Eminent Domain in Missouri - Two Years After Kelo
by Spencer Thomson
It has been approximately two years since the Supreme Court of the United States handed down its controversial ruling in Kelo v. City of New London, Connecticut.
Few opinions in recent memory have resulted in as much public debate and legislative reaction. The essence of the opinion is that the City of New London did not violate the “public use” clause of the Fifth Amendment to the United States Constitution when it condemned private property in order to accommodate a mixed-use redevelopment of that property. Among the stated purposes for the condemnation was to encourage economic development, create jobs and increase tax revenues. In short, the issue was whether economic development alone was a sufficient “public use” to allow government to take private property.
While five members of the Court agreed that economic development alone was a sufficient public use, four Justices strenuously dissented. These Justices believed that the majority had gone too far in allowing condemnation for purely economic reasons. They felt previous decisions of the Court upholding takings were distinguishable because they provided other public benefits such as blight removal. Considering the immediate public outcry and intense media coverage that ensued, it appeared much of the country agreed with the dissent.
Within no time Missouri Governor Matt Blunt created a statewide task force to examine Missouri’s eminent domain law and make recommendations for legislative changes.
Most would agree that new law resulting from this process addresses the clear problems and lessens the likelihood of future abuses, but did not go so far as to prevent prudent action by local government officials throughout Missouri who are faced with the practical realities of balancing the need to remove blight and promote economic development against the property rights of their constituents. For example, the new law requires that condemning authorities must individually consider each parcel of property within a proposed redevelopment area with regard to whether it is blighted and must find that a preponderance of the area is blighted before it can proceed with condemnation of any parcels. The new law deals precisely with the Kelo issue by explicitly prohibiting the taking of private property for solely economic development purposes. The law further prohibits farmland from being declared blighted in order to exercise eminent domain and provides landowners with a expedited procedure for appealing a trial court’s finding of blight.
Several provisions of the new law were designed to “level the playing field” for property owners, ensure that owners be informed of their rights and encourage good faith negotiations. These include expanded notice requirements before a condemnation may proceed; the requirement of a 30 day advance written offer; and mandating the government pay a landowner’s legal fees if the condemnation is abandoned.
Two of the more controversial, and constitutionally suspect, provisions of the new law are also two of the most popular with property rights advocates. The so-called “heritage value” and “homestead taking” concepts award 50% and 25%, respectively, above fair market value to property owners who have owned their property in the same family for 50 years or whose “homestead” is being taken. These provisions likely grew out of the public testimony on the need to compensate property owners for the “intangibles”, including being forced to move against their will. Many question whether different constitutional issues are raised by valuing similar properties differently simply because one has been owned by the same family for a longer period or is owner occupied. It is likely these “enhanced value” provisions of the new law will be some of the first to be challenged and specifically reviewed by courts.
Given the law has been in place for less than a year, it is too early to determine exactly how effective the changes will be or how courts will interpret them. Those chapters of the Missouri eminent domain saga are only now being written and will most likely be the subject of future articles.
Spencer Thomson is Partner, Blackwell Sanders Peper Martin LLP.
P | 816.983.8000
E | sthomson@blackwellsanders.com