Private Property Rights Protection Act - Makes ineligible for federal funds any condemning authority or acquiring party that engages or participates in a taking or condemnation of any real property interest not for a public use or public purpose using the power of eminent domain, without the owner's consent. Requires any entity applying for federal funds to certify eligibility. Allows the Commissioner of the Internal Revenue Service (IRS) to audit any condemning authority or acquiring party that has made such a certification.
Allows a property owner who is notified that his or her property will be taken to file for and attach a Fifth Amendment property protection statement (PPS) indicating that the condemning entity is exceeding its authority, which shall prohibit any acquiring party from claiming any benefit, deduction, or tax credit related to any activities conducted within the geographical boundaries comprising the jurisdiction of the condemning authority. Allows the condemning entity to seek a judicial determination of the statement's validity and an order releasing the PPS if not valid.
Prohibits any government from engaging or participating in a taking or condemnation of any private real property interest under the power of eminent domain for any purpose that is not for a public purpose or a public use. Applies such prohibition to an exercise of eminent domain: (1) by the federal government; (2) related to a program or activity receiving federal financial assistance; or (3) that would affect commerce with foreign nations, among the states, or with Indian tribes.
Allows a person to assert a violation of this act as a claim or defense in a judicial proceeding.
Allows the United States to bring an action for injunctive or declaratory relief to enforce compliance with this Act.
[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 1895 Introduced in Senate (IS)]
109th CONGRESS
1st Session
S. 1895
To return meaning to the Fifth Amendment by limiting the power of
eminent domain.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
October 19, 2005
Mr. Ensign (for himself, Mr. Inhofe, and Mr. DeMint) introduced the
following bill; which was read twice and referred to the Committee on
Finance
_______________________________________________________________________
A BILL
To return meaning to the Fifth Amendment by limiting the power of
eminent domain.
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''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) The founding fathers held dear the fundamental rights
associated with the ownership of private property.
(2) In 1788, James Madison recognized the connection
between freedom and property rights when he wrote in Federalist
No. 10 that the right to own property originates in free
thought and that it is the Government's job to protect such
rights.
(3) In 1792, in an essay entitled ``Property'', James
Madison wrote, ``where an excess of power prevails, property of
no sort is duly respected. No man is safe in his opinions, his
person, his faculties, or his possessions.''.
(4) In the ``Property'' essay James Madison also wrote,
``Government is instituted to protect property of every sort. .
. . This being the end of government, that alone is a just
government, which impartially secures to every man, whatever is
his own.''.
(5) In 1775, the Virginia patriot Arthur Lee wrote, ``The
right of property is the guardian of every other right, and to
deprive a people of this, is in fact to deprive them of their
liberty.''.
(6) In 1783, Benjamin Franklin wrote, ``All the property
that is necessary to a Man, for the Conservation of the
Individual and the Propagation of the Species, is his natural
Right, which none can justly deprive him of.''.
(7) In 1787, John Adams wrote, ``The moment the idea is
admitted into society that property is not as sacred as the
laws of God, and that there is not a force of law and public
justice to protect it, anarchy and tyranny commence.''.
(8) In 1795 Supreme Court Justice William Patterson wrote,
in the case Vanhorne's Lessee v. Dorrance: ``From these
passages it is evident; that the right of acquiring . . .
property, and having it protected, is one of the natural,
inherent, and unalienable rights of man. Men have a sense of
property: Property is necessary to their subsistence, and
correspondent to their natural wants and desires; its security
was one of the objects, that induced them to unite in society.
No man would become a member of a community, in which he could
not enjoy the fruits of his honest labor and industry. The
preservation of property then is a primary object of the social
compact, and . . . was made a fundamental law.''.
(9) In 1798, the Supreme Court considered the case of
Calder v. Bull, in which Justice Samuel Chase recognized that
government action which is ``contrary to the great first
principles of the social compact, cannot be considered a
rightful exercise of legislative authority'' which he explained
with the following example: ``. . . a law that takes property
from A and gives it to B: It is against all reason and justice,
for a people to entrust a Legislature with such powers . . .
