Kelo v. City of New London: Eminent Domain and Public Use

August 25, 2024 4 min read Law Government Regulations Eminent Domain Supreme Court Property Law Government Regulations U.S. Constitution

A U.S. Supreme Court decision that expanded the concept of constitutionally allowable taking of private property for public use to include takings for commercial developments benefiting the community.

On this page

Kelo v. City of New London was a landmark decision by the U.S. Supreme Court that significantly expanded the interpretation of “public use” under the Fifth Amendment to the U.S. Constitution. This decision permitted the taking of private property through eminent domain for commercial development projects which were argued to benefit the community, notably through increased property tax revenues.

Background and Historical Context

Case Origin and Proceedings

The case began when the City of New London, Connecticut, decided to use its eminent domain authority to seize private property for the purpose of economic development. The city intended to transfer the land to private developers to construct a complex including offices, a hotel, and a conference center. The city argued that the development would create jobs and increase tax revenues.

Petitioners and Respondents

Petitioners: Susette Kelo and other property owners who challenged the city’s action.
Respondents: City of New London and the private developers selected for the project.

Legal Framework and Arguments

Eminent Domain and Public Use

Under the Fifth Amendment of the U.S. Constitution, the government is authorized to take private property for “public use” provided just compensation is given. Historically, “public use” was interpreted narrowly to include projects like highways, schools, and other directly public facilities.

Expansion of Interpretation

The central legal question in Kelo v. City of New London was whether the city’s plan constituted a permissible “public use” under the Fifth Amendment despite the property ultimately being used for private development.

The majority opinion, delivered by Justice John Paul Stevens, held that the general benefits a community could derive from economic growth, such as job creation and increased tax revenues, satisfied the public use requirement.

Key Points of the Decision

Majority Opinion

Court’s Rationale: The Court applied a broad interpretation of public use, affirming that economic development, even if privately executed, was permissible under the Fifth Amendment.
Precedent Applied: The decision referenced earlier cases like Berman v. Parker and Hawaii Housing Authority v. Midkiff, emphasizing a deferential approach to legislative judgments in economic matters.

Dissenting Opinions

Concerns and Criticisms

Justice O’Connor: Argued that the decision essentially rendered the “public use” clause meaningless, allowing any property to be taken for a private project promising increased tax revenue.
Justice Thomas: Warned against the potential for abuse, particularly against underprivileged communities.

Implications and Controversies

The Kelo decision remains controversial. Proponents argue it provides municipalities with powerful tools to revitalize and economically develop distressed areas. Critics, however, argue it disproportionately impacts low-income and minority communities, displacing residents for developments that do not necessarily benefit them.

Legislative Responses

In response to the public backlash, many states enacted laws restricting the use of eminent domain for economic development, aiming to provide more robust protections for property owners.

Eminent Domain: The right of a government to take private property for public use, with compensation.
Public Use: Historically interpreted as use by the public, now includes broader community benefits like economic development.
Just Compensation: Requirement that the government must fairly compensate the owner of the property taken under eminent domain.

FAQs

Can eminent domain be used for private development?

Yes, according to the Kelo decision, if the development provides significant benefits to the community such as job creation and increased tax revenues, it can be considered “public use.”

Who decides what constitutes public use?

Typically, this is determined by local governmental entities and legislative bodies, with courts providing a level of review to ensure compliance with constitutional standards.

Did the Kelo property ultimately get developed?

No, the intended development in New London did not fully materialize, leading to criticisms of the decision and public disappointment.

References

U.S. Supreme Court. “Kelo v. City of New London,” 545 U.S. 469 (2005).
Berman v. Parker, 348 U.S. 26 (1954).
Hawaii Housing Authority v. Midkiff, 467 U.S. 229 (1984).

Summary

The Kelo v. City of New London decision represented a significant moment in U.S. constitutional law, broadening the scope of “public use” to include private, economically beneficial development projects. Despite the intention to foster economic growth and community benefits, the decision sparked intense debate and led to legislative changes across various states, aiming to balance economic development with the rights and protections of property owners.