A Preeminent Decision on Eminent Domain
The U. S. Supreme Court Rules Against Private Property Owners in Kelo Case
The recent U.S. Supreme Court case, Kelo et al. v. City of New London et al., has stirred up considerable controversy throughout the nation. At issue in this case was whether the City had violated the so-called 'Takings Clause' of the Fifth Amendment to the U.S. Constitution, which reads as follows:
"[N]or shall private property be taken for public use, without just compensation." U.S. Const. Amdt.5, emphasis added. (This Clause is applicable to the States through the Fourteenth Amendment.)
Public Use versus Public Purpose
The Court ruled that the term "public use" allows governments to condemn and seize private homes and businesses, even when such properties are not "blighted", in order to give the land to a developer. Since the developer would have agreed to follow an approved land development plan, the Court found that the City's development plan serves a "public purpose"; and therefore, the taking passed constitutional muster.
However, the Court also said states and local governments are free to ban the taking of property for such projects. Indeed, since the 5-4 decision on June 23, 2005, dozens of state legislatures have either proposed or promised to propose reform legislation, while cities, towns, and counties have also taken action through local ordinances to reform such seizures. According to Steve Rauschenberger, President of the National Conference of State
Legislatures, "what the Court said in the Kelo decision – in no uncertain terms – is that the issue of eminent domain is a state and local issue. Period." Deference to Legislative Judgments
Such legislation has already been enacted in Alabama, Delaware, and Texas. Congress also has acted to override the Kelo decision with legislation that has already passed the House of Representatives and with a similar bill being considered in the Senate. During the recent Senate confirmation hearings, Chief Justice John Roberts was asked about the Kelo case, and Judge Roberts said Kelo "leaves the ball in the court of the legislature."
The Kelo decision left open the question of whether such takings were constitutional if there were no development plan in place. On the other hand, the Court also declined to rule on how well the overall plan served the public purpose, saying it did not want to "second guess" such plans.
Apparently, under Kelo, government may condemn any property so long as there is a plan to put something more expensive there. In her dissenting opinion, Justice O’Connor noted the following: "Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a
shopping center, or any farm with a factory."
Effects on Brownfields projects
It remains to be seen whether either the decision in Kelo itself or the resulting backlash of state and local legislation will have an effect on such environmental programs as brownfields redevelopment. However, in many cases, even the new state legislation provides exceptions for legally defined "blighted" properties.
Need help with environmental aspects of a real estate transaction? Please call OMNI at 800-951-7625
Continue to Page 4 |