.''.
(10) On March 6, 1860, Abraham Lincoln stated that the
institution of slavery is reprehensible because it offends the
right of man to keep the fruits of his own labor and thus
denies man the right to own property.
(11) In a stark departure from the honor and recognition
given individual private property rights under the United
States Constitution, the United States Supreme Court in the
case of Kelo v. City of New London, issued a decision on June
23, 2005, by a 5 to 4 vote, that eminent domain may be used to
seize property for the purpose of private economic development.
(12) Justice Sandra Day O'Connor rightly stated in her
dissenting opinion in Kelo, ``the government now has license to
transfer property from those with fewer resources to those with
more. The Founders cannot have intended this perverse
result.''.
(13) Justice O'Connor further wrote, ``any property may now
be taken for the benefit of another private party, but the
fallout from this decision will not be random. The
beneficiaries are likely to be those citizens with
disproportionate influence and power in the political process,
including large corporations and development firms.''.
(14) Justice O'Connor also wrote about the effects of the
Kelo ruling: ``To reason, as the Court does, that the
incidental public benefits resulting from the subsequent
ordinary use of private property render economic development
takings `for public use' is to wash out any distinction between
private and public use of property--and thereby effectively to
delete the words `for public use' from the Takings Clause of
the Fifth Amendment.''.
(15) Justice Clarence Thomas wrote, ``I do not believe that
this Court can eliminate liberties expressly enumerated in the
Constitution.''.
(16) The City Council of New London, Connecticut, created
the New London Development Corporation (``NLDC'') as a
501(c)(3) non-profit organization and authorized the NLDC to
purchase property or to acquire private property for economic
development purposes by exercising eminent domain in the City's
name.
(17) NLDC's actions, which were the subject of the lawsuit
in the Kelo case, were made possible by numerous Federal grants
and direct appropriations, including: $2,000,000 from the
Economic Development Administration in 2001, $750,000 from the
Department of Labor in 2000, $125,000 from the Fannie Mae
Foundation in 2000, and an earmark of $100,000 in the FY2001
VA-HUD appropriations Act (Public Law 106-988).
(18) The Kelo decision stands as a repudiation of the
principle of the Fifth Amendment, as embodied by the writings
of James Madison, Benjamin Franklin, John Adams, and Abraham
Lincoln, and also as had previously been recognized by the
Supreme Court.
(19) Congress has encouraged the State and local
governments' practice of using eminent domain to further
economic development by using the Federal purse strings to
incentivize such practices through Federal grants and direct
appropriations.
(20) Congress has also created extensive tax-based
incentives to encourage State and local governments to condemn
private property for economic development purposes.
(21) In a joint amicus brief, the National Association for
the Advancement of Colored People and the American Association
of Retired Persons stated, ``The takings that result [from the
Court's decision in Kelo] will disproportionately affect and
harm the economically disadvantaged and, in particular, racial
and ethnic minorities and the elderly.''.
(22) The Supreme Court's decision to expand eminent domain
is also troubling for religious institutions, as this ruling
will disproportionately negatively impact these institutions as
they are often non-profit and almost universally tax-exempt. As
a result, the property owned by religious institutions is
particularly vulnerable to this type of taking, as the ruling
of the court disfavors non-profit, tax-exempt property owners
in favor of for-profit, tax generating businesses.
(23) It is in the best interest of the American people for
Congress to prohibit Federal funding and to restrict tax
benefits from accruing to any person, party, or governmental
authority who would seek to acquire private property through
seizure by eminent domain for economic development purposes.
(24) Congress can restrict the use of Federal funds and the
availability of Federal tax incentives to discourage the
activities of State and local governments.
(25) It is the responsibility and obligation of Congress to
act to protect private property rights and to further the
protections afforded to private parties by the United States
Constitution under the Fifth Amendment and to prevent the
unjust use of the power of eminent domain.
SEC. 3. DEFINITIONS.
