Property Rights

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(HOST) Improving local economies is a critical issue for many towns and cities. Commentator Cheryl Hanna discusses an upcoming Supreme Court case that will likely impact the future of economic development throughout Vermont and the Nation.

(HANNA) Suppose that a company wants to open a research facility in an area of Vermont that’s been struggling economically. Let’s further assume that the company asks the town to condemn the adjacent neighborhood so that a private developer can build hotels, office space and expensive condos to support the new facility.

Well, the city’s only too happy to agree, because it wants the company to come and the new private development will generate a lot more taxes. But the folks who live there don’t want their neighborhood destroyed. They have decent working-class jobs and own their own homes, many for generations. It’s not an upscale neighborhood, but it’s hardly downtrodden.

Whose rights do you think should trump? The city’s right to condemn property with the hope of improving a bad economy, or the homeowners’ right to their private property?

Next week, the United States Supreme Court will hear arguments in Kelo v. City of New London. In this case, a Connecticut city wants to condemn a neighborhood and transfer it to a private developer who’ll then develop it to meet the needs of a new Pfizer facility. It’s the most important property rights case in fifty years. The 5th Amendment of the U. S. Constitution gives local governments the power to condemn private property through eminent domain. But governments can only use this power for what the amendment calls “public use” and are required to provide the owners with “just compensation”.

Historically, eminent domain has been used to vacate private properties to make way for bridges or highways. But in 1954, the U. S. Supreme Court expanded the definition of “public use” giving local governments the right to condemn blighted areas in order to improve them. Yet, the New London neighborhood isn’t blighted by anyone’s definition. The homeowners argue that the government has gone too far and are asking the court to roll-back its definition of public use.

However, before you start siding with the homeowners and against the interests of big business, consider that the Court’s relatively broad reading of the public use doctrine has also justified environmental regulations and other social policies that have protected our landscape and turned around local economies.

That’s why this case has made some very strange bedfellows. Property rights advocates have joined forces with advocates for the poor, while business interests and some environmentalists have lobbied for a broad reading of the public use doctrine.

No one’s certain how the Court will rule, and I’m far from certain what the right decision is. But it’s a conversation we should all be having now, because it’s only a matter of time before Vermont’s faced with making some hard decisions about the future of our people, our property and our principles.

This is Cheryl Hanna.

Cheryl Hanna is a professor at Vermont Law School in South Royalton.

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