In June 2005, the U.S. Supreme Court trampled all over private property and the U.S. Constitution in the Kelo v. City of New London case.  The Court's narrow majority gave a green light for politicians to take property through eminent domain for pretty much whatever reason they liked. 

This decision has made clear that homes and small businesses are at risk of being taken by misguided politicians willing to hand that property over to other private entities in the name of economic development.

If anything positive came from this atrocious, activist decision, it was to spark a national backlash in favor of property rights.  A recent SBE Council report - "Stopping Kelo One Year Later: Legislative Efforts to Reverse Eminent Domain Abuse" -- highlighted actions taken by various state legislatures.

In a variety of states this year, voters will be able to weigh in directly on the issue.  Here is the rundown on eminent domain/takings state ballot measures (information from state-based sources, such as secretaries of state website and news accounts, and the National Conference of State Legislators):

• California.  Proposition 90 is a proposed state constitutional amendment that would prohibit state and local governments from condemning or damaging private property in order to benefit other private projects or uses; limit governmental authority to adopt certain land use, housing, consumer, environmental and workplace laws and regulations, except when necessary to preserve public health or safety; define "just compensation;" and mandate that if government abandons condemnation objects, property must be first offered for resale to prior owner or heirs of prior owner.

• Florida.  Amendment #8 is a proposed state constitutional amendment that generally prohibits the transfer of private property to another private entity through the use of eminent domain, with exceptions allowed when gaining a three-fifths vote in each house of the state legislature.

• Georgia.  A proposed constitutional amendment would require that the condemnation of property for redevelopment purposes be approved by a vote of the elected governing body of the county or city in which the property is located.

• Idaho.  Idaho's Proposition 2 would limit eminent domain for private entities, urban renewal and economic development, and provide just compensation to condemnees and those who have the value of their property reduced due to regulatory action.

• Louisiana.  On September 30, voters in Louisiana will weigh in on two generally positive property-related ballot measures: 1) Ballot Number 5 would prohibit taking private property so it can be transferred to another private entity, though an exception would be provided for industrial development purposes; and 2) Ballot Number 6 would prohibit transferring or leasing property expropriated by the government without first offering the property to the original owner.

• Michigan.  Voters will decide on a state constitutional amendment that would require that the owners of a principal residence taken for public use should receive at least 125 percent of the property's fair market value as just compensation, and public use does not include transferring property to private entities for economic development or generating more tax revenues.

• Montana.  Ballot initiative number 152 would prohibit government from using eminent domain powers to take private property in order to hand it over to another private entity, and would require government to compensate property owners for a reduction in value due to a regulation passed after the property was acquired, unless the regulation is repealed or waived.

• Nevada. The Property Owners Bill of Rights ballot proposal would prohibit government from taking private property in order to transfer it to another private entity, and would provide property owners with additional protections, including juries determining if there is a public use involved, and compensation based on a property's highest use.

• New Hampshire.  Voters will decide on a proposed state constitutional amendment declaring that "a person's property shall not be taken by eminent domain if the taking is for private use."

• Oregon.  Measure #39 prohibits government from condemning private property in order to convey it to another private party.

• South Carolina.  Ballot measure would prohibit invoking eminent domain for anything but a public use, though allowing for a blight exception.

While some of these ballot measures are better than others, each one represents a step in the right direction, that is, towards greater protection of private property.

Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council