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The Institute for Justice on Post-Kelo Eminent Domain Reform:

Bert Gall of the Institute for Justice has a piece on TechCentralstation defending a significantly more optimistic assessment of Post-Kelo reforms than I have expressed here and here, among other places. IJ represented the property owners in Kelo and has probably done more to protect constitutional property rights in recent years than any other organization. So their take on post-Kelo reform efforts must be taken seriously by anyone interested in the issue. While Gall makes several good points and is certainly right to emphasize that legislative reform efforts should continue, I am still not as optimistic as he is.

First, the points where we agree:

Gall is absolutely right that the reform efforts represent an improvement over a pre-Kelo status quo that in many states was absolutely abysmal. In numerous jurisdictions, there was pretty much nowhere to go but up, because pre-Kelo law allowed local governments to condemn pretty much any property they set their sights on. He is also correct that some states (notably Florida, Alabama, Georgia, and South Dakota), have passed laws that represent major improvements and go a long way towards banning all or most condemnations for "economic development." I noted several such states in a previous post on this subject, and the list has expanded since then. Finally, Gall is also right to note that many reform movements take years or decades to achieve their goals (though this point has an important flipside that I will note below). By my count, there are now eight states that have enacted meaningful reform, and this number is likely to increase (I will perhaps provide a list and discussion of categorization criteria in a future post).

That said, there are also important reasons to be less optimistic than he suggests:

First, the substance of many of the bills already enacted actually makes little or no improvement on preexisting laws. Indeed, many of these laws may be intended to persuade voters that meaningful reforms have been undertaken without actually enacting any real change. I lack the space to fully address these issues, but they are discussed in some detail in Tim Sandefur's paper here, and some early post-Kelo laws are also dissected in my own forthcoming article on Kelo (pp. 65-84). Both Tim's paper and especially mine are somewhat dated, but several of the laws enacted in the last few weeks have weaknesses similar to those in the earlier laws that we discussed.

The federal reform efforts cited by Gall also suffer from comparable shortcomings. For example, Gall notes the Property Rights Protection Act, a bill which passed the House of Representatives last year. The PRPA, which would cut off federal "development" funds to localities that engage in Kelo-style condemnations, has serious shortcomings that I discuss in a forthcoming article (see here, at pp. 73-76), the most important of which is the fact that it probably only affects a tiny percentage of federal funds available to the offending states and localities. Moreover, the PRPA is currently bottled up in the Senate, and it is far from clear that Judiciary Committee Chairman Senator Arlen Specter (the person holding it up) will let it move forward.

A second ground for skepticism is the fact that the window of opportunity for reform may be closing. As time passes since the Kelo decision, public attention will move on to other issues. This is especially like at a tme when numerous other compelling stories are competing for public attention (including the War in Iraq, immigration reform, and others).

Can we be certain that the momentum of backlash will wane? Perhaps not. But it is worth remembering the lessons of the massive outcry occasioned by the 1981 Poletown condemnations, which displaced some 4000 people so that General Motors could build a new factory in Detroit. Although Poletown was, at the time, almost as widely denounced as Kelo today, it resulted in little lasting reform, and the issue soon faded from the public's radar screen. I suspect that eminent domain is not the kind of issue that is likely to become a permanent part of the political landscape, both because it affects only a small percentage of the population at any one time and because it does not neatly divide the parties from each other; both Republican and Democratic politicians often have strong ties to developers and other interest groups that benefit from condemnation, and thus both have important incentives to allow the issue to die down over time. For these reasons, Gall's observation that reform movements often take years to succeed is not as comforting as we might wish.

Third, as discussed here, several of the states that have passed the best reforms (e.g. -Georgia and South Dakota) had little or no prior record of abusive development condemnations. Many of the states that, according to IJ studies (see here and here), have the most severe records of abuse, have enacted purely cosmetic reforms or none at all. New York, New Jersey, and California are particularly noteworthy in this respect. In many cases, the states that are enacting the best reforms are the ones that need them the least, while many of the most egregious offenders tend to do little or nothing.

