U.S. House puts kibosh on eminent domain

[Dingfod]

Somewhat.

Originally Posted by AP

Conservative defenders of private property and liberal protectors of the poor joined in an overwhelming House vote to prevent local and state governments from seizing homes and businesses for use in economic development projects.

The House legislation, passed 376-38, was in response to a widely criticized 5-4 ruling by the Supreme Court last June that allowed eminent domain authority to be used to obtain land for tax revenue-generating commercial purposes.

Emphasis mine.

I can see the need for eminent domain in the case of public thoroughfares, public utilities, and the like. But who does a shopping mall primarily benefit? If cities, counties and even states can take land and hand it to private enterprise just because more tax revenues are generated, what is to stop them from taking your house and selling the property to McDonald's or Walmart. Certainly the sales tax revenues will more than replace the property taxes they get from your little shithole. What is the objection to a law limiting government's power of eminent domain?

[Godless Dave]

I hope this or something like it becomes law. This practice is rampant in my area, and often the new businesses don't generate much tax revenue because they are allowed to use Tax Increment Financing to "pay for" the land. It's even possible for them to generate less tax revenue than the business that was forced to sell to the government.

[Stephen Maturin]

Originally Posted by Warren

What is the objection to a law limiting government's power of eminent domain?

The main objections I've heard are (1) governments have always used eminent domain for economic development purposes and (2) given the revenue shortfalls local governments have suffered in the wake of the recession and rampant tax cutting, they have little choice but to pursue money by every means available. Neither objection is especially valid, IMO. Mere longevity doesn't render any practice necessary or desireable. As to the second objection, Godless Dave rightly notes that the revenue generated by this use of eminent domain is often much lower than anticipated.

A quick search of Thomas reveals a veritable assload of these bills currently floating through Congress. The one that the House just passed appears to have the biggest teeth. It reads as follows:

109th CONGRESS

1st Session

H. R. 4128

AN ACT

To protect private property rights.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Private Property Rights Protection Act of 2005'.

SEC. 2. PROHIBITION ON EMINENT DOMAIN ABUSE BY STATES.

(a) In General- No State or political subdivision of a State shall exercise its power of eminent domain , or allow the exercise of such power by any person or entity to which such power has been delegated, over property to be used for economic development or over property that is subsequently used for economic development, if that State or political subdivision receives Federal economic development funds during any fiscal year in which it does so.

(b) Ineligibility for Federal Funds- A violation of subsection (a) by a State or political subdivision shall render such State or political subdivision ineligible for any Federal economic development funds for a period of 2 fiscal years following a final judgment on the merits by a court of competent jurisdiction that such subsection has been violated, and any Federal agency charged with distributing those funds shall withhold them for such 2-year period, and any such funds distributed to such State or political subdivision shall be returned or reimbursed by such State or political subdivision to the appropriate Federal agency or authority of the Federal Government, or component thereof.

(c) Opportunity to Cure Violation- A State or political subdivision shall not be ineligible for any Federal economic development funds under subsection (b) if such State or political subdivision returns all real property the taking of which was found by a court of competent jurisdiction to have constituted a violation of subsection (a) and replaces any other property destroyed and repairs any other property damaged as a result of such violation.

SEC. 3. PROHIBITION ON EMINENT DOMAIN ABUSE BY THE FEDERAL GOVERNMENT.

The Federal Government or any authority of the Federal Government shall not exercise its power of eminent domain to be used for economic development.

SEC. 4. PRIVATE RIGHT OF ACTION.

(a) Cause of Action- Any owner of private property who suffers injury as a result of a violation of any provision of this Act may bring an action to enforce any provision of this Act in the appropriate Federal or State court, and a State shall not be immune under the eleventh amendment to the Constitution of the United States from any such action in a Federal or State court of competent jurisdiction. In such action, the defendant has the burden to show by clear and convincing evidence that the taking is not for economic development. Any such property owner may also seek any appropriate relief through a preliminary injunction or a temporary restraining order.

(b) Limitation on Bringing Action- An action brought under this Act may be brought if the property is used for economic development following the conclusion of any condemnation proceedings condemning the private property of such property owner, but shall not be brought later than seven years following the conclusion of any such proceedings and the subsequent use of such condemned property for economic development.

(c) Attorneys' Fee and Other Costs- In any action or proceeding under this Act, the court shall allow a prevailing plaintiff a reasonable attorneys' fee as part of the costs, and include expert fees as part of the attorneys' fee.

SEC. 5. NOTIFICATION BY ATTORNEY GENERAL.

