Rep. Wolkins has introduced HB 1411 amending the level of compensation for what the statute calls “non-public” uses. I put that term in quotes since, if it was truly “non-public” then the use of eminent domain wouldn’t be possible. The 5th Amendment provides, “nor shall private property be taken for public use, without just compensation.” Back when the blog was young, I covered the case of Kelo v. City of New London wherein the Supreme Court held that an economic development plan by the City to revitalize a blighted part of the town was a Constitutionally permissible taking where the City would ultimately transfer some of the taken land to private developers. The breathless opposition to the case at the time proclaimed that the concept of private property was at an end! Turns out, not so much. In any case, shortly thereafter, the General Assembly passed IC 32-24-4.5 at the time which governed governmental taking of the kind contemplated by Kelo.
The statute defined “public use” as being where the government actually retained ownership for things like highways, airports, and parks; leasing public property to a private entity (e.g. the Toll Road); and utilities (even if those were privately owned). So, some transfers to private entities were specifically o.k., but the statute specifically excluded from the term “public use” ” the public benefit of economic development, including an increase in a tax base, tax revenues, employment, or general economic health.” This was the kind of “public use” that’s constitutionally permissible under Kelo. And, it remained permissible under Indiana law if the real estate was, in some sense (defined in the statute), blighted and the acquisition would do more than just improve the property increase the property tax base of the governmental entity. The entity condemning the property would also have to pay more for it: 125% of market value for agricultural property; 150% of market value for owner-occupied residential property; and 100% for any other real property.
That’s a long wind up for what Rep. Wolkin’s legislation would do: make the 150% apply to all residential property whether owner-occupied or not. However, it defines “residential property” as a single-family dwelling that’s not owned for the purpose of resale, rental, or leasing in the ordinary course of business. So, I’m not sure if the intent is to protect land owned by trusts but occupied by the beneficiary of the trusts or to protect land where, say, mom and dad own the property but let family members live there or what. My guess is that there is a specific story behind this particular piece of legislation.