Agenda 2012: Eminent Domain | Eastern North Carolina Now

    Publisher's note: Agenda 2012 is the John Locke Foundation's charge to make known their wise political agenda to voters, and most especially candidates, with our twenty-seventh instalment being the "Eminent Domain," written by Jon Sanders, Director of Regulatory Studies at the John Locke Foundation. The first installment was the "Introduction" published here.

    Eminent domain is the government's power to seize private property for public use. It is a constitutional power; the Fifth Amendment to the United States Constitution states, "Nor shall private property be taken for public use, without just compensation." What that means, however, is that the Founders envisioned the property seized to be used only for a public use after justly compensating the owner.

    The U.S. Supreme Court has steadily expanded this power to take private property so far afield that a government can take property even for "economic development." The landmark ruling in Kelo v. City of New London (2005), building on the Court's expansion of "public use" to include "public purpose" and "public benefits," gave government even the power to take property from one citizen and transfer it to another for economic development (if the latter would, for example, build a shopping mall on it to generate more tax revenue or jobs).

Key Facts

   • North Carolina has the weakest constitutional protection of property rights in the nation. North Carolina is the only state in the nation whose constitution lacks a "takings" clause, a provision that says property may be taken only for a public use.

   • Prior to Kelo, the North Carolina Supreme Court had already approved takings for private uses. In Piedmont Triad Airport Authority v. Urbine (2001), the state's high court upheld the airport authority's taking of private property for a cargo facility to be used solely by Federal Express, stating that the purpose of the taking was to improve the airport, and that the obvious benefit to Federal Express was incidental.

   • After Kelo, several states -- including the neighboring states of Georgia and South Carolina -- passed constitutional amendments to protect against eminent domain abuses. Since 2006, there have been several attempts to pass such protections in North Carolina, but they have all fallen short.

   • In 2006, the legislature passed a bill that narrowed the definition of "blight" and prevented the government from seizing entire blighted areas (that merely contained some blighted properties) rather than just the blighted properties themselves. Those statutory changes should be enveloped within a constitutional amendment as a further protection of private property against a government able to condemn desired property as "blighted" in a path-of-least-resistance gambit to take it for economic development.

   • Furthermore, a constitutional amendment should place the burden of proof on government to show that the taking is necessary for a public use and that the former owner receives just compensation. This compensation should cover more than "fair market value," also taking into consideration other costs incurred by the owner, such as relocation costs, attorneys' fees, loss of business goodwill, and other factors that financially harm property owners.

   • The property owner should be able to request a jury of peers to decide just compensation.

Recommendations

    Amend the North Carolina Constitution to protect property owners from eminent domain abuse.
    Prohibit takings for economic development.
    Define blight narrowly and allow for the taking of blighted properties that present a concrete threat to the health and safety of the public. This addition to the constitutional amendment would differ from a practice of seizing "blighted areas" that include some properties classified as blighted under a looser definition.
    Impose on government the burden to prove that a taking is for a public use, that a property is really blighted, and that compensation is just.
    Include relocation costs, attorneys' fees, and loss of business goodwill in just compensation. Recompensing property owners only fair market value causes them to suffer significant financial loss.


    Analyst: Jon Sanders

     Director of Regulatory Studies
     919-828-3876 • jsanders@johnlocke.org