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WASHINGTON (AP) -- -- The Supreme Court on Thursday ruled that local governments may seize people's homes and businesses -- even against their will -- for private economic development.

It was a decision fraught with huge implications for a country with many areas, particularly the rapidly growing urban and suburban areas, facing countervailing pressures of development and property ownership rights.

The 5-4 ruling represented a defeat for some Connecticut residents whose homes are slated for destruction to make room for an office complex. They argued that cities have no right to take their land except for projects with a clear public use, such as roads or schools, or to revitalize blighted areas.

As a result, cities have wide power to bulldoze residences for projects such as shopping malls and hotel complexes to generate tax revenue.

Local officials, not federal judges, know best in deciding whether a development project will benefit the community, justices said.

"The city has carefully formulated an economic development that it believes will provide appreciable benefits to the community, including -- but by no means limited to -- new jobs and increased tax revenue," Justice John Paul Stevens wrote for the majority.

He was joined by Justice Anthony Kennedy, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer.

At issue was the scope of the Fifth Amendment, which allows governments to take private property through eminent domain if the land is for "public use."

Susette Kelo and several other homeowners in a working-class neighborhood in New London, Connecticut, filed suit after city officials announced plans to raze their homes for a riverfront hotel, health club and offices.

New London officials countered that the private development plans served a public purpose of boosting economic growth that outweighed the homeowners' property rights, even if the area wasn't blighted.

Justice Sandra Day O'Connor, who has been a key swing vote on many cases before the court, issued a stinging dissent. She argued that cities should not have unlimited authority to uproot families, even if they are provided compensation, simply to accommodate wealthy developers.

The lower courts had been divided on the issue, with many allowing a taking only if it eliminates blight.

"Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random," O'Connor wrote. "The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms."

She was joined in her opinion by Chief Justice William H. Rehnquist, as well as Justices Antonin Scalia and Clarence Thomas.

NEW LONDON, Conn. - Seven homeowners in this small waterfront community lost a groundbreaking
U.S. Supreme Courtdecision Thursday when justices ruled that City Hall may take their property through eminent domain to make way for a hotel and convention center.
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Word of the high court decision spread around Bill Von Winkle's part of town like news of a passing relative. "Hello?" he answered his cell phone. "Yeah, we lost. I know, hard to believe, huh?"

"I spent all the money I had," said Von Winkle, a retired deli owner, of the properties he bought in the Fort Trumbull neighborhood. "I sold sandwiches to buy these properties. It took 21 years."

The court's decision drew a scathing dissent from Justice
Sandra Day O'Connor, who argued the decision favors rich corporations.

The fight over Fort Trumbull has been raging for years. New London once was a center for the whaling industry and later became a manufacturing hub. More recently the city has suffered the kind of economic woes afflicting urban areas across the country.

City officials envision a commercial development including a riverfront hotel, health club and offices that would attract tourists to the Thames riverfront, complementing the adjoining Pfizer center and a proposed Coast Guard museum.

Most homeowners sold their properties to make way for wrecking crews, but seven families stubbornly refused to sell. Collectively, they owned 15 houses.

"The U.S. Supreme Court destroyed everybody's lives today, everybody who owns a home," said Richard Beyer, owner of two rental properties in the once-vibrant immigrant neighborhood.

Nationwide, however, legal experts said they don't expect local governments to rush to claim homes.

"The message of the case to cities is yes, you can use eminent domain, but you better be careful and conduct hearings," said Thomas Merrill, a Columbia law professor who specializes in property rights.

In his majority opinion, Justice
John Paul Stevenssaid New London could pursue private development under the Fifth Amendment, which allows governments to take private property if the land is for public use. He said the project the city has in mind promises to bring more jobs and revenue.

"Promoting economic development is a traditional and long accepted function of government," Stevens wrote. He added that local officials are better positioned than federal judges to decide what's best for a community.

He was joined in his opinion by other members of the court's liberal wing — David H. Souter,
Ruth Bader Ginsburgand Stephen G. Breyer, as well as Reagan appointee Justice
Anthony Kennedy, in noting that states are free to pass additional protections if they see fit.

The four-member bloc typically has favored greater deference to cities, which historically have used the power of eminent domain for urban renewal projects.

At least eight states — Arkansas, Florida, Illinois, Kentucky, Maine, Montana, South Carolina and Washington — forbid the use of eminent domain for economic development unless it is to eliminate blight. Other states either expressly allow private property to be taken for private economic purposes or have not spoken clearly to the question.

Meanwhile, the decision did little to bring city officials and property owners here closer together.

Under the ruling, residents still will be entitled to "just compensation" for their homes as provided under the Fifth Amendment. However, homeowners had refused to move at any price, calling it an unjustified taking of their property.

City Manager Richard Brown said he expects more lawsuits, but believes the land fight is over and doesn't expect a showdown when bulldozers arrive in the neighborhood.

Landowners in the lawsuit, however, pledged to continue their fight.

"It's a little shocking to believe you can lose your home in this country," said Von Winkle, who said he would battle beyond the lawsuits and fight the bulldozers if necessary. "I won't be going anywhere."

The case is Kelo et al v. City of New London, 04-108.

B4UTRUST wrote:Josh, the sad part is this isn't a city! The town that caused this horrid decision is some little bumfuck nowheresville. It's not some thriving metropolis or even a decent sized city. It's a hole in the wall town that use to be a manufacturing hub and had a decent market in whaling back when that was the thing...It's New London, Ct.

frigidmagi wrote:Problem is Kendall the Supreme Court is pretty well walled off from the rest of the government (granted it was meant that way with a good reason) and the nation at large.

While I've heard both Democrats and Republicians and Libertains and Socalist screaming in pure anger and shock over this, I'm not sure if there's anything Congress can do.

frigidmagi wrote:Problem is Kendall the Supreme Court is pretty well walled off from the rest of the government (granted it was meant that way with a good reason) and the nation at large.

While I've heard both Democrats and Republicians and Libertains and Socalist screaming in pure anger and shock over this, I'm not sure if there's anything Congress can do.

Cpl Kendall wrote:Any way that this can be appealed? Or will it just go before the same Supremem Court Justices, and wind up with the same ruling?