Archive | Post-Kelo Reform

Proposed California Referendum Initiative Would Make it Even Easier to Declare Property “Blighted” and Condemn it

Timothy Sandefur of the Pacific Legal Foundation has a good post outlining the the dangers posed by a California ballot question drafted by local governments interested in expanding their already very broad power to condemn property:

[J]ust before Christmas, the law firm of Rutan & Tucker—the leading California law firm for cities that want to steal your land for redevelopment—filed a new ballot initiative [that]… would bring back redevelopment as the “Jobs and Education Development Initiative.” But what’s even more remarkable is how it would expand the power of eminent domain even further than California’s already extremely broad Redevelopment Law allows. Indeed, if this initiative were to pass, it would essentially declare the whole state of California “blighted….”

Quick background: to take property for redevelopment, a local redevelopment agency (typically the City Council) has to declare an area “blighted.” They don’t have to declare each structure to be blighted—they can condemn whole neighborhoods, including perfectly adequate property, if lots down the street or around the corner are “blighted.” And what is the definition of “blight”? The Redevelopment Law contains two lists of factors (“physical” and “economic”), and the officials have to declare that one item from each list is present. That’s all. And the factors are already very vague. My personal favorite is “conditions that prevent or substantially hinder the viable use or capacity of buildings or lots.” What does that mean? It means whatever the government says it means.

That’s the current law. It is already so bad that practically any property in the state can be declared blighted if local officials want to do it. What the new initiative would do is expand these two lists even more.

For example, it changes “conditions that prevent or substantially hinder the viable use or capacity of buildings or lots” to

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Upcoming Federalist Society Faculty Conference Presentation on my Next Book – The Grasping Hand: Kelo v. City of New London and the Limits of Eminent Domain

Next week, on Friday, January 3, between 5 and 6:15 PM, I will be doing a presentation on my next book, tentatively entitled The Grasping Hand: Kelo v. City of New London and the Limits of Eminent Domain at the Federalist Society’s annual faculty conference. This will be a preview of the book, which will be the first book-length treatment by a legal scholar of Kelo v. City of New London – one of the most controversial decisions in the modern history of the Supreme Court, and the important constitutional property rights issues it raises. The book considers Kelo from the standpoint of both originalist and living constitution theory, and also has the most complete analysis to date of the enormous political reaction that Kelo generated. I have completed a first draft of the book, but will be making revisions over the coming months.

The Federalist Society conference will be held in parallel with the annual AALS conference nearby. I will be presenting as part of a panel focusing on works in progress. If you are coming to the AALS conference and are interested in constitutional theory, property rights issues, or eminent domain, I hope you will consider dropping by. Legal blogosphere mavens may be interested to know that Dan Markel of Prawfsblawg, a leading criminal law scholar, will be presenting a paper as part of the same panel.

UPDATE: In the initial version of this post, I accidentally forgot to include a link to the Fed Soc faculty conference’s website. I have now fixed that problem. [...]

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Philadelphia Condemns Artist’s Studio to Build a Supermarket and Parking Lot

Nick Sibilla of the Institute for Justice has a good article on the City of Philadelphia’s dubious efforts to condemn a successful artist’s studio in order to transfer it to a new private owner that would build a supermarket and parking lot on the site. This scheme isn’t quite paving paradise to put up a parking lot. But it’s almost equally egregious:

James Dupree has been celebrated around the world for his art. But now he is being condemned by the city of Philadelphia—literally.

His art has been shown at many museums, including the Philadelphia Museum of Art, the Pennsylvania Academy of Fine Arts…

But the city of Philadelphia has other plans for his property. In November 2012, the Philadelphia Redevelopment Authority (PRA) was authorized to acquire 17 properties to build a supermarket in Mantua. According to the redevelopment plans, the PRA wants to bulldoze Dupree’s studio to make room for the privately-owned grocery store and its parking lot. No tenant has been identified yet, but the supermarket project has received $2.75 million in state subsidies….

Dupree estimates professionally moving his oeuvre would cost at least a quarter of a million dollars. So just relocating his vast collection actually costs more than what he originally paid for the building.

