Bloomberg reports that the U.S. Supreme Court bolstered local governments' power to take over private property to make way for economic development such as shopping malls, office parks and sports stadiums.
The court in another 5-4 ruling said government agencies can constitutionally take property in the name of economic development and increased tax receipts, as long as they pay compensation to the owners.
The case is from Connecticut, Kelo v. City of New London, 04-108.
According to the Associated Press, the Supreme Court said local officials, not federal judges, know best in deciding whether a development project will benefit the community:
"The city has carefully formulated an economic development that it believes will provide appreciable benefits to the community, including - but by no means limited to - new jobs and increased tax revenue," Justice John Paul Stevens wrote for the majority.
He was joined by Justice Anthony Kennedy, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer.
What was at stake in the Kelo case was the ability of communities to use eminent domain powers to acquire real estate by condemnation and transfer it to private developers to build things like luxury condominiums and shopping areas in choice locations. The plaintiffs in the Kelo case argued that securing land for private developers doesn't qualify as a legitimate public purpose.
Communities are using condemnation more and more. Last week the New London's The Day reported that the Castle Coalition has produced a report documenting 10,000 instances of such “private to private” real estate transfers employing eminent domain in 41 states between 1998 and 2002.
The opinions are available here.