[Congressional Record Volume 160, Number 31 (Tuesday, February 25, 2014)]
[House]
[Pages H1913-H1917]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PRIVATE PROPERTY RIGHTS PROTECTION ACT OF 2013
Mr. GOODLATTE. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 1944) to protect private property rights.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 1944
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Private Property Rights
Protection Act of 2013''.
SEC. 2. PROHIBITION ON EMINENT DOMAIN ABUSE BY STATES.
(a) In General.--No State or political subdivision of a
State shall exercise its power of eminent domain, or allow
the exercise of such power by any person or entity to which
such power has been delegated, over property to be used for
economic development or over property that is used for
economic development within 7 years after that exercise, if
that State or political subdivision receives Federal economic
development funds during any fiscal year in which the
property is so used or intended to be used.
(b) Ineligibility for Federal Funds.--A violation of
subsection (a) by a State or political subdivision shall
render such State or political subdivision ineligible for any
Federal economic development funds for a period of 2 fiscal
years following a final judgment on the merits by a court of
competent jurisdiction that such subsection has been
violated, and any Federal agency charged with distributing
those funds shall withhold them for such 2-year period, and
any such funds distributed to such State or political
subdivision shall be returned or reimbursed by such State or
political subdivision to the appropriate Federal agency or
authority of the Federal Government, or component thereof.
(c) Opportunity To Cure Violation.--A State or political
subdivision shall not be ineligible for any Federal economic
development funds under subsection (b) if such State or
political subdivision returns all real property the taking of
which was found by a court of competent jurisdiction to have
constituted a violation of subsection (a) and replaces any
other property destroyed and repairs any other property
damaged as a result of such violation. In addition, the State
or political subdivision must pay any applicable penalties
and interest to reattain eligibility.
SEC. 3. PROHIBITION ON EMINENT DOMAIN ABUSE BY THE FEDERAL
GOVERNMENT.
The Federal Government or any authority of the Federal
Government shall not exercise its power of eminent domain to
be used for economic development.
SEC. 4. PRIVATE RIGHT OF ACTION.
(a) Cause of Action.--Any (1) owner of private property
whose property is subject to eminent domain who suffers
injury as a result of a violation of any provision of this
Act with respect to that property, or (2) any tenant of
property that is subject to eminent domain who suffers injury
as a result of a violation of any provision of this Act with
respect to that property, may bring an action to enforce any
provision of this Act in the appropriate Federal or State
court. A State shall not be immune under the 11th Amendment
to the Constitution of the United States from any such action
in a Federal or State court of competent jurisdiction. In
such action, the defendant has the burden to show by clear
and convincing evidence that the taking is not for economic
development. Any such property owner or tenant may also seek
an appropriate relief through a preliminary injunction or a
temporary restraining order.
(b) Limitation on Bringing Action.--An action brought by a
property owner or tenant under this Act may be brought if the
property is used for economic development following the
conclusion of any condemnation proceedings condemning the
property of such property owner or tenant, but shall not be
brought later than seven years following the conclusion of
any such proceedings.
(c) Attorneys' Fee and Other Costs.--In any action or
proceeding under this Act, the court shall allow a prevailing
plaintiff a reasonable attorneys' fee as part of the costs,
and include expert fees as part of the attorneys' fee.
SEC. 5. REPORTING OF VIOLATIONS TO ATTORNEY GENERAL.
(a) Submission of Report to Attorney General.--Any (1)
owner of private property whose property is subject to
eminent domain who suffers injury as a result of a violation
of any provision of this Act with respect to that property,
or (2) any tenant of property that is subject to eminent
domain who suffers injury as a result of a violation of any
provision of this Act with respect to that property, may
report a violation by the Federal Government, any authority
of the Federal Government, State, or political subdivision of
a State to the Attorney General.
(b) Investigation by Attorney General.--Upon receiving a
report of an alleged violation, the Attorney General shall
conduct an investigation to determine whether a violation
exists.
