Understanding Eminent Domain

Alan Burkhart

Posted Dec 29, 2005      •Permalink      • Printer-Friendly Version
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Understanding Eminent Domain

By Alan Burkhart

The property rights debate continues to rage across the nation as local governments take advantage of the disastrous “Kelo” ruling by the Supreme Court. Through it all, Americans keep wondering, “How is this possible in the land of the free?”

In every state in the Union, city governments are taking private land to build shopping centers, gyms, factories, and other private-sector ventures all in the name of serving the “public good.” City governments and many legislators maintain that taking homes away from their owners to build commercial ventures does indeed serve the public good, since it creates jobs and tax revenue.

At issue is the Fifth Amendment to the Constitution, the relevant part of which reads thusly:

…nor shall private property be taken for public use, without just compensation.

To fully understand how city governments can force you to sell your property, you must first understand how property ownership works in the good old U. S. of A.

The primary form of property ownership in the U.S. is called “fee simple.” Without descending into the vagaries of lawyer-speak, fee simple means that you can own property, but that ownership can be terminated by local, state or federal government. If, for example, your city decides that your property is the perfect location for a new water treatment plant, and can provide proof of the need, you can legally be forced to sell your land. This is a perfect example of legitimate public use.

What else constitutes public use?

Some, especially commercial real estate developers and city planners, would say that public use is interchangeable with “public good.” This is how people can be forced out of their homes for the purpose of building a shopping mall or other non-government facility. The new mall generates tax and property revenue that would otherwise be paid by home owners, who are generally less able to pay these taxes than retail giants like Wal-Mart, Target and Sears. These tax revenues are then used to build and maintain city streets, buy new fire trucks, and whatever else the city may need to properly serve the citizenry.

The above situation describes land being taken to serve the public good, and a viable argument can be made that it does just that. But that isn’t what the Constitution says. The Fifth Amendment says public use, not public good.

What do we often call government buildings? Do we not use the term “public building” to describe a post office or court house? Look on a dollar bill. See the term, “…LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE”?

What do you suppose that means? Could it mean that “private” refers to private sector debt, and “public” refers to debts owed to the government?

When we hear about people living in “public housing,” do we not assume that those people are living in government housing? Are public schools owned by a private company? Of course not. Public schools are owned and operated (and not very well, I might add), by the government.

So, we can establish without much doubt that in this case, “public” and “government” have the same meaning. What about the other half of the phrase? What does “use” mean?

When government uses its power of eminent domain to take property for the building of a road, government is using that land. Even if the road is a privately maintained toll road, it is still a part of the public highway system. It is therefore being used by the government. The same goes for military bases, court houses, prisons, sanitary landfills and all other public facilities.

What about when a city forcibly purchases an entire neighborhood to build a retail area? Does this constitute government use? One could argue that government is using the property to accomplish a certain goal. That goal might be shoring up the tax base by creating a retail zone. Or, maybe generating jobs for the populace by creating an industrial park. All these things, the government will tell you, serve the public good…

Wait a minute!!! Didn’t we just establish that “public” meant “government?”

We also see and hear the word “public” used to refer to the citizenry. If a business erects a sign that states “Open to the Public,” it isn’t referring to Uncle Sam. It refers to private citizens like you and me. Television stations sell advertising based upon the demographics of their “viewing public.” A “public display” is open to everyone, not just members of Congress. That aforementioned shopping mall that was built via eminent domain is also open to the public, and therefore we can say that it’s for “public use.” Confused yet?

Herein lies the problem. Government is charged with working in the best interests of the people it serves. If a particular neighborhood or town is deficient in terms of retail services or viable jobs, it falls to the local government to solve the problem. This problem is most often solved by creating an area attractive to outside businesses. The State of Mississippi bent over backwards to get Nissan to build a new plant in the town of Canton, just north of Jackson. All of the land upon which that plant now sits was taken by eminent domain. The result? New jobs and tremendous gains in tax revenue.

The flip side of the coin is that those property owners had no choice in the matter. Once the deal was struck between Nissan and Mississippi, property owners were left with no option except to take the payment and pack their bags. How much clout can a citizen have when negotiating a price if government has the power to simply force the owner off the land? In situations where private development is involved, the property owner should have a right to simply say “No.”

Unfortunately that isn’t how the system works. If you own land in the United States of America, you own that land only at the government’s pleasure. This is why the Supreme Court ruled in favor of the City of New London in the now famous Kelo case. What New London did was completely legal.

But was it right?

No, it wasn’t. If the rights of the individual are not respected, then we are not a free nation. If true property ownership, immune to the avarice of developers and the myopia of most elected officials, means that I have to drive an extra mile or two to buy a sack of potatoes then so be it. I’ll go the extra mile. For every person who benefits from eminent domain abuse, there is another who suffers. The laws must be changed.

Originally published at http://www.alanburkhart.com/index.html  and reprinted in TAM with permission of the author.