Affordable Housing Institute : US

In yet another very close decision, the Supreme Court voted 5-4 to approve New London’s eminent domain taking of several homes in Fort Trumbull.  I’ve blogged this at length and also blogged the oral arguments, so the decision is not exactly surprising.

I’m in Nairobi now on AHI business — working with the Kenyan Ministry of Lands and Housing to tackle the enormous and complex problem of upgrading some of the world’s worst slums — and will not be able to study the decision until my return to the USA.  Of most interest will be two questions:

1.  Did the court give a sweeping expansion of eminent domain, or did it simply conclude that New London had found enough clear evidence of impending blight and a rational plan?  In other words, did the court in effect merely apply existing ‘blight’ doctrine to the facts at hand?  I’ll bet it did.

2.  How much dicta did the court provide on the critical question of ‘just compensation’?  As I argued in my lengthy blog post, eminent domain differs from other forms of taking in that the state, while acting ostensibly to improve the health of communities, also has a financial interest in the outcome.  In such a case, giving those who hold out a stake in the upside would provide a nice economic counterbalance and check on city councils run amok.

More when I get back to the USA.

UPDATE: The blogosphere is alive with the sounds of Kelo posting!  For more on Kelo, check out the terrific posts at SCOTUS blog and the Volokh Conspiracy.  Both are group discussions by very smart lawyers who, while not expert in urban development, are showing remarkable civility in working through what continues to be a very complex question balancing common good with private property rights.

FURTHER UPDATE (7/1): Who’d have thought a complex Supreme Court case would generate such passion?  Enter the House of Representatives:

Last week’s 5 to 4 decision has drawn a swift and visceral backlash from an unusual coalition of conservatives concerned about property rights and liberals worried about the effect on poor people, whose property is often vulnerable to condemnation (link in .pdf) because it does not generate a lot of revenue.

The House measure, which passed 231 to 189, would deny federal funds to any city or state project that used eminent domain to force people to sell their property to make way for a profit-making project such as a hotel or mall. Historically, eminent domain has been used mainly for public purposes such as highways or airports.

Aside from the ‘just compensation’ question, where I think the real issues lie, there is also the important ‘due process’ question whether a public use (as required under the Fifth Amendment) is satisfied by invoking a public purpose via a private use (as in a reflector transaction whereby one private owner is awarded property the government has taken from another private owner).  [Note that the Post conflates the two.]  An excellent examination of this second question by Todd Zywicki may be found here.

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