “adequacy, accessibility,or usefulness,” or other conditions146—in the opinion of government officials. The bill does imposeslightly greater requirements if the property in question is a residence: property containing one ormore dwellings must be either abandoned, or must be apartments that have been “converted from

147 Id. at adding Wis. Stat. 32.03(6)(a)(1)-(2).

148 See BERLINER, supra note 83 at 215.

149 Available at http://www.legis.state.wv.us/Bill_Text_HTML/2006_SESSIONS/RS/BILLS/hb4048%20enr.htm (visited Apr. 11, 2006).

150 Id. at §54-1-2(6).

151 Id. at §54-1-2(11).

152 Id.

153 Id.

29

a single dwelling unit,” and located in an area with a higher crime rate than the rest of the city.147

Although Wisconsin has rarely used eminent domain for private parties,148 this weak definition ofblight does little to increase protections for small businesses, routine victims of eminent domain inother states.

5. West Virginia

On April 5, 2006, West Virginia enacted H.B. 4048,149 purportedly to restrict the use ofeminent domain. The bill does nothing of the sort; in fact, it is extremely favorable to the use ofeminent domain for redevelopment. It defines “public use” so as to allow the condemnation ofproperty for traditional public projects, and also for “the reasonable use by an incorporated companyengaged in a public enterprise of which the state or any county or municipality is the sole or a partowner,”150 for the redevelopment of “blighted” areas,151 and “for any and every other public use,object and purpose not herein specifically mentioned.”152 The provision goes on to declare that “inno event may ‘public use’...be construed to mean the exercise of eminent domain primarily forprivate economic development,”153 but the provisions with regard to “blighted” areas render thisprotection virtually meaningless.

The bill defines a blighted area as

an area, other than a slum area, which by reason of the predominance of defective orinadequate street layout, faulty lot layout in relation to size, adequacy, accessibilityor usefulness, insanitary or unsafe conditions, deterioration of site improvement,diversity of ownership, tax or special assessment delinquency exceeding the fairvalue of the land, defective or unusual conditions of title, improper subdivision orobsolete platting, or the existence of conditions which endanger life or property byfire and other causes, or any combination of such factors, substantially impairs orarrests the sound growth of the community, retards the provision of housing

154 Id. at Art. 18, adding §16-18-3(c).

155 Id. adding § 16-18-6a(b).

156 Avail. at http://www.leg.state.vt.us/docs/legdoc.cfm?URL=/docs/2006/acts/ACT111.HTM(visited May 1, 2006).

157 Id. § 1, adding 12 V.S.A. § 1040(a) (emphasis added).

158 24 V.S.A. § 3201(3) (emphasis added).

30

accommodations or constitutes an economic or social liability and is a menace to thepublic health, safety, morals, or welfare in its present condition and use.154

Non-blighted property located within a blighted area may be condemned if the governmentdeclares that the redevelopment project cannot proceed without the condemnation of the property,that the property cannot be integrated into the redevelopment project, that altering the redevelopmentplan is not feasible, and other factors.155 Under these provisions, government officials need merelydeclare that a neighborhood is an “economic or social liability,” and “arrests the sound growth of thecommunity,” and they will then be free to seize property and transfer it to private businesses.

6. Vermont

Vermont’s Senate Bill 246156 declares that “no governmental or private entity may takeprivate property through the use of eminent domain if the taking is primarily for purposes ofeconomic development, unless the property is taken pursuant to chapter 85 of Title 24 (urbanrenewal).”157 That title allows government agencies to condemn property if it is “blighted,” and thenew law adds to the definition of blight; the law had defined a“blighted area” as an area which

by reason of the presence of a substantial number of slum, deteriorated ordeteriorating structures, predominance of defective or inadequate street layout, faultylot layout in relation to size, adequacy, accessibility or usefulness, insanitary orunsafe conditions, deterioration of site or other improvements, diversity ofownership, tax or special assessment delinquency exceeding the fair value of theland, defective or unusual conditions of title, or the existence of conditions whichendanger life or property by fire and other causes, or any combination of such factors,substantially impairs or arrests the sound growth of a municipality, retards theprovision of housing accommodations or constitutes an economic or socialliability....158

The new law adds, “No area shall be determined to be a blighted area solely or primarily because itscondition and value for tax purposes are less than the condition and value projected as the result of

159 S. 246 § 2, amending 24 V.S.A. § 3201(3).

160 See BERLINER, supra note 83 at 199.

161 Avail. at http://www.unicam.state.ne.us/legal/SLIP_LB924.pdf (visited May 1, 2006).

162 See id. at § 2(1), amending Neb. Rev. St. § 76-701(2).

163 Id. § 2(2).

164 Id. § 3(g).

165 Id.

31

the implementation of any state, municipal, or private redevelopment plan.”159 Note that thislimitation does not limit the designation of property as blighted due to the fact that it does not “createjobs,” or even due to the fact that the current property doesn’t look nice. Vermont has a relativelyclean record when it comes to eminent domain for private development,160 but under this new law,there is little to stand in the way of a more aggressive policy in the future. If government officialswish, they may exploit the vague definitions in the state’s legal definition of blight, to seize propertyand transfer it to private developers.

7. Nebraska

Nebraska’s LB 924,161 like the new laws in Alabama, Texas, and elsewhere, prohibit the useof eminent domain for “economic development.”162 It defines “economic development” as “takingproperty for subsequent use by a commercial for-profit enterprise or to increase tax revenue, taxbase, employment, or general economic conditions.”163 Had the law stopped here, it would haveprotected property rights significantly. Yet it includes an exception that by now is becoming routine:“This section does not affect the use of eminent domain...based upon a finding of blighted orsubstandard conditions under the Community Development Law.”164 (Yet the law does prohibit eventhese kinds of takings of the property is “agricultural land or horticultural land.”165) The CommunityDevelopment Law defines a blighted area in terms virtually identical to those in Vermont, but it addssuch factors as:

Unemployment in the designated area is at least one hundred twenty percent of thestate or national average

the average age of the residential or commercial units in the area is at least forty years

the per capita income of the area is lower than the average per capita income of thecity or village in which the area is designated

166 Neb. Rev. St. § 18-2103(11).

167 Avail. at http://janus.state.me.us/legis/LawMakerWeb/externalsiteframe.asp?ID=280019894&LD=1870&Type=1&SessionID=6 (visited May 1, 2006).

168 Id. § 1.1, adding 1 MRSA s816(1)(A)-(C).

169 Id. § 2.

170 See 30-A M.R.S.A. § 5101(2).

171 See BERLINER, supra note 83 at 159.

172 Norwood v. Horney, 830 N.E.2d 381, 388 (Ohio App. 1 Dist. 2005).

32

the area has had either stable or decreasing population based on the last twodecennial censuses.

At least one of these factors must be present in addition to the “faulty lot layout in relationto...usefulness,” “improper subdivision or obsolete platting,” and “defective or inadequate streetlayout,” to qualify an area as blighted.166 Such property may then be taken through eminent domainand transferred to another private party to use for private profit.

8. Maine

LD 1870 (HP 1310)167 may have been modeled on Alabama’s law; it prohibits the taking ofprivate property “[f]or the purposes of private retail, office, commercial, industrial or residentialdevelopment,” or “[p]rimarily for the enhancement of tax revenue,” or “For transfer to a person,nongovernmental entity, public-private partnership, corporation or other business entity.”168 Butthese limitations “[do] not apply to the use of eminent domain...based upon a finding of blight in anarea covered by any redevelopment plan or urban renewal plan.”169 Although Maine law definesblight with greater precision than other states,170 the new Maine law does little to increase protectionsfor property owners.

9. Ohio

Some sort of prize, however, should be reserved for Ohio for enacting the least protective lawof all in the wake of Kelo.

Under the laws of Ohio—one of the states which most often condemns property to transferto private parties171—property may be declared blighted not only when it is unsafe and poorlymaintained, but even when it is “deteriorating.”172 In fact, Ohio’s Constitution actually explicitlyallows for the use of eminent domain for economic redevelopment: it declares that the state maycondemn property and resell it to private parties to “create or preserve jobs and employment

173 OHIO CONST. art. VIII, § 13.

174 State ex rel. Bruestle v. Rich, 110 N.E.2d 778, 787 (Ohio 1953).

175 Superior Laundry & Towel Supply Co. v. City of Cincinnati, 168 N.E.2d 445, 447 (Ohio Com.Pl. 1959).

176 BERLINER, supra note 83 at 160-61.

177 Id. at 168. In fact, the new factory is fully automated, so fewer than half of the expectedworkforce was ever employed.

