Property Rights

Not for Sale

The little pink house that sparked an eminent domain revolution

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The little pink house that was the centerpiece of the U.S. Supreme Court's infamous Kelo v. New London decision is standing once again. The house, moved from the now destroyed Fort Trumbull neighborhood, will stand as a monument to the bravery of Susette Kelo and her neighbors, and to the thousands of others who have battled and are battling the abuse of eminent domain across the country. In contrast, the project for which the City of New London forced out its citizens is dead in the water.

Today marks the three-year anniversary of the Court's ruling, easily one of the most despised decisions in the Court's history. In Kelo, the Court, by a narrow 5-4 margin, ruled that New London could take homes and small businesses to give to a private developer in the name of "economic development." The case caused a nationwide backlash against eminent domain abuse, resulting in judicial decisions, citizen activism, initiatives, and legislation in favor of property owners.

Since Kelo, two state supreme courts have explicitly rejected the decision, while another three have questioned the validity of the decision under their respective state constitutions. As cases come before them, more state courts are likely to do the same.

Moreover, there has been massive public awareness brought to the issue of eminent domain abuse. Although there was growing concern about the issue and some awareness before Kelo, after the decision, just about every reasonably well-informed person in the country now knows about the issue—and a vast majority of them oppose eminent domain for private development.

This significant public opposition to eminent domain abuse has led to a complete change in the Zeitgeist on the issue. While public officials, planners, and developers in the past could keep the condemnations for private gain under the public's radar and thus usually get away with the seizure of homes and small businesses, that is no longer the case. Property law expert Dwight Merriam notes: "The reaction to Kelo has chilled the will of government to use eminent domain for private economic development."

Also, in a mere three-year period, 42 states have changed their eminent domain laws either through citizen initiative or legislation. About half of these provide strong protection against the abuse of eminent domain and virtually all of them represent an improvement over the truly terrible eminent domain laws that were on the books before Kelo.

Even more remarkably, eminent domain reforms have been passed despite the fact that powerful interest groups—developers, municipal officials, and planners—have fought desperately to preserve their power. Certainly, much work remains to be done. For example, Connecticut, home of the Kelo decision, has passed no substantive reforms even though it has one of the most sweeping laws in the country authorizing eminent domain for private commercial development. Likewise, its neighbor, New York, has rampant eminent domain abuse and a legislature that refuses to act. For anyone who cares about property rights, what has happened post-Kelo, however, is a classic example of losing the battle but winning the war.

Meanwhile, a mile away from the pink house's new location, history is repeating itself in the Fort Trumbull neighborhood. Urban renewal, backed by eminent domain and taxpayer subsidies, has a sad and dispiriting history over the past 50 years, resulting in the destruction of poorer neighborhoods, and their replacement with failed or underperforming newer projects.

New London's Fort Trumbull project has so far been an unmitigated disaster. Despite the infusion of close to $80 million in taxpayer funds and three years elapsing since the Kelo decision, there has been no new construction in the area whatsoever. The preferred developer for part of the site, Corcoran Jennison, just missed its latest deadline for securing financing for building something—anything—on the site of the old neighborhood. The developer was so desperate for funding that it applied to the federal Housing and Urban Development agency to obtain taxpayer-subsidized loans to build luxury apartments in the area. Even the former editor of the local newspaper, who was a strong supporter of the project from its inception, admitted this month, "The city is unlikely to get much new tax revenue anytime soon in Fort Trumbull and a hotel [the supposed centerpiece of the project] is at least five years away, if at all."

Although Susette Kelo and her neighbors endured a tragic loss of their neighborhood, they can take comfort in the fact that they have left a legacy of real change and inspiration for millions of other property owners throughout the nation. On June 21, a ribbon-cutting ceremony and party was held at the little pink house, celebrating the fact that it will still be a home, and one that changed the nation for the better.

Scott Bullock is a senior attorney at the Institute for Justice, the non-profit, public interest law center that litigated the Kelo case. Bullock argued the case before the Court.