What is Eminent Domain?
Eminent domain is the power held by certain federal, state and local governmental entities as well as certain private entities to take private property for a public use. Basically, eminent domain involves a forced sale of private property so that the private property can be converted to a public purpose. The property owner, who is forced to sell her property, is to receive fair market value for the property being appropriated. Many public projects, such as public roads and highways, public buildings, and public utilities and other services, would not be possible without eminent domain.
Why has eminent domain been in the news so much recently?
In 2005, the United States Supreme Court held in Kelo v. City of New London that under the United States Constitution eminent domain could be used for pure economic development. In other words, private property could be appropriated via eminent domain if the property was in an area that is simply economically depressed, in order to transfer the property to another private entity for the purpose of economic revitalization. This decision caused most states, including Ohio, to review their eminent domain laws. The fallout from the Kelo decision is why you have heard so much recently about eminent domain.
What has Ohio done in response to the Kelo decision?
Ohio's response to the Kelo decision has come from both the Ohio Supreme Court and the Ohio General Assembly.
The Ohio Supreme Court held in City of Norwood v. Horney that, unlike the United States Constitution, the Ohio Constitution does not permit eminent domain to be used for pure economic development. Hence, an appropriating entity cannot appropriate private property in Ohio simply because the property is in an area that is economically depressed.
The Ohio General Assembly formed a task force to review Ohio's eminent domain laws and recommend changes, if any, to be made to such laws. The General Assembly debated the recommendations of the task force, which resulted in the passage of S.B 7. S.B. 7 became effective on October 10, 2007, and made many changes to Ohio's eminent domain laws. Some of the highlights of SB7 include:
- A new definition of blight to be applied when an appropriating entity seeks to use eminent domain to take property to redevelop a blighted or slum area
- Additional requirements that must be followed by an appropriating entity prior to filing an eminent domain lawsuit, for instance, the appropriating entity must provide the property owner with a written notice of intent to appropriate, a good faith offer, and a copy of its appraisal prior to filing an eminent domain lawsuit
- New provisions for mediation during eminent domain proceedings
- A shifting of the burden of proof to the appropriating entity on preliminary issues such as the appropriating entity's right to take the property, the necessity for the taking of the property, and the parties' inability to agree
- New provisions with respect to the appeal of eminent domain proceedings
- New provisions providing under certain circumstances for additional compensation to be paid to the property owner for loss of goodwill, relocation assistance, and attorney fees and costs
The application of these changes in eminent domain proceedings is likely to keep eminent domain in Ohio in the news for the relatively near future.