178 Calhoun Realty v. City of Cincinnati, No. 1:03-CV-00198-SA5 (D.C.S.D. Ohio filed Mar. 19,2003).

179 AAAA Enterprises, Inc. v. River Place Cmty. Urban Redevelopment Corp., 553 N.E.2d 597, 601(Ohio 1990).

180 Id. at 600.

33

opportunities, to improve the economic welfare of the people of the state.”173 It is unsurprising, then,that Ohio courts have declared that “public use” is synonymous with “public benefit,”174 and haveallowed the condemnation of land for a variety of private transfers: for instance, Ohio courts haveallowed cities to condemn land to provide off-street parking places near a major league baseball fieldso as to keep the baseball team from moving to another city175; to condemn a shoe repair shop tomake way for a Walgreen’s so that the city could take the Walgreen’s site and give it toNordstrom176; to condemn 83 homes to allow a DaimlerChrysler Jeep factory to expand, on thetheory that creating jobs would serve a public benefit177; and to condemn the landmark Cincinnatirestaurant, Run The Wood, and several other restaurants, so that they could be replaced by a $270million project including a movie theater, retail shops, and condominiums.178

Ohio courts are extremely deferential to legislative declarations that an area is “blighted,” andthey will only overturn such declarations when they are “arbitrary,” “unconscionable,” or if there is“no sound reasoning process that would support that decision.”179 Thus Ohio courts not onlyinterpret “public use” liberally, but even give “a liberal interpretation” to the term “blight.”180 In onecase currently before the Ohio Supreme Court, city officials were directly approached by a developerwho urged them to use eminent domain to condemn a non-blighted area and transfer it to thedeveloper, to construct a shopping mall. The city complied, declaring that the area was“deteriorating,” meaning that it “[was] not a slum, blighted or deteriorated area, but which becauseof incompatible land uses, nonconforming uses, lack of adequate facilities, faulty street arrangement,obsolete platting, inadequate community and public utilities, diversity of ownership . . . [and variousother factors, was] detrimental to the public health, safety, morals and general welfare, and which

181 Norwood, 830 N.E.2d at 388 (citation omitted).

182 2005 S 167 § 2(A).

183 Id. § 3(A).

184 Id. § 3(C).

185 Id. § 2(A).

186 BERLINER, supra note 83 at 159.

34

will deteriorate or is in danger of deteriorating, into a blighted area.’”181 The Court of Appealsallowed the condemnation to proceed.

After the United States Supreme Court announced its decision in Kelo, the Ohio legislaturepassed SB 167. This act imposes a moratorium, effective until December 31, 2006, on allcondemnations of “private property that is not within a blighted area, as determined by the[condemning agency], when the primary purpose for the taking is economic development that willultimately result in ownership of that property being vested in another private person.”182

This task force will be made up of 25 members: three members of the state House, threemembers of the State Senate, one “member who shall be a statewide advocate on the issues raisedin Kelo,” one attorney representing Ohio property owners, two attorneys with special expertise ineminent domain law, one non-attorney representative of Ohio property owners, one personrepresenting small businesses, one person delegated by the Director of Development, anotherdelegated by the Director of Transportation, and one member each representing the following: the“home building industry,” the real estate industry, the planning industry, licensed Realtors, laborunions, historic preservation organizations, municipal corporations, counties, townships, and arepresentative of the Ohio Prosecuting Attorneys Association or the Ohio Association of ProbateJudges.183 During the moratorium period, a Legislative Task Force to Study Eminent Domain andIts Use and Application, will convene to study the issue and write a legislative report.184

Three observations come immediately to mind when considering the Ohio moratorium. First,it does not apply at all to condemnations of property that are already “within a blighted area.”185

Condemnations in these properties may proceed unhindered. Second, it seems to apply only tocondemnations of property for “economic development,” as distinguished from condemnations thatare supposed to eradicate blight. But these are not distinguishable concepts. Because properties areoften declared blighted due to their failure to perform up to a desirable economic level, economicdevelopment projects routinely start with a declaration that the current use of property constitutesa blight. There do not appear to be any reported incidents—and it is hard to imagine any—in whichproperty has been condemned for economic development purposes without first being declaredblighted. Finally, and most importantly, the Ohio Legislature is not obligated to act on the TaskForce’s report in any way. Considering the state’s record of “aggressive land-grabbing,”186 it seemshighly unlikely that serious reform will follow the Task Force’s report, especially given that the

187 Steve Kemme, Moratorium Has Little Effect Here, CINCINNATI ENQUIRER, Nov. 18, 2005 at 2(2005 WLNR 18706923).

188 BERLINER, supra note 83 at 20.

189 Available at http://info.sen.ca.gov/pub/bill/sen/sb_0001-0050/sca_12_bill_20050815_amended_sen.html (visited Nov. 28, 2005). This bill was reintroduced in the 2006 session as SCA 24, andit is still pending.

190 Compare Kelo, 125 S. Ct. at 2661 (“the City would no doubt be forbidden from taking petitioners’land for the purpose of conferring a private benefit on a particular private party”) with id. at 2665(“Because [the redevelopment] plan unquestionably serves a public purpose, the takings challengedhere satisfy the public use requirement of the Fifth Amendment.”)

35

committee will include many members who can be counted on to be sympathetic to pro-condemnation interests, and very few who can be expected to defend the rights of property owners.

It is perhaps not surprising that a state which has so often used eminent domain to benefitprivate parties would do nothing more than declare a one-year “time-out”—a pause that does noteven apply to most major condemnation projects in the state. As the Cincinnati Enquirer correctlynoted, the moratorium “is expected to have minimal impact on development projects in GreaterCincinnati.”187

B. Failed Reform Attempts

1. California

With more than 200 condemnations benefitting private parties in the five years between 1998and 2003, California is one of the leading abusers of eminent domain in America.188 Yet, despitemuch public outrage over the Kelo decision, California has yet to enact any provision to limit theabuse of eminent domain. Although both Republicans and Democrats voiced their opposition toeminent domain abuse, three attempts to limit the power redevelopment condemnations in theGolden State were quickly buried by the state Legislature.

The first proposal, SCA 12,189 would have amended the state Constitution by adding a singlesentence: “Public use does not include the taking of owner-occupied residential property for privateuse.” This provision has two obvious flaws. First, it is already the law, and always has been, bothin California and nationally, that private property may not be taken for “private use.” Kelo did notdeclare otherwise. It simply declared that a taking is not a “private use” if it is rationally related toa legitimate public interest.190 Since condemnation and private transfer of property in blighted areasis considered a public use, a ban on takings for “private use” would be legally meaningless. Second,SCA 12 would have applied only to “owner-occupied residential property,” and not to businesses,apartments, churches, or other private property throughout the state. This is startling, given that most

191 See BERLINER, supra note 83 at 21-37.

192 Mesdaq, supra note 67. Photos of the Gran Havana Cigar Factory are available at http://www.granhavana.com/cafeimages/index.htm (visited Nov. 28, 2005).

193 Herron Zamora, City Forces Out 2 Downtown Businesses: Action Follows High Court Rulingon Eminent Domain, SAN FRANCISCO CHRONICLE, July 2, 2005, at B3 (2005 WLNR 10420449); FoxNews, Oakland Seizes Land, Swaps Retailer, Nov. 04, 2005, available at http://www.foxnews.com/story/0,2933,174519,00.html (visited Nov. 28, 2005).

194 99 Cents Only Stores v. Lancaster Redevelopment Agency, 237 F. Supp. 2d 1123 (C.D. Cal.2001).

195 Cottonwood Christian Ctr. v. Cypress Redevelopment Agency, 218 F. Supp. 2d 1203 (C.D. Cal.2002). See further GREENHUT, supra note 61 at 160-88.

196 Available at http://info.sen.ca.gov/pub/bill/sen/sb_1001-1050/sb_1026_bill_20050822_amended_asm.html (visited Nov. 28, 2005). As of the time of this writing, SB 1026 has been drasticallyamended. Its present version, which now has nothing to do with eminent domain, is currently beforethe Senate.

197 Available at http://info.sen.ca.gov/pub/bill/sen/sb_0001-0050/sca_15_bill_20050823_amended_sen.html (visited Nov. 28, 2005). This bill was reintroduced in the 2006 session as SCA 20, whereit failed to emerge from the State Senate Judiciary Committee.

36

victims of private takings in California appear to be small businesses.191 The condemnation of theGran Havana Cigar Factory in San Diego is a prime example192; or the city of Oakland’s decision tocondemn a tire shop and transfer the property to Sears so that it could construct a tire shop of itsown193; or the city of Lancaster’s attempt to condemn a 99 Cents Store to transfer the property to aCostco instead.194 Incidents like these—or condemnations of churches, which are often victims ofeminent domain195—would not have been affected at all by SCA 12.

The second California proposal, SB 1026,196 was also limited to “owner-occupied residentialproperty.” Like the Ohio reform measure, this proposal would have imposed a two-year moratoriumon condemnations of such property, while a committee wrote a report on eminent domain abuse.Like SCA 12, this proposal would have done nothing to protect businesses, churches, apartmentbuildings, farms, or other properties. Unlike SCA 12, this proposal actually defined “privateuse”—as “any use other than as a public facility or a public works that is owned and operated by thepublic entity”—which would have given the proposal at least some legal significance. But since itonly imposed a moratorium, without requiring that the state legislature do anything once theinvestigation was completed, the proposal would probably have accomplished little.

