Last Tuesday, voters in California faced the choice between two statewide initiatives, each claiming to protect property rights against eminent domain abuse. The loser, Proposition 98, which was sponsored primarily by the Howard Jarvis Taxpayers Association, would have imposed significant limits on the ability of state and local officials to seize private property using eminent domain, and would have phased out rent control everywhere in California. The winner, Proposition 99, which was championed by the League of California Cities, will do neither of those things.
In fact, despite being titled the "Homeowners and Private Property Protection Act," Prop. 99 will dramatically undermine the rights of California property owners, farmers, landlords, and renters. Of particular concern is the fact that Prop. 99 specifically protects only "owner-occupied residence[s]" from eminent domain abuse, leaving apartment buildings and other rental properties, not to mention family farms, churches, and small businesses, wide open for the taking. And even that flimsy safeguard contains loopholes. Under the most notable exception, owner-occupied residences may be condemned on behalf of "private uses incidental to, or necessary for," public works and improvements (emphasis mine). As George Mason University law professor Ilya Somin notes, "This means that homes could still be taken for transfer to private developers if the proposed project allocated some space for a ‘public' facility such as a community center or library."
So what happened? Did Prop. 99 trick voters into thinking they were protecting property rights when they were actually undermining them? Or did a majority of Californians simply reject Prop. 98's controversial attack on rent control?
The short answer is yes to both. As critics charged, Prop. 99 looked like a legitimate reform measure, despite the fact that it actually leaves city and state officials with vast powers to condemn and seize property. Moreover, for those voters opposed to eminent domain abuse but unaware of Prop. 99's fine print, it would have made sense to vote yes on both measures, just to be safe. Yet under Prop. 99, if both measured passed, "the provisions of this measure  shall prevail in their entirety." In other words, Prop. 99 benefited—by design—from both intentional and miscast votes.
But Prop. 98's critics had a point, too. Limiting what a landlord charges in rent is a far cry from seizing somebody's house and handing the property over to a developer. Furthermore, while reforming eminent domain is a popular issue in California (and elsewhere), ending rent control is highly controversial. So not only was including the anti-rent control plank a bad strategic move, it gave Prop. 98 the appearance of bad faith as well. To put it another way, why bundle an unpopular proposal with an extremely popular one unless you're trying something fishy?
In hindsight, it seems clear that Prop. 98 should have been a straightforward assault on eminent domain abuse. That approach would have attracted a broad coalition of support. Consider the various liberal and left-of-center voices that spoke out against Kelo v. City of New London (2005), where the Supreme Court allowed the Pfizer Corporation to acquire private property via eminent domain under the city's "economic revitalization" scheme. Rep. Maxine Waters (D-Calif.), for instance, declared, "the taking of private property for private use is in my estimation unconstitutional, un-American, and is not to be tolerated."
Similarly, the National Association for the Advancement of Colored People (NAACP), in the amicus curiae brief it filed on behalf of the victimized Kelo homeowners, charged that not only were Kelo-style takings in violation of the Constitution, their burden "has and will continue to fall disproportionately upon racial and ethnic minorities, the elderly, and the economically disadvantaged." In California, however, groups representing racial and ethnic minorities and the elderly overwhelmingly lined up against Prop. 98, a testament to the measure's narrow appeal.
But the future isn't entirely bleak. Chip Mellor, President of the Institute for Justice, the libertarian public interest firm that litigated Kelo, recently told reason that the outcry against the Court's decision has resulted in forty-two states enacting "laws that change the status quo that was in existence at the time of Kelo." And while not all of these laws are perfect, "all of them are better than what existed before."
Prop. 99, of course, is now the exception to that statement, but
Mellor's point remains strong. The Kelo backlash has
sparked eminent domain fights from Brooklyn, New York to
Raytown, Missouri. Too bad the authors of Prop. 98 squandered
their shot at winning a real victory in California.
Damon W. Root is a reason associate editor.