Arlington, Va. — Imagine if two of your neighbors got together, claimed they established a new town, and then “voted” to take your property from you using eminent domain. Crazy, right? Not in Colorado, where the owners of Woodcrest Homes are battling a competing developer’s attempt to use eminent domain to take their property.
After battling in the courts for the last four years, today the Institute for Justice has partnered with Woodcrest to formally petition the U.S. Supreme Court to resolve whether the Constitution allows private developers to grant themselves the right to use eminent domain to seize someone else’s private property for their own gain.
In upholding the land grab, the Colorado Supreme Court wrote: “Permitting some private benefit by public taking may strike some as unusual. But Colorado is no stranger to this method of encouraging development.”
“When it comes to property rights, Colorado’s law is more akin to the Wild West than a constitutional republic,” said Jeff Redfern, an attorney at the Institute for Justice, which represents the petitioner. “This is nothing other than an old-fashioned landgrab. Unlike most eminent domain laws, which require governments to engage in the taking, Colorado’s law cuts out the middleman and just lets private developers use eminent domain to hand land over to themselves.”
In 2006, Woodcrest Homes began planning to build a housing development outside the town of Parker, Colo., and purchased a small piece of land sandwiched between two larger parcels to begin the project. When the housing market went bust in 2008, the project stalled. But years later, Century Communities, a competing developer, picked up where Woodcrest left off. Using Woodcrest’s own plans, Century purchased the two pieces of land surrounding Woodcrest’s parcel and created a so-called “municipal district”—a pseudo-governmental body permitted in Colorado—comprising all three pieces of land and staffed by Century’s own employees. The district then “voted” on whether to use eminent domain to take away Woodcrest’s land and—unsurprisingly—Century “won.”
Woodcrest challenged the taking, arguing that it violated the Fifth Amendment of U.S. Constitution, which only allows property to be taken for “public use.” But the Colorado Supreme Court disagreed, holding that the only thing that mattered was what Woodcrest wanted to put on the land (roads and utilities) not whether the process had been captured by a private developer serving its own ends.
“Eminent domain is supposed to be used by the government for the benefit of the public, not by developers for themselves,” said IJ Attorney Patrick Jaicomo. “Colorado law gives public power to private businesses to use for private gain. That’s plainly unconstitutional and we’re confident that U.S. Supreme Court will end this corrupt abuse of power.”
“Colorado law gives developers a blank check to use eminent domain to benefit themselves or harm their enemies,” concluded IJ Senior Attorney Robert McNamara. “But courts have a duty to make sure that public powers like eminent domain are used only for public ends. IJ will not rest until that happens—in this case and in every case.”