The third proposal, SCA 15, would have imposed meaningful limitations on the abuse ofeminent domain.197 It would have amended the state Constitution to prohibit the use of eminentdomain except where the taken property was “owned and occupied by the condemnor, or anothergovernmental agency utilizing the property for the stated public use . . . or . . . leased only to

198 Id. § 19(b).

199 It also provided for a right of first refusal whereby the original owner of the property would bepermitted to buy back the property once the government had terminated its public use of theproperty.

200 Technically, state officials could still have condemned property to construct commercial buildingssuch as shopping malls, but only if the government itself owned and operated the shopping mall.

201 Walters, supra note 10.

202 For example, SB 1099, currently pending in the state Senate, would limit the use of eminentdomain only if the takings affected agricultural property. Available at http://info.sen.ca.gov/pub/bill/sen/sb_1051-1100/sb_1099_bill_20050815_amended_sen.html (visited Nov. 28, 2005).

203 Available at http://legis.state.nm.us/Sessions/06%20Regular/FinalVersions/house/HB0746.pdf(visited Mar. 10, 2006).

37

entities . . . regulated by the Public Utilities Commission.”198 Although it allowed for the incidentaluse of government property for “gift shops, newsstands, shoeshine stands” and other occasional uses,as well as the use of eminent domain to provide for public utilities, SCA 15 would have forbiddengovernment from taking people’s homes, businesses, farms, churches, or other property, and givingthe land to private commercial entities for their own use and profit.199 SCA 15 would therefore haverestored the “actual public use” interpretation of the public use clause, whereby eminent domaincould only have been used to provide government-owned, and government-operated buildings,including roads, schools, or parks.200

All three of these proposals were defeated in the state legislature. As well-knownSacramento journalist Dan Walters noted, defenders of eminent domain hoped to “cool off theanti-eminent domain fervor,” by drafting “legislation that would place a two-year moratorium on theseizure of private homes (but not commercial property), and authorize a study of the practice, thusgiving their members a chance, or so it seemed, to side with the anti-eminent domain sentimentwithout doing any real damage to redevelopment agencies.”201 But even such watered-downproposals failed. At the time of this writing, several other bills are still pending in the legislature,but few of them promise serious protection for property owners.202

2. New Mexico

New Mexico’s H.B. 746 passed both houses of the state legislature in February, 2006, onlyto be vetoed by Governor Bill Richardson on March 8. The bill was unusually simple; it read in itsentirety: “The state or a local public body shall not condemn private property if the taking is topromote private or commercial development and title to the property is transferred to another privateentity within five years following condemnation of the property.”203 Despite his veto, Richardsoninsisted that he “take[s] a backseat to no one when it comes to protecting private property rights,”

204 Barry Massey, Governor Vetoes Eminent Domain Legislation, FREE NEW MEXICAN, Mar. 8, 2006,available at http://www.freenewmexican.com/news/40445.html (visited Mar. 10, 2006).

205 Id.

38

and promised to appoint a committee to examine the issue.204 But he called H.B. 746 “ambiguous”and warned that it “may stop public projects that encourage environmental conservation, masstransportation and smart urban development, simply because private entities play a role in theproject.”205 It is hard to see, however, what is ambiguous about H.B. 746. The bill prohibitedcondemnations for commercial development in cases where title was transferred to a private entitywithin a fixed period of time. It would therefore have barred Kelo-style takings while allowing thegovernment to eliminate truly dangerous property, and to engage in traditional public projects suchas highway construction. Nothing about environmental conservation requires the government totransfer title to property between private owners. Thus Richardson’s claims that conservation ortransportation projects would have been obstructed by this bill were disingenuous. We are leftinstead with his belief that “smart urban development” requires government to transfer land fromone private owner to another. Despite his protests of sincerity with regard to property rights, it isdifficult to interpret the veto of such a straightforward and intelligently crafted a measure as anythingother than an endorsement of Kelo-style takings.

C. Meaningful Reforms

1. South Dakota

On February 27, 2006, South Dakota became the first state to enact a meaningful restrictionon eminent domain. HB 1080 reads in its entirety,

Section 1. No county, municipality, or housing and redevelopment commission, asprovided for in chapter 11-7, may acquire private property by use of eminent domain:

(1) For transfer to any private person, nongovernmental entity, or other public-privatebusiness entity; or(2) Primarily for enhancement of tax revenue.Section 2. No county, municipality, or housing and redevelopment commission, asprovided for in chapter 11-7, may transfer any fee interest in property acquired by theuse or threat of eminent domain within seven years of acquisition to any privateperson, nongovernmental entity, or public-private business entity without firstoffering to sell such fee interest back to the person who originally owned theproperty, or such person's heirs or assigns, at current fair market value, whether the

206 Available at http://legis.state.sd.us/sessions/2006/bills/HB1080enr.htm (visited Mar. 1, 2006).

207 See BERLINER, supra note 83 at 189.

208 See Illinois Cent. R. Co. v. East Sioux Falls Quarry Co., 144 N.W. 724, 728-29 (S.D. 1913)(public use “cannot be equivalent to the general welfare or public good.”)

209 Available at http://www.in.gov/legislative/bills/2006/EH/EH1010.2.html (visited Mar. 2, 2006).

210 See Section 15(a)(1)-(3).

211 See BERLINER, supra note 83 at 71.

212 See Daniels v. Area Plan Comm’n of Allen County, 306 F.3d 445, 463 (7th Cir. 2002).

213 IC 36-7-1-3 (2006).

39

property has been improved or has remained unimproved during the interval, or atthe original transfer value, whichever is less.206

Unlike the measures passed in Alabama and Texas, the South Dakota law includes noexceptions for “blighted” property, or other similar loopholes. The enactment of HB 1080 reflectsthe state’s abiding respect for private property rights: there are no reported incidents of SouthDakota officials seizing property for private development,207 and the state’s courts have longsubscribed to a strict interpretation of “public use.”208

2. Indiana

On March 24, 2006, Indiana Governor Mitch Daniels signed HB 1010, the most significantresponse to Kelo yet seen. HB 1010209 is a long and complicated bill which contains manyprovisions, including a guarantee of attorney’s fees for property owners,210 but the importantprovisions regarding redevelopment condemnations are significantly more protective of privateproperty rights than previous law. This is especially significant, given the fact that recent years haveseen Indiana increasingly willing to use eminent domain for private developers.211

Like other states, Indiana has authorized local governments to use eminent domain toeliminate “blighted” areas,212 which state law defines as neighborhoods featuring a “lack ofdevelopment . . . cessation of growth . . . deteriorated or deteriorating improvements,” or which, dueto the “character of occupancy . . . age . . . obsolescence . . . substandard buildings” or other factors,“impair values or prevent a normal use or development of [the] property.”213 Once a localredevelopment commission finds that properties suffer from these problems, and declares that they

214 IC 36-7-14-15 (2006).

215 IC 36-7-14-22 (2006).

216 HB 1010 § 18, amending IC 32-24-4.5(1)(a)(1).

217 Id., amending IC 32-24-4.5(1)(a)(2)-(3).

218 Id., amending 32-24-4.5(11)(a).

219 Id., amending 32-24-4.5(9)(2).

220 Id., amending 32-24-4.5(10)(a).

40

cannot be fixed “by regulatory processes or the ordinary operations of private enterprise,”214 officialscan take the property and transfer it to private developers.215

HB 1010 restricts this power by defining “public use” as “possession, occupation, andenjoyment of a parcel of real property by the general public or a public agency for the purpose ofproviding the general public with fundamental services, including the construction, maintenance, andreconstruction of highways, bridges, airports, ports,” and similar projects,216 as well as traditionalpublic uses.217 It further prohibits the use of eminent domain for development except in cases wherea) the house, business, or other building on the property is a traditional nuisance, b) is dilapidated,unsanitary, unsafe, vermin infested, or is not in compliance with building codes, c) is a fire hazardor a similar danger to the public, d) is not fit for its intended use because of the lack of plumbing,heating, or electricity, e) the land is vacant, but in a developed neighborhood, and due to lack ofmaintenance is unsanitary, collecting vermin, and is dangerous to public health, f) is subject to taxdelinquencies, g) is a danger because of environmental pollution, and h) has been abandoned.

