What is Eminent Domain?

In addition to the Obama win, there was another outcome of the 2012 Elections that caused much debate in the press: Virginia passed a law limiting the power of eminent domain. This led to many people asking, "What is eminent domain?"

Eminent domain is "the power to take private property for public use by a state, municipality, or private person or corporation authorized to exercise functions of public character, following the payment of just compensation to the owner of that property." It is an action of the state to seize private property without the owner’s consent by providing just compensation. The rule is normally applied when building highways, train tracks or public property for the benefit of a community and the action is protected by the US Constitution.

In general, to exercise the power of eminent domain, the government must prove that the four elements set forth in the Fifth Amendment are present: (1) private property (2) must be taken (3) for public use (4) and with just compensation. These elements have been interpreted broadly.

However, the United States Supreme Court ruled in 2005 that the Constitution grants the government the right to take private property – homes, businesses, and other property – and sell or give it to another private entity if jobs and taxes could be generated (Kelo versus City of New London, Connecticut, 2005). The eminent domain attorney for the case pressed the high court to vote in favor of economic development projects that create jobs, increases taxes and other revenue, and revitalizes a depressed or blighted area that qualifies as “public use.” The courts ruled that private economic development is a public use under the Fifth Amendment.

The VA amendment makes it so that private property can only be taken for a public use - it cannot be taken and given to another private landowner, even if the transfer would spur economic development. Supporters of the amendment claimed that that changes are necessary because the 2005 ruling gave the government too much power to use eminent domain for private economic development projects. 

Opposers, both Republicans and Democrats alike, were against the amendment as it may force the state government and municipalities to pay more money for what they claim are appropriate uses of eminent domain. The amendment may cost both over tens of millions of dollars for both the local and state governments. Even with the opposition, the amendment passed with flying colors, passing with 75 percent of the voters for the limits on eminent domain - the law will go into effect on Jan 1, 2013.

The 2005 Kelo decision informed the public about eminent domain abuse. Since the decision, 44 other states have made amendments to their constitutions to reduce the government’s power to take private property though eminent domain.