EMPTY DOMAIN:

Land Confiscated In "Public Interest" Under Supreme Court Eminent Domain Decision Goes To Waste
By A. Kronstadt

[11/27/09] As reported in The SHADOW [Issue #51], the narrowly split 2005 decision of the United States Supreme Court in the case of Kelo vs. City of New London, in essence, gave government at all levels the right to seize anybody's private property and transfer it to any other individual, at its own discretion, under the legal principle of eminent domain.

Suzette Kelo and a group of her New London, Connecticut neighbors had sued the city
government to block the demolition of their homes, which were situated in a 90-acre area
slated for redevelopment under a private scheme sponsored primarily by Pfizer Pharmaceuticals, the centerpiece of which was to be the expansion of Pfizer's research and development facilities, already in operation in nearby Groton, into New London. Pfizer was planning to bring in private
real estate money to build additional office complexes and a hotel in the immediate vicinity of their own new offices. The only public money involved was to be for the creation of a small state park
in one section of the development zone.

Ideologically, the 5-4 split in the court was considered to be along "liberal/conservative" lines, with the liberals who wrote the Kelo decision upholding the power of government to make wise decisions on behalf of the public. Environmentalists as well as defenders of affordable housing were supposed to be happy about Kelo because it ostensibly put public interest above individual greed.

On the other hand, advocates for individual rights on both the left and right of the political spectrum have condemned the Kelo decision as a means for further empowering Big Government to dismantle the lives of everyday people and turn the pieces over to Big Business.

Central to the logic behind the Supreme Court's rejection of the arguments presented by the attorneys for Ms. Kelo and the other homeowners was the soundness of the government plan
and the amount of revenue it was expected to generate for the public good. One of our great
liberal heroes on the high court, Justice John Paul Stevens, wrote for the majority:

"The city has carefully formulated a development plan that it believes will provide appreciable
benefits to the community, including, but not limited to, new jobs and increased tax revenue."

Specifically, the lawyers for the City of New London defending the project were contending that
it would generate 3,169 new jobs and $1.2 million a year in tax revenues.

Economic reality, however, would have the last word. The upshot of the case is that the City
of New London and State of Connecticut paid 78 million dollars to demolish Kelo's house and
the other buildings on the development site. Except for the parkland, which was developed at taxpayer expense, the rest of the area was taken over by weeds and became home to tribes of
feral cats. On November 9, 2009, the Hartford Courant reported:

"Pfizer Inc. will shut down its massive New London research and development headquarters
and transfer most of the 1,400 people working there to Groton, the pharmaceutical giant said Monday....Pfizer is now deciding what to do with its giant New London offices, and will consider selling it, leasing it and other options, a company spokeswoman said."

Pfizer still has many options because, according to their deal with New London, they are leasing
the property for $1 per year. Suzette Kelo summed up the situation as follows:

"They are getting what they deserve. They are going to get nothing. I don't think this is what the United States Supreme Court justices had in mind when they made this decision."

The demolition of the private dwellings, including that of Suzette Kelo, had been ordered by
New London courts under the legal principle of eminent domain, which allows the local, state,
or national government to seize private property without the owner's consent, for public use.
In the past, eminent domain seizures have been primarily associated with direct governmental
needs that were considered to be manifestly in the public interest, including the building of
schools, highways, and military installations. The Fifth Amendment to the U.S. Constitution
ncludes the prominent "Takings Clause" which reads "...nor shall private property be taken for public use, without just compensation." The British colonial rulers of early America were infamous for seizing people's property simply to transfer it to members of the nobility who wanted it for themselves, or to punish political dissidents. The Fifth Amendment was intended to curb this, as
well as a number of other judicial abuses that Americans had experienced under King George III.

The "just compensation" part of the Takings Clause has been interpreted as meaning that the government must pay the owners of seized properties a price that is in line with the market value
of those properties. Suzette Kelo, for example, was paid $440,000 for her house in working-class New London. Although this might on the surface appear to be just compensation, the use of
eminent domain, and the fact that Kelo and her neighbors had been stripped of their right to
refuse to sell, absolved Pfizer and the developers from the need to negotiate directly with the property owners, who might have obtained more money for their property had free enterprise
been applied to them as it had for the huge drug company. Indeed, the whole idea of the development plan was to sweeten the deal for Pfizer and enable them to snap up the land
cheaply. The residents of New London were entitled only to a fair price as interpreted by the government, whereas Pfizer was entitled to play the market and make a killing.

The Supreme Court has been remarkably "liberal"in interpreting the meaning of "public use" in
the language of the Fifth Amendment. For example, the 1954 decision in the case of Berman vs. Parker upheld the right of the government of Washington, D.C. not only to seize "blighted," i.e. abandoned, properties to be turned over to real estate developers in the interests of "slum clearance," but also to take over non-blighted properties that were still occupied by their owners, because the government's legitimate interest in slum clearance was seen as a totality, rather than
on a property by property basis.

Kelo extended this legal doctrine to property that is not blighted and to situations where the goal was not as specific, or as virtuous, as getting rid of slums. The Pfizer development in New London was ruled to be constitutional simply because it promised, at least on the face of it, to increase the tax revenue of the City of New London, because Pfizer, in theory, could pay more in taxes than the people living on the properties to be seized. Yet, currently, Pfizer continues to pay the city of New London only one dollar a year for those 90 acres of land.

Developer Abuses Eminent Domain In Brooklyn

The Kelo case led to a flurry of legislative activity throughout the U.S., intended to prevent repeats
of such travesties of justice such as what happened in New London. Forty three states now have laws intended to raise the bar for the eminent domain argument so that private property can be seized only for purposes with demonstrable public benefits.

However, no such legislation appears to be pending in New York State, where, on November 24, 2009, a seven-judge panel of the State Court of Appeals ruled that 123 private parcels of land, including homes and businesses, could be evicted to make way for the 22 acre "Atlantic Yards" project, a massive development around the old Brooklyn Navy Yard, masterminded by real estate magnate Bruce Ratner, on the grounds that the properties were "blighted." Even if he succeeds
in demolishing the occupied properties and assembling the parcel he wants to build on, Ratner's project may never get off the ground, as he must still sell $700 million in bonds in order to obtain crucial tax-exempt financing.

Judge Jonathan Lippman, writing for the majority in Matter of Daniel Goldstein (organizer of
Develop Don't Destroy Brooklyn) vs. New York State Urban Development Corporation, stated:

"It may be that the bar has now been set too low -- that what will now pass as 'blight,' as that expression has come to be understood and used by political appointees to public corporations
relying upon studies paid for by developers, should not be permitted to constitute a predicate
for the invasion of property rights and the razing of homes and businesses, But any such
limitation upon the sovereign power of eminent domain as it has come to be defined in the
urban renewal context is a matter for the Legislature, not the courts."

And with a legislature such as we have here in New York State, where real estate bucks can
touch off a virtual coup de etát and torpedo any legislation that challenges the power of
developers, the "public interest" will continue to be construed as meaning whatever brings
in the bacon for this small group of big landowners, allowing eminent domain to be used to
clear out the rest of us when we are in their way. 

[For more on the Kelo Decision, as well as Anti Eminent Domain Abuse activism, go to: Develop Don't Destroy
Brooklyn at: http://dddb.net and New Jersey Eminent Domain Abuse at: http://njeminentdomainabuse.com/]

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