Transforming a broken-down garage and warehouse into a top-notch art studio was no easy feat. “When I purchased the property, it was basically condemnable,” he said. The roof leaked when it rained. The plumbing and electrical were “next to nil.”

“I invested everything I owned into this property…I was basically broke,” Dupree remarked. The property itself cost a little under $200,000. Installing new electrical and plumbing: $60,000. Fixing the roof was another $68,000. Thousands more were spent on renovations, furnishings and appliances.

But Dupree sensed the property at 3617-21 Haverford

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New Jersey Adopts Dubious Post-Kelo Eminent Domain “Reform” Law that is Likely to Endanger Property Rights More than it Protects Them

New Jersey recently became the 45th state to adopt an eminent domain reform law in the aftermath of the Supreme Court’s controversial 2005 decision in Kelo v. City of New London, which ruled that it was constitutionally permissible for government to condemn private property and give it to another private owner in order to promote “economic development.” Unfortunately, as John Ross of Reason explains, the new law does not actually impose any meaningful constraints on the use of eminent domain, and may even actually promote abusive “blight” condemnations:

The law purports to do two things: first, codify a 2007 New Jersey Supreme Court ruling favorable to property owners and, second, decouple eminent domain from redevelopment subsidies. It fails miserably at both.

When local officials declare that an area is blighted and “in need of redevelopment,” the designation both allows them to offer economic development incentives and authorizes the use of eminent domain. But sometimes officials honestly don’t want to seize anyone’s property; they just want the ability to offer subsidies to developers.

But officials cannot credibly promise not to condemn property once it has been declared blighted. Officials can change their minds. And the next city council isn’t bound by past promises….

Decoupling the incentives from condemnation would remove the threat. And the law appears to do just that, allowing for the creation of “non-condemnation redevelopment areas.” But the law lets officials transform a non-condemnation area into a condemnation area if property owners refuse to sell….

The law also muddies the issue of blight.

In Gallenthin v. Paulsboro, the New Jersey Supreme Court held that before cities can seize property for private development, officials must show “substantial evidence” the property is blighted.

Prior to Gallenthin, municipal officials could claim a variety of vague, subjective conditions like

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Eminent Domain and the Decline of Detroit

Detroit’s sixty year decline, culminating in its recent bankruptcy, has many causes. But one that should not be ignored is the city’s extensive use of eminent domain to transfer property to politically influential private interests. For many years, Detroit aggressively used eminent domain to promote “economic development” and “urban renewal.” The most notorious example was the 1981 Poletown case, in which some 4000 people lost their homes, and numerous businesses were forced to move in order to make way for a General Motors factory. As I explained in this article, the Poletown takings – like many other similar condemnations – ended up destroying far more development than they ever created. In his prescient dissent in Poletown, Michigan Supreme Court Justice James Ryan warned that there was no real reason to expect that the project would produce the growth promised by GM and noted that Detroit and the court had “subordinated a constitutional right to private corporate interests.”

Eminent domain abuse certainly wasn’t the only cause of Detroit’s troubles. But the city’s record is a strong argument against oft-heard claims that the use of eminent domain to transfer property to private economic interests is the key to revitalizing economically troubled cities. In addition to the immediate destruction and dislocation caused by such takings, they also tend to deter investment by undermining confidence in the security of property rights. One of the main findings of recent scholarship in development economics is that secure property rights are an important factor in promoting long-term economic growth. As economists Daron Acemoglu and James Robinson put it in their much-praised recent book Why Nations Fail, “secure private property rights are central [to development], since only those with such rights will be willing to invest and increase productivity” (pg. 75). Detroit is [...]

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The Case for Federal Eminent Domain Reform

Nick Sibilla of the Institute for Justice, the libertarian public interest firm that litigated Kelo v. City of New London and many other property rights cases, has a good op ed in Forbes on the need for reform measures to curb federal funding of abusive condemnations by state and local governments:

Eight years ago, the U.S. Supreme Court ruled the city of New London, Conn., could use the power of eminent domain to seize an entire neighborhood…. The city justified this as a “public use” by claiming the development might increase tax revenue and jobs.