Finally, as I have argued in all the posts and articles cited above, widespread political ignorance makes it difficult or impossible for the average voter to tell the difference between reform laws that make meaningful changes and those that do not. This suggests that it will often be very hard to prevent politicians from enacting meaningless reforms and passing them off as real achievements.

My friends at IJ are understandably concerned that people not give up the fight for post-Kelo reform out of a sense of hopelessness; that is certainly a valid point. But it is also important to guard against the opposite danger - the possibility that support for reform (and for judicial protection of property rights) will dissipate because of a false perception that the problem has been "solved" by reforms that actually have little or no effect.

CONFLICT OF INTEREST WATCH: I worked at IJ as a law student clerk during the summer of 1998, receiving a small stipend funded by the Yale Law School Student Funded Fellowship program. Since graduating, I have also written several amicus briefs for IJ on a pro bono basis.

Related Posts (on one page):

  1. Common Problems in Post-Kelo Reform Legislation:
  2. The Institute for Justice on Post-Kelo Eminent Domain Reform:
Seerak (mail):
This item caught my attention:

"...and because it does not neatly divide the parties from each other; both Republican and Democratic politicians often have strong ties to developers..."

That's rather ominous, isn't it? Here we have an issue which lies close to the foundation of freedom itself, and yet we can't even grasp it politically because of the blinding effects of the arbitrary, defined-by-nonessentials "spectrum" of conventional politics.

For those trapped inside that box -- which, unfortunately, includes most of the electorate -- the position consistent with freedom is not found on one side (as it would were the political divide drawn by reference to freedom vs. tyranny) but is scattered almost at random across the false divide. This makes a coherent political defense of property rights rather difficult (because of the "strange bedfellows" perception), leaving them open to erosion.
7.7.2006 9:52pm
Public_Defender (mail):
Can we be certain that the momentum of backlash will wane?

I am making the second comment to this post even though you posted it yesterday. Compare that to 183 comments to yesterday's posts about gay marriage (as of this writing). Yes, the gay marriage posts were up a little longer, but 183 to 2 is a huge difference in interest.

This blog tends to attract people with libertarian and conservative leanings (and a few liberals like me who like to have our ideas challenged). If this blog's readers show so little interest in the Kelo aftermath, do you really think the rest of the nation cares very much?
7.8.2006 12:52pm
stephen:
Thanks for your pro bono work for IJ.
7.9.2006 12:08am
Patrick Wright (mail):
I commented last time this issue was raised and will do so again. I don't know how you are categorizing Michigan, but it should be in the vanguard. If, as is likely, SJR-E passes, Michigan will have an explicit constitutional prohibition against economic development takings. Further, "blight" will have to be determined on a property-by-property basis, and the burden of proof (clear and convincing evidence) for showing that a property is blighted will be on the governmental unit. Home owners will receive %125 for their principal residence.

On the statutory front, the definition of blight is being tightened from the extremely broad definitions found in MCL 125.71 and 125.72.

Here is the language for SJR-E
7.9.2006 1:07am
Patrick Wright (mail):
Frank,

You are correct about the holding in Hathcock. The feeling in the Michigan Legislature was that Poletown was decided under the exact same wording of Article 10 section 2 of the Michigan constitution; therefore, to prevent a future court from returning to Poletown an explicit prohibition against economic development takings was necessary.

You are also correct that the major improvement from SJR-E would be in the area of blight. Given the loose definitions of blight found in MCL 125.71 and MCL 125.72 and the federal blight caselaw (Berman v. Parker) there existed a serious possibility that municipalities could obtain there economic development aims merely through a change in the nomenclature. Currently in Michigan, this is happening in East Lansing; the city has declared a 35-acre area "blighted" when in reality the city is seeking to develop the area.

If SJR-E passes, it should put an end to such abuses.
7.9.2006 3:50am
Ilya Somin:
The Michigan Supreme Court already ruled that takings for "economic development" are unconstitutional under the state's Takings Clause in County of Wayne v. Hathcock (2004), a year before Kelo. So much of the proposed constitutional amendment is superfluous (the part banning "economic development" takings). The reform of blight designations, however, would represent a real improvement over the pre-Kelo status quo.

