Today the Supreme Court announced its decision in Kelo v. City of New London, Connecticut, 2005 WL 1469529. This case involved a challenge to an eminent domain action by a city against the owners of homes and other investment properties located in an area slated for economic development. The property owners, including a woman who lived in the home in which she was born, and in which she had lived with her husband for more than 60 years, sought to restrain the city from taking their property for the purpose of implementing a redevelopment plan.
Their properties were apparently well-maintained, and by no means constituted a run-down public nuisance or “blighted” area. However, the city in which they were located had experienced some tough economic times. Pfizer had just located a research facility there, and the city leaders hoped that by revitalizing the adjoining area, they could get something good going to attract more business and investment to the community. They formed a public corporation devoted to economic redevelopment and began purchasing properties. When the plaintiffs held out, eminent domain proceedings were brought and the plaintiffs lost their property rights. Of course, they were paid FMV for them, but presumably that did not take into account the particular sentimental values of a homestead, such as the woman mentioned above.
Eminent domain proceedings are useful and serve as a limitation on private property rights when the public good is adversely affected. Traditional uses for the power include building railroads, highways, or other places that benefit the public good. After all, if one guy could stop the highway, public costs would escalate and we would have crooked roads everywhere. However, this case put the question of what constitutes a public purpose. A majority of the court found that economic development in these circumstances was sufficiently related to the public, even though it was not for a planned public space or facility. The dissent, led by Justice O’Connor, thought this approach created a slippery slope, which could well lead to abusive encroachments on private property rights by the power-hungry political branches.
The case puts the liberal and conservative justices on each side of this dispute at odds, to some degree, with their usual positions. The conservatives in dissent focused heavily on the importance of private property and the need to protect that right from encroachments by the government. Precedent clearly supports the proposition that government cannot play favorites with regard to property: it cannot take A’s property and give it to B. They are right to be concerned, as enemies of the political establishment holding minority positions might well lose their property. (E.g., Could Chuck Heston be able to withstand a political decision that his beach house would serve the public good more effectively if it were owned by a an anti-gun lobbyist?)
The liberals, on the other hand, recognize this point, but find that the putative purposes of economic development found by the government should be respected as an adequate public purpose. After all, who are they, as judges, to second guess the determinations of the politically accountable branches on these matters?
This kind of thinking may sound strange coming from these particular judges, whom we usually expect to intervene to declare legislation invalid instead of deferring to legislative judgments.
I don’t happen to think the sky is falling in this area – at least not yet. The context of this case does seem to provide some limits, which would allow one to distinguish a case where a taking from one party to give to another private party would still be precluded. However, it does give much more discretion to government in such matters. There may well be cases where the political process does not provide an adequate check on public power. But in such cases, there is still the requirement of adequate compensation. Though that may not protect the family homestead, it does presumably allow a comparable property to be acquired and life to go on.
Edward A. Morse