(a) Notification to States and Political Subdivisions-

(1) Not later than 30 days after the enactment of this Act, the Attorney General shall provide to the chief executive officer of each State the text of this Act and a description of the rights of property owners under this Act.

(2) Not later than 120 days after the enactment of this Act, the Attorney General shall compile a list of the Federal laws under which Federal economic development funds are distributed. The Attorney General shall compile annual revisions of such list as necessary. Such list and any successive revisions of such list shall be communicated by the Attorney General to the chief executive officer of each State and also made available on the Internet website maintained by the United States Department of Justice for use by the public and by the authorities in each State and political subdivisions of each State empowered to take private property and convert it to public use subject to just compensation for the taking.

(b) Notification to Property Owners- Not later than 30 days after the enactment of this Act, the Attorney General shall publish in the Federal Register and make available on the Internet website maintained by the United States Department of Justice a notice containing the text of this Act and a description of the rights of property owners under this Act.

SEC. 6. REPORT.

Not later than 1 year after the date of enactment of this Act, and every subsequent year thereafter, the Attorney General shall transmit a report identifying States or political subdivisions that have used eminent domain in violation of this Act to the Chairman and Ranking Member of the Committee on the Judiciary of the House of Representatives and to the Chairman and Ranking Member of the Committee on the Judiciary of the Senate. The report shall--

(1) identify all private rights of action brought as a result of a State's or political subdivision's violation of this Act;

(2) identify all States or political subdivisions that have lost Federal economic development funds as a result of a violation of this Act, as well as describe the type and amount of Federal economic development funds lost in each State or political subdivision and the Agency that is responsible for withholding such funds;

(3) discuss all instances in which a State or political subdivision has cured a violation as described in section 2(c) of this Act.

SEC. 7. SENSE OF CONGRESS REGARDING RURAL AMERICA.

(a) Findings- The Congress finds the following:

(1) The founders realized the fundamental importance of property rights when they codified the Takings Clause of the Fifth Amendment to the Constitution, which requires that private property shall not be taken `for public use, without just compensation'.

(2) Rural lands are unique in that they are not traditionally considered high tax revenue-generating properties for State and local governments. In addition, farmland and forest land owners need to have long-term certainty regarding their property rights in order to make the investment decisions to commit land to these uses.

(3) Ownership rights in rural land are fundamental building blocks for our Nation's agriculture industry, which continues to be one of the most important economic sectors of our economy.

(4) In the wake of the Supreme Court's decision in Kelo v. City of New London, abuse of eminent domain is a threat to the property rights of all private property owners, including rural land owners.

(b) Sense of Congress- It is the sense of Congress that the use of eminent domain for the purpose of economic development is a threat to agricultural and other property in rural America and that the Congress should protect the property rights of Americans, including those who reside in rural areas. Property rights are central to liberty in this country and to our economy. The use of eminent domain to take farmland and other rural property for economic development threatens liberty, rural economies, and the economy of the United States. The taking of farmland and rural property will have a direct impact on existing irrigation and reclamation projects. Furthermore, the use of eminent domain to take rural private property for private commercial uses will force increasing numbers of activities from private property onto this Nation's public lands, including its National forests, National parks and wildlife refuges. This increase can overburden the infrastructure of these lands, reducing the enjoyment of such lands for all citizens. Americans should not have to fear the government's taking their homes, farms, or businesses to give to other persons. Governments should not abuse the power of eminent domain to force rural property owners from their land in order to develop rural land into industrial and commercial property. Congress has a duty to protect the property rights of rural Americans in the face of eminent domain abuse.

SEC. 8. DEFINITIONS.

In this Act the following definitions apply:

(1) ECONOMIC DEVELOPMENT- The term `economic development' means taking private property, without the consent of the owner, and conveying or leasing such property from one private person or entity to another private person or entity for commercial enterprise carried on for profit, or to increase tax revenue, tax base, employment, or general economic health, except that such term shall not include--

(A) conveying private property--

(i) to public ownership, such as for a road, hospital, airport, or military base;

(ii) to an entity, such as a common carrier, that makes the property available to the general public as of right, such as a railroad or public facility;

(iii) for use as a road or other right of way or means, open to the public for transportation, whether free or by toll;

(iv) for use as an aqueduct, flood control facility, pipeline, or similar use;

(B) removing harmful uses of land provided such uses constitute an immediate threat to public health and safety;

(C) leasing property to a private person or entity that occupies an incidental part of public property or a public facility, such as a retail establishment on the ground floor of a public building;

(D) acquiring abandoned property;

(E) clearing defective chains of title;

(F) taking private property for use by a public utility; and

(G) redeveloping of a brownfield site as defined in the Small Business Liability Relief and Brownfields Revitalization Act (42 U.S.C. 9601(39)).