(c) Notification of Violation.--If the Attorney General
concludes that a violation does exist, then the Attorney
General shall notify the Federal Government, authority of the
Federal Government, State, or political subdivision of a
State that the Attorney General has determined that it is in
violation of the Act. The notification shall further provide
that the Federal Government, State, or political subdivision
of a State has 90 days from the date of the notification to
demonstrate to the Attorney General either that (1) it is not
in violation of the Act or (2) that it has cured its
violation by returning all real property the taking of which
the Attorney General finds to have constituted a violation of
the Act and replacing any other property destroyed and
repairing any other property damaged as a result of such
violation.
(d) Attorney General's Bringing of Action To Enforce Act.--
If, at the end of the 90-day period described in subsection
(c), the Attorney General determines that the Federal
Government, authority of the Federal Government, State, or
political subdivision of a State is still violating the Act
or has not cured its violation as described in subsection
(c), then the Attorney General will bring an action to
enforce the Act unless the property owner or tenant who
reported the violation has already brought an action to
enforce the Act. In such a case, the Attorney General shall
intervene if it determines that intervention is necessary in
order to enforce the Act. The Attorney General may file its
lawsuit to enforce the Act in the appropriate Federal or
State court. A State shall not be immune under the 11th
Amendment to the Constitution of the United States from any
such action in a Federal or State court of competent
jurisdiction. In such action, the defendant has the burden to
show by clear and convincing evidence that the taking is not
for economic development. The Attorney General may seek any
appropriate relief through a preliminary injunction or a
temporary restraining order.
(e) Limitation on Bringing Action.--An action brought by
the Attorney General under this Act may be brought if the
property is used for economic development following the
conclusion of any condemnation proceedings condemning the
property of an owner or tenant who reports a violation of the
Act to the Attorney General, but shall not be brought later
than seven years following the conclusion of any such
proceedings.
(f) Attorneys' Fee and Other Costs.--In any action or
proceeding under this Act brought by the Attorney General,
the court shall, if the Attorney General is a prevailing
plaintiff, award the Attorney General a reasonable attorneys'
fee as part of the costs, and include expert fees as part of
the attorneys' fee.
SEC. 6. NOTIFICATION BY ATTORNEY GENERAL.
(a) Notification to States and Political Subdivisions.--
(1) Not later than 30 days after the enactment of this Act,
the Attorney General shall provide to the chief executive
officer of each State the text of this Act and a description
of the rights of property owners and tenants under this Act.
(2) Not later than 120 days after the enactment of this
Act, the Attorney General shall compile a list of the Federal
laws under which Federal economic development funds are
distributed. The Attorney General shall compile annual
revisions of such list as necessary. Such list and any
successive revisions of such list shall be communicated by
the Attorney General to the chief executive officer of each
State and also made available on the Internet website
maintained by the United States Department of Justice for use
by the public and by the authorities in each State and
political subdivisions of each State empowered to take
private property and convert it to public use subject to just
compensation for the taking.
(b) Notification to Property Owners and Tenants.--Not later
than 30 days after the enactment of this Act, the Attorney
General shall publish in the Federal Register and make
available on the Internet website maintained by the United
States Department of Justice a notice containing the text of
this Act and a description of the rights of property owners
and tenants under this Act.
SEC. 7. REPORTS.
(a) By Attorney General.--Not later than 1 year after the
date of enactment of this Act, and every subsequent year
thereafter, the Attorney General shall transmit a report
identifying States or political subdivisions that have used
eminent domain in violation of this Act to the Chairman and
Ranking Member of the Committee on the Judiciary of the House
of Representatives and to the Chairman and Ranking Member of
the Committee on the Judiciary of the Senate. The report
shall--
(1) identify all private rights of action brought as a
result of a State's or political subdivision's violation of
this Act;
(2) identify all violations reported by property owners and
tenants under section 5(c) of this Act;
(3) identify the percentage of minority residents compared
to the surrounding nonminority residents and the median
incomes of those impacted by a violation of this Act;
(4) identify all lawsuits brought by the Attorney General
under section 5(d) of this Act;
(5) identify all States or political subdivisions that have
lost Federal economic development funds as a result of a
violation of this Act, as well as describe the type and
amount of Federal economic development funds lost in each
State or political subdivision and the Agency that is
responsible for withholding such funds; and
[[Page H1914]]
(6) discuss all instances in which a State or political
subdivision has cured a violation as described in section
2(c) of this Act.
