What is eminent domain?
Eminent domain is a good example of the concept that private property rights are one of our strongest rights as Americans. However, these rights are not absolute. Through eminent domain, the government has the power to take private property for public use, with or without the consent of the owner.
Justification for Eminent Domain
While eminent domain existed before the U.S. Constitution was drafted, the drafters of the Constitution put limits on this power of government through the 5th Amendment Takings Clause. The takings clause states that private property can be a governmental “taking,” as long as it is used for a public purpose and there is just compensation.
The justification for eminent domain has always been simple. We all live in a society, and for this society to function properly, we must exchange some autonomy and control for the good of the general public. However, as you will see, while there are benefits to eminent domain, this power of government has also been the subject of heavy criticism.
Public Purpose and Eminent Domain
While eminent domain rights have broadened in recent years, this right is still not without limits – the land taken by the government through eminent domain must be used for a “public purpose.” Because the U.S. Supreme Court allows the lower courts to determine the meaning of “public purpose,” the meaning of this phrase has been interpreted in a variety of ways.
“Public purpose” most commonly means that the private property is taken to build highways, or government buildings and structures such as schools or parks. However, courts have found that “public purpose” has a broader meaning as well, and have allowed government to exercise eminent domain to further public goals through private companies. The rationale for this is that certain public goals can be accomplished more effectively when done through private enterprises.
While private enterprises are benefiting from property taken through eminent domain, courts have held that this situation still meets the “public purpose” criteria. These types of takings are most commonly known in cases where eminent domain is exercised for the purpose of building railroads. These railroads are generally owned by a private company, which ultimately benefits from the taking, yet the taking furthers the important public goal of public transportation.
Private Property and Eminent Domain
Courts have also allowed government to allocate private property to private companies through eminent domain in “blighted” areas, for the purposes of spurring economic development. The benefits of allowing this are that bad conditions and slums are eliminated, and growth is encouraged. The drawbacks are that this can lead to corruption. Interested private enterprises can bribe the government through campaign contributions or exploit this power in other ways.
Further, this type of eminent domain, which only sacrifices deprived areas of the country, sacrifices lower class neighborhoods for upper class purposes, which ultimately means displacement for whole communities. Finally, some jurisdictions have been criticized for over broadening the “blighted” criteria, and for finding this type of eminent domain appropriate in neighborhoods that are far from deprived.
Just Compensation and Eminent Domain
The Supreme Court has determined that “just compensation” means fair market value, or the amount that a willing buyer, under no pressure, would pay for the property. Unfortunately, this is not always “fair,” especially when it comes to commercial properties. Businesses that lose their property through eminent domain sometimes have little or no other place to go. This is particularly true when businesses are forced out of poorer neighborhoods to make room for newer business that will spur growth. Some jurisdictions have attempted to correct this problem by compensating the business for disruption, or for loss of “goodwill.”
Eminent Domain Procedure
Though eminent domain procedure will vary by jurisdiction, the government will generally initiate the process, condemning the property by issuing a declaration of public need. This is followed by an appraisal of the property, and finally an offer of “just compensation” to the owner. Many times, the owner will dispute either the right of the government to take the property, or the amount they are being offered. In these eminent domain cases, the owner can sue the government, and let the court determine the outcome.