Note: I accidentally posted this comment before under the name of "Frank Buckley" (a computer glitch created when Prof. Buckley had asked me to put up some comments he had written about an earlier post). I deleted the old comment and have now reposted it under my own name.
7.9.2006 4:37am
Ilya Somin:
One small further comment on Michigan:

I don't think that an explicit ban on "economic development" takings in the state constitution adds much to what the state supreme court did in County of Wayne v. Hathcock. After all, that decision was unanimous and the historical and textual case for banning development condemnations under the existing text of article 10, Sect. 2, is very strong. See the amicus brief I wrote in that case on behalf of the Institute for Justice.

If a dishonest future court really were intent on going back on Hathcock, it might be able to do so even if the amendment passes because it could approve economic development takings under another name, such as "community development" (the loophole exploited in the Texas post-Kelo statute, for example). That said, I agree that it's better to have an explicit ban than to not have it.

Regarding "blight" takings, I agree that the amendment would be an improvement over the status quo. But it is not clear whether an extremely broad definition of "blight" that allows condemnations that are essentially for development would pass muster under Hathcock.

The proposed Michigan constitutional amendment will be a genuine improvement over the status quo, if it passes. But it will be an incremental gain rather than a truly major change.
7.9.2006 4:59am
Patrick Wright (mail):
Ilya,

I testified before the Michigan Legislature on this matter. I agree with you that under its current composition there is a strong possibility that the Michigan Supreme Court would not allow blight takings to be be used as a subterfuge for economic development. But just as you noted that there is an opportunity for a future court to misconstrue the proposed amendment, that same future court could find plenty of wiggle room in Hathcock to "justify" a finding that most "blight" takings are proper.

It was clear that something was going to be legislatively, and the initial goal of the amendment's sponsor was to prevent a return to Poletown. Therefore, Hathcock was going to be "codified" by placing its holding in the Michigan constitution. But the Hathcock court recognized that in some instances blight takings might be proper. Thus, there was a lot of discussion about whether blight should be mentioned in the constitution.

It was decided that some mention of blight was going to be made. Therefore, there were three ways to limit its impact: (1) by tightly defining blight; (2) by making blight be determined on a property-by-property basis; and (3) by limiting judicial deference to the municipalities' blight determinations. I would have liked to have seen all three concepts in the amendment, but only the last two made it in. The property-by-property determination in particular should slow down bogus takings for few developers will want a checkboard area.

I guess if you believe that Hathcock would have prevented abusive blight takings then the progress is incremental. Again, with the current court, I agree that such a reading is plausible. But given the legislative situation that existed post-Kelo, I feel that this is an excellent amendment.

I would be interested in your viewpoint about what an ideal law would be and how far you think SJR-E is from that ideal.
7.9.2006 1:56pm
Ilya Somin:
Patrick,

I think SJ-RE as written is very good and I certainly support it and very much hope that it gets ratified. The reason why it may only be an incremental improvement over the status quo is not a flaw in the amendment, but a result of the fact that the post-Hathcock Michigan status quo was already fairly good (much better than in most other states, certainly).

What would an ideal law look like? Difficult to answer. I think that such a law would, at the very least, ban all economic development takings, define blight very narrowly, and eliminate as far as possible the practice of condemning for development under other names (e.g. - "community development," "sound growth," etc.). It should also put the burden of proof on the government to show 1) that an area really is blighted under the narrow definition, and 2) that the use of eminent domain against the property in question is necessary to alleviate the blight.

There is an argument that blight condemnations should be eliminated entirely (as the state of Utah did under a pre-Kelo reform law), but that is an issue for another time.
7.9.2006 6:38pm
Patrick Wright (mail):
Ilya,

Thanks for the response. Myself and others who have been working on this issue in Michigan have found your work both interesting and useful.

There was a discussion about taking a no-blight-ever position, but it was readily apparent that such a position would lead its proponent being marginalized. Given the politics at the time, the most prudent course was to accept some blight takings but to limit them as much as possible.
7.9.2006 10:04pm