By Owen Eagan
Senior Vice President, Transportation, The Saint Consulting Group
In 2005, the US Supreme Court found in Kelo v. City of New London that local governments could seize private property by eminent domain for economic development purposes. So, if you’re a politician and you’re confronted with a decision as to whether to take private land by eminent domain for economic development, what kind of test would you apply to determine whether the public benefits outweigh the private interests?
Would it be based on the ability to attract and retain new businesses in the area? Would it be based on developing a complementary business mix for the business community? Would it be based on the tax revenue or jobs that could be created? Whatever the reason, it would have to be based on sound public policy, right? Not necessarily.
Both the Kelo case and one recently cited in Washington state suggest that like any other land use decision, politicians will likely more often than not make eminent domain decisions not on policy but on politics. That is, if politicians see a development opportunity that is politically popular and has little to no political opposition, they are likely to support the land taking. The converse is also true. In fact, our success rate at Saint Consulting is greater than 90% because our consultants are so good at assessing the political viability of real estate development projects. Eminent domain cases are no different.
An interesting eminent domain case with Kelo implications just arose in Washington State, which involves the taking of a parking lot near the airport for the development of an entertainment center (see “Kelo rears its ugly head… west coast style” http://bit.ly/5W6gVO). Airports have become major economic drivers, resulting in the emergence of the “aerotropolis” with many businesses being integrated into airport development. In Seattle’s case, it’s easy to see how this development might make economic sense.
However, when it comes to eminent domain, the politics surrounding these issues can be more complicated. For instance, according to The Saint Index, 80% of people disagreed with the Kelo decision, with 63% saying they disagreed strongly. Therefore, opposition to the proposed Seattle project could likely be easily generated.
But, regardless of your position on this issue, the affected parties would be well advised that, in addition to gathering their facts and legal opinions, they do their political homework. Just having the facts on your side is never enough when it comes to political decisions.
Owen Eagan is senior vice president for transportation, The Saint Consulting Group, email email@example.com or phone (781) 831-2494