Texas Governor Vetoes Eminent Domain Reform

All Texans Remain Vulnerable to Abuse

CONTACT: John Kramer; Lisa Knepper
(703) 682-9320
June 18, 2007

Arlington, Va.—On Friday, June 15, 2007, Texas Governor Rick Perry vetoed HB 2006, an eminent domain reform measure that overwhelmingly passed both chambers of the Texas Legislature.  The bill was designed to close a loophole that remained from an earlier bill Perry signed two years ago in response to the U.S. Supreme Court’s infamous Kelo v. City of New London decision.  Perry becomes only the fourth governor to veto an eminent domain bill since Kelo.  In the three other states, however, reform still passed when the Iowa Legislature overrode one veto, New Mexico’s executive signed other reform legislation this year and Arizona reformed its laws by citizen initiative.

“With this veto, Governor Perry has left every home, farm, ranch and small business owner vulnerable to the abuse of eminent domain,” said Steven Anderson, director of the Institute for Justice’s Castle Coalition, a national grassroots advocacy group committed to ending the private-to-private transfer of property using eminent domain.

The bill would have closed the large loophole that remained after the enactment of SB 7, the 2005 legislation that allows local authorities to forcibly acquire private property for the purpose of so-called “slum” or “blight” removal.  Under Texas law, the terms “slum” and “blight” are defined so broadly that they can be applied to any property, meaning no one’s property is safe.  HB 2006 required, with certain limited exceptions, that all takings be made for a “public use,” which would have stopped eminent domain abuse throughout the state.

HB 2006 also included procedural and compensation changes, and it was the latter that Perry cited as the reason for his veto.

“Compensation concerns were totally overblown by government agencies,” Anderson said.  “Comprehensive protection against eminent domain abuse for all Texans was scuttled because of unfounded fears that property acquisitions would cost substantially more.  Dollars drive the abuse, and now dollars drive this veto.  In both cases, the property owners are the ones who end up getting hurt.”

In all, 41 states have passed legislation responding to the Kelo decision.  For a review of those states and the effectiveness of the reforms, see the Institute for Justice’s 50-state report card, available at http://www.castletrans.wpengine.com/index.php?option=com_content&task=view&id=57&Itemid=113.