Requiring all of these elements means that this law will protect property owners more thanany other proposal that has been passed by a legislative body. Although the bill does contain anexception allowing a condemnor which has already acquired 90 percent of the properties in thesurrounding area to condemn any property other than a residence if the project area is at least 10acres within a single county, this exception is tailored narrowly enough to bar particularizedcondemnations.218

The also requires the government to compensate owners 125 percent of the value ofcondemned property,219 and generally requires the condemning agency to pay the cost ofcondemnation proceedings.220 It further prohibits the use of eminent domain if the ownerdemonstrates by clear and convincing evidence that her present property is “essential to the viabilityof the owner’s commercial activities and that the payment or [that] damages and relocation costs

221 Id., amending 32-24-4.5(10)(c).

222 Id., § 23.

223 Available at http://www.legis.state.ga.us/legis/2005_06/fulltext/hb1313.htm (visited Apr. 5,2006).

224 Id. at § 3, amending Ga. Stat. § 22-1-1(9)(A)(vi).

225 Id., amending Ga. Stat. § 22-1-1(1) (emphasis added).

226 Id., amending Ga. Stat. § 22-1-1(1)(B).

41

cannot adequately compensate the owner.”221 Finally, HB 1010 creates a committee to study issuesrelated to the use of eminent domain and submit a report to the legislature on November 1, 2007.222

3. Georgia

Georgia’s H.B. 1313,223 signed into law on April 4, 2006, significantly increases protectionfor property owners in that state. Although the new law expressly defines “the remedy of blight” asa “public use,”224 it defines blight as property which

(A) Presents two or more of the following conditions:

(i) Uninhabitable, unsafe, or abandoned structures;(ii) Inadequate provisions for ventilation, light, air, or sanitation;(iii) An imminent harm to life or other property caused by fire, flood, hurricane...orother natural catastrophe respecting which the Governor has declared a state ofemergency....(iv) A...Superfund site...(v) Repeated illegal activity on the individual property of which the property ownerknew or should have known; or(vi) The maintenance of the property is below state, county, or municipal codes forat least one year after notice of the code violation; and

(B) Is conducive to ill health, transmission of disease, infant mortality, or crime inthe immediate proximity of the property.225

This conjunctive requirement ensures that government may only seize property when it is dangerousto public health. In addition, the bill forbids officials from declaring property blighted “because ofesthetic conditions,”226 and declares that “The public benefit of economic development shall not

227 Id., amending Ga. Stat. § 22-1-1(9)(B).

228 BERLINER, supra note 83 at 59.

229 Available at http://www.legis.state.pa.us/WU01/LI/BI/BT/2005/0/SB0881P1738.HTM (visitedMay 10, 2006).

230 Id. § 204(a).

231 Id. § 204(b).

232 Id. § 205.

233 Id. § 205(b)(4).

234 Id. § 205(b)(6).

235 Id. § 205(e).

42

constitute a public use.”227 As with the Indiana law, Georgia’s new law forbids officials from seizingproperty whenever they believe that they could improve the economy by doing so. As with SouthDakota, Georgia has no reported history of abusing the power of eminent domain,228 but the new lawdoes ensure against future abuses.

4. Pennsylvania

On May 5, 2005, Pennsylvania governor Ed Rendell signed S.B. 881, which represents a vastimprovement over the laws passed in Alabama, Texas, Ohio and other states.229 The new lawprohibits the use of eminent domain “to take private property in order to use it for privateenterprise.”230 The only exceptions to this prohibition are cases in which the property ownerconsents, where the property is transferred to “a common carrier” or “incidental” commercialactivities such as gift shops or newsstands in government buildings, where the condemnation isnecessary to eliminate public nuisances or dangerous buildings,231 or where the condemnation isnecessary to eliminate “blight” as narrowly defined by the bill itself.232 The bill’s definition of blighteliminates the possibility of economic development condemnations in the style of Kelo: it allowsgovernment to declare property blighted only if it is actually a danger to the public health and safety(e.g., “a structure which is a fire hazard or is otherwise dangerous to the safety of persons orproperty”;233 or “any vacant or unimproved lot . . . in a predominantly built-up neighborhood which,by reason of neglect or lack of maintenance, has become a place for accumulation of trash and debrisor a haven for rodents or other vermin”234). In addition, it places a 10 year limit on the lifespan ofany declaration of blight.235

Unfortunately, these protections were severely withdrawn through a last minute amendmentwhich declared that certain cities can continue condemning property for redevelopment projects un

236 Id. § 203(b)(6).

237 Available at http://www.myfloridahouse.gov/Sections/Documents/loaddoc.aspx?FileName=_h1567er.doc&DocumentType=Bill&BillNumber=1567&Session=2006 (visited May 16, 2006).

238 Id. § 2, amending Fla. Stat. § 163.335(2)(7).

239 See id. § 1, adding Fla. Stat. § 73.013 (g)(2).

240 Id. § 7 amending Fla. Stat. § 163.375(5)(a)(3).

241 BERLINER, supra note 83 at 52.

43

until 2012.236 This exception allows Philadelphia, Pittsburgh, and other cities to continue usingeminent domain for planned redevelopment projects long into the future.

Nevertheless, as far as it does apply, the Pennsylvania law is a well-crafted, carefully thought-out measure which provides serious protection for property owners, while allowing government toeliminate actual cases of dangerous or misused property. It will eliminate the possibility thatgovernment may act as a real estate agent to transfer property from owners to private developers inthe name of economic development or “public benefits.” While it would still be able to act againstenvironmental hazards, dilapidated buildings, nuisances such as “crack houses,” or land whichaccumulates trash or disease-carrying vermin, this bill would eliminate the government’s ability toredistribute property for private profit. Aside from the grandfather clause designed for Pittsburghand other cities, the Pennsylvania legislation represents a far more significant response to Kelo thanthe other state statutes.

5. Florida

What is probably the strongest of all of the eminent domain reform bills was signed byFlorida Governor Jeb Bush on May 11, 2006. H.B. 1567237 explicitly declares that “the preventionor elimination of a slum area or blighted area...and the preservation or enhancement of the tax baseare not public uses...and do not satisfy the public-purpose requirement.”238 Instead, the governmentwould only be permitted to seize property and transfer it to private entities for traditional public uses.The government could auction off seized property to the highest bidder only after possessing it forfive years—a provision designed to prevent the government from seizing property for sale to apreferred owner.239 Another section would impose the burden of proof on the government todemonstrate that the taking is “reasonably necessary to accomplish the public purpose of eliminatingan existing threat to the public health or public safety that is likely to continue absent the exerciseof eminent domain.”240

This is remarkable reform for a state which has recently suffered from an astonishingoutbreak of eminent domain abuse. In five years alone, there were more than 2,000 incidents ofproperty owners being threatened with eminent domain for the benefit of private parties.241 The

242 See, e.g., City of Naples v. Moon, 269 So.2d 355, 356 (Fla.1972); State v. Miami BeachRedevelopment Agency, 392 So.2d 875 (Fla., 1980).

243 See Jamie Manfuso, Murdock Village Project Puts Some Lives in Limbo, SARASOTA HERALDTRIBUNE, Feb. 16, 2004, at A1 (2004 WLNR 2995524).

244 The obvious exception, of course, is Berman, which was undertaken under federal authority sinceit involved redevelopment in Washington, D.C.

245 See Fischel, supra note 143.

246 Available at http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_bills&docid=f:h4128eh.txt.pdf (visited Nov. 30, 2005).

247 H.R. 4128 § 2(a).

248 Id. § 8(1).

44

Florida judiciary has long acquiesced in the use of eminent domain for “redevelopment.”242 In fact,not long after the Kelo decision was announced, Port Charlotte County began acquiring 3,000properties, including 77 homes for a multimillion dollar redevelopment project.243

Because H.B. 1567 contains no loopholes for “blighted” property, or allowing officials to goon condemning property for a decade (as the Pennsylvania law does), it represents a major stepforward for the protection of the state’s landowners.

D. Meaningful Proposals

1. Federal Reform

Although the federal government does not usually engage in redevelopment condemnationsitself,244 federal funding is behind a great many such cases, including the notorious Poletown casein Michigan.245 Shortly after Kelo was decided, Congress began working on a law to restrict theavailability of federal funds for the support of such projects. HR 4128, the “Private Property RightsProtection Act of 2005,”246 received an overwhelming vote of 376 to 38 on November 3, 2005. Thebill prohibits states or cities from exercising eminent domain “over property to be used for economicdevelopment . . . if that State or political subdivision receives Federal economic developmentfunds.”247 The bill defines condemnation for economic development as “taking private property,without the consent of the owner, and conveying or leasing such property from one private personor entity to another private person or entity for commercial enterprise carried on for profit, or toincrease tax revenue, tax base, employment, or general economic health.”248 It allows condemnationsfor common carriers, roads, military installations, the elimination of nuisances, and other traditional

249 Id. §§ 8(1)(A)-(G).

250 Id. § 2(b).

251 See generally Gary Lawson, Making a Federal Case Out of It: Sabri v. United States and theConstitution of Leviathan, 2004 CATO SUP. CT. REV. 119; Lynn A. Baker, The Spending Power andthe Federalist Revival, 4 CHAP. L. REV. 195, 195 (2001) (“The greatest threat to state autonomy is,and has long been, Congress’s spending power.”)

252 Congress also enacted H.R. 3058, which restricts the use of federal funds in the 2005-2006 fiscalyear for any Department of Transportation or Housing and Urban Development project in whicheminent domain is used for economic development. This was a major step forward for propertyrights, but since it affects only a single year’s appropriations, it does not count as genuine eminentdomain reform.

253 National League of Cities, Confusing and Vague Bill May Produce Chilling Effect on EconomicDevelopment, Nov. 4, 2005, available at http://www.nlc.org/Newsroom/press_room/6964.cfm(visited Nov. 30, 2005).

