Wrecking property rights: how cities use eminent domain to seize property for private developers

Reason, Feb, 2003 by Sam Staley

That may already be happening. In Chester County, Pennsylvania, near Philadelphia, the city of Coatesville, population 11,000, has decided it's going to revitalize itself with a 230-acre recreation center. Plans include two ice rinks, bowling alleys, a go-cart track, rock climbing walls, a 270-room hotel and conference center, an 18-hole golf course, miniature golf, pitch 'n' putt, and a driving range, among other attractions. The city manager, Paul Janssen, thinks the project will attract corporate executives to the former steel town once they see the downtown (which will "soon" be revitalized). The average home in Coatesville is worth $56,000. Local homeowners are resisting the attempts by the city to condemn their land, but their prospects are dim. Dick Saha's farm has been condemned even though it's located outside the city limits. He can't even vote for or against the people who are taking his land.

Beyond the Courts

Despite recent victories, the courts are unlikely to be much help in reining in abuses of eminent domain. The courts "don't feel comfortable saying, 'We know better than the government' on public use," observes Garnett. When they intervene, they usually "pick up procedural aspects of the implementation of the law." This was the case even in Illinois, she notes. The Illinois Supreme Court objected to the government's "offering its services for eminent domain. It wasn't saying that economic development was not a public use."

"The constraint on local governments has seldom been the courts," agrees Fischel. "Local politics and public opinion discourages unprincipled takings because using eminent domain for arguably private purposes is often unpopular."

In fact, many of the recent victories against eminent domain abuse have resulted from nonjudicial remedies. Pittsburgh backed off its plans to oust 125 local businesses through eminent domain after a well-orchestrated protest campaign made the issue too risky politically and the key anchor--a Nordstrom's department store--pulled out of the project. (See "Death by Wrecking Ball," June 2000.) Similarly, IKEA backed out of the New Rochelle plan after it found itself facing negative coverage in the local media and public demonstrations (including one outside the Swedish consulate in New York). In Baltimore County, Maryland, condemnation for redevelopment purposes went to the ballot and was rejected by more than two-thirds of voters. The county had planned to condemn 100 properties, including three apartment complexes, and replace them with upscale homes, retail businesses, and restaurants.

The Castle Coalition, a grassroots group founded in early 2002 to help property owners fight eminent domain abuse, aims to organize such popular resistance. Most property owners, after all, don't have access to attorneys, and many tend to assume that local governments are acting in the public interest--even when their property is being condemned.

Protest, alas, is not always enough. The city of Mesa has suffered a barrage of negative press over the Randy Bailey case. Yet the city government has refused to back down from its position that virtually anyone's property in Mesa can be seized and handed over to his neighbor as long as enough people on the city council vote for it. The city of Coatesville shows little willingness to back down on its taking of the Saha's property and even placed a two-page ad in the local paper supporting its decision and criticizing the Saha's and other property owners' opposition. In the end, it will be up to the judiciary to determine how far eminent domain can go--and whether property ownership is simply a temporary condition subject to the whims and pleasures of local officials.