Up From Kelo:
Ohio and Property Rights
By Henry Wickham
Private property rights of citizens are no less important
to the protection of citizens from intrusive government than the freedom from unreasonable
search and seizure or the right to a jury trial. Thus, Alexander Hamilton called
the protection of property one of the “great objects of government.” This principle
is embodied in the Fifth Amendment, among other places, of the United States Constitution
which states:
“[N]or shall
private property be taken for public use, without just compensation.”
There is little
controversy over the power of a governmental agency to take private property by
eminent domain for a genuine public use. Roadways, schools, and parks are examples
of this sort of public use.
In 2005, the
United States Supreme Court dealt a serious blow to property rights in the now notorious
case of Kelo v. City of New London. In an effort to increase its tax base and attract
businesses, the City of New London, Connecticut adopted a waterfront development
plan that required the removal of many private homes. This property was to be turned
over to private developers who would then own and develop the water front.
Nine property
owners refused to sell their homes. One property owner had lived in her home since
1918. The parcels of these homeowners were to be developed for office space, parking
lots, retail space, all privately owned. These homes were not “blighted” or “deteriorated.”
The City sought to force the sale by its powers of eminent domain.
In a five to
four decision, the United States Supreme Court upheld the power of the City of New
London to take the private property of citizens and turn it over to other private
citizens for development.
In its interpretation
of the Fifth Amendment the Court essentially redefined the words “public use” to
mean any purpose established by the governmental agency that has some public benefit.
After Kelo a governmental agency may take private property by just coming up with
a plan that has some arguable public benefit. (“Just compensation” was not an issue
in the Kelo case). The agency can then turn over the property to private developers
for their ownership and profit.
Justice Thomas’s
dissent in Kelo makes an interesting point about the standard of review by the majority
and the level of deference that must be shown to local authorities. Justice Thomas
noted that the Court uses the highest “strict scrutiny” standard when evaluating
whether a governmental agency can come into a citizen’s home, but it uses the most
lenient, deferential standard when reviewing whether that same government agency
can destroy that citizen’s home.
Furthermore,
the dissents of both Justice O’Connor and Justice Thomas note the incongruity of
the Court’s supposedly compassionate wing siding with local politicians and real
estate developers against the poor. Both noted that it will be the poor who are
most likely to lose their homes in the name of some redevelopment plan. Such is
the incoherence when Justices find a “living constitution,” where they can rule
based upon personal preferences in an individual case rather than upon the constitutional
text.
In the majority
decision in Kelo, the Court limited its interpretation to the Fifth Amendment of
the United States Constitution, and did not rule out the power of states to provide
more stringent protections for private property rights. As invited by the majority
in Kelo some states have taken the initiative to better protect private property
rights in eminent domain cases.
The State of
Ohio, to its credit, has shown more respect for private property in eminent domain
cases than either the City of New London, Connecticut, or the United States Supreme
Court. In 2006 the Ohio Supreme Court refused to allow the City of Norwood to do to homeowners what the City of New London did to its homeowners. The Ohio Supreme
Court, interpreting the Ohio Constitution, refused to find “economic benefits alone
to be a sufficient public use for a valid taking.” It recognized that a “beneficial
use is not necessarily a public use.” Unlike the United States Supreme Court which
took the most differential and least rigorous standard of review of the City’s actions,
the Ohio Supreme Court “strictly construed” the City’s action, and it supported
the principle of resolving doubt over the propriety of the taking in favor of the
property owner.
Also, in response
to Kelo, the Ohio legislature has acted to limit the ability of governmental agencies
in Ohio to take private property by eminent domain for the purpose of redevelopment.
The power of eminent domain has often been used in the past for what has euphemistically
been called “urban renewal.” The Ohio legislature has now narrowed the definitions
of “blighted areas,” “blighted parcels,” and “slums” to make a much higher burden
on local officials who try to use “slum clearance” as a pretext for use of its eminent
domain power.
The legislature
has specifically defined “public use” to exclude “any taking that is for conveyance
to a private commercial enterprise” unless the governmental agency establishes by
a preponderance of the evidence that the area or parcel meets the tougher definition
of “blighted.”
Most importantly
in light of the Kelo decision, the Ohio legislature has mandated that when considering
whether a property is “blighted,” the public agency is not permitted to consider
“whether there is a comparatively better use” for the property or “whether the property
could generate more tax revenues if put to another use.” These were the two most
important factors for the City of New London and they are now forbidden in the State
of Ohio.
The statute builds in other protections for property owners. The burden of proof in contested
eminent domain cases is now shifted from the property owner to the governmental
agency. When the governmental agency desires to take property that it claims is
“blighted,” there is no longer a legal presumption in its favor. Generally, property
owners have a more expedited appeals process if they lose at the lower court level.
There are new procedures for discouraging low-ball offers from the governmental
agency, and there are now circumstances where the property owners can recover their
attorney’s fees.
These reactions
of the Ohio Supreme Court and legislature to the trampling of property rights in
eminent domain cases are commendable. They represent an improvement of the balance
of those rights of property owners and the power of the State that was so enhanced
by the Kelo decision.
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