What's yours can be mine: are there any private takings after Kelo v. City of New London?

• Author: Schultz, David A.

The Supreme Court's decision in Kelo v. City of New London, (1) upholding the use of eminent domain to take private property from one owner and give it to another in order to promote economic development, angered many. (2) Some felt that this decision meant the "public use" stipulation for the use of eminent domain no longer had any meaning and that the Court was now prepared to endorse any taking for any reason, so long as compensation was paid. Did Kelo in fact signal the death knell for the "public use" doctrine? If yes, this is not the first time that property rights advocates would have made this claim. Following decisions such as Hawaii Housing Authority v. Midkiff (3) and Poletown Neighborhood Council v. City of Detroit (4) similar laments were heard. (5)

This Article will argue that Kelo did not render toothless the public use stipulation on eminent domain. Moreover, it will also argue that the decision did not really represent any major change in the law as it had evolved in the last 20, if not 100, or so years. The real importance of the Kelo decision lies in its effort to articulate a new test already emerging in state law regarding what separates a private from a public taking. This distinction centers in on the role of the comprehensive plan as a tool for demarcating the boundary between a purely private taking and one promoting a public use.

The article first presents a jurisprudential history of the public use doctrine at the federal and state level. The reason for this discussion is twofold: first, to show that economic development was already an accepted goal of eminent domain even prior to Kelo and, second, to show how previous efforts to draw a bright-line rule distinguishing a valid public use from a private taking had failed. The second part of the Article examines the Supreme Court's Kelo opinion, concentrating on how it discussed the role of comprehensive plans as a possible means of distinguishing public from private takings. Finally, the third part of the article draws upon three pre-Kelo state court opinions to demonstrate two points. One point is that comprehensive plans had already been used in an effort to clarify when a taking is for a public as opposed to a private use. The other point is that even in jurisdictions that recognize a broad authority to use eminent domain for economic development purposes, it is still possible to find that some takings are not valid in that they serve private interests. This is the case even when a comprehensive plan is in place.

Overall, this article argues that while the Court in Kelo hinted at a new test to distinguish valid public from invalid private uses of eminent domain, and even though the presence of a comprehensive plan may not ultimately be a satisfactory means to distinguish the two types of takings, nonetheless, the decision does not mean that the public use doctrine is dead.

I.

DISTINGUISHING PUBLIC FROM PRIVATE TAKINGS

The jurisprudential road to City of New London v. Kelo is punctuated by three characteristics when it comes to the public use doctrine. First, the term "public use" is ambiguous, yielding many competing definitions. Second, previous efforts to forge a precise distinction or fashion a bright-line rule between a taking that is for a valid public use versus one that is for a private benefit have failed. Third, "public use" is an elastic concept, yielding over time to an ever broader array of activities which may be undertaken or facilitated by eminent domain. Due to these three characteristics, a brief history of the public use doctrine reveals that, even prior to Kelo, the use of eminent domain for economic development purposes was already well accepted and permitted.

1. Competing Visions of Public Use

   1. The Broad and Narrow Public Use Doctrines

      The "public use" doctrine can be described as an "essentially contested concept" whereby its meaning has been subject to debate over time. (6) A history of this doctrine shows that various courts and legislatures have defined "public use" to mean "used by the public," "public advantage," "promoting the public welfare," the "public good," and "public necessity," among other similar conceptualizations. (7) In efforts to try to distinguish between a public use and a private benefit, courts have employed a variety of tests. They range from insisting that the public have a right to use the property taken, or that everyone must benefit from the project for the condemnation to be considered valid, to a private acquisition being one where the private benefits are primary and not secondary to the public benefits. Yet despite these tests, clear demarcation between a public and a private use has been difficult for at least two reasons.

      First, local customs and conditions have significantly influenced the meaning of public use in both the United States and individual state constitutions. (8) For example, though irrigation of private property in a dry climate, given local weather conditions, the state of the economy, and patterns of land ownership, may be considered a valid public use in one community, (9) such irrigation in a wet climate may not be considered a valid public use but may be seen as simply favoring a private interest. Legislatures are clearly influenced by local conditions when determining eminent domain policy and local courts pay great respect to local determinations of public use. (10) In effect, the law on what constituted a valid "public use" was constructed from the bottom up, with local jurisdictions basing determinations upon local conditions and needs, resulting in a lack of a unified or uniform definition of a valid "public use."

      The federal courts reinforced this process by giving great deference to local determinations of public use. For example, the 1896 decision in Missouri Pacific Railway Company v. Nebraska (11) was the first and last time the United States Supreme Court overruled a state court determination of what constituted a valid public use. Justice Holmes, in Strickley v. Highland Boy Mining Company, (12) underscored this point, indicating that if eminent domain statues of a state are constitutional, the Supreme Court would "follow the construction of the state court." (13)

      A second reason for the vagueness of the public use doctrine is that throughout American history, it has carried two distinct meanings. One, the narrow meaning, defines public use as "used by the public." (14) A project must be used by many people for it to be considered public. (15) The second definition, the broad construction, equates public use with public advantage, public utility, or public purpose. (16) This meaning suggests that almost any project can be construed as a public use as long as it is shown that it furthers economic development, public welfare, or a better use of local resources. (17)

      Throughout American history courts have wavered between applying the broad versus the narrow constructions of public use, but during the twentieth century, and most certainly at present, the broad construction of public use has triumphed. (18) This has resulted in legislatures being given wide deference in local determinations of what constitutes a valid public use, with public use eventually given a scope equal to that of the police power in Hawaii Housing Authority v. Midkiff. (19)

      Colonial and early American uses of eminent domain were confined mainly to the building of roads, schools, and other public buildings. (20) In some cases eminent domain furthered economic development, but generally, while the eminent domain power was established and accepted, little discussion about the meaning of public use occurred. (21) Moreover, the Fifth Amendment Takings Clause did not apply to the states until 1897. (22) Thus, unless local state constitutions had a public use stipulation, they were not limited by federal "public use" constitutional standards. In 1776 only two state constitutions had a public use clauses, and it was not until about the 1830s that most states had such a stipulation attached to the exercise of eminent domain power. (23) Overall, federal courts did not become involved with public use and eminent domain questions until the last quarter of the nineteenth century, (24) leaving local state courts as the mainstay in constructing the public use meaning, subject to local conditions. The result was a plethora of different uses upheld as valid condemnations, subject to competing broad and narrow constructions of the term.

      Two events are particularly important in early state history of public use and eminent domain. First, state judges articulated both a broad construction of public use to justify state support of economic development, and a narrow meaning of just compensation as a way to make traditional property owners subsidize new commercial interests. (25) Eminent domain was an important nineteenth-century economic development tool, used to redistribute economic and political power and wealth. (26) Until the 1830s public use was not a judicial question, but generally a legislative one, giving state representatives wide latitude to further economic development goals. After this time the courts, especially in New York, became more conservative and made public use determinations judicial questions. (27)

      One early example of this change is Bloodgood v. The Mohawk and Hudson Railroad Company. (28) At issue was a New York state law granting railroads the right to enter onto and take private land, and compensate the owner to build rail lines. Nowhere did the statute refer to a public use justification for this action. But according to the opinions of Kent and Tracy, the public use doctrine must apply to this type of taking. What does it mean to say a taking is for "public use"? While dicta mention public utility, interest, and expediency, the New York court settled on the narrow definition of public use as "used by the public." (29) Since the railroads were used by...