(2) FEDERAL ECONOMIC DEVELOPMENT FUNDS- The term `Federal economic development funds' means any Federal funds distributed to or through States or political subdivisions of States under Federal laws designed to improve or increase the size of the economies of States or political subdivisions of States.

(3) STATE- The term `State' means each of the several States, the District of Columbia, the Commonwealth of Puerto Rico, or any other territory or possession of the United States.

SEC. 9. SEVERABILITY AND EFFECTIVE DATE.

(a) Severability- The provisions of this Act are severable. If any provision of this Act, or any application thereof, is found unconstitutional, that finding shall not affect any provision or application of the Act not so adjudicated.

(b) Effective Date- This Act shall take effect upon the first day of the first fiscal year that begins after the date of the enactment of this Act, but shall not apply to any project for which condemnation proceedings have been initiated prior to the date of enactment.

SEC. 10. SENSE OF CONGRESS.

It is the policy of the United States to encourage, support, and promote the private ownership of property and to ensure that the constitutional and other legal rights of private property owners are protected by the Federal Government.

SEC. 11. BROAD CONSTRUCTION.

This Act shall be construed in favor of a broad protection of private property rights, to the maximum extent permitted by the terms of this Act and the Constitution.

SEC. 12. LIMITATION ON STATUTORY CONSTRUCTION.

Nothing in this Act may be construed to supersede, limit, or otherwise affect any provision of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42 U.S.C. 4601 et seq.).

SEC. 13. RELIGIOUS AND NONPROFIT ORGANIZATIONS.

(a) Prohibition on States- No State or political subdivision of a State shall exercise its power of eminent domain , or allow the exercise of such power by any person or entity to which such power has been delegated, over property of a religious or other nonprofit organization by reason of the nonprofit or tax-exempt status of such organization, or any quality related thereto if that State or political subdivision receives Federal economic development funds during any fiscal year in which it does so.

(b) Ineligibility for Federal Funds- A violation of subsection (a) by a State or political subdivision shall render such State or political subdivision ineligible for any Federal economic development funds for a period of 2 fiscal years following a final judgment on the merits by a court of competent jurisdiction that such subsection has been violated, and any Federal agency charged with distributing those funds shall withhold them for such 2-year period, and any such funds distributed to such State or political subdivision shall be returned or reimbursed by such State or political subdivision to the appropriate Federal agency or authority of the Federal Government, or component thereof.

(c) Prohibition on Federal Government- The Federal Government or any authority of the Federal Government shall not exercise its power of eminent domain over property of a religious or other nonprofit organization by reason of the nonprofit or tax-exempt status of such organization, or any quality related thereto.

SEC. 14. REPORT BY FEDERAL AGENCIES ON REGULATIONS AND PROCEDURES RELATING TO EMINENT DOMAIN .

Not later than 180 days after the date of the enactment of this Act, the head of each Executive department and agency shall review all rules, regulations, and procedures and report to the Attorney General on the activities of that department or agency to bring its rules, regulations and procedures into compliance with this Act.

SEC. 15. SENSE OF CONGRESS.

It is the sense of Congress that any and all precautions shall be taken by the government to avoid the unfair or unreasonable taking of property away from survivors of Hurricane Katrina who own, were bequeathed, or assigned such property, for economic development purposes or for the private use of others.

[Abdul Alhazred]

Hear, hear! And no "party line" nonsense this time.

[Dingfod]

Not much "party line". The main objectors were Democrats who think it ties the hands of local and state governments, keeping them from instituting urban renewal in blighted areas.

[maddog]

Originally Posted by Warren

Not much "party line". The main objectors were Democrats who think it ties the hands of local and state governments, keeping them from instituting urban renewal in blighted areas.

That was what I was going to say. The theory which permits razing blighted tenements is the same behind Kelo. It's difficult to draw a principled distinction between them. You pays your money and you takes your choice. Most people find Kelo beyond the pale of their tolerance.

Liberals as well as conservatives believe in private property rights. Conservatives as well as liberals care about the poor.

I've always thought, for example, that the environmental restrictions which preclude a private owner from developing their property (e.g., b/c some endangered critter lives on the land) should have been construed as a "taking" and the owner compensated. I thought it was a bit disingenuous to say that the owner still retains enough rights for it not to be a "taking."
#594

[livius drusus]

That's a really good point, maddog. My parents have property the state of Connecticut considers protected wooded wetland (and in CT such large parcels are getting to be so rare it's heartbreaking, frankly). If I recall correctly, they had to go through some kind of process to get the land put in the right category, but once they did they got a tax break.

