Kelo v. City of New London (2005) is a highly controversial Supreme Court case that expanded the government's eminent domain power under the Fifth Amendment's Takings Clause. The Court held that economic development constitutes a valid "public use" even when the condemned property is transferred to private developers, sparking nationwide debate about property rights.
Kelo v. City of New London, 545 U.S. 469 (2005)
The City of New London, Connecticut, was experiencing economic decline and had been designated a "distressed municipality" by the state. In 1998, the city approved a development plan designed to revitalize the downtown area and waterfront, particularly in conjunction with a new research facility that Pfizer Inc. was planning to build nearby.
The New London Development Corporation (NLDC), a private nonprofit entity, was authorized by the city to use eminent domain to acquire property for the redevelopment project. The plan called for a waterfront conference hotel, restaurants, shopping, marinas, new residences, and office space that would complement the new Pfizer facility and generate jobs, taxes, and economic activity.
Susette Kelo and several other property owners refused to sell their homes to the city. Their properties were not blighted or in poor condition; they simply stood in the way of the comprehensive redevelopment plan. The city initiated condemnation proceedings to take the properties through eminent domain, planning to transfer them to private developers as part of the economic development project.
Does the Fifth Amendment's "public use" requirement permit a city to condemn non-blighted private property for the purpose of economic development when the condemned property will be transferred to other private parties?
The Fifth Amendment's "public use" requirement is satisfied when the government's purpose is legitimate and serves a valid public purpose, even if the property is ultimately transferred to private parties. Economic development that provides public benefits such as job creation, increased tax revenue, and community revitalization constitutes a valid public use.
Yes. The Supreme Court held 5-4 that the city's exercise of eminent domain power for economic development purposes satisfied the Fifth Amendment's public use requirement. The Court upheld the condemnation, ruling that economic development constitutes a valid public use even when the property is transferred to private developers.
The majority opinion, written by Justice Stevens, relied on several key arguments:
The Court distinguished this case from situations where property is taken solely to benefit a particular private party, emphasizing that the development plan served a comprehensive public purpose rather than merely transferring property from one private owner to another.
The dissenting justices, led by Justice O'Connor, argued that the decision effectively eliminated any meaningful limit on eminent domain power and threatened individual property rights by allowing government to take property whenever it could benefit the public.
Kelo v. City of New London has had enormous impact on property law and public policy:
The case remains highly controversial and is often cited as an example of judicial overreach. Ironically, the New London development project ultimately failed, with much of the condemned area remaining vacant years later, adding to criticism of the decision.
"Public use" traditionally meant the government or public would directly use the property (like for roads or schools). "Public purpose" is broader, including any use that provides public benefits, even if private parties ultimately own or operate the property.
Over 40 states passed legislation restricting eminent domain use for economic development. These reforms varied from complete bans on economic development takings to requiring higher standards of proof for public benefit.
The project largely failed. Pfizer closed its facility in 2009, and much of the condemned area remained undeveloped for years. This outcome became a symbol of the potential problems with using eminent domain for speculative economic development.
Kelo requires that the taking serve a legitimate public purpose and be part of a comprehensive development plan. Courts still examine whether the primary purpose is public benefit rather than private gain, though the standard is quite deferential to government determinations.
Study more cases on eminent domain, property rights, and the balance between individual and community interests.