Eminent Domain: An Overview.

Introduction

Eminent domain is an inherent right of a government to seize private property, or property held by private citizens, provided that the property is used for the benefit of the public and the land owners are compensated for the property. Thus, a government may seize property owned by private owners to use the property to develop schools, roads, railroad tracks, libraries, and other projects for the benefit of the public, or even for economic development projects to revitalize failing communities. Essentially, the principle of eminent domain holds that governments retain a right to seize any property within its borders so long as the owner is compensated for the property and the land is used for the public benefit. For the seizure to be deemed legal, the government must meet these two requirements.

Eminent domain in the United States has been used on some occasions to raze blighted, or deteriorating, buildings—some of which were still in use as housing development projects—so that private developers could construct new buildings on the land that would also generate increased tax revenues for local, state, or federal governments. Increased property and sales taxes translate to more money for government budgets and, by extension, for the public. Many people have objected to this application of eminent domain, arguing that seizing private property for the sole purpose of generating increased revenues is an inappropriate exercise of government power. Although the US Supreme Court has upheld such use of eminent domain powers, the government historically seized property for the purpose of acquiring the land necessary to build or develop the transportation and manufacturing infrastructures necessary for commercial growth throughout the US.

Opponents of eminent domain have claimed that the practice is unconstitutional and unfair. Because eminent domain necessarily favors property that can bring in the most revenue, small or family-owned businesses are often the most vulnerable to the government's exercise of its eminent domain powers, while large businesses or corporations are often the beneficiary of property seizures. For this reason, the exercise of the powers of eminent domain have tended to give the appearance of the government favoring large companies by bullying small business owners and homeowners.

The practice of eminent domain has a long history in the US, going back to the colonial period, in which private property was often bought by the local government and resold to mill owners. Supporters of eminent domain have argued that now, just as then, certain businesses and certain industries aid the growth of the economy more than others, and preference should be given to those businesses, since they improve the overall conditions for the public.

Understanding the Discussion

Blight: The term used to describe a vacant, neglected, or otherwise undesirable property that is a suitable candidate for eminent domain. A city usually must prove that an area is blighted to invoke eminent domain. In most cases, the city also defines what passes for blight, meaning that eminent domain may be invoked virtually anywhere.

Magna Carta: A medieval English charter, established by King John, which eventually served as the inspiration for much of the US Constitution, including the right set forth in the Fifth Amendment that permits the taking of private property for public use with just compensation.

Public Use: The main requirement for property seized by eminent domain, which holds that the general public should benefit from the use of any property taken through eminent domain. People in favor of eminent domain's use in transferring private property to another private owner have tended to interpret “public use” broadly, often to mean any development that would improve the economic status of the local community. More conservative readings of the takings clause of the Fifth Amendment have asserted that “public use” refers only to developments that are for the direct benefit of the public, such as roads and schools.

Takings clause: The last clause of the Fifth Amendment to the Constitution, which reads, “Nor shall private property be taken for public use, without just compensation.” This clause does not explicitly endorse or establish the practice of taking property for public use, but, by outlining the proper way for the government to take private property (only when just compensation is provided), the conduct is implicitly endorsed.

History

Though never officially codified in the US Constitution, the government's right to take property by eminent domain had been established in the American colonies since their founding. The wording in many colonial constitutions, and in the Fifth Amendment of the US Constitution, closely resemble the wording in the Magna Carta, which states, “No Freeman shall be taken, or imprisoned, or be disseized of his Freehold . . . but by lawful Judgment of his Peers, or by the Law of the Land.”

The Magna Carta made no mention of compensation, just or otherwise, for seized land, but this became common practice in the colonies, when private land was often taken for the development of roads and, to a lesser extent, private mills. Nevertheless, the decision to pay property owners when taking their property was more a courtesy than a regulation. Requirements were sometimes placed on property owners to use their land in specified ways that benefited the community.

Philosophically, the concept of eminent domain was originally a utilitarian concept. The framers of the Constitution relied heavily on both the Magna Carta and the writings of such political philosophers as Hugo Grotius and Samuel von Pufendorf, both of whom ascribed the right of eminent domain to the state, but said that it should only be exercised for the benefit, or utility, of the public. These ideas—part of the natural law school of thought, which holds that there are certain universal principles that stem from the laws of nature and that are to govern human affairs—were especially prevalent in the United States in the late eighteenth century, when the Bill of Rights was being drafted. Thus, the Founding Fathers were familiar with the principle that there may be occasions when the interest of the economic development of a community becomes paramount to the interest of preserving privately held property. Under certain conditions, the government retains the inherent power to take private property for the greater good of public use, provided just compensation is made for the property seized.

With the passage of the Fifth Amendment, which includes the takings clause, along with the rest of the Bill of Rights, the power of eminent domain was incorporated into the US Constitution. However, the Bill of Rights as originally enacted applied only to the federal government, and thus the protections in the Fifth Amendment did not apply to state or local governments. In 1897 the US Supreme Court applied the takings clause of the Fifth Amendment to the states through the Fourteenth Amendment due process clause in Chicago Burlington and Quincy R.R. v. City of Chicago.

