Kentucky Still Needs Meaningful Eminent Domain Reform

Your home is not yours anymore.  That is what the City of Newport told 150 homeowners in the Cote Brilliant neighborhood when it condemned their properties by eminent domain in 2002 for the Newport Promenade shopping center.  Designating the neighborhood as “blighted”—even though it had the second-highest economic base in Newport and consisted of $200,000 homes—City officials bulldozed the neighborhood, the developer backed out of the deal, and the once-charming neighborhood now sits in shambles.

This month, Gov. Ernie Fletcher signed into law House Bill 508, legislation that redefines “public use” under the State’s eminent domain laws—but a bill that does not go far enough to stop even this kind of eminent domain abuse from happening again.  That is because the law contains a large loophole allowing for the acquisition of so-called “blighted” and “slum” areas.  The loophole, which references the state’s vague and sweeping blight statutes, gives local governments the power to continue using eminent domain for private profit.  Kentucky municipalities can still take homes and businesses that are old or obsolescent and are economic liabilities—meaning they do not provide enough tax money.

Acknowledging the need for legislative reform, Kentucky lawmakers joined legislators from across the country in a nationwide effort to reform eminent domain laws after the U.S. Supreme Court decided Kelo v. City of New London last summer.  The now-infamous case, which gave municipalities the green light to condemn private property for private profit, left the need to protect property rights in the hands of lawmakers.  Since Kelo, legislators in 47 states and Congress have responded to overwhelming public outcry by introducing, considering and passing legislation aiming to limit the government’s eminent domain power.  It is important that Kentucky legislators pass further reform in the next legislative session striking at the heart of the issue—stopping the government from taking property from one person and giving it to another private party.

The beneficiaries of eminent domain abuse know the new law won’t stop them from taking people’s property for private profit.   In fact, it’s likely these beneficiaries are the main reason such a loophole exists.  Until the state tightens the definition of blight, every home, small business, farm and place of worship can be seized and bulldozed by the government if City officials simply assert the land could generate more taxes or create more jobs as something else.

In February, South Dakota became the first state to tackle the fundamental problem by enacting a law that prohibits government agencies from seizing private property by eminent domain “for transfer to any private person, nongovernmental entity, or other public-private business entity.”  Indiana followed by enacting broad, comprehensive reforms to its eminent domain laws in March.  And, Georgia Gov. Sonny Perdue signed into law legislation that tightens the state’s definition of blight to properties that are truly a danger to health or safety.

Kentucky House Bill 508 is a good start and contains very good language, but the task is not finished.  Home and business owners in the Bluegrass State are not much more protected today than they were before the governor signed the legislation into law, since the law used to engage in abuse has been left untouched.

It is time the Legislature enacts the kind of reform that South Dakota, Indiana and Georgia have written into their state codes.  Even with this new legislation, Newport City officials—and their counterparts throughout the state—can still abuse their eminent domain power by designating charming neighborhoods “blighted.”

Only after lawmakers tackle the fundamental problem in the next legislative session will Kentuckians finally be secure in their fundamental right to keep what they already rightfully own.  Only then, will their homes truly be theirs.