Eminent Domain: Kelo vs. New London

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Kelo vs. New London Simply put, eminent domain is the power of the state to take private property for the use in a public project in return for reasonable compensation. Reasonable compensation is defined in terms of fair market value of the property. Traditionally the power of eminent domain has been exercised for the construction of large public projects, but its use is beginning to be broadened to projects involving not ‘public use’ but ‘public benefit.’ The decision in Kelo vs. City of New London, a case that came before the US Supreme Court in 2004, set a precedent for property to be transferred to a private owner for the purpose of economic development. The court found that if an economic project creates new jobs, increases tax and other city revenues, and revitalizes a depressed or blighted urban area it qualifies as a public use, and therefore the land can be seized, because it is viewed as a benefit to the public. The case of Kelo vs. New London involved an economic development plan for the City of New London, Connecticut, and the people who had owned land with in the fort Trumbell area. New London was a town, which had not had strong economic standings and had been in an economic decline for many decades. Pfizer, Inc., a large pharmaceutical company came along in 1998, and announced that they had plans to build a large research facility in New London on a near the Fort Trumbull neighborhood. This neighborhood has been characterized as one with a high vacancy rate for nonresidential buildings, old buildings in poor shape, and with fewer than half of the residential properties in average or better condition. The city of New London and many of its residents were in favor of the reconstruction and so they put developed the nonprofit New London Development Corporation (NLDC) and put them in charge of creating an economic development plan that would be

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