In Kelo v. City of New London, 545 U.S. 469 (2005), the Supreme Court ruled 5–4 that a city may use eminent domain to take private homes and transfer them to another private party as part of an economic development plan. The majority read the Fifth Amendment’s “public use” requirement to include a broader “public purpose,” so condemned land does not have to be opened to the general public for the taking to be constitutional.1Cornell Law Institute. Kelo v City of New London The decision became one of the most criticized property rulings in modern American history and set off the widest wave of state legislative pushback any Supreme Court decision has ever produced.
What the Supreme Court Held
Justice John Paul Stevens wrote the majority opinion, joined by Justices Kennedy, Souter, Ginsburg, and Breyer. New London’s development plan, the Court concluded, satisfied the Fifth Amendment’s public use requirement. Stevens wrote that the Court had “long ago rejected any literal requirement that condemned property be put into use for the general public” and had instead embraced the “broader and more natural interpretation of public use as ‘public purpose.'”2Supreme Court of the United States. Kelo v City of New London
The majority drew one line. A city cannot take property purely to hand it to a favored private party. But New London’s plan, Stevens wrote, was not adopted “to benefit a particular class of identifiable individuals.” It was a comprehensive effort to address a genuinely distressed area, blending commercial, residential, and recreational uses. Because promoting economic development is a “traditional and long accepted governmental function,” the Court saw no principled way to separate it from other public purposes it had already approved.3Justia U.S. Supreme Court Center. Kelo v City of New London
Judicial deference did much of the work. The majority told courts not to second-guess a city’s judgment about what kind of development its community needs. If a taking is part of a carefully considered plan and the projected benefits are not clearly irrational, judges should defer to local officials. The thoroughness of the planning process, not the eventual success of the project, is what separates a legitimate public purpose from a private giveaway. That framework put the burden on property owners to prove a plan was a sham, rather than on the government to show the plan would deliver what it promised.
The Dissents
Justice Sandra Day O’Connor wrote the principal dissent, joined by Chief Justice Rehnquist and Justices Scalia and Thomas. She argued that the majority had erased the line between private and public use. “Under the banner of economic development, all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded,” she wrote.4Cornell Law School. Kelo v City of New London Her practical concern was that almost any new development generates more tax revenue than an existing home, so the ruling gave cities an open invitation to condemn property whenever a more lucrative use appeared. The people most exposed, she warned, would be those with the least political power.
Justice Clarence Thomas filed a separate dissent grounded in original meaning. He argued that “public use” required the public to have an actual legal right to use the property, not merely an indirect benefit through jobs or taxes. Thomas called the majority opinion “simply the latest in a string of our cases construing the Public Use Clause to be a virtual nullity, without the slightest nod to its original meaning.”5Supreme Court of the United States. Kelo v City of New London, Connecticut
How Kelo Changed the Meaning of “Public Use”
Eminent domain is the government’s power to take private property whether the owner wants to sell or not. The Fifth Amendment’s Takings Clause constrains that power: “nor shall private property be taken for public use, without just compensation.”6Constitution Annotated. Amdt5.10.1 Overview of Takings Clause The taking must be for a public use, and the owner must be paid fairly.
Historically, public use meant something the public would physically use: roads, bridges, schools, military bases. The central question in Kelo was whether handing private land to a developer for a commercial project qualified simply because the project might create jobs and generate tax revenue. The Court’s answer was yes, so long as the transfer was part of a considered plan aimed at a public purpose. That answer stretched public use further than most Americans thought it could go, which is why the reaction was so sharp.
The Homes and Owners at the Center of the Case
New London, Connecticut had been losing population and jobs for years. The 1996 closure of the Naval Undersea Warfare Center at Fort Trumbull cost the city over 1,500 jobs. In February 1998, Pfizer announced plans to build a $300 million research facility next to Fort Trumbull, and city planners built a development scheme around Pfizer’s arrival: a waterfront hotel, new residences, office and retail space, and a pedestrian riverwalk. The Connecticut Supreme Court described the plan as “projected to create in excess of 1,000 jobs, to increase tax and other revenues, and to revitalize an economically distressed city.”3Justia U.S. Supreme Court Center. Kelo v City of New London
The Fort Trumbull area held roughly 115 privately owned properties. Most owners accepted buyouts. Nine refused, holding 15 parcels between them. Susette Kelo, a nurse who had restored a Victorian cottage and painted it pink, became the face of the resistance. None of the holdout properties were blighted or in poor condition. The New London Development Corporation, a private nonprofit the city had tapped to lead the plan, moved to take them by force.
State and Federal Backlash
Public opposition to the ruling crossed political lines. Within a few years, 45 states enacted some form of eminent domain reform, the broadest state legislative response to any Supreme Court decision in American history. Some states passed statutes restricting economic development takings. Others amended their constitutions, often by referendum. Several state supreme courts rejected Kelo as a guide for their own constitutions and held that economic development alone cannot justify a taking under state law.
Not every reform had real force. Analysts have grouped the state responses into three categories: reforms that genuinely restricted eminent domain abuse, nominal reforms that sounded protective but left significant loopholes, and states that did nothing. A common weakness was the treatment of blight. Cities could still condemn property by labeling a neighborhood “blighted,” a term defined so loosely in many states that it could cover almost any area a developer wanted. The strongest reforms narrowed blight to individual properties that posed genuine health or safety threats, required parcel-by-parcel findings, and put the burden of proof on the government.
At the federal level, Congress held hearings on restricting federal economic development funding for projects that used eminent domain to transfer property to private parties. Several bills were introduced. President George W. Bush signed an executive order titled “Protecting the Property Rights of the American People,” which limited federal agencies’ use of eminent domain for economic development.7GovInfo. Supreme Courts Kelo Decision and Potential Congressional Responses
What Happened to Fort Trumbull After the Ruling
The development plan the Supreme Court approved was never built. After the homes were demolished and the residents dispersed, no new construction followed. The chosen developer’s agreement was eventually terminated after repeated delays, and no replacement was selected. In 2009, four years after the ruling, Pfizer announced it was closing its New London research facility and consolidating operations elsewhere.
The cleared Fort Trumbull site sat vacant for years, described in one account as home to little more than new roads, utility lines, feral cats, and weeds. The promised jobs, the hotel, the office space, and the revitalized waterfront never arrived. The land produced no tax revenue and no public benefit.
Kelo’s pink cottage survived. After the litigation ended, the city and state agreed to let the house be moved rather than demolished. It was relocated to a new site in New London, where it still stands.