For purposes of this Act:
(1) Acquiring party.--The term ``acquiring party'' means
any person or party that acquires a real property interest from
a condemning authority, which took title to such real property
interest by the use of eminent domain or the threat of the use
of eminent domain, including any--
(A) individual;
(B) trust;
(C) charity;
(D) corporation;
(E) partnership; or
(F) limited liability company.
(2) Blighted property.--The term ``blighted property''
includes any--
(A) property which because of physical condition,
use, or occupancy constitutes a public nuisance or
attractive nuisance;
(B) dwelling which, because it is dilapidated,
unsanitary, unsafe, vermin-infested, or lacking in the
facilities and equipment required by the housing code
of the municipality, is unfit for human habitation;
(C) structure which is a fire hazard, or is
otherwise dangerous to the safety of persons or
property;
(D) structure the utilities, plumbing, heating,
sewer, or other utility services of which have been
disconnected, destroyed, moved, or rendered ineffective
such that the property is unfit for its intended use;
(E) vacant or unimproved lot or parcel of ground in
a predominately built-up-neighborhood, which by reason
of neglect or lack of maintenance has become a place
for accumulation of trash and debris or a haven for
rodents or other vermin;
(F) property that has tax delinquencies exceeding
the fair market value of the property;
(G) property with code violations affecting health
or safety that has not been substantially rehabilitated
within 1 year of the receipt of notice to rehabilitate
from the appropriate housing code enforcement agency;
or
(H) abandoned property.
(3) Condemning authority.--The term ``condemning
authority'' means any authority, utility, or co-operative which
exercises the power of eminent domain either directly or by a
delegation of power, including any--
(A) State;
(B) county;
(C) municipality,
(D) city;
(E) town, whether private or public;
(F) corporation, whether for profit or not for
profit; and
(G) district.
(4) Government.--For purposes of sections 6, 7, and 8, the
term ``government''--
(A) means--
(i) a State, county, municipality, or other
governmental entity created under the authority
of a State;
(ii) any branch, department, agency,
instrumentality, or official of an entity
listed in clause (i); and
(iii) any other person acting under color
of State law; and
(B) includes the United States, a branch,
department, agency, instrumentality, or official of the
United States, and any other person acting under color
of Federal law.
(5) Incidental economic benefit.--The term ``incidental
economic benefit''--
(A) means the use of any property for any project
that is neither--
(i) a public use; or
(ii) a public purpose; and
(B) includes projects which rely on eminent domain
to acquire property and which are done--
(i) for the purpose of enhancing or
increasing the tax base of a condemning
authority;
(ii) for the purpose of creating jobs
within the jurisdiction of a condemning
authority; or
(iii) in furtherance of economic
development.
(6) Property owner.--The term ``property owner'' means any
person with a real property interest, whether possessory or
not, that is being taken under the power of eminent domain.
(7) Public purpose.--The term ``public purpose''--
(A) means the use of property acquired by eminent
domain that furthers a legitimate governmental purpose
to directly and substantially protect the health,
safety, and welfare of the public; and
(B) includes--
(i) condemnation of any severely blighted
property;
(ii) the development of any property to
provide public utilities, including--
(I) electric;
(II) gas;
(III) phone;
(IV) cable;
(V) water service and sewer; and
(VI) wi-fi networks;
(iii) hydro-electric projects and flood
control measures;
(iv) development of waste, recycling, and
waste treatment facilities; and
(v) development of any property to provide
an essential public health or safety service
such as a privately operated prison or
hospital.
(8) Public use.--The term ``public use''--
(A) means any use of property acquired by eminent
domain that is--
(i) used by a governmental entity;
(ii) owned, operated, or maintained by a
government entity and used by the public as a
right-of-way; or
(iii) used by a common carrier; and
(B) includes--
(i) right-of-ways;
(ii) roadways;
(iii) highways;
(iv) interstates;
(v) interchanges;
(vi) bike paths;
(vii) waterways and navigable waters;
(viii) airports, railroads, and other
transportation needs; and
(ix) public parks and public buildings,
including--
(I) schools;
(II) hospitals;
(III) prisons;
(IV) government buildings; and
(V) sports stadiums, theaters, or
other public entertainment venues
provided that any takings for these
projects is limited solely to the real
property necessary for--
(aa) the construction of
such stadiums, theaters or
venues; and
(bb) parking facilities and
public transportation and
access roads to and from such
stadiums, theaters or venues.
