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Supreme Court News: Sandra Day O'Connor to Retire ... Big Ruling on Property Rights

I’m Gwen Outen with the VOA Special English Economics Report.

On June twenty-third, the Supreme Court decided an important case about property rights in the United States. The ruling will permit local governments to take private property for economic development. This is how the case developed:

In nineteen ninety-eight, officials in New London, Connecticut, announced plans to redevelop an area of the city. Soon, the drug company Pfizer decided to place a research center in New London. This was good news for a city with years of economic difficulties.

In two thousand, officials expanded the economic development plan to include property along a river. They said the project would create more than one thousand jobs.

But the project needed land. The city of New London was able to buy about one hundred properties in the development area. However, nine people who owned fifteen properties refused to sell. The city said it would take the properties under eminent domain.

Eminent domain is a power that governments have to seize property in some cases.

The Fifth Amendment to the Constitution permits governments to take private property for "public use," if there is fair payment.

State courts in Connecticut ruled that the city could take the homes. The owners appealed to the United States Supreme Court. They argued that the project did not represent a "public use." Private companies would develop the office space and other buildings proposed.

The case divided the court. Four justices supported the owners. However, the other five supported the city. The majority ruled that the city could use eminent domain to take the properties after paying a fair price.

Justice John Paul Stevens wrote the majority opinion. He noted that governments may take land for public projects like roads. Justice Stevens said projects that help a community grow economically also serve a public purpose.

However, he said that states could restrict the use of eminent domain if they choose.

In a dissent, Justice Sandra Day O’Connor argued that governments now could take land simply by claiming it for economic development. She said any private property could be given to another private owner, so long as it might be improved.

This VOA Special English Economics Report was written by Mario Ritter. Our reports are online at I'm Gwen Outen.