Contracting around Kelo

Here we are in Day Two of life without property rights, thanks to the U.S. Supreme Court’s ruling yesterday in Kelo v. New London. Five unelected lawyers have decided that contrary to any rational reading of the Takings Clause of the Fifth Amendment, a local government can use its eminent domain power to take your land, pay you a pittance “just compensation”, then turn around and sell the land to someone who makes fat campaign donations to another private party that the government thinks will engage in a nice “public use” of your land … in other words, in some way that’s hyped as creating jobs, generating more property tax revenue, or helping economic development.
Since we can’t rely on the plain language of the Constitution anymore to keep the government’s grubby paws away from our property, what can we do? As a temporary measure, maybe we can contract around the Kelo problem.
Let’s say that you own some attractive real estate that your local government wants to take from you through eminent domain. To foil their plans you enter into a contract with the state government, where in exchange for a fee, the state automatically takes title to your property if your municipal or county government ever attempts to condemn it, and you get to live on the land. Perhaps it could be set up as a trust with the state as trustee.
Anyway, since a local government doesn’t have the authority to condemn state property, they lose all incentive to condemn your property once you tell them about your new arrangement. If the condemnation would be for a true public use (as we used to understand it) like building a highway or a bridge, you can always put a clause in the contract that exempts such true public uses from triggering the passage of title to the state.
Now since the local government gains nothing by using eminent domain for shifty purposes, they won’t condemn your property … and the state never takes title. But the state does get a valuable interest in your land, and it gets political brownie points by being perceived as “defending the little guy” from corrupt local politicians and fatcat developers. To top it all off, you get a fee from the state in exchange for its interest in your land.
This strikes me as a quick way to inoculate property against greedy local governments. What do you think?

UPDATE: Will Collier rounds up other possible solutions.
UPDATE 2: This post has merged at high speed into today’s Beltway Traffic Jam.

4 comments

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