Tuesday, March 18, 2008

Lefcoe on Kelo and Blight

George Lefcoe (USC) has posted Redevelopment Takings after Kelo: What's Blight Got to Do with it? on SSRN.  Here's the abstract:

Cities large and small across the country are utilizing redevelopment powers to become land developers, transforming underutilized areas into desirable commercial and mixed use enclaves, improving the appearance of the city and shoring up sagging tax bases. In using their eminent domain powers to assist private redevelopers, local governments open themselves to Fifth Amendment claims that these projects aren't for public uses. After the U.S. Supreme Court opinion in Kelo v. City of New London, state and local government officials need not worry about federal courts declaring anytime soon that their economic redevelopment projects aren't a sufficient "public use" to justify condemning one person's property for another unless the taking can be proved nothing but a sham, a naked pretext for wresting land from one private owner for the exclusive benefit of another. For the usual run of redevelopment projects, the requisite public use can be found either because the taking eliminates blight or proceeds from a comprehensive plan for redevelopment.

This paper begins with a recap of the Kelo Court's attenuated endorsement of comprehensive planning as a way of determining whether a taking of unblighted property qualifies as a public use. Then, the paper sketches the varying ways that states have defined blight to limit the use of eminent domain for redevelopment. Blight prevention was a rationale invoked by supporters of the federal urban renewal program to secure judicial approval in the 1930s and 1940s. Those projects were quite different from most redevelopment projects undertaken after the abolition of the federal program in 1974 and the paper describes the main differences. The blight standard makes less sense under most current types of redevelopment than it did under the early federal renewal programs because blight eradication is rarely what today's redevelopment projects aim to achieve.

In the final section, the paper compares planned efforts at improving the quality of life in the community with "spot" redevelopment aimed solely at pumping up local tax receipts. Objectionable redevelopment enables a favored private firm (often a big retailer) to expand by acquiring land from unwilling neighboring owners. Kelo and some of the Kelo-inspired, state-enacted reforms, would lead courts to prohibit such takings. They don't serve a public use because they are meant simply to assist a particular private firm with its expansion plans in order to enhance the local tax base. The concluding section of the paper suggests how redevelopment agencies could reformulate their narrowly focused tax-motivated projects to comply with the new emphasis on redevelopment planning articulated in Kelo.

Ben Barros

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