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Focus on New Laws: Eminent domain Cities Bulletin ONLINE EDITION Focus on New Laws: Eminent domain Issue 21 By Laura. Harris Page 1 of 4 Published: August 9, 2006 The power of eminent domain has been under scrutiny since the U.S. Supreme Court rendered its decision in Kelo v. City of New London last summer. While this decision did not expand local government eminent domain powers, it raised awareness and sparked a vigorous public debate about the use of eminent domain, particularly for economic development and redevelopment purposes. In its decision, the court invited states to scrutinize their eminent domain laws, and state legislatures across the country responded with legislation to restrict the use of this tool. In the 2006 session, the Minnesota Legislature enacted a new law that severely restricts the use of eminent domain for economic development and redevelopment purposes and provides greater compensation to property owners in all condemnation proceedings. The bill was signed into law (MN Session Laws 2006, Chapter 214) on May 19, 2006. The key provisions of the new law are summarized below. Limits on eminent domain authority Under this new law, the purposes for which eminent domain may be used are narrowly defined. The public benefits of economic development, including an increase in tax base, tax revenues, employment or general economic health are not by themselves considered a public use or public purpose. However, in limited circumstances the use of eminent domain to mitigate a blighted area, remediate an environmentally contaminated area, reduce abandoned property, or remove a public nuisance constitutes a public purpose. These terms are defined as follows: Blighted area. Section 2, subd. 6 requires that the area be in urban use and that 50 percent of the buildings in the area are structurally substandard. Section 2, subd. 7 defines "structurally substandard" as a building: 1) that has been inspected and cited for enforceable housing, maintenance, or building code violations; 2) in which the building code violations involve specific structural aspects of the building; 3) in which cited violations have not been remedied after two notices to cure noncompliance; and 4) where the cost to cure the violations is more than 50 percent of the assessor's taxable market value for the building. Environmentally contaminated area. Section 2, subd. 8 defines "environmentally contaminated area" as an area where more than 50 percent of the parcels contain contamination and the estimated costs of clean-up are more than the assessor's estimated market value of the parcel. Abandoned property. Section 2, subd. 5 defines "abandoned property" as property that has been unoccupied or unused for at least one year; that has not been maintained; and for which taxes have not been paid for at least the previous two years. Public nuisance. Section 2, subd. 9 refers to Minnesota Statutes 609.74 as the definition of http://www.lmnc.org/bulletin/story.cfin?id=1227&title id=1 8/16/2006