Opinion: Carolina Beat

No. 780: Try This Lesson Plan for Eminent Domain

From time to time it is important to study the history of nations and movements to anticipate potential future social directions. To assist not only in learning but teaching about eminent domain, the Center for Local Innovation offers this lesson plan.

• Philadelphia, Pennsylvania, July 4, 1776 — Fifty-six men pledged their lives, fortunes, and sacred honor in a Declaration of Independence that told the king of England that the inalienable right to life, liberty, and the pursuit of happiness — related to the right to property and to seek one’s fortune shall not be infringed upon by the state.

• New York City, Dec. 15, 1791 — The first 10 constitutional amendments known as The Bill of Rights, are ratified. The Fifth Amendment states, “No person shall be… deprived of life, liberty or property, without due process of law; nor shall private property be taken for public use without just compensation.

• Poletown, Mich., 1981 — The Michigan Supreme Court authorizes the city of Detroit to use “eminent domain” on behalf of General Motors to tear down private homes, schools, churches, and hospitals in the name of economic development.

• Norwood, Ohio, June 15, 2004 — Private homes are declared “blighted/deteriorated” (a term often associated with “tax increment financing”) so that a new mall can be developed forcing five home and business owners to move.

• Long Branch, N.J., spring, 2004 — The town attempts to forcibly take private homes on the waterfront to build more attractive and expensive condominiums in the name of economic development.

• Detroit, Mich., July 30, 2004 — The Michigan Supreme Court, in a unanimous ruling in County of Wayne v. Hathcock, reverses its Poletown decision.

The national landscape is littered with these types of decisions. Arizona, Mississippi, Colorado, and others have been or are attempting to use eminent domain in the name of economic development.
The most recent case is in New London, Conn., where an attempt is being made to remove established homeowners for the sake of more lucrative waterfront development. The Connecticut Supreme Court in a 4-3 ruling upheld the city’s right to seize the homes using eminent domain. Now, North Carolinians may soon be facing similar situations.

On the ballot this November is Amendment One. If passed, the constitutional amendment will allow cities and counties to sell bonds without so much as a whimper from the taxpayers in that community. The money raised would then be used to develop infrastructure, which can range from sewer, water, and roads to complete buildings for private development that politicians hope will increase the tax base of that particular city or county.

The difference, or “increment,” between the previous tax value and the current tax value would, in theory, pay for the bonds.

The most serious problem with TIFs goes beyond the development side and ties in not-quite-so-nicely with eminent domain. Authorizing local governments to be in the business of economic development means that the pursuit of higher property values for any given segment of the community will be in their primary interest.

Although the Michigan Supreme Court has reversed its Poletown decision, it may be that the remaining hope for private property rights rests with the U.S. Supreme Court. The court is considering taking up the New London case on appeal.

I can only hope that the voters of North Carolina will vote down TIFs this fall with a resounding “no” on Amendment One, just as they did in 1982 and 1993. In the meantime, we should also hope that the U.S. Supreme Court realizes the true erosion of property rights that governmental complexities have now wrought with tools like TIFs.

Chad Adams is a Lee County commissioner, a fellow of the North Carolina Institute of Political Leadership, and the director of the Center for Local Innovation.