(b) Duty of States.--Each State and local authority that is
subject to a private right of action under this Act shall
have the duty to report to the Attorney General such
information with respect to such State and local authorities
as the Attorney General needs to make the report required
under subsection (a).
SEC. 8. SENSE OF CONGRESS REGARDING RURAL AMERICA.
(a) Findings.--The Congress finds the following:
(1) The founders realized the fundamental importance of
property rights when they codified the Takings Clause of the
Fifth Amendment to the Constitution, which requires that
private property shall not be taken ``for public use, without
just compensation''.
(2) Rural lands are unique in that they are not
traditionally considered high tax revenue-generating
properties for State and local governments. In addition,
farmland and forest land owners need to have long-term
certainty regarding their property rights in order to make
the investment decisions to commit land to these uses.
(3) Ownership rights in rural land are fundamental building
blocks for our Nation's agriculture industry, which continues
to be one of the most important economic sectors of our
economy.
(4) In the wake of the Supreme Court's decision in Kelo v.
City of New London, abuse of eminent domain is a threat to
the property rights of all private property owners, including
rural land owners.
(b) Sense of Congress.--It is the sense of Congress that
the use of eminent domain for the purpose of economic
development is a threat to agricultural and other property in
rural America and that the Congress should protect the
property rights of Americans, including those who reside in
rural areas. Property rights are central to liberty in this
country and to our economy. The use of eminent domain to take
farmland and other rural property for economic development
threatens liberty, rural economies, and the economy of the
United States. The taking of farmland and rural property will
have a direct impact on existing irrigation and reclamation
projects. Furthermore, the use of eminent domain to take
rural private property for private commercial uses will force
increasing numbers of activities from private property onto
this Nation's public lands, including its National forests,
National parks and wildlife refuges. This increase can
overburden the infrastructure of these lands, reducing the
enjoyment of such lands for all citizens. Americans should
not have to fear the government's taking their homes, farms,
or businesses to give to other persons. Governments should
not abuse the power of eminent domain to force rural property
owners from their land in order to develop rural land into
industrial and commercial property. Congress has a duty to
protect the property rights of rural Americans in the face of
eminent domain abuse.
SEC. 9. SENSE OF CONGRESS.
It is the policy of the United States to encourage,
support, and promote the private ownership of property and to
ensure that the constitutional and other legal rights of
private property owners are protected by the Federal
Government.
SEC. 10. RELIGIOUS AND NONPROFIT ORGANIZATIONS.
(a) Prohibition on States.--No State or political
subdivision of a State shall exercise its power of eminent
domain, or allow the exercise of such power by any person or
entity to which such power has been delegated, over property
of a religious or other nonprofit organization by reason of
the nonprofit or tax-exempt status of such organization, or
any quality related thereto if that State or political
subdivision receives Federal economic development funds
during any fiscal year in which it does so.
(b) Ineligibility for Federal Funds.--A violation of
subsection (a) by a State or political subdivision shall
render such State or political subdivision ineligible for any
Federal economic development funds for a period of 2 fiscal
years following a final judgment on the merits by a court of
competent jurisdiction that such subsection has been
violated, and any Federal agency charged with distributing
those funds shall withhold them for such 2-year period, and
any such funds distributed to such State or political
subdivision shall be returned or reimbursed by such State or
political subdivision to the appropriate Federal agency or
authority of the Federal Government, or component thereof.
(c) Prohibition on Federal Government.--The Federal
Government or any authority of the Federal Government shall
not exercise its power of eminent domain over property of a
religious or other nonprofit organization by reason of the
nonprofit or tax-exempt status of such organization, or any
quality related thereto.
SEC. 11. REPORT BY FEDERAL AGENCIES ON REGULATIONS AND
PROCEDURES RELATING TO EMINENT DOMAIN.
Not later than 180 days after the date of the enactment of
this Act, the head of each Executive department and agency
shall review all rules, regulations, and procedures and
report to the Attorney General on the activities of that
department or agency to bring its rules, regulations and
procedures into compliance with this Act.
SEC. 12. SENSE OF CONGRESS.
It is the sense of Congress that any and all precautions
shall be taken by the government to avoid the unfair or
unreasonable taking of property away from survivors of
Hurricane Katrina who own, were bequeathed, or assigned such
property, for economic development purposes or for the
private use of others.