Americans were—and still are—outraged by this decision. Since Kelo v. New London, 44 states have passed some type of eminent domain reform…..

Despite this well-deserved backlash to the Supreme Court, eminent domain abuse still festers. Six states have failed to pass any type of reform….

Meanwhile, in states that have reformed eminent domain laws, municipal governments and developers have exploited loopholes. For example, some of these reforms still allow seizing property that has been declared “blighted.” Unsurprisingly, blight can be very broadly defined….

While many redevelopment projects are funded through state and local measures, federal grants are still being used to fund eminent domain abuse. Cedar Rapids, Iowa, received a $35 million grant from the Department of Commerce’s Economic Development Administration (EDA) to seize a hotel for a new convention center. At the time, it was the “largest discretionary grant” ever doled out by the EDA. In fact, that same bureaucracy was also responsible for granting $2 million to the redevelopment project that threatened Susette Kelo’s little pink house….

To that end, Congressman Jim Sensenbrenner (R-WI) has reintroduced the Private Property Rights Protection Act, which was recently passed by the House Judiciary Committee. If the act passes, a state or political subdivision that exercises

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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

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The Ongoing Saga of the Private Property Rights Protection Act

Last week, the House Judiciary Committee passed the Private Property Rights Protection Act, which would prevent local governments that engage in Kelo-style economic development takings from receiving federal economic development funds. As I explained in a post last year (which explains the bill in more detail), this legislation has been kicking around Congress since 2005. At various times, it has passed the House only to die in the Senate. If it finally passes both houses this time around, it will be a useful, though limited step towards disincentivizing abusive takings that transfer property to powerful private interests, often without actually producing the promised economic benefits for the region.

Why has the PRPA failed to pass for so long, despite overwhelming public opposition to Kelo-style takings? Various factors play a role. But a big one is political ignorance, of the same type that has led to enactment of many ineffective “reforms” at the state level. Most voters are unaware of the PRPA and don’t keep track of its legislative fortunes.Most voters are rationally ignorant and and devote only a very limited amount of time and effort to following political issues. Since the PRPA is not one of the top handful of issues on the political agenda, the public knows little about it and Congress can sit on it for years with little fear of punishment at the ballot box. Meanwhile, many local governments go on taking property for the benefit of private interest groups, while at the same time also collecting federal economic development funds. This is just one relatively small example of the broader problem of political ignorance discussed in my forthcoming book Democracy and Political Ignorance. [...]

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Interesting Missouri Supreme Court Decision Interpreting the State’s Post-Kelo Eminent Domain Reform Law

The Supreme Court of Missouri recently issued Missouri Ex. Rel. Jackson v. Dolan, an important decision interpreting the state’s post-Kelo eminent domain reform law, which bans the use of eminent domain to condemn property for “solely economic development purposes.” As Robert Thomas points out at the Inverse Condemnation Blog, the ruling gives the statute more bite in constraining eminent domain than most experts (myself included) expected it to have.

In the aftermath of the federal Supreme Court’s unpopular decision in Kelo v. City of New London, which ruled that the federal constitution permits economic development takings, 44 states adopted eminent domain reform laws that supposedly restricted such condemnations. Unfortunately, many of the new laws do little to actually constrain the use of eminent domain authority, often allowing the same old takings to continue under other names. Most commentators believed that the Missouri law was one such ineffectual reform, because, as Thomas explains, “it would seem that all a condemnor need do is throw in another reason — in addition to economic development — and it would be off the hook.” As he points out, courts in other states that ban takings “solely” or “primarily” for economic development have accepted such circumvention. In Jackson, however, the Missouri Supreme Court struck down a condemnation that, in addition to promoting economic development, would also supposedly enhance port facilities and “improve” river commerce. The Court ruled that these alternative rationales were not genuinely different from economic development because “”[t]he record demonstrates that the only manner in which the taking will ‘improve river commerce’ is by drawing more economic development into the area” and that any enhancement of port facilities would be of value only because it too promotes development.

