Three years ago, in Kelo v. New London, Conn., the U.S. Supreme Court failed to properly protect private property rights, approving an overly broad interpretation of the power of eminent domain. In the 5-4 ruling, the court decided it was constitutional for government to use eminent domain to take private property and transfer it to other private owners.
The court majority said the taking was proper as long as there was a "public benefit," and the majority expanded public benefit to mean any economic benefit, including higher tax revenues and job creation. That interpretation is far removed from the Fifth Amendment's limitation of eminent domain to "public use," such as roads, schools, utilities, parks, and so on.
Fortunately, individual states have the power to restrict eminent domain use, and many have done so since the Kelo ruling. But California has yet to act despite popular support for protecting private property rights.
There have been several attempts in the Legislature to amend eminent domain regulations as well as a ballot measure. All have failed.
Now voters have two dueling measures on the June 3 ballot to consider: Propositions 98 and 99. Neither deserves passage. The initiative process is a poor way to deal with an issue that is seemingly simple on the surface, but quite complex in its implementation.
Instead of informed debate by lawmakers on the issue of property rights and the many implications of eminent domain reform, we have a few political campaigns that employ hyperbole, questionable assertions and uncertain conclusions.
Proposition 98 is by far the most ambitious of the two initiatives. It severely limits the use of eminent domain and opens the door to extensive lawsuits.
While the purported intent of Proposition 98, to prevent the abuse of eminent domain, is commendable, there are several aspects of the initiative that give cause for concern.
One provision would prohibit laws and regulations that "transfer an economic benefit to one or more private persons at the expense of the private owner." This would severely undermine planning and zoning regulations throughout the state.
For example, approval of a new subdivision could be challenged by neighbors claiming that an economic benefit was transferred to the developer at their loss. Disapproval of the subdivision could result in the developer attacking a city for transferring an economic benefit from the builder to neighboring property owners.
The list of potential litigation is endless. Downtown renewal, approval of liquor licenses, gas stations or just about any business could be challenged by adjacent or nearby property owners.
Another section of Proposition 98 would allow a property owner to take "immediate possession of money deposited by the condemnor without prejudicing his or her right to challenge the determination of fair market value or his or her right to challenge the taking as being a private use."
In other words, the owner of the property could challenge the entire taking and price even after receiving payment. This could result in protracted legal battles by property owners holding a project hostage in an effort to get more money.
Proposition 98 is not limited to eminent domain. It also prohibits rent control statewide, including mobile home parks, allowing controls to continue only for current tenants. Once they vacate, their units no longer would be subject to any rent control. This is a separate issue that seems to be on the ballot chiefly to please apartment and mobile home park owners, who are financing most of the Proposition 98 campaign.
Proposition 99 purportedly is being presented as the responsible eminent domain reform. But it is severely limited, applying only to homeowners who have occupied their homes for a year or more. Apartments, churches and businesses are not included.
It appears the chief reason for Proposition 99 being on the ballot is to kill Proposition 98. In fact, the final clause in the initiative states that if both measures pass and Proposition 99 has more votes than Proposition 98, all of Proposition 98 is void, not just clauses that are contradictory, which is the normal procedure when conflicting measures both win.
Regardless of the fate of Propositions 98 and 99, the Legislature needs to address eminent domain reform in a comprehensive and responsible manner. Private property rights need additional protection, but not at the expense of legitimate public planning. Vote no on Propositions 98 and 99.