Eminent Domain for Urban Revitalization Five Years After Kelo

Eminent Domain for Urban Revitalization Five Years After Kelo

Get the latest Emerging Issues Analysis on Kelo v. City of New London, 545 U.S. 469 (U.S. 2005), the landmark U.S. Supreme Court decision holding that condemnation of non-blighted homes for retransfer for private urban redevelopment did not violate the Fifth Amendment's Public Use Clause. In this Analysis, Professor Steven J. Eagle examines cases since the Kelo decision and concludes that the Supreme Court's promise to prevent abuse of condemnation for private redevelopment largely has been unfulfilled. He writes:

State Law Developments After Kelo

     In the five years since Kelo was decided, legislation to limit or forbid condemnation for retransfer for private revitalization has been introduced in most states and passed in many. This legislation has been a mixed bag, with some states simply adding procedural hurdles or purporting to eliminate such takings, and others providing exceptions for loosely defined "blight." Generally speaking, anti-Kelo legislation has been mostly utilized in States where revitalization condemnation has not been utilized and least successful where it has been most utilized. For a comprehensive analysis, see Steven J. Eagle & Lauren A. Perotti, "Coping with Kelo: A Potpourri of Legislative and Judicial Responses," 43 Real Property, Probate and Trust J. 799 (2008).

     Likewise, some state courts have stringently restricted or forbidden takings for retransfer for private revitalization under state law. Notable among them are County of Wayne v. Hathcock, 471 Mich. 445, 684 N.W.2d 765 (Mich. 2004), decided the year before Kelo, that repudiated the state supreme court's earlier approval of revitalization transfers, and City of Norwood v. Horney, 110 Ohio St. 3d 353, 853 N.E.2d 1115 (Ohio 2006), where the Supreme Court of Ohio held that "an economic or financial benefit alone is insufficient to satisfy the public-use requirement" of the state constitution. The court accepted the analyses offered by the dissenting justices in Kelo and in County of Wayne v. Hathcock as models for interpreting Ohio's constitution.

     . . . .

Considering Types of Private Transfers Susceptible to Abuse

     In addition to his comments on rational basis review just quoted, Justice Kennedy declared in his concurring opinion in Kelo that general adherence to rational basis review "does not foreclose the possibility that a more stringent standard of review than that announced in Berman [v. Parker, 348 U.S. 26 (U.S. 1954)] and Midkiff [v. Hawaii Housing Authority, 467 U.S. 229 (U.S. 1984)] might be appropriate for a more narrowly drawn category of takings. There may be private transfers in which the risk of undetected impermissible favoritism of private parties is so acute that a presumption (rebuttable or otherwise) of invalidity is warranted under the Public Use Clause."

     One situation that might lend itself to heightened judicial scrutiny is the imposition of exactions by government-selected redevelopers in exchange for promises not to condemn. This was the issue in Didden v. Village of Port Chester, 322 F. Supp. 2d 385 (S.D.N.Y. 2004), adjudicating claims of extortionate exactions by a developer threatening condemnation under color of law.

(citations omitted)

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Also from Professor Steven J. Eagle - Regulatory Takings, Fourth Edition