Working Paper No. 07-35:
Does Blight Really Justify Condemnation?
Date Posted: 2007
This article asserts, contrary to existing law, that blight condemnation is inconsistent with the fundamental distinction between eminent domain, which arrogates private goods for public use, and the police power, which protects the public from harm. When conditions on a parcel constitute a threat to public health and safety, the landowner should be ordered to abate. If the owner is unable or unwilling to do so, the dangerous condition should be abated by government under its police power. The cost of abatement should be treated as a betterment assessment, which become a lien on the land and, if unpaid, should result in a foreclosure sale. Thereafter, the land could be redeveloped by the purchaser or its designee.
One practical result of abatement and foreclosure is that an owner has an incentive to abate, or to sell to a neighbor or redeveloper who would abate, perhaps in combination with abatement on other nearby parcels similarly situated. Should the parcel go through foreclosure, its redeveloper is selected through a transparent process of competitive bidding. This likely would reduce unjustified blight condemnation resulting from rent seeking manifested through political favoritism towards selected redevelopers. Also, re-channeling redevelopment through market actors would reduce grandiose and wasteful redevelopment schemes.