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Call it the post- Kelowave. Just five weeks after the U.S. Supreme Court upheld the use of eminent domain to seize private property for economic development, more than half of the states have introduced legislation to thwart potential abuses. Since the June 23 ruling in Kelo v. City of New London, 125 S. Ct. 2655, lawmakers in 28 states have introduced more than 70 bills. But while most lawmakers agree on the nature of the problem, their solutions vary from state to state. Legislators in Texas, Florida, Oklahoma, New Jersey and Michigan are mobilizing to support state constitutional amendments prohibiting eminent domain for private development. In California, which has some of the strictest proposed legislation, two bills would prohibit the exercise of eminent domain for private use under any circumstances, while lawmakers in Texas, Minnesota, Delaware and Connecticut would simply limit the use of eminent domain for private projects or tighten eminent domain procedures. “The [ Kelo] decision touched off a firestorm of outrage across the country,” asserted Dana Berliner, senior attorney with the Institute for Justice, a libertarian public interest law firm in Washington. “Ordinary citizens, I think, never realized that their homes and businesses could be taken from them because somebody else with more money wanted to move in there . . . .I think very few people realized how out of control matters had gotten in the courts.” But attorneys representing municipalities and private developers in eminent domain cases hailed the high court’s ruling, maintaining that eminent domain is essential to economic development, and that critics of the ruling are overreacting. “I think the property rights advocates are just way off base,” said attorney Mark Zausmer of Zausmer, Kaufman, August & Caldwell in Farmington Hills, Mich., who has represented municipalities in eminent domain disputes in Michigan. “I think that the idea that economic development is not a function of government is ridiculous . . . .[Eminent domain] is just a tool for economic development,” he added. While opinions on eminent domain vary, one thing is for sure: The issue is not going to go away. According to the Institute for Justice, more than 10,000 properties were threatened or taken by eminent domain between 1998 and 2002. The group claims that thousands of properties are still facing the threat of eminent domain for private development. ‘Pushing the envelope’
Post-’Kelo’ activity How states are acting to restrict eminent domain powers: Alabama, California, Florida, Louisiana, Michigan New Jersey, Ohio and Texas—currently proposed or are drafting state constitutional amendments prohibiting the use of eminent domain for private development. Georgia—bill would prohibit using eminent domain for the purpose of “improving tax revenue.” Alabama—bill would prohibit using eminent domain for “retail, office, commercial or residential development.” Texas—bills include one that calls for a “constitutional amendment to prohibit…taking private property for the primary purpose of economic development.” Massachusetts—bill would prohibit the taking of property for private economic development “unless the property is a blighted area.” Rhode Island—bill urges the U.S. Congress to, among other things, nullify the Kelo decision. Connecticut—called for a moratorium on the use of eminent domain by all Connecticut cities until the legislature can revise the law to protect property owners.

Many state legislators argue that municipalities have gone too far in exercising their eminent domain powers. It’s not about building schools, roads and bridges anymore, they argue, but about bringing in WalMarts and Costcos that can generate hefty tax revenues. “I think we’ve pushed the envelope on the original concept of eminent domain to an untenable point,” said Colorado state Representative Al White, who is drafting a constitutional amendment to prevent local governments from taking private property for private development. White, a Republican from Winter Park, Colo., said there have been a few efforts to seize land for private development in Colorado. One city considered condemning land to build a WalMart. Another attempted to take property for a toll road. “I think the ruling from the Supreme Court validated what these entities had tried but had ultimately backed away from,” White said. “With that kind of Supreme Court validation, I feel certain that without some correctness of the law, we’ll be facing it once again.” Ohio state Senator Kevin Coughlin agreed, saying that the recent high court ruling sounded an alarm for legislators nationwide who scrambled to protect property owners’ rights. “It’s on the minds of legislators all over the country, there’s no doubt about that,” said Coughlin, who is circulating a bill to block state funds to municipalities that take for economic development private property that is not considered blighted. “The idea that you would take a block of homes and let some other private owner put a hotel on it because it would generate more tax revenue is pushing it too far and the court has basically allowed that,” Coughlin said. “I think that the framers never intended for eminent domain to be used for that purpose or for that to be considered a public use.” And now the states are wrestling with that very legal question. In California, for example, state Senator