Relates to requiring financial reports for real property acquired by the state, including any agencies and authorities, through eminent domain

BILL NUMBER:S5415

Title of bill

An act to amend the eminent domain procedure law, in relation to requiring financial reports for real property acquired by the state, including any agencies and authorities, through eminent domain

Purpose

To provide that local development corporations provide an estimated cost benefit analysis of proposed projects, the additional tax revenue anticipated from the project and assistance to be provided.

Summary of provisions

Section 1 amends eminent domain procedure law by adding a new section 305 to require that local development corporations include a financial impact report when invoking power of eminent domain. This section requires that the report include: i) an analysis of estimated costs and benefits; ii) estimated retained or additional tax revenue for the next three years; iii) amount of assistance being provided from the local development corporation; and iv) present value of the assistance being provided.

Section 2 sets for the effective date.

Justification

The constitution guarantees that "private property shall not be taken for public use without just compensation." In Kelo v City of New London, the U.S. Supreme Court allowed for the forcible transfer of property from one private owner to another in support of economic development.

The eminent domain procedure law has not been updated in response and as a result although it can be said to be a "public use" to support economic development the state procedures do not provide for gathering of information relating to economic development in the process. We must update the laws to ensure that the public has full understanding of the anticipated economic costs and benefits associated with eminent domain for the subject project.

It is imperative that if eminent domains is being used for purposes of economic development we have a full assessment of the costs and benefits of the project that will benefit from the use of economic domain, including tax revenue.

Legislative history

This is a new bill.

Fiscal implications

This bill will add a minimal cost to the process of eminent domain however because it is providing needed information about financial costs and benefits it will allow decision makers to make decision that bring in additional revenues that will offset the added cost to the process.

Effective date

This act shall take effect immediately.