Thomas is right that this ruling could potentially constrain economic development [...]

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Illinois Senate Passes Bill Authorizing the Use of Eminent Domain to Take Property for Casinos

The Institute for Justice, a leading libertarian public interest law firm that has litigated numerous property rights cases, reports that the Illinois state senate has passed a bill authorizing the use of eminent domain for the benefit of casinos:

The bill passed 32-20 in the state Senate on May 1 and is now being considered by the House Executive Committee. Gov. Pat Quinn has previously vetoed two Chicago casino bills in the past. However, while the governor still has concerns about this new casino bill, he has indicated he could sign, so long as gambling revenue funds education and ethics standards are tightened. (After all, four of Illinois’ last seven governors have gone to prison.) Yet casinos abusing eminent domain apparently hasn’t crossed Quinn’s mind.

As the IJ post notes, takings for the benefit of casino interests have occurred in other states, and often lead to the same sorts of abuses as other “economic development” condemnations of the type upheld by the federal Supreme Court in Kelo v. City of New London. Such takings are routinely used by politically powerful firms to acquire property from the politically weak. They also often destroy more economic value than they create. I discuss these problems in much more detail in this article.

In the aftermath of Kelo, some 44 states passed eminent domain reform laws intended to curb such abuses. But Illinois’ law is one of many that contain major loopholes that prevent them from providing much in the way of meaningful protection for property owners. The IJ post notes that Illinois’ 2006 law rates only a D+ under their grading scale.

Hopefully, the Illinois House of Representatives will reject the Senate bill. The legislation is currently before the House Executive Committee. If the House does not reject [...]

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Don’t Believe the Denials – Alabama Really Did Undermine its Post-Kelo Eminent Domain Reform Law

Last week, I blogged about how the Alabama state legislature recently adopted a bill that undermines its post-Kelo eminent domain reform law and opens the door to the taking of private property for transfer to a wide range of politically connected private interests. Two state senators who sponsored the law have claimed that their bill doesn’t really expand eminent domain authority [HT: John Ross, who is similarly skeptical about the sponsors’ denials]:

A new law designed to help lure high-tech manufacturing jobs to Alabama does not give cities greater eminent domain powers, several people involved in the legislation said Monday….

state Sen. Arthur Orr, R-Decatur, said that’s simply not the case. Orr said the “Major 21st Century Manufacturing Zone Act” does nothing to change or broaden eminent domain laws….

State Sen. Bill Holtzclaw, R-Madison, said he is “very big on personal property owner rights” and would not have co-sponsored the legislation if he thought it might be used to expand the use of eminent domain.

“I’ve been adamantly opposed to that,” Holtzclaw said Monday. “If there’s something there that was unintentional, we’ll close the loop on it.”

These denials are dubious, at best. The relevant legislation, Senate Bill 96 contains the following language:

It is further found and declared that the powers conferred by this chapter are for public and, in the case of automotive, automotive-industry related, aviation, aviation-industry related, medical, pharmaceutical, semiconductor, computer, electronics, energy conservation, cyber technology, and biomedical industry manufacturing facilities, private uses and purposes imbued with a public interest and for which public money may be expended, either directly or indirectly, in the case of automotive, automotive-industry related, aviation, aviation-industry related, medical, pharmaceutical, semiconductor, computer, electronics, energy conservation, cyber technology, and biomedical industry manufacturing facilities, and the power of eminent domain and police

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Alabama Undermines its Post-Kelo Eminent Domain Reform Law

In the aftermath of the Supreme Court’s controversial 2005 decision in Kelo v. City of New London, which ruled that state and local governments could condemn property for transfer to private parties for “economic development,” 44 states passed eminent domain reform laws intended to curtail abusive condemnations. Many of the new laws only pretended to curb the use of eminent domain without actually doing so. But Alabama was one of the exceptions, passing one of the nation’s better post-Kelo reforms. Unfortunately, as John Ross of Reason explains, the Alabama state legislature has now largely reversed its post-Kelo reform law, opening the door for condemnations that benefit powerful private interests at the expense of the poor and politically weak:

This month, Alabama Governor Robert Bentley signed into law a bill that allows local officials to condemn private property and turn it over to private developers.