(9) Real property interest.--The term ``real property
interest'' means any--
(A) fee title interest;
(B) lease interest;
(C) easement;
(D) development rights;
(E) mineral rights;
(F) water rights;
(G) rights in real property related to sky, air, or
vision which affect the value of such real property; or
(H) future interest in any of the real property
interests or rights described in subparagraphs (A)
through (G).
SEC. 4. DENIAL OF FEDERAL FUNDS FOR TAKINGS NOT FOR THE PUBLIC USE.
(a) Denial of Funds.--A condemning authority or acquiring party
that engages or participates in a taking or condemnation of any real
property interest not for a public use or public purpose, without the
consent of the owner of such real property interest, under the power of
eminent domain pursuant to the Fifth Amendment of the United States
Constitution, or under any relevant State constitution, statute, or
regulation, shall not be eligible to receive any Federal funds,
including any funds appropriated by Congress or otherwise expended from
the Federal treasury.
(b) Certification of Eligibility to Receive Funds.--
(1) In general.--Any entity applying for Federal funds
shall certify to the appropriate Federal agency, under penalty
of perjury, that any funds it receives will not be used to--
(A) develop any real property which is subject to
or otherwise subsequently becomes subject to a Fifth
Amendment property protection statement;
(B) further any economic development associated
with an exercise of eminent domain power which is not
in furtherance of a public use or public purpose; or
(C) provide, further, or enhance an incidental
economic benefit.
(2) Regulations required.--The Secretary of the Treasury
shall promulgate rules and regulations to establish the
procedures and rules regarding the certification required under
paragraph (1), including--
(A) certification language; and
(B) application forms.
(3) Notice to the irs.--Each Federal agency shall forward a
copy of each certification required under paragraph (1) that it
receives to the Commissioner of Internal Revenue.
(4) Audits.--
(A) Authority.--The Commissioner of Internal
Revenue may conduct an audit of any condemning
authority or acquiring party that has made a
certification under paragraph (1) and may review such
books, records, and materials as the Commissioner
determines appropriate.
(B) Reimbursement obligation.--If after an audit of
a condemning authority or acquiring party, the
Commissioner of Internal Revenue determines that the
condemning authority or acquiring party violated the
terms of the certification required under paragraph
(1), the condemning authority or acquiring party shall
reimburse the Department of the Treasury for any
funds--
(i) received from any Federal agency;
(ii) expended by the Secretary of the
Treasury in conducting the audit; and
(iii) together with interest, compounded
annually at a rate of 12 per centum, calculated
from the date of disbursement of such funds
until the obligation has been repaid.
(C) Audit of prior periods.--An audit conducted
under this paragraph--
(i) shall not be limited to the year in
which a suspected violation of the terms of the
certification required under paragraph (1)
occurs; and
(ii) may extend back to cover any year or
years in the period beginning 10 years prior to
the year such audit commences.
(D) Appeal.--The United States Court of Federal
Claims shall have original and exclusive jurisdiction
over any appeal by a condemning authority or acquiring
party of any reimbursement obligation imposed under
subparagraph (B).
SEC. 5. DENIAL OF TAX BENEFITS FOR TAKINGS NOT FOR THE PUBLIC USE.
(a) Fifth Amendment Property Protection Statement.--
(1) In general.--Upon receipt of a notice from a condemning
authority which states the intent of the condemning authority
to initiate an eminent domain proceeding against a real
property interest of a property owner, any property owner who
receives such notice may file a Fifth Amendment property
protection statement (in this section referred to as a ``PPS'')
with the appropriate State or local agency responsible for
recording deeds, liens, or mortgages of real property in which
the affected real property interest is located, provided that
the property owner files the PPS not later than 90 days after
the receipt of such notice.