The takings clause has also been invoked to require the government to compensate individuals for property and assets seized or destroyed during the Revolutionary and Civil Wars. In addition, some scholars have argued that slavery is a form of a taking, suggesting that descendants of those who had been enslaved should be entitled to reparations, or sums of money that should have been paid to formerly enslaved individuals to compensate them for the value of their labor and their loss of self-ownership.

The federal government's power to exercise eminent domain lay largely dormant until 1875, when the Supreme Court ruled in favor of the federal government in the case of Kohl v. United States. Justice William Strong concluded that the very nature of sovereignty allowed the taking of land for public use, and he also invoked the takings clause as supporting the government's right to exercise its eminent domain powers.

However, the power of eminent domain has also been interpreted far more broadly than in past years. In 2005, the US Supreme Court ruled in Kelo v. New London that taking property for economic revitalization purposes was constitutional. In Kelo, the city of New London, Connecticut, wanted to build office buildings, upscale housing, a marina, and a pharmaceutical research center on ninety acres of waterfront property, but fifteen homeowners in the area protested. The homeowners were ultimately evicted when the Supreme Court ruled in favor of the city. On the anniversary of the Kelo decision, President George W. Bush issued an executive order that prohibited federal agencies from using eminent domain powers solely for private development purposes, although takings would still be permitted for projects benefiting both private and public development.

Eminent domain remained a divisive issue, although the division generally does not break down along party lines. While many conservative thinkers and constitutional scholars have argued vehemently for the power of the government to exercise eminent domain, an equally vocal group of conservatives have argued that the right to private property is the most fundamental right in a democracy, and that taking it away is a violation of personal liberty. The liberal argument against eminent domain, on the other hand, has concentrated more on the equity of a practice that necessarily pits the powerful against the weak and gives the obvious advantage to the powerful. The Institute for Justice, a libertarian nonprofit group, documented ten thousand complaints in cases of property seized from one private owner and given to another in the five-year period from 1998 to 2002.

The Supreme Court's decision in the case of Kelo v. New London was a major blow to critics of eminent domain practices. In a 5–4 decision, the Supreme Court ruled that the government may seize property, even if that property is not blighted. Justice John Paul Stevens stated that the waterfront development constituted public use since it was for the good of the public, while Justice Sandra Day O'Connor said that the decision favored powerful corporations and discriminated against small property owners. Adding insult to the homeowners' injury, the proposed development was never built. A film, Little Pink House (2018), was made about the case.

In the wake of this court battle, by 2015 forty-four states had enacted legislation or passed ballot measures that restricted the use of eminent domain. Alabama was the first state to react, when Governor Bob Riley signed a bill passed unanimously by a special session of the Alabama legislature that prohibited the government from using eminent domain to seize nonblighted private property to resell it to retail, industrial, office, or residential developers without the owner's consent. Some states even passed constitutional amendments that were placed on ballots for approval, marking one of the first times the practice of eminent domain was put before the public for a vote. Although these measures varied from state to state, a common theme was that they prohibited state and local governments from taking private property solely for economic development purposes, to generate revenue, or simply to transfer property between private parties, while takings for public use remained permissible. Most states, however, including Alabama, still included provisions for transferring blighted property to private developers, which critics have claimed leaves a loophole in the law that can still be abused by special interest groups.

Eminent domain fights have also involved the mortgage and energy industries. During and after the Great Recession, debate centered around whether eminent domain could resolve the prevalent problem of underwater mortgages, in which property owners owed more than the property was worth. Later, landowners in energy-producing states opposed major proposed natural gas or petroleum pipelines like the Keystone XL or Dakota Access Pipeline, which they believed serve the interests of the energy companies rather than the public. Energy companies have maintained that they are ensuring adequate supplies and preventing shortages of necessary commodities.

Eminent Domain Today

In the late 2010s, President Donald Trump campaigned on and, after taking office, continued to vow to construct a border wall along the entirety of the US-Mexico border, even if it meant using eminent domain. About two-thirds of the land there belongs to private owners or the states. Many Texan property owners and their congressional members opposed the plan, just as they had sued over earlier efforts by the George W. Bush administration to seize their land. To prevent the federal government from using "quick takes," in which property is seized before compensation is determined, Representative Justin Amash introduced the Eminent Domain Just Compensation Act in early 2019. However, the legislation did not progress, and by the end of Trump's presidency in 2021, it was reported that his administration had initiated more than one hundred lawsuits citing eminent domain against landowners in pursuit of further border wall construction. While President Joe Biden's administration brought a pause to such active pursuits, those cases remained. Some critics of eminent domain argued that the government has engaged in secret dealings, both along the border and elsewhere, to circumvent legal protections for property owners.

In a win for property owners, the Supreme Court ruled in the 2019 case Knick v. Township of Scott that a takings claim may go directly to federal court, without needing to be litigated at the state level first. This had been required since the 1985 Williamson County decision. Similarly, in the 2017 ruling Public Service Company of New Mexico v. Barboan, a court had found that lands in which American Indian tribes held even a partial interest could not be seized under eminent domain. Though it involved a legal fight that lasted decades, the Winnebago Tribe of Nebraska succeeded in having a bill signed into law in 2024 that transferred around 1,600 acres of land back to the tribe that the US Army Corps of Engineers had illegally taken through eminent domain in the 1970s.

These essays and any opinions, information or representations contained therein are the creation of the particular author and do not necessarily reflect the opinion of EBSCO Information Services.

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