Alabama’s statutes had contained some of the best protections in the nation for property owners; officials couldn’t seize property for private development unless it was a true threat to human health and safety.

Welcome back to the bad old days.

Advertised as a tool to attract industry to Alabama, the new law (the Major 21st Century Manufacturing Zone Act) expands tax subsidies for companies that open a manufacturing facility of at least 250 acres. It also allows municipal officials to seize property for “private uses and purposes imbued with a public interest” like auto factories, biomedical facilities, and pharmaceutical plants.

Officials can now condemn property they deem “blighted,” which, since the statutory definition of the term is so subjective, could be nearly any property.

As I discuss in this article, such “economic development” takings not only often victimize the politically weak for the benefit of powerful private interests, but also [...]

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How I Became a (Minor) Victim of Academic Plagiarism

Today, the Baltimore Sun published a detailed story about Towson University Professor Benjamin Neil, who has been accused of numerous instances of plagiarism, especially in a 2012 article on Kelo v. City of New London and post-Kelo eminent domain reform which has since been withdrawn by the Journal of Academic and Business Ethics:

A longtime Towson University professor has resigned his post as the head of the city school system’s ethics panel amid allegations that his published academic articles contain content from dozens of sources without proper — or in some cases any — attribution.

University officials and journal publishers say they are reviewing several articles submitted by Benjamin A. Neil, a legal affairs professor, after a librarian at another university alerted them to the issue.

A Baltimore Sun review of five papers published by Neil shows passages with identical language and others with close similarities to scholarly journals, news publications, congressional testimony, blogs and websites. In many cases, there was no attribution.

Neil, who has taught at Towson for more than 20 years, says he properly attributed work from other authors.

“I don’t think I’ve done anything wrong,” said Neil, 62. “The issue seems to be that I didn’t put things in quotes. But I’ve given attribution to people….”

Meanwhile, some of his colleagues across the country and authors of the original material who were contacted by The Sun criticized what they called “lazy plagiarism” and a breach of academic integrity. Experts say the incident highlights the pressures that professors feel to publish.

“It’s completely unacceptable conduct, particularly for a professor,” said Jeffrey Beall, a scholarly initiatives librarian at the University of Colorado, Denver who contacted Towson officials and journals about the alleged plagiarism.

It so happens that I was one of the scholars whom Neil plagiarized [...]

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University of Michigan Law School Talk on Property Rights Since Kelo

On Thursday, March 14, I will be giving a talk on “Property Rights Since Kelo” at the University of Michigan Law School. The event will run from 11:45 to about 12:50.

I will cover both the legislative and judicial reactions to the Supreme Court’s controversial 2005 decision in Kelo v. City of New London, which ruled that the Fifth Amendment allows government to take property from one private owner and give it to another simply on the basis that the new owner might promote “economic development” in the area. Much has happened since Kelo, which generated the broadest legislative reaction of any decision in Supreme Court history, with 44 states and the federal government passing eminent domain reform laws in its wake. While important progress has been made in protecting property owners, much remains to be done.

University of Michigan property Professor James Krier, coauthor of the widely-used Dukeminier and Krier property law textbook, will comment on my talk. The event is sponsored by the University of Michigan Law School Federalist Society. [...]

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Talk on Kelo and Post-Kelo Eminent Domain Reform at South Texas College of Law

This Thursday at 5 PM, I will be speaking on Kelo v. City of New London and post-Kelo eminent domain reform at South Texas College of Law in Houston. The talk will be held in the Emile Slohm conference roomon the 6th Floor, and is sponsored by the South Texas Federalist Society.

I will will cover both Kelo itself, and the massive political and judicial reaction it has generated. South Texas property professor Josh Blackman, who is also a prominent legal blogger, will provide commentary. [...]

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