Wednesday, October 13, 2004

In case you missed it

This item is a bit old now, coming from the September 28 New York Times, but it's still worth noting.
The Supreme Court added an important property rights case to its docket on Tuesday....

The case is an appeal by seven property owners in a neighborhood in New London, Conn., that the city has designated for economic development. The Connecticut Supreme Court upheld the city's right to exercise its power of eminent domain to take the parcels, pay compensation to the owners and turn the land over to a private developer.
The power of eminent domain, the power of government to take private land, is an ancient one, one of such long standing that even the most conservative, the most libertarian, do not challenge it in principle. But under the Fifth Amendment to the Constitution, it's limited in two ways by the closing phrase, "nor shall private property be taken for public use without just compensation."

"Just compensation" is usually understood to mean fair market value. Although there are frequent arguments as to what is fair value in a given case, the meaning of the phrase is well established. Traditionally, "public use" was understood equally clearly: The land must be designated for use by the public. It must be for a road, a school, a post office, some sort of public facility.

Over the past few decades, however, that definition has slipped considerably and now cash-strapped localities are increasingly using eminent domain to force landholders - often homeowners - to sell in order to turn the land over to private developers for profit-making projects. The cities claim that because the development will bring in more tax revenue than the homes, that constitutes a "public use."

So what's at issue in the New London case is the Constitutional limits, if any, on the definition of "public use" a government body can use to benefit private corporations.

The loophole cities are using, like many other things, was an outgrowth of the law of unintended consequences. Columnist Jeff Jacoby writes in the September 30 Boston (MA) Globe:
In Berman v. Parker, a 1954 case, the court permitted eminent domain to be deployed for purposes of what was then called "urban renewal." It allowed property to be seized from private owners in an inner-city slum and sold to new owners for redevelopment. "Public use," it held, encompassed "public purpose" - and when the government's purpose was to revive a poverty-stricken, rat-infested neighborhood, property owners could be forced to yield.
But "public use," having been expanded to include "public purpose," metamorphosized further into "public benefit," and cities claimed that anything that "benefitted" the public - for example, by providing an expanded tax base - empowered the use of eminent domain.

Personally, I think arguments such as these are a perversion of the Constitution. The "takings" clause of the Fifth Amendment, as it is known, was designed to protect people from arbitrary government authority, not to enable that government to take land away from one private party only to give it to another. Just how twisted some of the arguments can become could be seen in a "60 Minutes" story from July about a case in Lakewood, Ohio:
The Saleets live in an area called Scenic Park, and because it is so scenic, it's a prime place to build upscale condominiums. With great views, over the Rocky River, those condos will be a cinch to sell.

But the condos can't go up unless the city can remove the Saleets and their neighbors through eminent domain. And to legally invoke eminent domain, the city had to certify that this scenic park area is, really, "blighted." ...

"The term 'blighted' is a statutory word," says Mayor [Madeleine] Cain. "It is, it really doesn't have a lot to do with whether or not your home is painted. ...A statutory term is used to describe an area. The question is whether or not that area can be used for a higher and better use."

But what's higher and better than a home? "The term 'blight' is used to describe whether or not the structures generally in an area meet today's standards," says Cain.

And it's the city that sets those standards, so Lakewood set a standard for blight that would include most of the homes in the neighborhood. A home could be considered blighted, says Jim Saleet, if it doesn't have the following: three bedrooms, two baths, an attached two-car garage and central air.
By two of those requirements, every place I've ever lived has been "blighted." Most have failed on three, and the one I grew up in failed on all four.

This is insane. This is cities ripping up established, stable neighborhoods in order to mortgage their economic futures to greed-driven corporations, selling their birthright, as it were, for a mess of pottage. Now, believe me, when I find myself agreeing with Jeff Jacoby on something, I re-think it two or three times. But I truly hope that the Supreme Court, which the Times says has "traditionally been quite deferential toward the government's use of eminent domain," chose to take the case because its members have come to their senses and realized that the meanings of "public use" (as expanded by "public purpose") and "blighted" have been distorted too far to continue to ignore.

Footnote: One other thing this matter shows is the need for an urban policy, one that will not leave our cities so desperate for a tax base that they will fall so easily for the blandishments of developers waving promises of big bucks and become so willing to turn abusive in pursuit of what too often turns out to be a mirage rather than a miracle.

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