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Ohio Court Rejects Eminent Domain
The Ohio Supreme Court ruled unanimously on Wednesday that economic development isn't a sufficient reason under the state constitution to justify taking homes, putting a halt to a $125 million project of offices, shops, and restaurants in a Cincinnati suburb that officials said would create jobs and add tax revenue.
The case was the first challenge of property rights laws to reach a state high court since the U.S. Supreme Court last summer allowed municipalities to seize homes for use by a private developer.
"For the individual property owner, the appropriation is not simply the seizure of a house," Justice Maureen O'Connor wrote in a case that pitted the city of Norwood against two couples trying to save their homes. "It is the taking of a home - the place where ancestors toiled, where families were raised, where memories were made."
Property rights' advocates, business groups and backers of city planning were watching the Ohio case because of the precedent it could set. The ruling comes a year after the U.S. Supreme Court ruled 5-4 in a case from New London, Conn., that cities can take land for shopping malls or other private development.
Story Continues Below Norwood wanted to use its power of eminent domain - the authority to buy and take private property for public projects such as highways - to seize properties holding out against private development in an area considered to be deteriorating.
In the ruling, O'Connor said cities may consider economic benefits but that courts deciding such cases in the future must "apply heightened scrutiny" to assure private citizens' property rights.
Targeting property because it is in a deteriorating area also is unconstitutional because the term is too vague and requires speculation, the court found.
O'Connor wrote that the court attempted in its decision to balance "two competing interests of great import in American democracy: the individual's rights in the possession and security of property, and the sovereign's power to take private property for the benefit of the community."
Dana Berliner, an attorney for the Arlington, Va.-based Institute for Justice that represented property owners in the case, said Wednesday's decision will have ramifications in high courts and legislatures across the country.
"This case is really part of a trend throughout the country of states responding to and rejecting the U.S. Supreme Court's Kelo decision last year," she said. "There are now 28 states that have taken legislative steps to protect owners more after that decision, and this case is the next movement in that trend, and I believe now not only legislatures but other courts are going to begin rejecting that terrible decision."
After the U.S. Supreme Court decision, Ohio declared a moratorium that prevents local governments from seizing unblighted private property for use by private developers until 2007. A legislative task force is expected to go ahead with reforms when it meets Aug. 31.
"I anticipate that many of our recommendations, combined with today's Supreme Court decision, will ensure that Ohio sends a strong message to its citizens that their private property rights are secure," said state Sen. Tim Grendell, chairman of the state's Eminent Domain Task Force.
Norwood Mayor Tom Williams defended the plan and said he still believes the project was lawful. "I believed that we did that right thing then, I believe we did the right thing now," he said.
Tim Burke, a lawyer hired by Norwood, called the decision a significant disappointment and said it will halt progress on the planned development. He said the city likely will not appeal.
"Norwood, every step of the way, followed the law as it existed," Burke said.
Development interests in other areas - particularly Cleveland's Flats development along Lake Erie - signaled their intentions to proceed with plans that involve similar seizures.
"The Flats case is fundamentally different from the Norwood case and as such, we do not believe today's ruling will impact the outcome of our legal actions," the Port Authority and The Wolstein Group said in a joint statement.
Berliner called Norwood emblematic of development trends across the country.
"This was a perfect example of what is going on all over the country: a perfectly nice, working class neighborhood with no tax delinquencies, no falling down buildings, a nice neighborhood of homes and businesses, that a developer thought could be much more profitable as an upscale shopping and high-end housing center," she said.
© 2006 Associated Press.
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