SEC. 13. DISPROPORTIONATE IMPACT.
If the court determines that a violation of this Act has
occurred, and that the violation has a disproportionately
high impact on the poor or minorities, the Attorney General
shall use reasonable efforts to locate former owners and
tenants and inform them of the violation and any remedies
they may have.
SEC. 14. DEFINITIONS.
In this Act the following definitions apply:
(1) Economic development.--The term ``economic
development'' means taking private property, without the
consent of the owner, and conveying or leasing such property
from one private person or entity to another private person
or entity for commercial enterprise carried on for profit, or
to increase tax revenue, tax base, employment, or general
economic health, except that such term shall not include--
(A) conveying private property--
(i) to public ownership, such as for a road, hospital,
airport, or military base;
(ii) to an entity, such as a common carrier, that makes the
property available to the general public as of right, such as
a railroad or public facility;
(iii) for use as a road or other right of way or means,
open to the public for transportation, whether free or by
toll; and
(iv) for use as an aqueduct, flood control facility,
pipeline, or similar use;
(B) removing harmful uses of land provided such uses
constitute an immediate threat to public health and safety;
(C) leasing property to a private person or entity that
occupies an incidental part of public property or a public
facility, such as a retail establishment on the ground floor
of a public building;
(D) acquiring abandoned property;
(E) clearing defective chains of title;
(F) taking private property for use by a utility providing
electric, natural gas, telecommunication, water, wastewater,
or other utility services either directly to the public or
indirectly through provision of such services at the
wholesale level for resale to the public; and
(G) redeveloping of a brownfield site as defined in the
Small Business Liability Relief and Brownfields
Revitalization Act (42 U.S.C. 9601(39)).
(2) Federal economic development funds.--The term ``Federal
economic development funds'' means any Federal funds
distributed to or through States or political subdivisions of
States under Federal laws designed to improve or increase the
size of the economies of States or political subdivisions of
States.
(3) State.--The term ``State'' means each of the several
States, the District of Columbia, the Commonwealth of Puerto
Rico, or any other territory or possession of the United
States.
SEC. 15. LIMITATION ON STATUTORY CONSTRUCTION.
Nothing in this Act may be construed to supersede, limit,
or otherwise affect any provision of the Uniform Relocation
Assistance and Real Property Acquisition Policies Act of 1970
(42 U.S.C. 4601 et seq.).
SEC. 16. BROAD CONSTRUCTION.
This Act shall be construed in favor of a broad protection
of private property rights, to the maximum extent permitted
by the terms of this Act and the Constitution.
SEC. 17. SEVERABILITY AND EFFECTIVE DATE.
(a) Severability.--The provisions of this Act are
severable. If any provision of this Act, or any application
thereof, is found unconstitutional, that finding shall not
affect any provision or application of the Act not so
adjudicated.
(b) Effective Date.--This Act shall take effect upon the
first day of the first fiscal year that begins after the date
of the enactment of this Act, but shall not apply to any
project for which condemnation proceedings have been
initiated prior to the date of enactment.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Virginia (Mr. Goodlatte) and the gentleman from Virginia (Mr. Scott)
each will control 20 minutes.
The Chair recognizes the gentleman from Virginia.
General Leave
Mr. GOODLATTE. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days within which to revise and extend their
remarks and include extraneous material on H.R. 1944, currently under
consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Virginia?
There was no objection.
Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may
consume.
In 1997, Susette Kelo was trying to rebuild her life when she
purchased a small, Victorian house perched on the waterfront in the
Fort Trumbull neighborhood of New London, Connecticut.
[[Page H1915]]
It was Susette's dream to own a home that looked out over the water.
The little pink house she purchased was in need of repair, but with
lots of hard work, she was able to restore it and start a new life for
herself on the banks of the Thames River. Susette was finally living
her dream.
Tragically, however, the city of New London turned that dream into a
nightmare.
In 1998, pharmaceutical giant Pfizer announced its intent to build a
plant in Fort Trumbull, and the city of New London began planning a
massive redevelopment of the area surrounding the Pfizer plant. The
city handed its power of eminent domain to a private corporation to
take the entire neighborhood for economic development purposes.
