Private Property is the Foundation of Our Free Economy – “Yes” on Proposition 90

“Nor shall private property be taken for public use without just compensation” – 5th Amendment of the US Constitution

On June 23, 2005 the Supreme Court of the United States ruled for New London and against Susette Kelo in what is shaping up to be a landmark case: Kelo vs. New London.  The Supreme Court essentially ruled that local governments could take private property from citizens not for public uses such as roads, bridges, fire stations and schools but to give it to other private citizens for other private uses such as a shopping mall or condominium building. 

Local governments like to do this under the guise of “economic development” and also because it can increase their tax revenues.  A luxury condominium building will provide much more in property tax revenues or a new mall in sales taxes than a bunch of old homes. 

Since the passage of Kelo vs. New London last June local governments have been emboldened to use the so called power of “eminent domain” to take private property for other private uses. 

The thing is in this country we have these things called “rights” which are laid out in the part our Constitution known as “The Bill of Rights”.  These rights are meant to spell out in more detail the broad vision so eloquently articulated by Thomas Jefferson in the Declaration of Independence:

We hold these truths to be self evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are Life, Liberty and the Pursuit of Happiness – That to secure these rights, Governments are instituted among men, deriving their just powers from the consent of the governed.

Eminent domain for private use is inconsistent with the founding principles of America and clearly unconstitutional.  The 5th amendment has the implication that eminent domain is only justified in the case of public use – in which case just compensation must be provided.  The obstacle to liberty and the pursuit of happiness that eminent domain places on those whose homes and businesses are to be taken is tremendous.  The Founders clearly thought it was only justified in cases where the benefit to the community was so great as to justify the harm to a few individuals.  And even in those cases the individuals would have to be justly compensated. 

Proposition 90 aims to put an end to this violation of our rights and our Constitution in the state of California.  It limits eminent domain to the case of public use and prevents it for the transfer to other private parties, for “economic development” or to increase tax revenues. 

However, Proposition 90 is more complicated than that.  Not only does it limit eminent domain but it requires the government to compensate property owners for so called “regulatory takings”.  Common examples of “regulatory taking” are when a government only permits the development of a certain number of home parcels on a property that could support many more or limits the height of a building.  More complicated would be environmental laws that,say, impose extensive costs on a manufacturer.  These restrictions on the use of private property obviously reduce their value. 

Proposition 90 states that government would be required to compensate private property owners for any “substantial economic losses” resulting from the passage of any new laws (subject to a few exceptions such as for the public health and safety or declared during a state of emergency).  All existing laws and rules would be exempt. 

The complexity of this aspect of Proposition 90 and the confusion it has engendered has allowed its opponents to create an atmosphere of fear and doubt.  In the official voter information guide the argument against Proposition 90 begins like this:

The handful of wealthy landowners that paid to put Prop. 90 on the ballot are trying a classic bait and switch on the California voters.

They want you to believe Prop. 90 is about eminent domain.  That’s the bait.  But, hidden in the fine print of the measure is the trap – a far-reaching section unrelated to eminent domain that would lead to huge new costs for all California taxpayers

Prop. 90 would change California’s Constitution to enable large landowners and corporations to demand huge payouts from state and local taxpayers just by claiming a law has harmed the value of their property or business – no matter how important the law may be or far fetched the claim.

But that’s ridiculous.  It wouldn’t allow anybody to demand huge payouts on the basis of far fetched claims.  It would require them to prove in a court of law “substantial economic loss”.  That’s quite a big difference, I think you would agree. 

And this, I submit, is eminently fair:

In cases where it does apply, [supporters of Proposition 90] ask, why shouldn’t taxpayers cover the cost of laws that benefit the public, rather than allowing the burden to fall entirely to a handful of property owners?

‘These costs are already being imposed on somebody,’ said Timothy Sandefur, an attorney for the Pacific Legal Foundation. 

Proponents say that ‘regulatory taking’ cases are more of a burden on property owners than outright condemnation.

‘With a downsizing, you get nothing,’ [Dave] Gillard said [Gillard is spokesman for the Protect Our Homes Coalition].

He predicted that most of the cases would involve downzonings, and said many of the scenarios conjured by the opposition are red herrings.

The argument in favor of Proposition 90 in the Official Voter Information Guide is a powerful statement by three victims of eminent domain and I highly recommend reading it in whole.  Here is an excerpt:

Local governments can take homes, businesses, and churches through unfair use of eminent domain.  They can also take away your property value with the stroke of a pen.

We are three average Californians, and it happened to us.

Local governments unfairly tried to take our property away from us and turn it over to developers to build condos, hotels, and other commercial projects.

Why?  Because these developers are politically connected, and their projects will generate more tax revenue for local governments.

  • Manuel Romero had eminent domain used against his family restaurant so that a Mercedes-Benz dealership next door could use the space for a parking lot.
  • Bob Blue had eminent domain used against his small luggage store – in his family for almost sixty years – to that a luxury hotel could be built.
  • Pastor Roem Agustin had his church threatened with condemnation so that a developer could build condominiums. 

Read the rest

Don’t be intimidated by the complexities of Proposition 90.  The “regulatory takings” aspect would require property owners to prove substantial economic loss in a court of law

This isn’t a recipe for frivolous lawsuits and ridiculous taxpayer funded payouts.  This is just compensation for the lost economic value caused by government laws and regulations.  If a community wants a smaller development, that’s fine.  But they should have to pay for it rather than the burden falling solely on the developer whose property value has been hammered.

Proposition 90 is in the spirit of individual rights and freedom that define America and have made it great.  Vote “Yes” on Proposition 90!!! 

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