254 See, e.g., John Shirey, Executive Director, California Redevelopment Association, Summary ofTestimony before the California State Senate Joint Interim Hearing on Redevelopment and Blight,Oct. 25, 2005, available at http://www.calredevelop.org/Leg/ShireyTestimonyOutline. pdf (visitedNov. 30, 2005) at 2 (claiming that eminent domain is intended to eliminate “property that iscontaminated . . . [or] owned by absentee slumlords who refuse to maintain their property.”)

255 GREENHUT, supra note 61 at 215 (quoting American Planning Association, Policy Guide 2002.)

45

uses of eminent domain.249 States or cities violating the prohibition are punished by being madeineligible for federal funding for two years.250

Considering the enormous influence that federal funding has on local governments,251 thereis reason to believe that if HR 4128 is passed by the Senate and signed by the President, it willgreatly limit the number of Kelo-style redevelopment takings.252 This explains why organizationssuch as the National League of Cities opposed the bill, complaining that it could “freeze the processof public-private economic development projects across the country.”253 This statement reveals thetrue motive of redevelopment bureaucracies: although they often claim that they are concerned withcleaning up dangerous or dilapidated neighborhoods,254 the reality is that redevelopment projects area major industry combining the public power of government with the private profit motives ofcorporate lobbyists. Redevelopment “‘is now seen by local agencies as almost exclusively a tool foreconomic development rather than for physical redevelopment.’”255

256 Available at www.legislature.mi.gov/documents/2005-2006/jointresolutionenrolled/senate/pdf/2005-SNJR-E.pdf (visited Jan. 20, 2006).

257 Id. art. X, § 2, ¶ 2.

258 Id. ¶ 3.

259 See 108 J. OF HOUSE OF REPRESENTATIVES 2511-12 (2005) available at http://www.legislature.mi.gov/(40e0g0fbrycpl0e0fwvgx1nl)/documents/2005-2006/journal/house/pdf/2005-HJ-12-13-108.pdf (visited Jan. 20, 2006).

260 See 101 J. OF THE SENATE 2163-64 (2005) available at http://www.legislature.mi.gov/(40e0g0fbrycpl0e0fwvgx1nl)/mileg.aspx?page=getobject&objectname=2005-SJ-11-09-101 (visited Jan. 20,2006).

261 Supra note 8.

262 Available at http://www.myfloridahouse.gov/Sections/Documents/loaddoc.aspx?FileName=_h1569e1.doc&DocumentType=Bill&BillNumber=1569&Session=2006 (visited Apr. 11, 2006).

46

2. Michigan’s Constitutional Amendment

While other states have opted for statutory reform, the Michigan legislature has passed aproposal to amend the state constitution. This proposal, Senate Joint Resolution E,256 will bepresented to voters at the November 2006 general election. It prohibits the state from taking property“for transfer to a private entity for the purpose of economic development or enhancement of taxrevenues.”257 In addition, it places the burden of proof on the condemning authority “to demonstrate,by a preponderance of the evidence,” that the condemnation “is for a public use.” In cases where thecondemnation is intended to eradicate blight, the burden is even greater: the condemning authoritymust prove “by clear and convincing evidence” that the condemnation is for a public use.258 Thus,unlike all of the other measures which have been enacted, the Michigan amendment regards blight-eradication condemnations with even more skepticism than other types of condemnations. What’smore, the amendment would require the government to pay homeowners 125 percent of the fairmarket value when it condemns a person’s primary residence.

Remarkably, this amendment received unanimous approval in the state House259 and onlythree no votes in the state Senate.260 By seeking to enshrine the prohibition on eminent domain abusethat was first announced in the Michigan Supreme Court’s 2004 Hathcock decision,261 the Michiganlegislature has distinguished itself as the cutting edge of eminent domain reform in the United States.

3. Two Proposals in Florida

The Florida bills, H.J.R. 1569262 and H.J.R. 1571, propose amendments to the stateconstitution. H.J.R. 1569 would prohibit government from transferring any seized property to aprivate party, except for property that the government owns for at least five years. (Strangely, the

263 Available at http://www.protectourhomes2006.com (visited May 16, 2006).

264 Id. § 3, adding CAL. CONST. art. I § 19(b)(2).

265 Id., adding CAL. CONST. art. I § 19(b)(1).

266 Id., adding CAL. CONST. art. I § 19(b)(6).

267 Id., adding CAL. CONST. art. I § 19(a)(3).

268 Id., adding CAL. CONST. art. I § 19(e).

269 Id., adding CAL. CONST. art. I § 18(b)(8).

47

provision does not require the government to sell such property to the highest bidder.) H.J.R. 1571alters to property tax rules, to protect those whose property is taken through eminent domain fromfacing significantly higher taxes in their new homes.

4. California’s “Protect Our Homes” Initiative

Having failed to obtain relief from the state legislature, Californians collected enoughsignatures to place the “Protect Our Homes Act”263 on the November, 2006 ballot. This long billwould amend the state constitution to declare that “public use shall not include the direct or indirecttransfer of any possessory interest in property” from the owner “to another private party” except ifthe property is to be owned and used by the public.264 The term public use “shall have a distinct andmore narrow meaning than the term ‘public purpose,’” and it shall not mean “any other actual usesthat are not public in fact.”265 The government may lease seized property “to entities that areregulated by the Public Utilities Commission,” which allows the government to construct railroads,power lines, and similar projects, but not to transfer the property to the owners of shopping malls.Further, the initiative would require government to pay not merely the value of taken property, butto “place the property owner in the same position, monetarily...as if the property had never beentaken,”266 and to offer the original owner a right of first refusal if the government no longer needsthe property.267

The initiative would allow the government to condemn blighted property—but only if eachparcel that is taken is itself blighted.268 This would be far more protective than the current law,under which even non-blighted property may be seized if it is in a blighted area. Further, even ifblighted property is seized under this initiative, it could not be transferred to a private party forprivate use. The initiative would also require government to compensate property owners for certainregulatory burdens. If a law fails to protect the public health and safety, and imposes a “substantialeconomic loss” on the private property, the government would be required to compensate theowner.269

If enacted, the Protect Our Homes Act would be among the most strongest of the responsesto Kelo seen so far. It would eliminate the use of government as a tool for redistributing propertybased on its economic performance. Moreover, it would protect property owners both from outright

270 Available at http://www.house.mo.gov/bills061/biltxt/truly/HB1944T.HTM (visited May 10,2006).

271 MO. CONST. art. VI § 21 (2006).

272 Mo. St. § 99.300, et seq.

273 Id. § 99.320(3).

274 MO. CONST. art. I § 28.

48

seizures of their land, but also from some government actions which interfere with their right to usetheir property.

E. Meaningless Proposals

1. Missouri

Missouri’s SB 1944270 was overwhelmingly passed on May 5, 2006, and sent to GovernorMatt Blunt for action. This bill would do virtually nothing to protect property owners from wrongfulcondemnations of their property.

Under the state constitution, government may seize property which is in a “blighted,substandard or insanitary” neighborhood.271 Under the Land Clearance Development Law,272 ablighted or substandard neighborhood is:

an area which, by reason of the predominance of defective or inadequate streetlayout, insanitary or unsafe conditions, deterioration of site improvements, impropersubdivision or obsolete platting, or the existence of conditions which endanger lifeor property by fire and other causes, or any combination of such factors, retards theprovision of housing accommodations or constitutes an economic or social liabilityor a menace to the public health, safety, morals, or welfare in its present conditionand use.273

These terms are so vague that a mom-and-pop hardware store, or a church, or even a home, whichbureaucrats believe have “constitute an economic . . . liability” can be condemned and handed overto a private company to build a store.

And in Missouri, as in many other states, courts routinely defer to legislative declarations ofblight. Although the state constitution declares that the courts shall decide whether “thecontemplated use be public . . . without regard to any legislative declaration that the use is public,”274

the fact is that courts defer to legislative declarations in all but the most extreme circumstances. In

275 364 Mo. 974 (en banc 1954).

276 Id. at 988-89.

277 S.B. 881, adding Mo. St. § 523.271.1 (emphasis added).

278 See id. § 523.271.2 (“For the purposes of this section, ‘economic development’ shall mean a useof a specific piece of property or properties which would provide an increase in the tax base, taxrevenues, employment, and general economic health, and does not include the elimination ofblighted, substandard, or unsanitary conditions, or conditions rendering the property or itssurrounding area a conservation area....” (emphasis added)).

279 Id. § 523.274.1.

280 Id. § 523.261.

49

State ex rel. Dalton v. Land Clearance for Redevelopment Authority,275 the Missouri Supreme Courtheld that “a legislative finding . . . that a blighted or insanitary area exists . . . will be accepted by thecourts as conclusive evidence that the contemplated use thereof is public” unless the property ownercan show “clear proof that the legislative finding was arbitrary or was induced by fraud, collusionor bad faith,” something that is extremely difficult to prove.276

None of this is changed by H.B. 1944. The bill does say that “no condemning authority shallacquire private property through the process of eminent domain for solely economic developmentpurposes,”277 but it goes on to define “economic development purposes” in language which stillallows the government to condemn property when bureaucrats declare it blighted.278 Under H.B.1944, government would not be allowed to seize property to “provide an increase in the tax base, taxrevenues, employment, and general economic health,” but it would still be allowed to declareproperty blighted and then take it for “redevelopment,” because such condemnations would not be“solely” for economic development purposes.

