This Land Is Your Land -- Maybe

CAROUSEL -- Political strategists Anita Dunn and Kevin Madden preview President Obama's State of the Union Address on "The Early Show" Wednesday, Jan. 27, 2010.
CBS
If you're a homeowner standing in your yard, you probably think this land is your land.

But it may not stay your land if your local government wants somebody else to have it.

The concept, known as "eminent domain," is the focus of a Supreme Court showdown, with some property owners saying that the practice is being abused. CBS News Correspondent Joie Chen reports in the cover story of CBS News This Morning.


From the front steps of her 100-year-old cottage, Susette Kelo has a clear view of Long Island Sound. But maybe not for long.

"I don't want to sell it. It's a beautiful house, it's paid for, we want to stay here," she tells Chen.

Kelo's hometown, New London, Conn., says it wants to make way for the future in that corner of the past: offices, hotels and fancy condos are envisioned for Kelo's neighborhood.

But Kelo, a registered nurse who works three jobs to make ends meet, says, early on, it was clear she and her family weren't part of the picture: "We weren't the right type of people. …They said they wanted to create a hip little city. And to us hip -- or to me -- hip meant higher income people. …Not me."

That's why Kelo has traveled to the U.S. Supreme Court.

"I want to keep my home," Kelo says simply.

Her fight to save her house is now before the high court. At stake is the right of government to use its power of eminent domain to spur private development.

"Eminent domain" comes from the Constitution's Fifth Amendment, which states that private property shall not be "taken for public use, without just compensation."

Typically, Chen says, it works like this: In exchange for what it decides is a fair price, the government can take private property (your home or your land) and put it to public use to build something like a road, a hospital, a school, or an airport.

Throughout history, eminent domain has been behind big things, from constructing the transcontinental railroad, to building the Brooklyn Bridge, and even for creating national parks.

But Kelo believes that, in her case, government is going too far.

Her neighborhood isn't being taken for a public project, but for private development. The thinking, local government officials assert, is that by generating new taxes and new jobs, the public will benefit.

A good deal for New London? Maybe.

But not for Kelo: "I said that I wouldn't go. And then I told them they would be sorry for picking on me."

"The whole process," says Matt Dery, "has been emasculating to the degree that any man wants to be able to protect his family -- keep 'em safe -- keep a roof over their head."

Matt and Sue Dery live down the block from Kelo, and they're fighting, too. Since 1901, five generations of their family have lived in four homes on the block. Even as developers tore down the neighborhood around them, the Derys refused to budge.

"We choose to stay here," Matt Dery says. "We like it here. It's home."

But the Derys find themselves up against a $70 million development project that's well under way and, many believe, badly needed.

New London's economy is in trouble. In the last decade, the city has lost thousands of jobs. It has double Connecticut's unemployment rate.

"Without this kind of development, what happens to New London?" Chen asked Ed O'Connell, the lawyer for the New London Development Corporation, a non-profit, private development company funded by the state.

"It continues to deteriorate and remain moribund," O'Connell responded, "and will not be able to dig itself out of the financial situation that it and all the other Northeast communities, all the other inner-cities in the United States, find themselves in.

"We envision shops. …We envision retail areas…office buildings, all taxable property which will benefit the city of New London. …That's called progress."

Perhaps, Chen notes, nothing symbolizes progress in New London more than the new $300 million research facility built by the pharmaceutical giant Pfizer.

The company is New London's biggest taxpayer, and its research building is practically next door to Kelo's house, which is why developers believe it's the perfect spot for new, high-end construction.

Eighty-eight of the project's 90 acres of land are ready to go. But, according to Tom Londregan, lawyer for the city, the holdout families are holding everything up: "How many office parks have you seen in this country with class A office space, where you would have a home in the middle of it?"

A New London native, Londregan sees this development as the best hope for his town: "There is a tremendous amount of immediate public benefit. And it also has an economic development at the end, when all of this is fully completed: There will be the economic development as well."

"You're sure?" Chen pressed him.

"I'm sure," Londregan answered.

"Economic development projects," says attorney Dana Berliner, "are often crapshoots. Maybe they'll work. Maybe they won't. And that's why they're things that are done by private developers engaging in land speculation, not government taking other people's homes away from them."

Berliner is a lawyer for the Institute for Justice, a libertarian advocacy group that's given free legal aid to the New London homeowners, bringing their case all the way to the Supreme Court.

"Eminent domain for private development," Berliner charges, "is a legalized theft. It's legal in the sense that there's not outright bribery going on. But it's still taking someone's home away involuntarily for another private party who is more politically connected. It's still wrong."

Berliner documented more than 10,000 cases in 41 states over five years where eminent domain has been threatened or used to benefit private development.

For instance: Atlantic City, N.J., where in 1998, a public agency tried to take the home of elderly widow Vera Coking to provide limousine parking for billionaire Donald Trump's casino.

And in Norwood, Ohio, where, just last month, Carl and Joy Gamble were forced by the city to pack up their home to make way for a new shopping mall.

Even supporters of eminent domain admit it can be a drastic solution.

"It is the community versus the individual, unfortunately," acknowledges Jeff Finkle, who heads the International Economic Development Council, which supports eminent domain for projects such as the one in New London.

Finkle took Chen to southeast Washington, D.C., to look at another neighborhood where eminent domain might be used; this time, to build the city a new sports complex.

"The alternative for the stadium was (where Finkle showed Chen) or it was way out in (suburban) Loudon County, Va. …Eminent domain in this case is going to allow the city to acquire the site and redevelop a neighborhood that's about six blocks from the U.S. Capitol."

Chen points out that backers of the New London project say they have the same goals: keeping their city vital, and fighting suburban sprawl.

But to hear Matt Dery tell it, what all of this is really about, is his home: "This is a fight that was brought to us. …They brought it right to our doorstep. …We had no choice but to fight it. And if I didn't, I wouldn't be able to live with myself.

The Supreme Court is expected to issue its ruling by the end of June.

By then, the snow will have melted.

But Kelo vows her resolve will remain firm "because it's my house. It's my home. It's one I bought. And that's where I wanted to spend the rest of my life."