The Right to Full and Fair Compensation: Making Sure Small Business Gets a Fair-Shake

Date: March 05, 2014

Since the Supreme Court’s infamous decision, in Kelo v. New London, there have been some big eminent domain reforms across the country. That was the decision that allowed government to take private property from ordinary homeowners, and small businesses, for the benefit of large corporate developers. But if there was a silver-lining, Kelo brought a lot of attention to the problem of eminent domain abuse in America. The result is that citizens in some states have succeeded in limiting the government’s power of eminent domain through legislation and the initiative process. For example, last fall Virginians voted to amend their State Constitution to prohibit municipalities from taking private property for the benefit of private corporations.

NFIB Legal Center has been vocal about eminent domain abuse in both the court of law and the court of public opinion. To be sure, we led a coalition of 12 different groups in urging the Supreme Court to reconsider Kelo last year. And we continue to fight eminent domain abuse in other ways—including challenging the authority of state and local government to proceed with eminent domain takings where the authorities have failed to comply with procedural rules that are designed to protect private property owners. But, one of our biggest concerns—in the fight to end eminent domain abuse—is the problem of undervaluation. Accordingly, NFIB Legal Center has launched a special initiative to advocate for rules that ensure small business owners are fully and fairly compensated for their losses when they suffer a taking in eminent domain.

As part of our Just Compensation Project, NFIB Legal Center recently filed in an Ohio case to defend the rights of a small business owner. As part of a beautification project, the City of Westerville decided to use eminent domain to take away the owner’s right to control landscaping on his property. In taking this right for itself, the City’s actions caused the remainder of the owner’s property to depreciate in value. But, the City is refusing to compensate him for this depreciation. Accordingly, NFIB Legal Center filed an amicus brief arguing that the Constitution requires compensation for depreciation in value to private property when government takes away valuable property rights. In this case, the right to maintain unobstructed views to and from public roads was valuable—as it is for many commercial properties—because there is a strong correlation between public visibility and consumer traffic.

This is just the latest in NFIB Legal Center’s ongoing effort to ensure full and fair valuation in eminent domain cases. We are concerned that small business owners are very often undercompensated, and we’re trying to change that. So, if you are dealing with an eminent domain problem, rest assured that we are on your side.

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