The bill allows non-blighted property to be condemned if a “a preponderance” of the area isblighted.279 Although it would put a time limit on blight designations, so that property could not becondemned if the blight determination is more than 5 years old, it authorizes the legislative boy torenew such designations for an indefinite number of 5-year increments. H.B. 1944 contains nodefinition of blight, and only prohibits “any legislative determination that an area is blighted,substandard, or unsanitary” from being “arbitrary or capricious or induced by fraud, collusion, or badfaith.” This, of course, is already the law in every state, under the basic rules of due process andequal protection.280

At bottom, although H.B. 1944 contains several provisions regulating the manner ofdetermining and awarding just compensation, it does virtually nothing to prohibit Kelo-stylecondemnations of private property. Of course, it could hardly do more; given that the stateconstitution specifically allows for the taking of “blighted” or “unsanitary” property for

281 Available at http://www.kslegislature.org/legsrv-bills/showBill.do?id=86288 (visited May 10,2006).

282 Id. § 1(b).

283 Id. § 2(f).

284 Id. § 5, amending K.S.A. 2005 Supp. 19-101(a)(35)(A).

285 Id. § 17, amending K.S.A. 49-406(d)(10).

286 Id. § 7.

287 K.S.A. § 12-1770a(c).

288 BERLINER, supra note 83 at 78.

50

redevelopment, Missouri’s property owners cannot expect their rights to be protected by anythingshort of a constitutional amendment.

2. Kansas

Kansas’ S.B. 323281 prohibits the use of eminent domain “for the purpose of selling, leasingor otherwise transferring such property to any private entity”282—that is, except where it allows suchcondemnations: “The taking of private property by eminent domain for the purpose of selling,leasing, or otherwise transferring such property to any private entity is authorized if the takingis...expressly authorized by the legislature on or after July 1, 2006, by enactment of law thatidentifies the specific tract or tracts to be taken.”283 The rest of the bill is a confusing 26 page hashthat contains references to the state’s liquor control laws,284 and the practice of mining engineers.285

Most important, however, is section 7, which declares that “the provisions of this act shall not applyto the exercise of eminent domain...within a[n existing] redevelopment district.”286 Kansas’ vagueblight definition287 has made that state one of the nation’s leading abusers of eminent domain, withover 155 cases of eminent domain being filed for the benefit of private developers, in just the years1998-2003.288 S.B. 323 merely authorizes the state legislature to declare which properties inparticular may be seized. It does nothing to restrict the cases in which eminent domain may be used.Although it contains long provisions regarding the awarding of compensation, S.B. 323 simply doesnot limit the use of eminent domain.

IV. WILL FUTURE REFORMS ACCOMPLISH ANYTHING?

As these examples reveal, the Kelo backlash is in danger of being sold out by legislationdesigned to ally the fears of property owners without accomplishing anything. In Alabama, Texas,and several other states, attempted reforms have been severely weakened by exceptions andloopholes; Ohio’s and Delaware’s provisions appear to accomplish almost nothing; and not only was

289 See generally JAMES BUCHANAN & GORDON TULLOCK, THE CALCULUS OF CONSENT (1965).

290 John O. McGinnis, The Original Constitution and Its Decline: A Public Choice Perspective, 21HARV. J.L. & PUB. POL’Y 195, 197 (1997).

291 See BUCHANAN & TULLOCK, supra note 289 at 287-88 (noting “spiral effect” of ever-greaterlobbying efforts).

292 See generally Donald J. Kochan, “Public Use” and the Independent Judiciary: Condemnationin an Interest-Group Perspective, 3 TEX. REV. L. & POL. 49 (1998); Sandefur, Gleeful Obituary,

(continued...)

51

New Mexico’s genuine reform vetoed, but the fainthearted attempts at reform in California failedeven to clear the state legislature. There are two primary reasons for these failures in the face ofwhat seems to be overwhelming popular demand for reform. These two causes may be describedas the short-term, or efficient cause, and the long-term, or material cause. The efficient cause of thefailure to reform eminent domain is what economists refer to as the “public choice” problem: thepolitical tendency of private interest groups to exploit government power for their own enrichment.289

The material cause is the breakdown in public’s understanding of the role of government and privateproperty rights in a free society. But while these are two major obstacles faced by property rightsadvocates, laws such as those in South Dakota and Indiana, and the Michigan and federal bills whichhave made it part way through the process of becoming laws, give reason for optimism that genuinereform is possible. If these bills eventually become law, they might serve as models for other states,and actually protect property owners from the abuses that Kelo permitted.

A. Public Choice

Whenever government has the authority to take property from some people and transfer itto other people, private groups will choose to invest their time and energy in convincing thegovernment to use that power for their own benefit. Or, in simpler language, legislative majorities“use their power to take away resources and opportunities from minorities and redistribute it tothemselves.”290 This is the insight known as “public choice” theory, and it explains the phenomenonof lobbying. If a group can realize gains through government action, it is worthwhile for them tospend money obtaining those gains by lobbying the officials who have the necessary authority. Sincethe benefits conferred by the transfer of private property through eminent domain will be localizedand concentrated, while the costs are broadly dispersed, incentives will be skewed toward increasedlobbying and ever-increasing amounts of wealth distribution.291 Suppose government takes $1 fromeach of 100 people, and gives it all to person X. It is in X’s interest to spend $99 to convince thegovernment to do this again; but it is only in the interest of each other person to spend $1 to convinceit not to take their money from them. Public choice theory predicts that, as the use of eminentdomain for private benefit becomes more common, private interest groups are more likely to try toobtain the benefits of that power by manipulating the political process, while property owners willbe less able to organize to defend themselves politically.292

292 (...continued)supra note 40 at 661-65.

293 See GREENHUT, supra note 61 at 191-201 (describing Costco as the “Darth Vader” of eminentdomain).

294 See Ted Mann, Pfizer’s Fingerprints on Fort Trumbull Plan, THE (NEW LONDON) DAY, Oct. 16,2005, available at http://www.theday.com/eng/web/news/re.aspx?re=4f7f99ae-ffa5-4aad-88c2-65fa3c75b5e1 (visited Nov. 28, 2005).

295 California Redevelopment Association, Comments on Committee Staff Briefing Paper, What isto Be Done? Legislators Look at Redevelopment Reforms, Nov. 17, 2005, available at http://www.calredevelop.org/Leg/updates/Eminent%20Domain-Response%20to%20Staff%20Report.pdf (visitedNov. 28, 2005) at 13.

296 Id.

297 As Professor Gideon Kanner has put it, “Kelo has also inspired an instant emergence of a cottageindustry among government functionaries, redevelopment professionals, and the usual academicsuspects who reacted to the Supreme Court’s decision and to the uproar it created, by blandlyasserting that the legal and civic revolution wrought by the court was no revolution at all, but merelythe application of long-standing precedent. In light of what the Kelo Court did decide, as explained

(continued...)

52

In fact, this is precisely what has happened. In the years since Berman first allowedgovernment to condemn property and transfer it to private parties for their own profit, a majorindustry has grown up around eminent domain. This industry combines private developers andgovernment agencies in “partnerships” to create shopping centers and other private developmentswhich benefit businesses and government agencies alike. One major member of this industry isCostco, which routinely exploits government authority to construct its discount shopping centers.293

Pfizer’s apparent complicity in the condemnation of Susette Kelo’s property is another example.294

But in addition to private industry, government agencies benefit from private condemnations in atleast two ways: first, completed redevelopment projects give political leaders an opportunity forreelection and advancement; mayors and city council members can point to a redevelopment projectand declare that their vision and dedication has created a new, improved shopping area. Second,redevelopment officials benefit from projects through increased funding and the opportunity to beinvolved in future projects. Lobbying by government officials as well as private industry is thereforehighly concentrated in favor of retaining the status quo with regard to eminent domain. This wasreflected in the impassioned statement of the California Redevelopment Agency (CRA) to the StateSenate Local Government Committee. “The Kelo decision did not change California laws regulating redevelopment activities,” declared the CRA’s report.295 “California’s laws in this regard are amongthe strongest in the nation.”296 Of course, it is true that Kelo did not “change” the law, becauseCalifornia law was already so permissive toward eminent domain.297 While California’s laws may

297 (...continued)presently, this performance brings to mind the scene in the movie Jumbo, where Jimmy Durante iscaught trying to sneak an elephant out of a circus, and when confronted by a guard says, ‘Elephant?What elephant?’” Gideon Kanner, Kelo v. New London: Bad Law, Bad Policy and Bad Judgment,ALI-ABA Program on Eminent Domain and Land Valuation Litigation, (forthcoming, 2006) (on filewith author).

298 CRA, Comments, supra note 295 at 18.

299 See generally MICHAEL DARDIA, SUBSIDIZING REDEVELOPMENT IN CALIFORNIA at x (1998) (“Inrecent years, $300 million that would otherwise have gone to counties, and $800 million that wouldhave gone to school districts, instead went to [redevelopment agencies].”)

