Gentrification by fiat

On June 23, 2005, in the case of Kelo vs. New London, the Supreme Court of the United States handed down a judgment that confirms the right of local government to take away your home and give it to some private entity it deems more important than you. As Justice Sandra Day O’Connor summed it up in her dissent: “The specter of condemnation hangs over all property. Nothing is to prevent the state from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory.”

The right of eminent domain is embedded in the Fifth Amendment in the so-called Takings Clause: “…nor shall private property be taken for public use, without just compensation.” The Kelo case does not deal with “fair market” compensation, which is a vexatious question by itself. What it does do is to broaden the meaning of “public” so that it can be used to justify almost any taking.

Eminent domain has always applied to the building of structures like roads and public schools that are owned, built and operated by government for the people. Since 1954, it has also applied to urban renewal: the condemnation of blighted areas to make way for private development deemed beneficial to the community. Since then, the definitions of “blight” have become more lenient, while private commercial development of condemned properties has increasingly been seen to satisfy the condition of serving the “public good.”

That’s what just has happened in New London, the subject of the Kelo court case. The homes to be demolished are in a middle-class riverfront neighborhood. They are to make way for ritzy condominiums, an office building and a riverfront hotel. This is allowable, the Supreme Court majority opinion stated, because it benefits the community’s “economic development.” Unfortunately, since construction of any type, from higher-class housing to casinos, can be considered “economic development,” this leaves the door open for any developer to get any land they want, whether or not somebody else is using it.

A confluence of two factors makes our own area especially vulnerable to this Supreme Court decision. The first factor is our decades-long desperation for economic growth, a desperation most recently evidenced in our flirtation with gambling casinos despite their undoubted costs in crime, congestion and quality of life. In the quest for economic stimulus, the temptation could be enormous, even for people of good faith, to think that some big construction project is so important for the general good that it is worth kicking a few individuals and businesses off their properties.

The second factor is our rapidly accelerating development boom, which has attracted an influx of well-heeled real estate developers. If they think they can get better properties for less money by playing the eminent domain angle, some of them may be likely to try.

There is no appeal of a Supreme Court ruling. But the good news is that this opinion has created a rare alliance between the political left and right, both of which seem equally outraged. This has produced unusually rapid response of an U.S. House of Representatives amendment just added to an appropriations bill, denying federal funds to any project using eminent domain to force people off their lands for commercial development purposes.

In addition, the opinion specifically states “nothing in our opinion precludes any State from placing further restrictions on its exercise of the takings power. Indeed, many States already impose ‘public use’ requirements that are stricter than the federal baseline.”

Unfortunately, despite some recent reforms with regard to notification periods, New York State’s current laws on eminent domain appear on the permissive side. A number of cases are pending in New York City, in particular which, after Kelo, will probably be approved, such as the condemnation of 12 businesses in East Harlem, including a prosperous custom woodworking firm, for the purposes of building a Home Depot.

That means it’s time for us to contact our state representatives and get them to write “further restrictions on its exercise of the takings power” into our laws. Given the financial power of real estate development interests with politicians at all levels, that won’t be easy. But the alternative is unthinkable. Remember, your home may be next.

Dr. Punnybone

Putting It In Writing