(2) Contents of pps.--Each PPS described in paragraph (1)
shall state the basis on which the property owner believes that
a condemning authority has exceeded its authority in exercising
its eminent domain power to take or condemn the real property
interest of the property owner, including by using or intending
to use such taking or condemnation to create an incidental
economic benefit.
(3) Filing copy of pps with the commissioner of internal
revenue.--A property owner may submit a copy of each PPS such
property owner filed under paragraph (1) to the Commissioner of
Internal Revenue.
(4) Voluntary release of pps.--
(A) In general.--A property owner, the personal
representative of a property owner, the estate of a
deceased property owner, or any qualified heir of a
deceased property owner (as such term is defined in
section 2032A(e) of the Internal Revenue Code) may
voluntarily file a document terminating a PPS with the
appropriate State or local agency responsible for
recording, deeds, liens, or mortgages of real property
in which the affected real property interest is
located.
(B) Effect.--The effect of filing a termination of
PPS under subparagraph (A) shall be to void such PPS.
(5) Involuntary release of pps.--
(A) In general.--A condemning authority may seek a
judicial determination of the validity of any timely
filed PPS in any State court having jurisdiction over
takings or condemnation proceedings in the State in
which the affected real property interest is located.
(B) Burden of proof.--In any case initiated under
subparagraph (A), a condemning authority shall bear the
burden of proof in demonstrating that such taking or
condemnation is not inconsistent with section 6(a).
(C) Final order.--Upon a final determination of any
court described in subparagraph (A) that such taking or
condemnation does not violate section 6(a), the court
may enter an order releasing the PPS.
(6) Form of pps.--The Secretary of the Treasury shall
establish a uniform format for all PPS and releases of PPS to
be used by property owners.
(b) Rules of Construction.--
(1) In general.--A PPS is intended to enhance the property
protections afforded by the Fifth Amendment by permitting a
property owner to take action to discourage those takings which
are not in furtherance of either a public use or public
purpose.
(2) Effect of pps on compensation award to property
owner.--Any compensation awarded for a taking pursuant to the
Fifth Amendment shall be made without regard to any PPS
attaching to the property being taken.
(3) Additional effects of a pps.--A PPS shall--
(A) attach to the real property interest which is
described in the PPS; and
(B) bind the current owner and all future owners,
including successor in interests, assigns, or heirs,
who at any time hold title to all or any portion of
such real property interest.
(c) Tax Effects of PPS.--For a period of 20 years beginning on the
January 1st immediately following the date of recording of any PPS, any
acquiring party which acquires any real property interest which is
subject to a PPS shall be prohibited from claiming any benefit,
deduction, or tax credit related to any activities conducted within the
geographical boundaries comprising the jurisdiction of the condemning
authority under the Internal Revenue Code of 1986, including the
following:
(1) Section 27 (relating to taxes of foreign countries and
possessions of the United States; possession tax credit).
(2) Section 38 (relating to general business credits).
(3) Section 39 (relating to carryback and carryforward of
unused credits).
(4) Section 40 (relating to alcohol used as a fuel).
(5) Section 41 (relating to credit for increasing research
activities).
(6) Section 42 (relating to low-income housing credit).
(7) Section 45 (relating to electricity produced from
certain renewable resources).
(8) Section 45A (relating to Indian employment credit).
(9) Section 45B (relating to credit for portion of employer
social security taxes paid with respect to employee cash tips).
(10) Section 45C (relating to clinical testing expenses for
certain drugs for rare diseases or conditions).
(11) Section 45D (relating to new markets tax credit).
(12) Section 45E (relating to small employer pension plan
startup costs).
(13) Section 45F (relating to employer-provided child care
credit).
(14) Section 47 (relating to rehabilitation credit).
(15) Section 103 (relating to interest on State and local
bonds).
(16) Section 162 (relating to trade or business expenses).
(17) Section 163 (relating to interest).