Developers are always making them offers, though, so clearly they have some way around wetland protections.

[Dingfod]

This issue has come to the forefront in the Tulsa area recently. A blighted area downtown, mostly abandoned warehouses and ramshackle empty storefronts, was taken over using eminent domain and handed over to a private developer to build a housing project. At least they put stipulations on the developer to include affordable and low income housing within the development. Even though brand new the new apartment homes have the look of an urban neighborhood, with a mix of large and small units throughout. It is an example of the good that can come out of eminent domain powers.

An eminent domain battle in downtown Tulsa took place to make room for a new arena, one which may or may not be needed or even fully utilized. The old one wasn't and isn't fully booked at this time. They declared a four block area blighted even though it was jam packed full of thriving businesses and fully utilized warehouses. It was a prime location next to the central post office, bus station, old civic center, federal building, county library, city-county offices and courthouse. One holdout didn't accept the "fair market" offer because it wasn't enough to even begin to replace the existing business. Then according to state law, it was supposed to go into mediation. Trying to stave this off the city made a counter offer almost twice their original offer. The owners made a slightly higher counteroffer which the city refused. It went to mediation where it was determined that, using the guidelines the city use to make offers to the other businesses affected, but which were not disclosed to the public, came up with a fair market value higher than the counteroffer. Too bad for the city, which was trying to steal the property, at least when we got a look at what they paid for some of the other properties owned by corporations and large mayoral campaign donors. It was an ugly battle, but at least it's a public owned structure being built. They really believe it will draw business downtown. Tulsa needs it, the downtown area is deader than a doornail after 5:00 PM.

Another ugly side of eminent domain came out when Tulsa County decided to rebuild an interchange south of Tulsa, condemned a bunch of rural properties in the name of that project, far more than they needed. Then they "sold" a couple hundred acre parcel over to a party that is supposedly going to build a shopping mall; as though Tulsa needs another shopping mall. There were several rural homeowners displaced by this, and even though compensated at "fair market value" they're mad as hell. They liked their rural lifestyle, yet close enough to the city to enjoy the benefits of that. To find comparable property they're probably going to have to move 10-15 miles further out or more. This is an example of a government entity using eminent domain to expand the tax base at the gain of private enterprise.

[viscousmemories]

The city of Arlington, Texas has condemned more than 3/4 of the houses on the land where they intend to build the new Dallas Cowboys stadium (story here), and despite the fact that they're still in 'negotiations' for other properties they've already started demolition and plan to break ground in five months. I wonder what (if any) effect this legislation will have on this project.

[Dingfod]

It's not the ruling as much as the bill just passed. If signed into law, the city of Arlington stands to lose any federal money they get for urban renewal projects or civic improvements. That's really the only punishment this law metes out. But, even then, a stadium owned by the city might be considered a public property even if the Dallas Cowboys has a long term lease and operating agreement. It might not stop this sort of project at all, but using eminent domain to transfer property to private enterprise for them to build a hotel complex, a shopping mall, or a private golf course are definitely what this bill has in mind.

[viscousmemories]

Sorry, I changed 'ruling' to 'legislation' shortly after I posted because I caught my poor phrasing. Thanks for clarifying the difference between public/private concerns, I hadn't caught that.

[godfry n. glad]

Originally Posted by viscousmemories

The city of Arlington, Texas has condemned more than 3/4 of the houses on the land where they intend to build the new Dallas Cowboys stadium (story here), and despite the fact that they're still in 'negotiations' for other properties they've already started demolition and plan to break ground in five months. I wonder what (if any) effect this legislation will have on this project.

If it's already underway, I don't this this legislation will have any effect on it anyway. You cannot retroject the law back into time.

[Dingfod]

Why not? They enact retroactive taxes or tax refunds sometimes.

[viscousmemories]

Besides, some of the cases are still pending.

From the article:

The owners of two dozen tracts agreed to sell to the city only after their land was condemned. That's a little less than half of the 55 properties the city has bought in the past several months.

Even after condemnation proceedings were dropped against those 24 properties, the city still has eminent domain cases pending against 88 other properties it needs to buy.

[Stephen Maturin]

Originally Posted by viscousmemories

I wonder what (if any) effect this legislation will have on this project.

In all likelihood, none. Section 9(b) specifies that the bill doesn't apply to any cases in which condemnation proceedings were commenced before the bill's enactment.* If this bill or something close to it gets close to making it all the way through Congress, we'll see city and county attorneys thoughout the country scrambling to courthouses to get their cases filed before the enactment date.

*It appears that the bill is partially retroactive in that it applies to condemnation proceedings commenced after enactment but before the bill's effective date.