Susette and several of her neighbors, some of whose families had
lived in their homes for generations, challenged the city's use of
eminent domain all of the way to the U.S. Supreme Court in a desperate
attempt to save their homes and their mostly blue collar neighborhood.
However, the Supreme Court, in one of the most controversial rulings
in its history, held that private economic development constitutes a
``public use'' under the Fifth Amendment to the United States
Constitution. Under the Court's reasoning, the government can now use
the eminent domain power to take the property of any individual for
nearly any reason. As the dissenting justices observed, by defining
public use so expansively, the result of the decision is:
Effectively to delete the words ``for public use'' from the
takings clause of the Fifth Amendment. The specter of
condemnation hangs over all property. Nothing is to prevent
the State from replacing any Motel 6 with a Ritz-Carlton, any
home with a shopping mall, or any farm with a factory. The
government now has license to transfer property from those
with few resources to those with more. The Founders cannot
have intended this perverse result.
The Court's 5-4 decision against Susette and her neighbors sparked a
nationwide backlash against eminent domain abuse. Susette's fight
helped remind Americans that private ownership of property is vital to
our freedom and our prosperity, and is one of the most fundamental
principles embedded in the Constitution. Poll after poll that came out
in the wake of the Court's ruling consistently showed that Americans
from across every demographic cross-section overwhelmingly opposed the
decision and supported efforts to strengthen property rights
protections.
Although Susette's story is probably the most infamous case of
eminent domain abuse, it is by no means an isolated case. Every day
across this country, Americans are forced to sit back and watch
powerlessly as their homes, small businesses, family farms, and
churches are bulldozed to make way for high-end condos, shopping malls,
and other upscale developments.
Oftentimes, after Americans go through the trauma of losing their
private property to eminent domain abuse, the planned private economic
development doesn't even occur. In New London, for instance, the Fort
Trumbull redevelopment project never got off the ground. After spending
close to $80 million in taxpayer money, there has been no new
construction, and the neighborhood where Susette Kelo's little pink
house was located is now a barren field, overrun by weeds.
It is time for Congress finally to step in and do its part to rein in
eminent domain abuse by passing the Private Property Rights Protection
Act. I want to thank Mr. Sensenbrenner for reintroducing this
legislation. He and I have worked together on this issue for many
years, and I am pleased that this legislation incorporates many
provisions from legislation I helped introduce in the 109th Congress,
the STOPP Act.
Specifically, the Private Property Rights Protection Act prohibits
State and local governments that receive Federal economic development
funds from using economic development as a justification for taking
property from one person and giving it to another private entity. Any
State or local government that violates this prohibition will be
ineligible to receive Federal economic development funds for a period
of 2 years.
Moreover, this legislation grants adversely affected landowners the
right to use appropriate legal remedies to enforce the provisions of
the bill. In addition, it allows State and local governments to cure
violations by giving the property back to the original owner. No one
should have to live in fear of the government snatching up their home,
farm, church, or small business. As the Institute for Justice has
observed:
Using eminent domain so another richer, better-connected
person may live or work on the land you used to own tells
Americans that their hopes, dreams, and hard work do not
matter as much as money and political influence. The use of
eminent domain for private development has no place in a
country built on traditions of independence, hard work, and
protection of property rights.
This bill creates incentives for State and local governments to help
ensure that eminent domain abuse does not occur in the future. I urge
my colleagues to support this legislation.
I reserve the balance of my time.
Mr. SCOTT of Virginia. Mr. Speaker, I rise in opposition to H.R.
1944, and I yield myself such time as I may consume.
Mr. Speaker, in the wake of the Supreme Court's decision in Kelo v.
City of New London, I have been concerned that States and
municipalities could use this decision to expand their power of eminent
domain, whether for the benefit of private parties or for public
projects, to the detriment of those who are least powerful in the
community.
While I believe the power of eminent domain has been abused,
particularly against those lacking economic or political power, in the
9 years since the Kelo decision, States have properly addressed the
issue on their own, and we should respect their judgment rather than
impose this awkward, one-size-fits-all Federal legislative response.
I have reached this conclusion for several reasons. The first and
foremost is that it is important to note that in Kelo, the Supreme
Court acknowledged that State courts may interpret their own eminent
domain powers in a manner that is actually more protective of property
rights. I am, therefore, encouraged that no fewer than 43 States have
followed that advice and taken steps to restrict their own powers of
eminent domain to guard against abuse.
