Real Estate & Property Law

Kelo Reality Check: "Belief" And "Hope" Aren't All They're Cracked Up To Be

By Robert Thomas (inversecondemnation.com)

Justice Stevens' majority opinion in Kelo v. City of New London, 545 U.S. 469 (2005) held the government's public use determination is off-limits if the determination was the result of a "comprehensive plan," regardless of whether than plan has any realistic chance of actually being accomplished. Thus, property owners can be forcibly dispossessed of their homes based merely on the government's "belief"  and "hope" a plan will succeed:

The City has carefully formulated an economic development plan that it believes will provide appreciable benefits to the community, including?but by no means limited to?new jobs and increased tax revenue. As with other exercises in urban planning and development, the City is endeavoring to coordinate a variety of commercial, residential, and recreational uses of land, with the hope that they will form a whole greater than the sum of its parts. To effectuate this plan, the City has invoked a state statute that specifically authorizes the use of eminent domain to promote economic development. Given the comprehensive character of the plan, the thorough deliberation that preceded its adoption, and the limited scope of our review, it is appropriate for us, as it was in Berman, to resolve the challenges of the individual owners, not on a piecemeal basis, but rather in light of the entire plan. Because that plan unquestionably serves a public purpose, the takings challenged here satisfy the public use requirement of the Fifth Amendment.

For a reality check, see Professor Gideon Kanner's guest column in the National Journal: "The New London Disaster: Why the Supreme Court's 'Kelo' Decision Was A Waste." An excerpt:

The city's contention was characterized by the Connecticut Supreme Court, as well as the U.S. Supreme Court, as an effort "projected to create in excess of 1,000 jobs, to increase tax and other revenues, and to revitalize an economically distressed city, including its downtown and waterfront areas." New London's lawyer took the position in oral argument that even if the city were to take a Motel 6 to replace it with a Ritz Carlton in order to generate higher tax revenues, that would be a permissible "public use." The court's majority agreed, thus deferring entirely to the judgment of municipal redevelopment agency functionaries, and de facto allowing them to pass judgment on the constitutionality of their own handiwork. Thus, it was the perceived quality of the town's redevelopment plans that carried the day.

But as the Kelo case wended its way through the courts, the city's vaunted plans began unraveling. By the time oral arguments were heard by the Supreme Court in April 2005, the proposed five-star hotel that would cater to Pfizer's conjectured upscale guests was scrubbed. It went downhill from there. Even though the redevelopment project was begun in 2000, and the court ruled in favor of the town in 2005, nothing has been done on the ground after the taken neighborhood was razed, except for an attempt to create a Coast Guard museum, which ran out of funds and had to be abandoned. By degrees, the 90-acre tract of waterfront land that comprised the redevelopment area became a trash-strewn, weed-infested urban wasteland. The latest dispatch from New London's newspaper, The Day, reported that the site is becoming a favorite of birds and bird watchers.

Recall that at one point, one of the players on the City's side actually blamed the objecting property owners for killing the project, and as noted in Professor Kanner's column, the site is reverting to its natural state.

Full post as published by inversecondemnation on September 01, 2009 (boomark / email).