The city of Elberton, Georgia has decided to get into the hotel and restaurant business—and is taking a family business’s property to do it.
Robert and Rina Thomas own a little, 567-square-foot office building on the Public Square in Elberton, Georgia. They have operated their chicken wholesaler business in the building—6 South Public Square—since 1998, and have owned the building since 2003. Rina grew up in Elberton, while Bob has called the town home for more than 30 years.
Rina and Bob love their building; its central location means plenty of friendly visitors throughout the day. Rina and Bob also use it to get involved in local politics and to sell tickets for a nearby, non-profit community theater.
Next door to 6 South Public Square is the Samuel Elbert Hotel. In 2012, the city bought the hotel as part of an economic redevelopment project. When the city started a $4.9 million renovation project on the hotel, it began to trespass on Rina and Bob’s property. Over Rina and Bob’s objections, the city hung a crane and a several-ton dumpster above their building, which put them and their customers in danger. The building sustained several thousands of dollars of damage from falling debris.
The city made it clear that the hotel would be a private business once renovations were complete. Even though the city owns the hotel, it planned to and did lease it out to private operators. Elberton’s city manager explained: “This is a standard lease. We are not having anything to do with the day-to-day operation. This is a private business with a private owner.”[c]Mark Berryman, Council approves hotel restaurant lease, Elberton Daily Star, Aug. 3, 2016, at 1.[/c]
Six South Public Square is not for sale.
The city made several attempts to get Rina and Bob to sell their property to the city for the hotel’s use. But if Rina and Bob sold the building, they would have to find a new building outside of the Public Square. They don’t want to move. This is why Rina and Bob repeatedly turned down the city’s offers to buy the building.
After Rina and Bob rejected the city’s last offer in mid-April, the city launched a new strategy for getting 6 South Public Square: eminent domain.
Days after the Thomases’ rejection, the city changed its plans for the hotel. Instead of leaving 6 South Public Square alone, the city had new plans drawn up showing the building torn down to make a “public walkway” that would connect a parking lot and the hotel. But there is already a public walkway on just the other side of the hotel—about 100 feet away from Rina and Bob’s office. In June 2016, the city filed an eminent domain lawsuit to take the building for this “new walkway” and for the airspace above the building, which the city had already been trespassing on.
What the city did is called a pretextual taking—making up a reason, a “pretext,” for taking property when the law would not allow eminent domain for the government’s actual reason. This practice is unfortunately common, but it is unconstitutional. To escape even the minimal protections for private property under the U.S. Supreme Court’s infamous 2005 ruling in Kelo v. City of New London, governments have frequently tried to hide the real reason they use eminent domain. But pretextual takings are not allowed.
Elberton is trying to evade meaningful protections for property owners.
The U.S. Supreme Court’s 2005 ruling in Kelo v. City of New London is one of the most reviled decisions in U.S. Supreme Court history—and rightly so. In Kelo, the city of New London, Connecticut decided to seize homes and turn them over to another private party in the hope that the new owners would use the land in a way that could create jobs and pay higher taxes. The Supreme Court upheld the taking, ruling that even a mere promise of generating “public benefits,” whether those benefits are likely or not, justifies taking someone’s home and turning it over to another private party for that party’s private profit.
The nationwide backlash against Kelo was swift and nearly unanimous. Public opinion polls consistently show that more than 80 percent of Americans disapprove of using eminent domain for private gain. As of 2016, 44 states have legislatively reformed their statutes to some degree to afford property owners greater protection against the wrongful seizure of their property through eminent domain. Three state supreme courts have squarely considered the Kelo question and unequivocally rejected the use of eminent domain for economic development.
