New Jersey Legislature Passes Ineffective Eminent Domain “Reform” Law

New Jersey is one of only six states that have not enacted an eminent domain reform law since the the Supreme Court’s controversial 2005 decision in Kelo v. City of New London, which ruled that state and local governments have the power to condemn private property and transfer it to other private interests in order to promote “economic development.” Last week, the state legislature finally did pass a reform law. Unfortunately, as John Ross explains, that law won’t actually do much to prevent eminent domain abuse:

This week, New Jersey lawmakers sent legislation to Governor Chris Christie that would reform the state’s eminent domain laws. If Christie signs, New Jersey would become the 45th state to pass reforms since the U.S. Supreme Court ruled against homeowners in Kelo v. New London in 2005.

Unfortunately, the legislation provides scant protections for property owners. The companion bills (S-2447 and A-3615) each allow local officials wide latitude to declare property blighted, which authorizes the use of eminent domain for private redevelopment projects….

The bills do provide for “non-condemnation redevelopment areas,” which allow developers to access the subsidies that come with a redevelopment designation—without granting eminent domain….

But, weirdly, the bills allow for turning a non-condemnation area into a condemnation area when a property owner is unwilling to sell to officials’ preferred developer. Sort of negates the whole point.

The legislation purports to codify a 2007 state Supreme Court ruling that made it more difficult to declare property blighted. Paulsboro officials had argued that their belief that a piece of land was not being put to the best and highest use was enough to warrant a blight designation. The judges disagreed.

But it will remain very easy for officials to label an area blighted. If an unstated number of properties in a neighborhood exhibit “faulty arrangement or design,” “excessive land coverage,” “obsolete layouts,” “diverse ownership,” or other criteria that have nothing to do with public health and safety, officials can create a condemnation area.

As Ross points out, New Jersey has a long history of abusive takings, though there have been fewer in recent years, in part due to the financial crisis and recession. Economic development and “blight” condemnations routinely transfer property to politically influential groups at the expense of the poor and politically weak, and then fail to produce the economic gains that supposedly justified the use of eminent domain in the first place.

Unfortunately, New Jersey is far from the first state whose post-Kelo eminent domain reforms purport to protect property owners without actually doing so. Some states have enacted genuine reforms. But, as I discuss in this article, numerous others have also passed ineffective laws, many of which – like New Jersey’s – include broad definitions of “blight” that allow almost any property to be designated as blighted and condemned on that basis. Although there is overwhelming public opposition to Kelo-style takings, many state legislatures have taken advantage of widespread political ignorance by pretending to address the problem without actually doing so.

UPDATE: The text of New Jersey Senate Bill 2447 is available here.

UPDATE #2: I should, add, as I have said previously, that I am not claiming that economic development takings are a bad idea merely because the vast majority of the public opposes them, or even that public opposition strengthens the case against them more than very slightly. As the author of a book decrying widespread political ignorance, I can hardly claim that I am right about an issue because I happen to have public opinion on my side. The interesting point about public opinion and post-Kelo reform is not that the public’s view proves that economic development takings should be banned, but that political ignorance has helped enable many state legislatures to avoid enacting effective reforms despite overwhelming public support for them. This is deplorable because these kinds of takings are bad for reasons independent of public sentiment. It is a striking example of how public ignorance can sometimes cause harm even in a case where majority public opinion is actually right about an issue.