Legislative Action Against Kelo

In Texas, House Joint Resolution 14 could give voters the opportunity to increase the security of the state’s property owners, pending passage in the State Senate, which already passed a separate, weaker bill.  Currently, under precedent set by the Supreme Court case Kelo v. the City of New London, states can take ownership of property under their eminent domain powers by demonstrating merely that government ownership would offer “public benefit” as opposed to being required to prove “public use.”

The Institute for Justice explains that  HJR 14, which passed unanimously in the Texas House of Representatives, could potentially improve the state’s policy environment:

Under Kelo, a government is free to take your home or business and give it to anyone who might create more jobs or pay more taxes with your land than you do.  HJR 14 fixes Kelo in Texas by making it clear that “public use” means a use of the property by the government, the condemning authority or the public at large.

This action to strengthen the rights of Texas property owners contrasts with movements in some U.S. cities, including Cleveland and Flint, which are considering planned shrinkage as a way of dealing with mortgage foreclosures. City planning authorities in these cities tout the benefits of confining development to a more compact area because it would allow public services and infrastructure to be provided at lower cost.

However, this policy comes with negative incentives for property owners which these planners are ignoring.  If a locality’s residents begin to fear that their government, rather than protecting their property, may seize it to put it to use for the “public benefit” (which poses a much lower burden than “public use”), private investment, not to mention faith in good governance, will decline. If it passes, HJR 14 will allow policy makers (and policy researchers) to gather evidence across municipalities as to the costs and benefits of using eminent domain for public benefit takings, as some cities outside of Texas begin to employ this policy measure more heavily.