(18) Section 164 (relating to taxes).
(19) Sections 165 and 166 (relating to ordinary losses)
(20) Section 167 (relating to depreciation).
(21) Section 169 (relating to amortization of pollution
control facilities).
(22) Section 172 (relating to net operating loss
deduction).
(23) Section 174 (relating to research and experimental
expenditures).
(24) Section 175 (relating to soil and water conservation
expenditures).
(25) Section 178 (relating to authorization of cost of
acquiring a lease).
(26) Section 179 (relating to election to expense certain
depreciable business assets).
(27) Sections 48(g) and 170(h) (relating to Federal
Historic Preservation Tax Incentives).
(28) Section 198 (relating to Brownfields Tax Incentives).
(29) Sections 1201 through 1298 (relating to capital
losses).
(30) Section 1400F (relating to Renewal Communities).
(31) Sections 1391 through 1398 (relating to Empowerment
Zones and Enterprise Communities Tax Incentives).
SEC. 6. PROTECTION OF PERSONAL PROPERTY RIGHTS.
(a) General Rule.--No government shall engage or participate in a
taking or condemnation of any private real property interest under the
power of eminent domain for any purpose unless such taking or
condemnation is either a public purpose or a public use.
(b) Scope of Application.--This section applies in any case in
which the exercise of eminent domain--
(1) is by the Federal Government;
(2) is related to a program or activity that receives
Federal financial assistance; or
(3) would affect, commerce with foreign nations, among the
several States, or with Indian tribes.
SEC. 7. JUDICIAL RELIEF.
(a) Cause of Action.--
(1) In general.--A person may assert a violation of this
Act as a claim or defense in a judicial proceeding and obtain
appropriate relief against a government.
(2) Standing.--Standing to assert a claim or defense under
paragraph (1) shall be governed by the general rules of
standing under article III of the Constitution.
(b) Jurisdiction.--Any pending action under which a government
exercises its authority of eminent domain shall not operate as a limit
on a court from hearing any claim for relief under this Act.
(c) Burden of Persuasion.--If a plaintiff produces prima facie
evidence to support a claim alleging a violation of the Fifth Amendment
takings clause or a violation of section 6, the government shall bear
the burden of persuasion on any element of such claim.
(d) Full Faith and Credit.--Adjudication of a claim of a violation
of this Act in a non-Federal forum shall not be entitled to full faith
and credit in a Federal court unless the claimant had a full and fair
adjudication of that claim in the non-Federal forum.
(e) Attorneys' Fees.--Section 722(b) of the Revised Statutes (42
U.S.C. 1988(b)) is amended by inserting ``the Private Property Rights
Protection Act,'' after ``the Religious Land Use and Institutionalized
Persons Act of 2000 (42 U.S.C. 2000cc et seq.),''.
(f) Authority of United States to Enforce This Act.--
(1) In general.--The United States may bring an action for
injunctive or declaratory relief to enforce compliance with
this Act.
(2) Limitation.--Nothing in this subsection shall be
construed to deny, impair, or otherwise affect any right or
authority of the Attorney General, the United States, or any
agency, officer, or employee of the United States, acting under
any law other than this subsection, to institute or intervene
in any proceeding.
SEC. 8. RULES OF CONSTRUCTION.
(a) Broad Construction.--This Act shall be construed in favor of a
broad protection of personal property rights, to the maximum extent
permitted by the terms of this Act and the Constitution.
(b) No Preemption or Repeal.--Nothing in this Act shall be
construed to preempt State law, or repeal Federal law, that is equally
as protective of personal property rights as, or more protective of
personal property rights than, this Act.
(c) Severability.--If any provision of this Act or of an amendment
made by this Act, or any application of such provision to any person or
circumstance, is held to be unconstitutional, the remainder of this
Act, the amendments made by this Act, and the application of the
provision to any other person or circumstance shall not be affected.
<all>
Introduced in Senate
Sponsor introductory remarks on measure. (CR S11568)
Read twice and referred to the Committee on Finance.
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