Tom McClintock has proposed a constitutional amendment that would “prohibit the use of eminent domain for private use under any circumstances.” “To take one person’s property and give it to another-there’s a word for it. It’s a simple word. It’s called theft,” said McClintock, arguing that the Kelodecision “shredded” people’s property rights. Meanwhile, seven states-Connecticut, Delaware, Texas, Massachusetts, Minnesota, New Jersey and Rhode Island-have proposed limiting the use of eminent domain for private projects or tightening eminent domain procedures. The proposed limitations in those states would still allow the taking of property for economic development, but only under certain circumstances. Massachusetts, for example, would prohibit using eminent domain for private development “unless the property is a blighted area.” An Alabama measure would prohibit using eminent domain for “retail, office, commercial or residential development.” Trial attorney Vincent Bartolotta, who represents plaintiffs in condemnation matters in Southern California, hailed the legislative action taking place. “There should be one hell of an outcry and I hope everybody keeps it up,” said Bartolotta of San Diego’s Thorsnes Bartolotta McGuire, who is representing a cigar shop owner in a condemnation case in San Diego’s trendy Gaslight district. Last month, Bartolotta’s client lost a legal battle with the government to save his cigar shop from being torn down to clear way for a new Marriott Hotel. Mesdaq v. Center City Development Corp., No. GIC 828361 (San Diego Co., Calif., Super. Ct.). Meanwhile, as quickly as legislators are moving to dull the effects of the Kelodecision, others are moving just as swiftly to take advantage of the ruling. In Freeport, Texas, just hours after the Kelodecision, officials began legal actions to seize two waterfront seafood companies to make way for a private boat marina. In Boston, two days after the Kelodecision, officials in that city called on the mayor to seize South Boston waterfront property from unwilling sellers for use in a private development project. In Lake Zurich, Ill., town officials are now moving to condemn the property of five owners to clear way for a private development, despite requests to hold off on condemnation. In Arnold, Mo., city officials applauded Kelo, saying it will help push forward plans to raze 30 homes and 15 small businesses to build a Lowe’s Home Improvement store and a strip mall. And in Baltimore, officials see the ruling as a green light to seize more than 2,000 properties for a biotech park and new residences. But Berliner, from the Institute for Justice, asserts that states must be vigilant in their efforts to reform eminent domain laws. “There are going to be states that just can’t bear to give up the power and try to use cosmetic changes instead of actually doing anything,” Berliner said. While Berliner encourages legislators to draft bills that spell out exactly what eminent domain can and cannot be used for, she said a constitutional amendment is probably the most effective measure. Berliner said “legislators tend to get swayed by particularly enticing projects” and could eventually change the law. A constitutional amendment is more binding, she said. Michigan condemnation lawyer Alan Ackerman of Troy, Mich.’s Ackerman & Ackerman, who is handling 70 condemnation lawsuits nationwide, agrees. “If you legislate it, you can take it away in a heartbeat without the vote of the people,” said Ackerman, who convinced the Michigan Supreme Court last year to overturn the landmark Poletowndecision, which allowed eminent domain to be exercised for private use. That’s no longer allowed in Michigan, noted Ackerman, who hopes states will amend their constitutions to prevent future eminent domain abuses. “Legislation will never be given full force in effect. It will be cut at and chipped away at,” Ackerman said. “There is such pressure by the large institutions that over a period of time they somehow move courts toward a reading or an analysis that is very limiting for the property owner.” Lobbying in Texas Berliner noted that corporate pressure and heavy lobbying is already taking effect. For example, in Texas, which has eight bills pending, she said lawmakers are already starting to water down their proposed reforms. Berliner said the idea of a constitutional amendment in Texas is losing fervor, and some legislators have grandfathered in various economic development projects that are currently under way. “They knew they had to do something, but when the time came that it meant that people would have to give up their pet projects, they just couldn’t do it,” Berliner said. “We’ll see if they pass anything at all.” Jim Bradbury, a condemnation lawyer in Jackson Walker’s Fort Worth, Texas, office, said he is skeptical about any immediate eminent domain reforms. He noted that despite the outcry over the Kelodecision, there has been no attempt in Texas to halt plans for a new Dallas Cowboys football stadium, which is being built through the use of eminent domain. “I suspect most of this is going to die on the vine,” Bradbury said. “People were so angry about it and so mad about Kelo, but as the interest cools, I suspect we’re not going to see sweeping changes in eminent domain law because cities and states are weighing in and saying, ‘Don’t kill my project,’ ” Bradbury noted.

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