50state

Tracking Eminent Domain

Reform Legislation since Kelo

June 2007

1 Synopsis

5 Alabama . . . . . . . . . . . . . . .B+

6 Alaska . . . . . . . . . . . . . . . .D

7 Arizona . . . . . . . . . . . . . . . .B+

8 Arkansas . . . . . . . . . . . . . .F

9 California . . . . . . . . . . . . . .D-

10 Colorado . . . . . . . . . . . . . . .C

11 Connecticut . . . . . . . . . . . .F

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

& state grades

table of contents

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

50

50state report card

state

report card

Tracking Eminent Domain

Reform Legislation since Kelo

Tracking Eminent Domain Abuse Legislation since Kelo

n the two years since the U.S. Supreme Court’s now-infamous decision in Kelo v. City of New London, 41 states have passed new laws aimed at curbing the abuse of eminent domain for private use.

50state

Castle Coalition

report card

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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.

Open-ended blight designations provide a way for local governments to circumvent the public use requirement. The Kelo decision then obliterated the federal public use requirement by equating "public use" with "private use." Under Kelo, local governments can condemn homes and

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The Supreme Court did get one thing right in Kelo: states are free to enact legislation that restricts the power of eminent domain. True eminent domain reform should start with states narrowing their laws’ definition of public use. State legislatures need to establish that a public use means that the government or the public at large owns, occupies, and has a definite right to use property acquired by eminent domain. The use of eminent domain to transfer private property from one party to another for "economic development" should specifically be excluded as a public use.

In this report card, we have evaluated the quality and strength of reforms that have passed in the states, both so that legislators can know what is left to do and so that citizens can find out if they are really protected from eminent domain abuse. In grading reforms in this report card, we have taken into account the criteria for good reform noted above, keeping in mind the basic question, "How hard is it now for the government to take a person’s home or business and give it to someone else for private gain?" The states in which it is now impossible or extremely difficult get high marks; those in which it is easy get low marks. States that failed to pass any eminent domain reform received failing grades.�������������������������

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50state

Castle Coalition

report card

5Inc.

Alabama

In the wake of the U.S. Supreme Court’s decision in Kelo v. City of New London, Alabama was the very first state to react legislatively to give its citizens stronger protections against the use of eminent domain for private profit. Senate Bill 68 (2005) specified that eminent domain could not be used for "private retail, office, commercial, industrial, or residential development; or primarily for enhancement of tax revenue; or for transfer to a person, nongovernmental entity, public-private partnership, corporation, or other business entity." The language was a good start to reforming the state’s eminent domain laws.

But while in one clause the law gave home and small business owners, farmers, and ranchers the substantial protection they deserve, a different clause within the same law gave rise to another threat to citizens’ property rights. SB 68 prohibited cities and counties from using eminent domain for private development or for enhancing tax revenue, but it left an exception for the seizure of so-called blighted properties. This would have allowed property to be condemned under blight law if it might become blighted in the future, or if the property is deemed "obsolescent"—usually a code word for "We’d like to have something else here." And if the property was condemned for blight, cities could still turn it over to private interests.

That all changed with the Kelo decision, as the constitutional provision that everyone trusted to protect their most fundamental of rights was suddenly ambiguous. After all, once the federal Takings Clause was interpreted to allow eminent domain abuses, Alaskans realized that their state’s Takings Clause could be treated the same way. Under Kelo, since "public use" now also means "private use," Alaskans need more protection at the state level.

In 2006, HB 318 sailed through both legislative houses with unanimous support. The new law prohibits the use of eminent domain "to acquire private property from a private person for the purpose of transferring title to the property to another private person for economic development purposes." Unfortunately, this language does not provide property owners solid protection. In order to prevent authorities from taking private property from one person and turning it over to another private entity, states need to ban all private-to-private transfers (with a few narrowly tailored exceptions for common carriers and the like). By focusing on the intent behind the transfer, rather than the transfer itself, Alaska’s Legislature provided a ready-made excuse for authorities to say that a private transfer was not their purpose when they originally acquired the property.

Additionally, snowcats could still drive through the loophole of the state’s blight statute. Alaska’s vague definitions of "slum areas" and "blighted areas" are virtually identical to those that have been horribly exploited in many other states. As currently written, the factors to determine blight could apply to virtually any home. And since the designations are made by "area," only a few properties need to be blighted before officials can destroy an entire neighborhood.Inc.

The Arizona Legislature responded to Kelo by passing House Bill 2675 (2006), which was an extremely strong piece of blight reform legislation. The bill would have required a condemning authority to prove by "clear and convincing evidence" that a property is maintained in a slum condition, and blight designations could be made only on a property-by-property basis. It also prohibited the use of eminent domain for economic development. Unfortunately, however, the governor vetoed the bill.

Proposition 207 did not amend Arizona’s Slum Clearance and Redevelopment chapter, so extremely broad definitions of "blighted area" and "slum area" were not changed. But after the recent reforms, all eminent domain actions now require a judicial determination that the use is, in fact, "public." In the case of slum clearance and redevelopment, the government must present clear and convincing evidence that each and every targeted parcel poses a direct threat to the public, such that eminent domain is necessary to eliminate the threat. With these new protections, as well as heightened compensation requirements, the citizens of Arizona have fought back against eminent domain abuse and can worry less about developers and city officials kicking them out of their homes.Inc.

