50 State Report Card Tracking Eminent Domain Reform

50state report card Tracking Eminent Domain Reform Legislation since Kelo August 2007 1 Synopsis 5 Alabama . .B+ 6 Alaska . .D 7 Arizona . .B+ 8 Arkansas . .F 9 California . .D- 10 Colorado . .C 11 Connecticut . .D 12 Delaware . .D- 13 Florida . .A 14 Georgia . .B+ 15 Hawaii . .F 16 Idaho . .D+ 17 Illinois . .D+ 18 Indiana . .B 19 Iowa . .B- 20 Kansas . .B 21 Kentucky . .D+ 22 Louisiana . .B 23 Maine . .D+ 24 Maryland . .D 25 Massachusetts . .F 26 Michigan . .A- 27 Minnesota . .B- 28 Mississippi . .F 29 Missouri . .D table of contents & state grades 30 Montana . .D 31 Nebraska . .D+ 32 Nevada . .B+ 33 New Hampshire . .B+ 34 New Jersey . .F 35 New Mexico . .A- 36 New York . .F 37 North Carolina . .C- 38 North Dakota . .A 39 Ohio . .D 40 Oklahoma . .F 41 Oregon . .B+ 42 Pennsylvania . .B- 43 Rhode Island . .F 44 South Carolina . .B+ 45 South Dakota . .A 46 Tennessee . .D- 47 Texas . .C- 48 Utah . .B 49 Vermont . .D- 50 Virginia . .B+ 51 Washington . .C- 52 West Virginia . .C- 53 Wisconsin . .C+ 54 Wyoming . .B 50state50 reportstate card reportTracking Eminentcard Domain Tracking ReformEminent Legislation Domain since Kelo Abuse Legislation since Kelo I n the two years since the U.S. Supreme Court’s now-infamous decision in Kelo v. City of New London, 42 states have passed new laws aimed at curbing the abuse of eminent domain for private use. 50state report card Castle Coalition Given that significant reform on most issues takes years to accomplish, the horrible state of most eminent domain laws, and that the defenders of eminent domain abuse—cities, developers and planners—have flexed their considerable political muscle to preserve the status quo, this is a remarkable and historic response to the most reviled Supreme Court decision of our time. Of course, more work remains to be done, in both state legislatures and Congress, to protect homes, businesses, churches, and farms. Indeed, because some states have not passed reforms, and because many reforms are incomplete, it is important to take a step back and evaluate the work that has been done and is left to do. Some states have passed model reforms that can serve as an example for others. Some states enacted nominal reform—possibly because of haste, oversight, or compromise—and need to know what is left to fix. And finally, there are those states that have failed to act altogether, leaving home, farm, and business owners threatened by Kelo-type takings and beyond. 2 Eminent domain authority expansion of the term came with the developers who promise increased carries with it tremendous incorporation of “blight” removal tax revenue and jobs. responsibility. Early in our nation’s as a public use. At first, blight was Open-ended blight designations history, the U.S. Supreme Court used as a justification to remove provide a way for local governments even described it as “the despotic properties that were real threats to circumvent the public use power.” Quite simply, it is the power to public health and safety (what requirement. TheKelo decision then to remove residents from their long- were historically considered public obliterated the federal public time homes and to destroy small nuisances, the abatement of which use requirement by equating family businesses. Thus, as the was always allowed pursuant to “public use” with “private use.” Founding Fathers understood, it is a the government’s police powers). Under Kelo, local governments power that must be used sparingly Over the past several decades, can condemn homes and and only for the right reasons. however, the definition of blight This understanding is reflected in has become so expansive that tax- the Fifth Amendment to the U.S. hungry governments now have the Constitution that states, “[N]or shall ability to take away perfectly fine private property be taken for public middle- and working-class use, without just compensation.” neighborhoods and Most states’ constitutions give them to land- have identical or similar hungry private language—language that is supposed to prevent the use of eminent domain for private benefit by restricting its exercise to only true public uses, like roads, fire stations, and schools. For most of our nation’s history, courts stayed true to the plain language and intent of the federal and state “public use” clauses, and prevented the taking of property for private benefit. However, those takings began to proliferate as public use was interpreted more broadly. The most significant 3 businesses and transfer them to new owners as long as government officials think that the new owners fundamental rights—the right to will produce more money with the own property. Thus, protections land. As Justice O’Connor stated in against its abuse should be anchored of giving deference to legislative her dissenting opinion, the result is in state constitutions so that they determinations of public use, courts