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January 2012 national Cooperative highway Research Program Legal Research Digest 56 the ramifications of post-kelo legislation on state transportation projects This report was prepared under NCHRP Project 20-6, "Legal Problems Arising Out of Highway Programs," for which the Transportation Research Board is the agency coordinating the research. The report was prepared by Larry W. Thomas, Attorney at Law, Washington, DC. James B. McDaniel, TRB Counsel for Legal Research Projects, was the principal investigator and content editor. The Problem and Its Solution State highway departments and transportation agen- opment or restricted the eminent domain process. This cies have a continuing need to keep abreast of operat- new legislation could also significantly impact the ac- ing practices and legal elements of specific problems in quisition of private property for transportation projects. highway law. This report continues NCHRP's practice of More importantly, the desire to constrain condemna- keeping departments up-to-date on laws that will affect tion for redevelopment purposes has the potential for their operations. influencing the cost and timely delivery of state trans- portation projects. Applications This digest reports on research that reveals the con- sequences of new legislation by examining how the new In the 2005 United States Supreme Court case of Kelo legislation has affected 1) using eminent domain for eco- v. the City of New London, the Court held that the use nomic development, 2) condemning blighted and non- of eminent domain to take nonblighted, private prop- blighted property, 3) restricting transfers of condemned erty for a city-approved, privately implemented eco- property to private parties, and 4) redefining "public nomic development plan was constitutional. That deci- use." States and localities considering more confining sion resulted in a great deal of discussion regarding the legislation would benefit from the identification of re- unfettered use of eminent domain and its implications strictions that could most significantly or adversely af- for property owners. Following these developments, fect the cost and timely delivery of state transportation there was considerable pressure on state legislatures to projects. Transportation officials and attorneys should curb the use of eminent domain powers. State trans- gain helpful insight in dealing with the overall impacts portation officials expressed concern that the backlash of such legislation. against condemnations would significantly affect the The digest should be useful to transportation admin- price of property needed for transportation projects. istrators; attorneys; transportation planners; state, city, Forty-three states enacted legislation that either re- and county legislators; property owners; and real estate stricted the use of eminent domain for economic devel- professionals. TRANSPORTATION RESEARCH BOARD OF THE NATIONAL ACADEMIES