Eminent Domain for Private Gain


Eminent Domain Abuses and When Eminent Domain Doesn’t Work:

Under the power of eminent domain, the government can take away private property for “public use” and with “just compensation.” In other words, the government can force you to sell your property to serve the public interest.

Unfortunately, the so-called “public use” component of eminent domain sometimes gets privatized in the interest of “economic development.” For example, consider Inglewood City Council’s use of eminent domain for the new Clippers basketball arena. Although the Inglewood Basketball and Entertainment Center (IBEC) will be privately owned, government officials argued the project would serve the economic interests of the Inglewood community, but locals disagreed. Still, 11 properties were taken by eminent domain.

Critics call this phenomenon “eminent domain for private gain,” and legal organizations like Castle Coalition and the Institute for Justice are fighting the abusive use of eminent domain (see the ‘Eminent Domain Abuses’ section here).

Kelo v. New London

Kelo v. New London is one of the most reviled Supreme Court decisions in United States history. In this case, the city of New London, Connecticut took over a poor neighborhood as part of a “comprehensive redevelopment plan.” In reality, Pfizer wanted to use the space for a new research facility. When residents heard that their homes had been taken for Pfizer’s private development, they fought the use of eminent domain, and the case made it all the way to the Supreme Court.

Sadly, the Supreme Court upheld New London’s decision because the Pfizer lab would allegedly enhance the city’s “economic development.” Worse still, Pfizer abandoned its plans soon after bulldozing the homes in question, and the neighborhood became a wasteland.

Before Kelo v. New London, eminent domain was largely used for transportation (specifically railroads and highways), parks, and war efforts. After Kelo v. New London, 44 states reformed their eminent domain laws to prevent future abuses.

Nevertheless, the use of eminent domain remains a large injustice in the United States. One report from 2009 claims that 10,000 properties have been seized by cities for private developers, and the number has only gone up since then.

Who Has the Power?

As the Foundation for Economic Education argues, “Eminent Domain for Private Gain Is Terrible and Cruel — Even When It ‘Works.’” Local governments take private property and gamble on private plans that may or may not enhance the local community. The only people who lose are those who own the private property, to begin with.

By allowing eminent domain for “economic development,” all a corporation must do is ask the local government to take a chance on its project.

As one critic explains:

“Practically every house in the entire country would produce more jobs and taxes as an office building, and everybody's small business would produce more jobs and taxes if it were removed and turned into a Costco.”

Fortunately, watchdogs are looking out for eminent domain abuses, and politicians and legislators are exploring eminent domain reform.

If you are facing an eminent domain action you disagree with, it is worth talking to an eminent domain attorney near you. At Allen, Semelsberger & Kaelin LLP, we have been guiding clients through eminent domain cases for nearly 3 decades, and we can help you protect your best interests.

Learn more about your rights and legal options by contacting us for a case evaluation and putting the power back into your hands – call us at (888) 998-2031 or send us a message online to get started today.