Unfortunately, when the legislature returned to session in 2007, it failed to pass any eminent domain reforms. Inc.

As citizens of an environmentally conscious state, Californians will be disappointed to know that the five eminent domain bills signed into law in 2006 were basically a waste of paper. In a state where thousands of properties have been threatened and/or condemned in the last decade, these bills scarcely hinder the rampant abuse of eminent domain.

In November 2006, Californians considered Proposition 90, a ballot initiative that, if passed, would have addressed property rights protections in the state constitution. Unfortunately, even that proposed amendment lacked the strong public use language necessary to ensure the security of homes, businesses, farms, and houses of worship. Probably because of a highly controversial provision on regulatory takings, the measure narrowly failed. Inc.

Even before the Supreme Court handed down its decision in Kelo, Colorado had an unfortunate history of municipalities abusing eminent domain for the benefit of wealthy private developers. In 2006, the Colorado General Assembly improved the state’s eminent domain laws by passing House Bill 1411, which amended the public use definition to "not include the taking of private property for transfer to a private entity for the purpose of economic development or enhancement of tax revenue" and stated that "Private property may otherwise be taken solely for the purpose of furthering a public use."

The General Assembly missed a golden opportunity, in that same session, when it considered but did not pass an amendment to the state constitution that would have prohibited the condemnation of private property for economic development. While the statutory protections it did eventually adopt will, for the time being, provide some increased protections from the government condemning people’s homes, businesses, farms, and places of worship—unless condemnors convince a court that the property is in fact blighted—those protections may eventually be stripped away if the public fails to guard carefully against those who can find personal gain through the abuse of eminent domain. Hopefully the legislature will revisit the possibility of a constitutional amendment and Coloradans will have the chance to provide themselves with the most enduring type of protections for their fundamental right to keep what they properly own.Inc.

Even though Connecticut is the state that gave us the Kelo case, the General Assembly failed to pass any meaningful eminent domain reform.

In 2006 the legislature managed to pass a bill that merely creates a property rights ombudsman, and then failed to fill the position for a year. At the end of the 2007 session, the General Assembly passed Senate Bill 167 with nearly unanimous support. The bill was easy to agree on because it does almost nothing to curb eminent domain abuse in Connecticut. The bill purports to stop condemnations "primarily" for economic development and requires municipalities to pass approval by a "super-majority." Unfortunately, SB 167 offers no substantive property rights protections because when cities are determined to see a project approved, they can easily assert an alternative "primary purpose" for a condemnation and are usually of one mind when it comes to voting. Even if the governor signs SB 167, Connecticut continue to have some of the most broad and easily abused eminent domain laws in the nation.Inc.

Although a condemning authority must declare its intended use for a property in advance of the condemnation, and is then limited to that specific use for the property, Delaware provides a sizeable catalog of public use options to pick from. The term is not clearly defined in state statutes and courts have succumbed to open-ended interpretations. In the wake of Kelo, Delaware’s laws could easily accommodate the use of eminent domain for private economic development. Until the legislature enacts substantive reform aimed at a limited definition of public use and forbidding condemnations for private use, Delaware home and business owners will remain very much at risk for eminent domain abuse.Inc.

LEGISLATION REPORT CARDInc.

House Bill 1313 (2006) counters the Kelo decision by providing that economic development is not a public use that justifies the use of eminent domain. Just as importantly, the bill significantly tightens the definition of blight in Georgia’s eminent domain laws. Now property can only be designated blighted if it meets two of six objective factors and "is conducive to ill health, transmission of disease, infant mortality, or crime in the immediate proximity of the property." The bill also requires government officials to evaluate blight on a parcel-by-parcel basis in order for the properties to be subject to condemnation for private development. No longer can entire areas be threatened with the wrecking ball based on the dilapidation of a few properties; now home and business owners can protect themselves by keeping their buildings well-maintained. The new law emphasizes, "Property shall not be deemed blighted because of esthetic conditions," and the government is given the burden of showing that a piece of property meets the criteria for blight. These changes go a tremendous way to protecting the freedoms of Georgia’s citizens.

House Resolution 1306 (2006) became a constitutional amendment that was approved by nearly 85 percent of the voters. Unfortunately, the constitutional amendment was only a minor procedural requirement that before eminent domain can be used for redevelopment, it must be voted on by elected officials. (In most cases of eminent domain abuse, elected officials vote; the point of constitutional protections is to prevent citizens’ rights from being voted away.) While any constitutional amendments strengthening property rights are good, Georgians would be better off if some of the strong reforms of HB 1313 made it into the state constitution.Inc.

Hawaii produced a key court case in the history of eminent domain authority expansion and abuse. In Hawaii Housing Authority v. Midkiff, the U.S. Supreme Court upheld an expansive definition of the "public use" provision, essentially reading the public use provision to mean "public purpose," as defined by the State Legislature.

Many bills were filed that attempted to address Kelo-style takings. Unfortunately, Hawaii missed the chance to be a national leader in restricting eminent domain abuse and the Legislature still needs to pass reform.Inc.

In the November 2006 election, the state had a citizen initiative, Proposition 2, on the ballot that contained the same meager reforms contained in HB 555, but with the added (and very controversial) element that would have limited regulatory takings. In the absence of meaningful protection against eminent domain abuse and with the added confusion of the regulatory takings measure, the amendment failed to pass.Inc.