Kelo and Foxconn – How Soon They Forget

July 31, 2017

Private property may only be condemned if it is being taken for a “public use” according to the Fifth Amendment Takings Clause. In 2005, in a universally unpopular opinion, the SCOTUS decided that the taking of private property by a city for redevelopment by a private entity was a “public use.”

In Kelo, the New London (Connecticut) Development Corporation (“NLDC”)—a private non-profit organization established to promote development planning in the city—produced  a development plan to revitalize the Fort Trumbull area of the city by building housing, office space and other facilities that would support the new headquarters for Pfizer.

The development required NLDC to acquire land belonging to 90 different property owners. The city council authorized NLDC to use eminent domain to acquire the property. Susette Kelo was one of seven property owners who refused to sell voluntarily. She and the other resistant property owners put up a good fight, but eventually lost the “public use” issue in the United States Supreme Court. In the wake of Kelo, Wisconsin, like many other states, promptly passed legislation (§ 32.03(6)(c)) prohibiting the condemnation of land that the condemnor intends to convey or lease to a private entity, unless the property is blighted.

So, I was surprised to see a recent news story about Foxconn building a plant in either Racine or Kenosha County. According to the story, Assembly Speaker Robin Vos, notoriously a strong supporter of property rights, said that offers to purchase properties in the area where the plant will likely be built have been “astronomical”. He also apparently said that landowners who choose not to sell their land could be “bought out” by municipalities that have the “tool of eminent domain.”

That won’t happen unless the legislature passes a new law reversing the very popular anti-Kelo legislation. That will be an interesting debate.

For more information about "Kelo and Foxconn – How Soon They Forget," contact Steven M. Streck at sstreck@axley.com or 608.283.6721.