On June 23, 2005, the U.S. Supreme Court, in a 5-4 decision called Kelo v. City of New London, ruled that private economic development is a public use under the Fifth Amendment to the U.S. Constitution and that governments could take people’s homes, small businesses and other property to hand over to private developers in the hope of raising more tax revenue and creating more jobs.
The U.S. Supreme Court should have ruled in favor of the Kelo homeowners and established a federal baseline that would protect home and business owners throughout the nation. Instead, it threw the issue to the states, completely abdicating its role as guardian of Americans’ rights under the U.S. Constitution.
Less than one week after the decision was handed down, the Institute for Justice launched a national campaign called “Hands Off My Home.” IJ was determined to focus the outrage over Kelo and turn it into meaningful reform. In the five years since the decision, there has been an unprecedented backlash against the Kelo ruling in terms of public opinion, citizen activism, legislative changes, state court decisions, and lessons learned from the New London case:
Kelo educated the public about eminent domain abuse, and polls consistently show that Americans are overwhelmingly opposed to Kelo and support efforts to change the law to better protect property rights.
Citizen activists defeated at least 44 projects that sought to abuse eminent domain for private gain in the five-year period since Kelo.
Forty-three states improved their laws in response to Kelo, more than half of those providing strong protection against eminent domain abuse.
Nine state high courts restricted the use of eminent domain for private development since Kelo while only one (New York) has so far refused to do so.
The New London project for which the property was taken in Kelo has been a complete failure and is now Exhibit A in what happens when governments engage in massive corporate welfare and abuse eminent domain. Although the project failed, Susette Kelo’s iconic little pink house has been moved to downtown New London and preserved. It still stands as a monument in honor of the families who fought for their rights and who inspired the nation to change its laws to better protect other property owners.
These dramatic changes are briefly addressed in this report.