The Frontier of Eminent Domain

Abstract

The Supreme Court's 2005 decision in Kelo v. City of New London brought the issues of takings and public use into the national spotlight. A groundswell of opposition to government-initiated 'economic development takings' the Court deemed a public use under the Fifth Amendment led to eminent domain reform legislation in over 30 states. Many people are surprised to learn, however, that another type of economic development taking is alive and well in many western states that are rich in natural resources. In those states, oil, gas, and mining companies have the power of eminent domain under state constitutions or state statutes to take private property to develop coal, oil, or other natural resources. In fact, the Supreme Court's deference to such 'natural resource development takings' in the early part of the 20th century was the base upon which the Court built its decision in Kelo. This Article first explores the relationship between Kelo-type economic development takings and natural resource development takings and argues that the national reaction to Kelo has focused too narrowly on government takings and ignored the impact of private takings. It then uses recent property reforms in the Interior West to explore the broader implications of the role of eminent domain in reallocating property in society and proposes some additional reforms for natural resource development takings.

Keywords: public use, takings, Interior West, property reforms, split-estate, economic development, eminent domain, fifth amendment, due process, natural resources, oil, gas, coalbed methane, Kelo

JEL Classification: K11, K23, K32