The 5th Amendment of the U.S. Constitution ends with “nor shall private property be taken for public use, without just compensation”. This sentence has been referred to as the “Takings Clause”, which enables “eminent domain” for a government to expropriate private property for public USE. However, there has now come to be policies that stretch the concept of public USE to also include public BENEFIT. The watershed moment for this change came in the 2005 Supreme Court case “Kelo v. City of New London” in which the court upheld a government coerced land transfer from one private owner to and for the benefit of another private owner based on the pretext of economic development that benefits the public.
Advocates of private property rights saw the Kelo decision as very troubling and took action. In an August 2007 report by the Institute for Justice, 44 states responded, in just 2 years’ time, to rein in the potential for eminent domain abuse as a result of the Supreme court’s Kelo decision. Give credit to Marco Rubio, then state rep in the state of Florida, for producing HB 1567 which offered strong legislative change, along with House Joint Resolution 1569 which was a voter approved ballot initiative passed in November 2006, embedding reforms into the state constitution. Florida’s response to Kelo scores high by most reports from legal scholars.
New York still has no positive response to Kelo. According to a 2015 Dana Berliner article in the Yale Law Journal, these eminent domain cases were upheld in New York: private development around a sports stadium, the expansion of Columbia University, the replacement of a CVS with a Walgreens, and the enhancement of a golf course. If you are a private property owner in New York State, you had better have a solid business plan for efficient and profitable use of your land, or a developer in cahoots with the government may make a case to take it from you.
But it gets worse. In 2011 New York established a “Land Bank” program to supposedly combat the problems of vacant and abandoned properties. The oft-stated intent is to allow communities to facilitate the return of vacant, abandoned, and tax-delinquent properties to productive use. The hope is for the Land Bank program to re-capture losses from delinquent properties through a plan other than putting properties up for auction at pennies on the dollar for what they might be worth.
But the rules for land bank acquisition present the same hazards as Kelo—collusion between local the government and land developers. We need to shackle in Land Banking to be sure it doesn’t also become abused, and we need to finally do something about Kelo. Private property rights are under duress in New York. However, being that eminent domain for public USE is constitutionally authorized, we should at a minimum require the government to use eminent domain for genuine public use—not for private BENEFIT.
To libertarians, even the public USE concept of eminent domain isn’t just cause for seizure of property. Walter Block had a nice YouTube video about the concept of developing private roads WITHOUT any need for eminent domain. Most of us libertarians would prefer the government had no right under any circumstances to seize private property.