that “[t]he specter of condemnation will be secure from subsequent should make governments show hangs over all property. Nothing is attempts by cities, developers, and that they are using eminent domain to prevent the State from replacing others that benefit from eminent properly. any Motel 6 with a Ritz-Carlton, any domain abuse to weaken them. While other provisions—such home with a shopping mall, or any Of course, as noted above, as providing sufficient notice of farm with a factory.” blight is a device that allows local takings—are helpful in reform The Supreme Court did get one governments to abuse the power legislation, the components of thing right in Kelo: states are free to of eminent domain. Thus, any reform discussed above are the enact legislation that restricts the reform that fails to address the most important because they power of eminent domain. True issue of blight is inadequate and directly put the brakes on private- eminent domain reform should leaves home and business owners to-private transfers of property for start with states narrowing their at significant risk of being victims private gain. laws’ definitions of public use. of abuse. State legislatures should In this report card, we have State legislatures need to establish either eliminate the use of eminent evaluated the quality and strength that a public use means that the domain for blight or redefine the of reforms that have passed in government or the public at large term narrowly so that it refers only the states, both so that legislators owns, occupies, and has a definite to individual properties that directly can know what is left to do and so right to use property acquired threaten public health and safety. that citizens can find out if they by eminent domain. The use of Unless open-ended definitions are really protected from eminent eminent domain to transfer private of blight are changed, blight domain abuse. In grading reforms property from one party to another designations can be applied to any in this report card, we have taken for “economic development” should neighborhood—no matter how into account the criteria for good specifically be excluded as a public nice—that politically connected reform noted above, keeping in use. developers desire. mind the basic question, “How hard Ideally, state legislatures Also, since taking away is it now for the government to take should enshrine the above someone’s home or livelihood a person’s home or business and definition of public use not only is such a severe act, when the give it to someone else for private in their state laws, but also in government uses eminent domain, gain?” The states in which it is now their state constitutions. Eminent the burden should be on it to prove impossible or extremely difficult get domain affects one of our most a legitimate public use. Instead high marks; those in which it is easy get low marks. States that failed to pass any eminent domain reform received failing grades. �� 4 50state report card Castle Coalition LEGISLATION REPORT CARD State: Alabama • Original bill prohibited eminent domain for private development but left open the blight loophole. • The following year that loophole was closed. In the wake of the U.S. Supreme Court’s is deemed “obsolescent”—usually a code word decision in Kelo v. City of New London, Alabama for “We’d like to have something else here.” And was the very first state to react legislatively to if the property was condemned for blight, cities give its citizens stronger protections against could still turn it over to private interests. the use of eminent domain for private profit. House Bill 654 was passed in 2006 to pick Senate Bill 68 (2005) specified that eminent up where SB 68 leftI off,nc significantly. closing the domain could not be used for “private retail, blight loophole by narrowing the criteria by office, commercial, industrial, or residential which property could be designated as blighted. development; or primarily for enhancement Under HB 654, blight designations must be of tax revenue; or for transfer to a person, made on a property-by-property basis, which nongovernmental entity, public-private prevents vague and abusive blight designations partnership, corporation, or other business that cover an entire neighborhood. The criteria entity.” The language was a good start to to determine blight now ensure that only truly reforming the state’s eminent domain laws. unsafe or neglected properties can be acquired But while in one clause the law gave and then given to a private developer. home and small business owners, farmers, and Alabama has proved to be a national leader ranchers the substantial protection they deserve, in eminent domain reform. It is important to a different clause within the same law gave rise note, however, that statutory reforms are at risk to another threat to citizens’ property rights.

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