{time} 1645
Given the fact that our system of federalism appears to be working
and that the States have already enacted legal protections that are
needed to prevent abuse of eminent domain power, I do not believe that
Federal intervention is necessary or appropriate at this time.
Second, the bill's enforcement provisions are very troubling. A
jurisdiction found in violation of this legislation would be stripped
of all Federal economic development funds for 2 years, which could have
a devastating impact on its financial health.
The Supreme Court has long held that, ``when Congress attaches
conditions to a State's acceptance of Federal funds, the conditions
must be set out 'unambiguously.''' But the term ``Federal economic
development funds'' is, in fact, ambiguous and could conceivably
include transportation, housing, and all kinds of significant Federal
funding.
Those who could bear the heaviest burden of cuts and programs like
the Community Development Block Grants could be precisely the same
communities that have suffered the most under the abuse of eminent
domain power in the past, that is, the powerless in our communities.
Furthermore, the impact of this legislation could be severe, even if
a city or State never exercised the power of eminent domain. That is
because no lender could ignore the risk of a future administration
violating this legislation by using them in a domain for a prohibited
purpose and, consequently, facing the devastating penalties during the
life of the bond, thereby affecting the city's ability to make the
payments on the bond.
This bill gives no discretion and no flexibility with respect to the
penalty. It fails to take into account the severity or magnitude of the
violation, so even a small violation would have to result in a complete
loss of all economic development funds for 2 years.
No matter how clean a city's record may be, the danger that some
future violation would have such a devastating effect could negatively
impact its bond rating.
Finally, against this backdrop, we need to remember that eminent
domain has a long and shameful history
[[Page H1916]]
of disproportionately impacting foreign minority communities.
Inner-city neighborhoods that lacked institutional and political
power were often designated as blighted areas slated for redevelopment
through urban renewal programs. Properties were condemned, and land was
turned over to private developers.
That abuse was not confined to the use of eminent domain for economic
development purposes. Many of those abuses would still be allowed under
this bill. You can trace the cost of any major highway in America to
see where poor and minority communities were located. You can map
political power, where it is and where it isn't, by the proposed route
of the Keystone pipeline today.
This bill does nothing to protect property owners like the witness
who testified before the House Judiciary Committee about how her
property was taken to benefit the foreign corporation building that
pipeline.
The bill does not even give property owners the right to sue to stop
an illegal taking in the first place. Suits can only be brought after
the property is taken, after it is too late. Despite the draconian
penalties in the bill, the actual property owner would get nothing.
This underscores why it is important that we continue to monitor the
facts on the ground to determine whether Federal action is warranted.
If so, what effective action should be taken?
If the States fail to protect our citizens, Congress should remain
ready, willing, and able to do so. However, as the States have already
acted to curb reviews, we in Congress should allow them to maintain
their authority to act.
Even if you believe the bill achieves the correct balance between
State authority and Federal intervention and prohibits the
inappropriate use of eminent domain, the irrational penalties it
imposes and the fact that individual property owners are not even
protected still require that the bill be defeated.
I urge my colleagues to oppose the legislation and reserve the
balance of my time.
Mr. GOODLATTE. Mr. Speaker, at this time, it is my pleasure to yield
such time as he may consume to the gentleman from Wisconsin (Mr.
Sensenbrenner), the chairman of the Crime, Terrorism, Homeland
Security, and Investigations Subcommittee, and the chief sponsor of
this legislation.
Mr. SENSENBRENNER. Mr. Speaker, I am pleased that the House of
Representatives today is considering H.R. 1944, the Private Property
Rights Protection Act, as part of Stop Government Abuse Week. My bill
aims to restore the property rights of all Americans the Supreme Court
took away 9 years ago.
The Founders of our country recognized the importance of an
individual's right to personal property when they drafted the
Constitution. The Fifth Amendment states, ``nor shall private property
be taken for public use, without just compensation.''
In Kelo v. the City of New London, in a 5-4 decision, the Supreme
Court decided that economic development can be a public use under the
Fifth Amendment's Takings Clause. The Court held that the government
could take private property from an owner to help a corporation or a
private developer.
