Ripe for Condemnation

The Supreme Court should reject land grabs aimed at boosting tax revenue

In 1997, when Susette Kelo bought her little house overlooking the Thames River in New London, Connecticut, she had to hack her way through weeds and brush to reach the front door. Renovations transformed the neglected Victorian into a salmon-colored "show home," but today it's besieged by a creeping menace it will take more than an ax to defeat.

Kelo's home stands in the way of progress—at least, the city's idea of progress: a riverfront redevelopment project designed to make New London more comfortable for the Pfizer Corporation, which a few years ago built a research facility adjacent to the Fort Trumbull neighborhood where Kelo had made the mistake of settling. The city wants to hand Fort Trumbull over to a private developer who will use the land for a hotel, condominiums, offices, and shops.

In a case the U.S. Supreme Court recently agreed to hear, Kelo and several of her neighbors are challenging the city's authority to carry out this plan. The outcome will determine whether the power of eminent domain is an unlimited license to reassign property rights—and how much you need to worry about ending up in Kelo's situation.

The day before Thanksgiving in 2000, Kelo and her husband found a notice on their front door from the New London Development Corporation, informing them that their home had been condemned. "There are no words to explain what it feels like to have someone try to take your home away from you," Kelo says. "You have to worry all the time."

The other plaintiffs in Kelo v. New London feel the same anxiety. They include Wilhelmina Dery, who lives in the same house where she was born in 1918, and her husband, Charles, with whom she has shared the home for half a century; Bill Von Winkle, proprietor of a deli that was shut down by the redevelopment project and owner of 11 apartments whose tenants were evicted in the middle of the winter; and Richard Beyer, who put money, time, and effort into renovating two houses in Fort Trumbull that he bought a decade ago and planned to rent out.

The city argues that its plan should override the plans of these people and the rest of the neighborhood's holdouts. It predicts the redevelopment project will yield more than 3,000 jobs and up to $1.2 million annually in property tax revenue—benefits that it says make the project a "public use" for which condemnation is justified under the Fifth Amendment.

That's quite a stretch. In the context of eminent domain, "public use" traditionally was understood to mean government buildings and infrastructure—things like courthouses and roads. In 1954 the Supreme Court decided it could also mean eliminating "blighted areas."

That decision encouraged local governments to be creative in defining blight. Even neighborhoods that bore no resemblance to slums could be declared blighted if they were deemed "economically obsolete" or lacked amenities such as air conditioning and two-car garages.

But in New London, the city is not even pretending Fort Trumbull was blighted. Instead, it says the promise of more jobs and tax revenue is enough to justify taking the land—a rationale that has become increasingly popular since the Michigan Supreme Court endorsed it in 1981.

The Institute for Justice, which represents the plaintiffs in Kelo, emphasizes the sweeping implications of the jobs-and-taxes argument, which the Michigan Supreme Court itself renounced last July, just a few months after the Connecticut Supreme Court used it to approve New London's land grab. "Any home can be condemned because few if any homes can generate as much tax revenue or as many jobs as an office building," I.J. noted in its petition for Supreme Court review. "Any small or medium-sized business can be condemned because the land will always produce more taxes as a larger business."

New London's central planners are claiming the authority to take the property of anyone who is not, in their judgment, putting it to its best possible use—i.e., the use most lucrative for the city. Validating that claim would invite politicians throughout the country to engage in the sort of arbitrary interference that rightly outrages Susette Kelo and her neighbors.

"What galls me is the developer is taking my land so someone else can live here," Kelo says, noting plans for new housing units. "I'm not good enough to live here, yet someone else is."