Eminent Domain

Table of Contents

What is Eminent Domain? (back to top)

Eminent domain is the process by which states and localities have the right to condemn and force the sale of private property usually in order to serve a public purpose.  In some situations, states or localities have given this power to administrative agencies, local utilities, or local boards, e.g. library boards.  Condemnation is the act of a government exercising its power of eminent domain, not to be confused with the legal process where a building is designated as no longer fit for habitation.  Traditionally, private property was often taken for public uses like building freeways, schools, bridges, and more recently certified technology parks.  Only a judge can decide whether or not a taking is for a public purpose should there be a dispute between the property owner and the state.   

Property can in certain situations be taken for private projects as well.  Over the past few decades, the courts have interpreted what projects are for “public use” very broadly.  The courts have deferred the decision of whether or not something is for a “public purpose” to the individual state legislatures.  For example, some communities now use the power of eminent domain to seize “blighted” neighborhoods for redevelopment into more upscale condominiums and apartments.  In situations such as these, the state serves as the “middleman,” taking the private property from one person to sell or give to another in order to spur economic growth.  Projects such as these are often referred to as “economic development zones.” 

While states and localities have the right of eminent domain, the U.S. Constitution entitles home and land owners to just compensation for their property by way of the 5th and 14th Amendments.  After the government decides to take property, it will provide an appraiser to determine the fair market value of the land, which is the amount of money that the government is offering for the property.  The appraiser will inspect the property and will review all other elements that might affect property value.  Home or land owners can either accept or reject the government’s offering price.  It is best to work with a lawyer in deciding whether or not to accept the government’s appraisal price and to protect your legal rights.

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Indiana Eminent Domain Law (back to top)

The Indiana General Assembly modified Indiana’s existing eminent domain law in 2006.  The most significant change to the existing law was the placement of new restrictions on localities from using the eminent domain power to create economic development zones or to spur private businesses.  The legislature carefully delineated the possible scenarios where eminent domain procedures are for a “public use.”  These public uses include the building of schools, bridges, highways, airports, and certified technology parks.  Further, the legislature limited the types of property that may be acquired by eminent domain, namely those that are public nuisances, unfit for habitation, abandoned or environmentally contaminated.

Projects that no longer qualify under the law as a public use are now termed as “private to public to private” projects (or “ppp”).  Some properties in a “ppp” then may not be acquired through an eminent domain action and must be purchased by whatever cost the seller is demanding as compensation.

Eminent Domain & Condemnation Articles