The now infamous Kelo decision was met with swift and strong
opposition. As former Justice O'Connor stated, ``Government now has
license to transfer property from those with fewer resources to those
with more. The Founders cannot have intended this perverse result.''
In the nearly 9 years since Kelo, polls show that Americans
overwhelmingly oppose property being taken and transferred to another
private owner, even if it is for a public economic good.
Groups including the AARP and NAACP oppose Kelo, noting that, ``the
takings that result [from the Court's decision] will disproportionately
affect and harm the economically disadvantaged and, in particular,
racial and ethnic minorities and the elderly.''
Representatives of religious organizations have stated that, ``Houses
of worship and other religious institutions are, by their very nature,
nonprofit and almost universally tax-exempt. These fundamental
characteristics of religious institutions render their property
singularly vulnerable to being taken under the rationale approved by
the Supreme Court.''
Should the government be able to close churches if it prefers malls?
The Private Property Rights Protection Act is needed to restore to
all Americans the property rights the Supreme Court took away. Although
several States have independently passed legislation to limit their
power of eminent domain, the supreme courts of Illinois, Michigan, and
Ohio have barred the practice under State constitutions. These laws
exist on a varying degree.
H.R. 1944 would prohibit State and local governments that receive
Federal economic development funds from using economic development as a
justification for taking property from one person and giving it to
another private entity.
Any State or local government that violates this prohibition will be
ineligible to receive Federal economic development funds for 2 years.
The protection of property rights is one of the most important tenets
of our government.
I am mindful of the long history of eminent domain abuses,
particularly in low-income and often predominantly minority
neighborhoods, and the need to stop it.
I am also mindful of the reasons we should allow the government to
take land when the way in which the land is being used constitutes an
immediate threat to public health and safety. I believe this bill
accomplishes both goals.
I urge my colleagues to join me in protecting property rights for all
Americans and limiting the dangerous effects of the Kelo decision on
the most vulnerable in society.
Mr. SCOTT of Virginia. Mr. Speaker, I have no further requests for
time, and I yield back the balance of my time.
Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may
consume.
I have in my hand bits of the few remaining bricks from the
foundation of Susette Kelo's home in New London, Connecticut. They were
picked up at the site just over a year ago.
They once supported the lovingly arranged sanctuary of a woman who
raised five sons and put herself through nursing school by working as
an emergency medical technician. They gave her a place to rest after a
long day's work surrounded by the things that meant the most to her.
They were the foundations of her castle until the government's
bulldozers arrived.
Mr. Speaker, Ms. Kelo's home, known as the ``little pink house,'' was
reduced to rubble--this rubble--by the government's abuse of eminent
domain and has remained just that--rubble.
These bits of bricks serve as a stark reminder of the government's
inability to plan people's lives better than they can plan them
themselves. They are the dramatic result of a type of government abuse
that should never be rewarded with Federal taxpayer dollars. The homes
that hardworking Americans have earned should be protected from
government abuse, and we here in the people's House have a duty to do
just that.
I had the opportunity to meet Susette Kelo. To me, she is a genuine
American hero, fighting all the way to the United States Supreme Court
to protect her little pink house and to protect all of our Fifth
Amendment rights under the United States Constitution.
To me, the failure of the Court to correctly rule on that eminent
domain case cries out for the Congress to correctly rule on this abuse
by passing Mr. Sensenbrenner's bill, by passing the Private Property
Rights Protection Act.
As has been noted, 43 States have acted to protect eminent domain
rights. Isn't it time for the United States Congress to do the same?
I urge my colleagues to support the Private Property Rights
Protection Act, and I yield back the balance of my time.
Mr. MULVANEY. Mr. Speaker, I rise today in support of H.R. 1944, the
Private Property Rights Protection Act of 2013.
This legislation addresses the eminent domain practice of seizing
private property for the ``public benefit'' of economic development,
which was deemed constitutional by the United States Supreme Court in
its decision in Kelo v. City of New London. This bill prohibits a state
or local government from seizing private property for
[[Page H1917]]
economic development if that state or local government receives federal
economic development funds, and prohibits the federal government from
exercising eminent domain powers for economic development purposes.