Georgia is one of the states that meaningfully reformed its eminent domain laws. In 2006, following Kelo and Georgia’s own “mini-Kelo”—the Stockbridge Florist & Gifts case—the Legislature passed, and the Governor signed into law, the “The Landowner’s Bill of Rights and Private Property Protection Act.”[c]See generally Jody Arogeti, et al., Eminent Domain, 23 Ga. St. U.L. Rev. 157, 158-67 (Fall 2006) (discussing motivations for the Act).[/c] The Act not only made clear that eminent domain is limited to “public use,” it restricted the definition of “public use” to preclude abuses like Kelo.[c]O.C.G.A. § 22-1-1(9)(A).[/c] Just as important, the Act made clear that “public use is a matter of law to be determined by the court and the condemnor bears the burden of proof.”[c]O.C.G.A. § 22-1-2(a).[/c] And the Act added numerous procedural protections for property owners facing eminent domain.[c]See, e.g., O.C.G.A. §§ 22-1-9, 22-1-10, 22-1-10.1, 22-1-11.[/c]
Georgia did not, however, reform all its eminent domain laws. Specifically, the statutes granting cities the power of eminent domain for “public road and other transportation projects” were not amended. Under these statutes, there is a presumption in favor of the government’s decision to take property.[c]West v. Department of Transp., 176 Ga. App. 806, 806-07 (1985).[/c] This means the burden is on property owners to show why they should get to keep their property.[c]O.C.G.A. § 32-3-11(b).[/c] Moreover, these statutes allow “quick take” proceedings, where government gets immediate title to the property, property owners have only 30 days to object, and government can kick the property owners out just 60 days after it files the eminent domain action.[c]O.C.G.A. §§ 32-3-7(a), 32-3-11(c), 32-3-12(b).[/c]
These are the powers the city tried to use to take Rina and Bob’s property. But the city’s use of Rina and Bob’s property was not for a “public road and other transportation project.” And the use certainly cannot be for a “public road and other transportation project” when the real reason was to benefit the private for-profit businesses in the hotel.
Because eminent domain—especially quick take proceedings—can deprive people of their property, courts strictly construe eminent domain statutes to ensure property and due process rights. Strictly construing the power to take property for “public road and other transportation projects” is also necessary to prevent Georgia governments from improperly invoking that power to avoid the important provisions of The Landowner’s Bill of Rights and Private Property Protection Act.
Georgia Courts Uphold Property Rights Protections
Even though the federal courts have abandoned their duty to guard against eminent domain abuse, the Georgia courts remain engaged to protect private property rights. Georgia courts have the power to put a stop to the abuse of eminent domain. Georgia courts have set aside eminent domain efforts that were based on fraud or bad faith. They have set aside takings based on the abuse or misuse of eminent domain. Georgia courts are clear that government cannot use eminent domain “to acquire property to be used by private individuals for private use and private gain.”[c]Department of Transp. v. Livaditis, 129 Ga. App. 358, 361 (1973)[/c] And they engage with the real facts of eminent domain cases to ensure that private property rights are protected. So Georgia courts have set aside the use of eminent domain where government has put forward a pretextual reason for eminent domain[c]Earth Management, Inc. v. Heard Cty., 248 Ga. 442 (1981).[/c] and where the “real reason” for eminent domain was to benefit a private entity.[c]Brannen v. Bulloch County Cty, 193 Ga. App. 151 (1989).[/c]
Against this backdrop, the Institute for Justice teamed with Rina and Bob Thomas to protect their property from yet another instance of eminent domain abuse. Once IJ got involved the city backed down. They dropped the eminent domain threat and paid the Thomases for the damage to their building’s roof. The eminent domain suit was dismissed in 2017.
The Institute for Justice: Fighting to Protect Property Rights for 25 Years
The Institute for Justice is the national law firm for liberty. It has earned its reputation as a formidable foes of eminent domain abuse. The U.S. and every state Constitution protect property rights because they are the foundation of our independence as responsible citizens. Indeed, for most Americans, ownership of a home or business is the cornerstone of their efforts to provide for their families and realize their dreams. The wrongful use of eminent domain to transfer property from one private owner to another does not simply destroy a home or business; it very often destroys a life, one patiently built through years of hard work.
The Institute for Justice has litigated eminent domain cases nationwide, successfully preserving the rights and properties of the politically and financially disenfranchised. Among IJ’s victories are:
The litigation team for this case is Institute for Justice Senior Attorney Paul Avelar and Institute for Justice Attorney Joshua House. Georgia attorney Kip Shepherd will serve as local counsel and help litigate this case.
For more information, please contact:
Director of Communications
Institute for Justice
(703) 682-9320 ext. 206