300 Kochan, supra note 292 at 82.

301 Or, as Sir Edward Coke put it in an early eminent domain case, “sometimes when a publick goodis pretended, a private benefit is intended.” The Case of the Isle of Ely, 10 Co. Rep. 141a, 142b(1609), reprinted in 1 THE SELECTED WRITINGS OF SIR EDWARD COKE 382 (Steve Sheppard, ed.2003).

53

be “among the strongest,” they provide little protection for property owners, as described above. Thedisingenuous nature of such statements is suggestive of how urgently the CRA desires to preservewhat it calls “one of the most important local tools to breathe new life into communities in need ofrevitalization,”298 but which in reality diverts immense amounts of wealth to their control.299

While lobbyists in favor of eminent domain projects have great incentive to protect theauthority to redistribute property, homeowners have, somewhat dishearteningly, less incentive to doso. As Donald Kochan has explained,

Even though a particular condemnation may concentrate the cost of the taking on theaffected landowner . . . that owner is not likely to invest enough to successfullyoppose the condemnation. First, the existence of compensation, even when not trulysubstituting for market or subjective value, decreases the cost to the affected ownerof the land seized and thereby decreases his incentive to invest in fighting thecondemnation. Furthermore, the special interest is likely to have more politicalinfluence, because unlike the landowner, the interest group is probably a repeatplayer in the political process and thereby able to offer more to legislators.300

What’s more, pro-eminent domain groups invest extensively in obscuring their privatebenefit by proclaiming the alleged public benefits of a condemnation.301 “As the Poletowncondemnation illustrates, the public can often be convinced that the action is in its interest and that

302 Kochan, supra note 292 at 82-83.

303 ANTHONY DE JASAY, JUSTICE AND ITS SURROUNDINGS 83 (2002).

304 Id.

305 Cf. Kochan, supra note 292 at 82-83 (“individual citizen opposition, such as from the landowner,is unlikely to influence a politician’s decision or his electoral chances, for ‘the probability that atypical voter will change the outcome of the election is vanishingly small.’”) (quoting MANCUROLSON, THE RISE AND DECLINE OF NATIONS: THE RISE AND DECLINE OF NATIONS: ECONOMICGROWTH, STAGFLATION, AND SOCIAL RIGIDITIES 26 (1982)).

306 See VA. DEC. OF RIGHTS ¶ 17 (1776).

54

the government is serving the public interest well by condemning land.”302 Eminent domain reformefforts are further hampered by the fact that property rights activists are confronting a speculative,future risk—most people, of course, will never suffer a condemnation—and therefore have lessincentive to lobby than do the redevelopment agencies and corporations that, every day, deal in, andprofit from, eminent domain projects.

Attempts to reform eminent domain will, therefore, face to the same public choice pressuresthat affect any particular incident of eminent domain abuse. Not only is democratic governmentliable to being captured by interest groups whenever it can confer concentrated benefits on particulargroups and disperse the costs of those benefits on society in general. Interest groups will also resistany attempt to restrict such powers on a constitutional level. As Anthony de Jasay puts it, interestgroups not only “choose legislation that maximizes their gains from politics,”303 they also “learn tochoose a constitution that maximizes the scope for such legislation.”304 Such groups can be countedon powerfully to oppose any attempt to limit the redistributionary mechanism that, for more than halfa century, has conferred inconceivably vast wealth upon them. Public choice theory predicts that theKelo decision will cause politicians to holler out for reform as loudly as necessary to appeaseoutraged constituents, and perhaps pass ineffectual measures designed to allay their outrage, but notto accomplish any substantial reform.305 Once the hue and cry has died down, the eminent domainindustry can return again to its old habits.

B. “A Frequent Recurrence to Fundamental Principles”306

But the material cause of the failure of eminent domain reform is a cultural and philosophicalcause. Since at least the New Deal, American society has grown accustomed to an enormousregulatory welfare state that intertwines government and private industry to a degree not known toprevious generations of Americans. For many people, the idea of a government which, in Jefferson’swords, “shall restrain men from injuring one another, shall leave them otherwise free to regulate theirown pursuits of industry and improvement, and shall not take from the mouth of labor the bread it

307 Thomas Jefferson, First Inaugural Address, reprinted in JEFFERSON: WRITINGS 494 (M. Petersoned., 1984).

308 See Gary Lawson, The Rise and Rise of the Administrative State, 107 HARV. L. REV. 1231, 1249(1994) (“the actual structure and operation of the national government today has virtually nothingto do with the Constitution. There is no reasonable prospect that this circumstance will significantlyimprove in the foreseeable future.”)

309 MCGERR, supra note 26 at 317.

310 Kelo,125 S. Ct. at 2665.

311 Wilkinson v. Leland, 27 U.S. (2 Pet.) 627, 657-58 (1829).

312 Penn Cent. Transp. Co. v. City of New York, 438 U.S. 104, 124 (1978).

313 Kelo, 125 S. Ct. at 2665.

55

has earned,”307 is virtually impossible to imagine. Government today is responsible not only forproviding such traditional public uses as roads, schools, and parks, but also for providing jobs, healthcare, popular consumer goods, old-age insurance, entertaining radio programs, environmentally-friendly automobiles, and a virtually infinite number of other desires, even though almost none ofthese responsibilities are actually vested in the government by the Constitution.308 As MichaelMcGerr writes, the legacy of the New Deal was to teach Americans that “[t]he task of governmentwas to make sure Americans could afford pleasure, and then get out of the way.”309 Unfortunatelyfor Americans, these desires are inherently contradictory.

The philosophical foundations of the modern regulatory welfare state would befundamentally broken by recognizing serious constitutional limitations on government’s power toredistribute private property. Kelo, after all, was not simply about the eminent domain power, butabout the role of government in our lives. This is suggested by the fact that Justice Stevens foundit unnecessary to provide any substantiation for his claim in Kelo that “[p]romoting economicdevelopment is a traditional and long accepted function of government.”310 There is no indicationthat the American founders accepted government as the agent for redistributing private property for“economic development”; on the contrary, in 1829, the Court declared that “[w]e know of no case,in which a legislative act to transfer the property of A. to B. without his consent, has ever been helda constitutional exercise of legislative power in any state in the union. On the contrary, it has beenconstantly resisted as inconsistent with just principles, by every judicial tribunal in which it has beenattempted to be enforced.”311 But almost exactly a century and a half later, after the New Dealrevolution, the Supreme Court held that property owners are usually not even due compensationwhen government takes their property so as to “adjust[] the benefits and burdens of economic life.”312

Between those two cases stands an enormous change in the understanding of government’s properrole. In this sense, Justice Stevens is correct when he says that “[t]here is . . . no principled way ofdistinguishing economic development from the other public purposes that we have recognized.”313

If it is proper for government to “create jobs,” “improve the economy,” “clean up the neighborhood,”

314 Note, for example, that at the same session in which it passed its eminent domain reform measure,the Alabama Legislature gave $188,151 in subsidies to the Alabama film commission. See PaulGodbey, Film Incentive Bill Jeopardized by Amendments, Alabama Loses Movie, Reelscene.ComNews, July 25, 2005, available at http://reelscene.com/news/rstaxbilljeopardy 050725.html (visitedNov. 30, 2005).

315 Or, as P.J. O’Rourke has put it, “[e]very government is a parliament of whores. The trouble is,in a democracy the whores are us.” PARLIAMENT OF WHORES: A LONE HUMORIST ATTEMPTS TOEXPLAIN THE ENTIRE U.S. GOVERNMENT 233 (New York: Grove Press, 2003) (1991).

316 Merrill, supra note 5.

317 See LEO STRAUSS, NATURAL RIGHT AND HISTORY 4 (1950) (“According to our social science, wecan be or become wise in all matters of secondary importance, but we have to be resigned to utterignorance in the most important respect: we cannot have any knowledge regarding the ultimateprinciples of our choices, i.e., regarding their soundness or unsoundness; our ultimate principles haveno other support than our arbitrary and hence blind preferences.”)

56

and to satisfy any number of other desires, then there is no reason to forbid it from using eminentdomain to accomplish these things. On the other hand, if the Court were to revive—and consistentlyapply—the principle that government may not take property from those who have earned it, and giveit to those who have not, a tremendous amount of the activities undertaken by government todaywould be brought to a sudden halt.314

The road to meaningful eminent domain reform is blocked by a massive obstacle: a bloatedregulatory welfare state that interferes in economic life in almost every imaginable way. Those whobenefit from such interferences—which include, alas, most of us—will naturally oppose any attemptby courts or political groups to limit the state in the manner the American founders consideredessential. People claim that they don’t like the idea of government taking away their homes to giveto private industry, but so far they have shown little interest in really respecting the limits of privateproperty rights—which would mean giving up their ability to grant themselves favors at the expenseof political opponents, or to tell their neighbors how to use their land. The same voters who protestthe outcome of Kelo also enact no-growth initiatives, rent-control laws, and school bonds whichviolate private property rights.315 If we really mean to respect Susette Kelo’s right to her property,we would also have to be willing to respect the private property rights of mining companies, cattleranchers, and other unpopular minorities; we would have to respect our fellow citizens. That wouldbe very difficult for some people to do.

