Eminent Domain

Based on the centuries-old honored principle that “a man’s home is his castle,” the Institute for Justice seeks to restore strict limits for when the government can use eminent domain.

In the United States, eminent domain is the power of the government to take away someone’s private property. But the Fifth Amendment places two strict limits on eminent domain. First, private property can be taken only for “public use,” or public works projects, like roads and bridges. Second, even if a property is taken for a public use, the owner must be paid “just compensation.” 

Eminent domain was intended to be a narrow power and has rightly been called a “despotic” power of government, given its vast potential for abuse: It can destroy lives and livelihoods by uprooting people from their homes, businesses, and communities. For years, the Fifth Amendment to the U.S. Constitution and similar provisions in state constitutions greatly restricted this power.

Unfortunately, the U.S. Supreme Court wrote a blank check for local and state governments to abuse eminent domain in the now infamous Kelo v. New London decision. IJ represented Susette Kelo and other homeowners in New London, Conn., to save their homes from being demolished. But in a narrow 5-4 decision, the Supreme Court instead upheld the taking of their homes under the guise of “economic development.”

Kelo was the culmination of decades of judicial abdication. Starting in the mid-20th Century, the U.S. Supreme Court began to weaken constitutional protections against eminent domain by gutting the public use clause. In its 1954 decision, Berman v. Parker, the Court upheld the constitutionality of “urban renewal,” enabling the government to condemn so-called blighted property, even if the property ended up in the hands of private developers. Berman also upheld an expansive definition of public use, transforming the requirement to “public purpose.” In the Court’s eyes, the end use no longer mattered; the projects served the public purpose of renewal and revitalization.  

Worse, the criteria to declare a property “blighted” were (and still are) often vague, enabling local officials to condemn any perfectly fine home or small business. No longer bound by the public use requirement, officials across the country could take property they deemed “blighted” based on increasingly vague criteria, give it to their developer friends, and wipe out entire neighborhoods of people they deemed undesirable.  

Urban renewal proceeded to devastate vulnerable communities of color across the United States. Research by Dr. Mindy Fullilove identified over 2,500 urban renewal projects that forcibly removed more than 1 million Americans from 1949 to 1973. Among those forcibly removed, two-thirds were African American, who were five times more likely to be displaced.  

Decades later, communities targeted by eminent domain for private development are still more likely to be communities of color, while residents are much more likely to live at or below the poverty line and have lower levels of income and education than surrounding neighborhoods. 

Courts should have acted as a check on eminent domain. Instead, they significantly abdicated their role and often simply deferred to whatever claims of “public purpose” a legislature or administrative agency made, no matter how tenuous. With strong economic incentives and few judicial checks, abusing eminent domain for private gain grew.  

Although much progress has been made, IJ continues to fight against abusive condemnations in states that have failed to reform their laws, protect homeowners against government officials who try to undermine those reforms and stand up for the rights of property owners who face condemnation by private interests like pipeline companies or property developers. Only when eminent domain is reined in will everyone’s home truly be their castle.