Wednesday, March 25, 2009

Ely on Post-Kelo Eminent Domain Reform at OUP Blog

Over at the OUP blog, James W. Ely Jr. (Vanderbilt) has a post on post-Kelo eminent domain reform.  His conclusion:

Although the state legislative response to Kelo has been decidedly mixed, several state supreme courts have struck down the exercise of eminent domain for economic development purposes by private parties. For example, the Ohio and Oklahoma supreme courts have specifically rejected the reasoning in Kelo and construed their own state constitutions to afford greater protection of property owners against eminent domain.

Supreme Court rulings sometimes have the effect of putting long-ignored issues back in the spotlight. Perhaps the most significant impact of Kelo could be heightened public recognition of the need to safeguard property rights. One result of Kelo has been to restore the rights of property owners to public debate. This development may ultimately bear more fruit.

Ben Barros

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Yes, Kelo was a tipping point, but it is still an uphill battle.

Speaking as someone actually fighting eminent domain in federal court with Houston-based Spectra Energy, I can confirm that it amounts to legal plunder under the badge of government.

Ultimately, power corrupts; and the power of eminent domain in the hands of government — which is transferred to a business — creates a sense of entitlement; and it creates an atmosphere ripe for abuse.

As you know, nowadays, eminent domain has less to do with projects for the “public good,” and everything to do with the financial good of publicly held companies.

In Bedford County, Pennsylvania (about 2 hours from Washington), property owners are being hauled into federal court by Spectra Energy, backed by the power of the Federal Energy Regulatory Commission.

The “public good” argument is that this is an underground natural gas storage site (bring gas from somewhere else for a fee, store it for a fee, then send it to the northeast via pipelines and charge another fee).

What goes missing is that the landowners’ property is sitting on top of the gas-rich Marcellus Shale; but they can’t develop that because Spectra Energy wants to use the Oriskany sands layer (which lies just beneath the Marcellus) for its underground gas storage facility.

This site is said to be “critical,” but Pennsylvania has more underground natural gas storage sites than any other state in the continental US, according to the Dept. of Energy.

Further, in its most recent motion, Spectra Energy asked that the federal judge exclude evidence that would argue “economic loss to the landowner” for fear that the jury would be “confused, misled and distracted … waste time.” (From p. 7 of the motion: Case 3:08-cv-00154-KRG, Document 59).

Here is the great conundrum in eminent domain: property owners possess the key asset that companies and government covet — the land. But they are treated as obstacles in this process rather than as key stakeholders.

For info & a landowner video:

Posted by: MikeB | Mar 26, 2009 4:24:35 AM

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