While it has not received much attention or debate in the full House
of Representatives, my colleagues on the Committee on Financial
Services and I have become increasingly concerned about a new proposed
use of eminent domain which would be incredibly destructive to our
housing markets and to Main Street investors alike.
Dozens of communities across the country are considering a vulture
fund-developed investment scheme by which the municipality's eminent
domain power is used to acquire underwater--but otherwise performing--
mortgage loans held by private-label mortgage-backed securities and
then refinance those loans through programs administered by the Federal
Housing Administration (FHA).
Our housing finance system depends on private capital to take risk,
make loans, purchase mortgage-backed securities, and help millions of
Americans fulfill the dream of homeownership. What this eminent domain
scheme considers would be incredibly destructive to the finance of
homeownership and would do little more than help a few homeowners who
can already afford their mortgage and line the pockets of the investors
who developed this proposal. Who would invest in a mortgage knowing
that their investment could be stolen just a few months or years later?
Ironically, this new risk to the housing finance system would freeze
the return of private capital to our markets at a time when many in
Congress are looking for ways to increase the role of the private
sector and decrease the federal government's footprint.
Using eminent domain in this manner will hurt Main Street investors
the most. Those investors and pensioners may be invested in mortgages
sitting in communities considering this plan--like Richmond,
California--and not even know it. They are the ones who will suffer the
most from this particular form of eminent domain.
Mr. Sensenbrenner's legislation shines a spotlight on the abusive
uses of eminent domain, including this investment scheme, and I am
proud to support the bill. I believe this legislation may have the
effect of defeating such a scheme. In addition, I support Chairman
Hensarling's efforts to directly target and defeat this use of eminent
domain, and I look forward to future opportunities to ensure the
protection of private property and the security of our housing finance
system.
Mr. CAMPBELL. Mr. Speaker, I rise in support of H.R. 1944, the
Private Property Rights Protection Act of 2013. Unfortunately, I was
delayed in returning to Washington and, regrettably, but want to take
this opportunity to note its importance.
When we hear the words ``eminent domain,'' we often visualize the
government taking a home, an office building, or a piece of land, often
for a highway or some other public infrastructure. But my colleague Mr.
Sensenbrenner articulated well in his remarks that the powers of
eminent domain are sometimes used for very different purposes.
One abuse of eminent domain that I have long been publicly against is
the use of eminent domain to seize mortgage notes from investors, using
the courts to unilaterally restructure the terms of those loans before
selling them to other investors. In this scheme, some private investors
have their investments seized and incur losses while other private
investors benefit. Many of the investors who will incur losses are the
savers and retirees who own them through their 401(k), IRA, or pension
accounts. But ultimately, this is a blatant abrogation of private
property rights and undermines longstanding contract law. As a
response, I have introduced H.R. 2733, which prohibits Fannie Mae,
Freddie Mac, and the Federal Housing Administration from making,
purchasing, or guaranteeing loans in areas where eminent domain is
being used to seize mortgage notes. This legislation is also included
in the Protecting American Taxpayers and Homeowners (PATH) Act.
I believe that property rights, whether real property or the
financial instruments that finance them, should be protected. Doing so
will give certainty to the housing finance system, which is necessary
to transition from a system dominated by government-guaranteed
mortgages to one based on private capital.
The Private Property Rights Protection Act of 2013 is not the only
legislation to address the issue of abusive eminent domain practices.
Section 407 of the Consolidated Appropriation Act of 2014, Pub. L. No.
113-76, prohibits the expenditure of federal funds to support
activities that utilize eminent domain powers, unless it's exclusively
for a public purpose. The schemes being considered call for the Federal
Housing Administration (FHA) to guarantee the seized and restructured
mortgage loans. Given that some private investors and their paid
intermediaries stand to benefit, it is apparent that FHA is unable to
participate in these restructuring programs, so long as eminent domain
powers are used. With this provision signed into law just last month,
Congress and the President have already begun to define the limits of
acceptable usage of eminent domain.
I thank Mr. Sensenbrenner for his important work on this issue.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Virginia (Mr. Goodlatte) that the House suspend the
rules and pass the bill, H.R. 1944.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds
being in the affirmative, the ayes have it.
Mr. SENSENBRENNER. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further
proceedings on this motion will be postponed.
____________________