If it is difficult for the average American to face the consequences of taking property rightsseriously, it is no wonder that the intellectual elite also finds it difficult. It might seem weird to somepeople that Professor Merrill would express shock and surprise at “the American people believ[ing]that property rights are invested with moral significance.”316 But for almost a century now, politicaland legal intellectuals have adopted the view that issues of morality or of rights are simply beyondthe limits of rational discussion,317 and the concept of an individual having rights which no

318 See, e.g., Supreme Court of New Hampshire v. Piper, 470 U.S. 274, 281 n.10 (1985) (“The‘natural rights’ theory . . . was discarded long ago.”). In fact, the Supreme Court tends to avoid theword “rights,” and speak instead of “interests.” As Justice Holmes explained, regarding a right as“only an interest” means that its “sanctity disappears.” Oliver Wendell Holmes Jr., Natural Law,32 HARV. L. REV. 40 (1918), reprinted in THE ESSENTIAL HOLMES 182 (R. Posner ed. 1992).

319 Roger Pilon, A Court Without a Compass, 40 N.Y.L. SCH. L. REV. 999, 1002 (1996). See furtherHadley Arkes, On the Grounds of Rights and Republican Government: What the Judges May StillTeach, in BRADFORD P. WILSON & KEN MASUGI, EDS., THE SUPREME COURT AND AMERICANCONSTITUTIONALISM 27, 45 (1998) (“It is not the people, these days, who need to be instructed inthe premises of constitutional government in order to be rendered into citizens fit for a republic.Curiously, it is their ‘betters’ who seem in most urgent need of this instruction.”)

320 See, e.g., Nollan v. California Coastal Comm’n, 483 U.S. 825, 834 (1987) (“Our cases have notelaborated on the standards for determining what constitutes a ‘legitimate state interest.’”)

321 See United States v. Carlton, 512 U.S. 26, 41-42 (Scalia, J., concurring in judgment) (“Thepicking and choosing among various rights to be accorded ‘substantive due process’ protection isalone enough to arouse suspicion; but the categorical and inexplicable exclusion of so-called‘economic rights’ (even though the Due Process Clause explicitly applies to ‘property’)unquestionably involves policymaking rather than neutral legal analysis.”)

322 See generally Timothy Sandefur, Liberal Originalism: A Past for the Future, 27 HARV. J.L. &PUB. POL’Y 489 (2004).

323 Richard A. Epstein, The Ebbs and Flows in Takings Law: Some Reflections on the Lake TahoeCase, 2002 CATO SUP. CT REV. 5, 16.

57

government may justly violate is widely dismissed.318 As a consequence of the rise of “the idea . . .that it is the function of government to solve our social and economic problems, including, morerecently, the problem of inequality,” our political and legal leaders have lost their way entirely whenit comes to major constitutional issues.319 The Supreme Court is notably haunted by the fact that,despite its frequent invocation of the phrase, it simply does not know what a legitimate state interestis,320 and seems incapable of drawing principled lines on that subject. Given the deference it hasadopted toward economic regulation in the years since the New Deal, the Court seems to take theposition that virtually any economic legislation that has a large voting bloc behind it is a legitimategovernment purpose.321 At least, it is not willing be guided by the principles of political philosophyenunciated in documents such as the Declaration of Independence, which set the boundaries ofconstitutional state interests.322 In short, as Richard Epstein has put it, reforming eminent domain“is a large job because it requires an assessment of the legitimate purposes of government action,”323

and the judiciary and legal intellectuals have so far distinguished themselves only in their capacityto avoid doing that job. But there is ultimately no alternative. Either our society maturely faces thefact that much of what government does today is beyond the legitimate reach of government—even

324 See Lawson, Rise and Rise, supra note 308 at 1253 (recommending that we “acknowledge openlyand honestly, as did some of the architects of the New Deal, that one cannot have allegiance both tothe administrative state and to the Constitution.”).

325 Madison, Property, supra note 22 at 515.

326 BERLINER, supra note 83 at 173.

327 See, e.g., Dornan v. Philadelphia Hous. Auth., 200 A. 834 (Pa. 1938); Bernstein v. Pittsburgh, 77A.2d 452 (Pa. 1951); Johnson v. Pennsylvania Hous. Fin. Agency, 309 A.2d 528, 533 (Pa. 1973).

328 See, e.g., Belovsky v. Redevelopment Auth. of City of Philadelphia, 54 A.2d 277, 280 (Pa. 1947)(“Although such legislative declarations are subject to judicial review they are entitled to a primafacie acceptance of their correctness.”)

329 See, e.g., In re Condemnation by City of Coatesville, 64 Pa. D. & C.4th 231, 287 n.174 (Ct. Com.Pl. 2002), rev’d 822 A.2d 846 (Pa. Cmwlth. 2003).

330 BERLINER, supra note 83 at 174-75. No meaningful reform has managed to pass, however. Id.

58

those things from which we personally benefit—or we allow government to continue to ignore theConstitution, including seizing private property for the benefit of private parties.324

Really fixing the problem presented by Kelo, therefore, requires much more than simplychanging the procedures by which bureaucrats condemn property. It even requires more thandefining such terms as “blight” or “public use.” It requires a major cultural self-examination—and,hopefully, a revival of the principles of private property rights and economic liberty which America’sfounders had in mind when they wrote the Fifth Amendment. Until Americans recognize that “thatalone is a just government, which impartially secures to every man, whatever is his own,”325 theproblem of eminent domain abuse will remain.

C. Reasons for Optimism

Yet, in spite of such overwhelming political pressures, South Dakota’s, Indiana’s, Georgia’sand Pennsylvania’s new laws, as well as and Michigan’s proposed constitutional amendment giveproperty rights advocates reason for hope. Pennsylvania in particular is among the worst abusers ofeminent domain, having filed more than 2,500 condemnations to benefit private parties in just theyears 1998-2003.326 Its courts have taken a liberal interpretation of the term “public use,”327 andadopted a highly deferential standard toward the legislature on eminent domain questions.328 Yetsome courts have expressed discomfort with the overly broad interpretation of “public use,”329 andthe legislature has recently considered several bills that would limit eminent domain abuses.330

Despite its unfortunate compromises which allow eminent domain abuse to continue for six moreyears in Pennsylvania’s largest cities, SB 881 is a fitting contribution from the state that gave us Van

331 2 U.S. (2 Dall.) 304 (C.C.D. Pa. 1795).

332 Id. at 312. It is perhaps worth mentioning that Dorrance is not a legal opinion, but a charge toa jury by Justice Paterson. Jury charges were recorded early judicial reporters alongside cases. Seegenerally Ralph Lerner, The Supreme Court as Republican Schoolmaster, reprinted in RALPHLERNER, THE THINKING REVOLUTIONARY 91 (1987).

59

Horne’s Lessee v. Dorrance,331 one of America’s most important early property rights cases. InDorrance, Justice William Paterson explained that

[I]t is of primary importance, that, when vested, [property] should be secured, and theproprietor protected in the enjoyment of it . . . . The constitution expressly declares,that the right of acquiring, possessing, and protecting property is natural, inherent,and unalienable . . . . One incroachment leads to another; precedent gives birth toprecedent; what has been done may be done again; thus radical principles aregenerally broken in upon, and the constitution eventually destroyed. Where is thesecurity, where the inviolability of property, if the legislature, by a private act,affecting particular persons only, can take land from one citizen, who acquired itlegally, and vest it in another?332

American history reveals that, if people are dedicated strongly enough to their principles, they canovercome the challenge presented by the public choice problem. There will always be interestgroups defending the status quo, especially when it enriches them. But when taken by a worthycause, Americans have repeatedly defied the predictions of pessimists. If Americans return to thefounding principles articulated by Justice Paterson, there is no reason that they cannot prevail againstthe redevelopment industry and its bureaucratic defenders. But if their victory is to be meaningful,they must take care not to commit the same errors already committed in four states. If they manageto avoid those snares, there is hope that the Kelo backlash will bring about greater protection forprivate property owners than they have known for fifty years.

CONCLUSION

So far, the reported “backlash” against the Supreme Court’s unpopular Kelo decision hasproduced thirteen reform laws, nine of which place few effectual limits on the power of eminentdomain. The reason these provisions have failed is that meaningful property rights protectionswould intrude on many entrenched economic interests, and on government programs which are todaytaken for granted by Americans who see government as an agency for providing for their wants,rather than protecting their rights. Meaningful eminent domain reform, therefore, must begin withcultural and philosophical change. Only by restoring the respect for private property that wasunderstood by the American founders can we hope to protect future generations from the abuse ofgovernment power. The bills recently passed in South Dakota, Georgia, Indiana, Pennsylvania, andby the United States Houses of Representatives demonstrate that success is possible, if legislatorshave the will to avoid loopholes and compromises.