States Re-Examining Eminent Domain Laws

By Linda Orlando

Last June, in a 5-4 decision that was met with widespread and heated criticism, the U.S. Supreme Court ruled that the city of New London, CT, had the authority to seize homes for a private development project. In its ruling, the high court also noted that states are free to ban that practice.

Since that time, state legislators around the country have been debating about whether they should do just that. Four states have already passed laws limiting the use of eminent domain laws, and another 40 are considering similar legislation. In Congress, the House voted to deny federal funds to any project that used eminent domain to benefit a private development. A federal study has been launched to examine how widely the eminent domain laws are being used.

The Constitution says that governments cannot take private property for public use without giving the owner "just compensation." State governments have used eminent domain laws for years to build public projects such as roads, reservoirs, and public parks. But over the last several decades, the Supreme Court has been expanding the definition of public use, and allowing cities to claim eminent domain in reconstructing urban areas to eliminate blight and encourage economic growth. Recent years have seen an increasing number of cases where elderly people who have lived in a home for their entire life are forced to move, with developers using laws of eminent domain.

Anna DeFaria, an 80-year-old retired preschool teacher, is one of those unfortunate people. The city of Long Branch, NJ, wants to take her home and two dozen other weathered, working-class beachfront homes, in order for private developers to build upscale townhouses in the hope of resurrecting the oceanfront resort town. "We thought this was going to be our home forever," said DeFaria. "Now they want to take it away. It’s unfair, it’s criminal and it’s unconstitutional."

New Jersey state Sen. Diane Allen, a Republican, is spearheading the push for a two-year ban on all eminent domain actions across the state of New Jersey, and for a bipartisan group to study and re-examine the use of the laws in the state. "Right now government, I think, is using eminent domain to take people's private properties and hand it over to another owner," said Allen. "It's really putting a hole in the American dream. Ownership of private property plays such a large role in that dream."

Bert Gall, an attorney with the Washington-based Institute for Justice, said that for redevelopment plans to succeed in claiming eminent domain, they usually must be able to define an area as being "blighted" or a "slum," although the definitions are vague. The criteria used can include nebulous items such as a building’s age, lack of compliance with recent building codes, and even the size of a yard. Gall says that abuses of the laws are widespread. During a five-year period ending in 2002, more than 10,000 properties were threatened by eminent domain claims. The Institute is working to convince state legislators across the country that laws should be changed so that private property can be seized for only public uses like a park or a school—not urban redevelopment efforts that pad the pockets of private developers.

Municipal leaders across the country are fighting state legislators who want to limit the use of eminent domain laws. They say that eminent domain is not widely abused, and that the emotional backlash in response to the Supreme Court ruling in Connecticut is going to risk quashing an important tool that has helped reverse the decline in many neighborhoods such as Baltimore’s Inner Harbor and New York’s Times Square. One such municipal decision-maker is the mayor of Long Branch, who believes that using eminent domain laws to buy the older beachfront houses in DeFaria’s area will help ensure the comeback of the town. "Most people wouldn't walk down those streets anymore," said Mayor Adam Schneider. "The worst neighborhood in our city was along our oceanfront. And that's been reversed," he said.

After a decade of planning, a redevelopment effort for Long Branch began in 2002, and now new shops and homeowners have moved in along the central waterfront, where an old pier burned down in 1987. New sidewalks have been installed, along with a new boardwalk, parks, and an ice-skating rink. "What you do is you've improved your city, you've gotten rid of decrepit housing, you've created jobs," Schneider said. "It's easy to play it out as the city is cruel and government is stealing your property. I'm used to it. But this has reversed the decline that's been going on in Long Branch for more than 50 years."

That’s all well and good for the new folks enjoying their beachfront homes in the rows and rows of new sand-colored condominiums that now cast a long shadow on Anna DeFaria’s one-story home as the sun is setting. The city has offered her $325,000 for the home she bought with her husband in 1960 for $6,400. Although that amount of money wouldn’t be nearly enough to buy a waterfront view on the New Jersey coast now, DeFaria said her refusal to sell has nothing to do with the money. "They’re taking my home away—not my house," she said. "My home. My life."