Protection of Homes, Small Businesses, and Private Property Act of 2012

(1) The protection of homes, small businesses, and other private property rights against government seizures and other unreasonable government interference is a fundamental principle and core commitment of our Nation’s founders.

(2) As Thomas Jefferson wrote on April 6, 1816, the protection of such rights is the first principle of association, the guarantee to every one of a free exercise of his industry, and the fruits acquired by it.

(3) The Fifth Amendment of the United States Constitution specifically provides that private property shall not be taken for public use, without just compensation.

(4) The Fifth Amendment thus provides an essential guarantee of liberty against the abuse of the power of eminent domain, by permitting government to seize private property only for public use.

(5) On June 23, 2005, the United States Supreme Court issued its decision in Kelo v. City of New London, 545 U.S. 469.

(6) As the Court acknowledged, it has long been accepted that the sovereign may not take the property of A for the sole purpose of transferring it to another private party B, and that under the Fifth Amendment, the power of eminent domain may be used only for public use.

(7) The Court nevertheless held, by a 5–4 vote, that government may seize the home, small business, or other private property of one owner, and transfer that same property to another private owner, simply by concluding that such a transfer would benefit the community through increased economic development.

(8) The Court’s decision in Kelo is alarming because, as Justice O’Connor accurately noted in her dissenting opinion, joined by the Chief Justice and Justices Scalia and Thomas, the Court has effectively... delete[d] the words for public use from the Takings Clause of the Fifth Amendment and thereby refuse[d] to enforce properly the Federal Constitution.

(9) Under the Court’s decision in Kelo, Justice O’Connor warns, The specter of condemnation hangs over all property. Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory..

(10) Justice O’Connor further warns that, under the Court’s decision in Kelo, Any property may now be taken for the benefit of another private party, and 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. As for the victims, 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..

(11) It is appropriate for Congress to take action, consistent with its limited powers under the Constitution, to restore the vital protections of the Fifth Amendment and to protect homes, small businesses, and other private property rights against unreasonable government use of the power of eminent domain.

(12) It would also be appropriate for States to take action to voluntarily limit their own power of eminent domain. As the Court in Kelo noted, nothing in our opinion precludes any State from placing further restrictions on its exercise of the takings power..

The power of eminent domain shall be available only for public use.

In this Act, the term public use shall not include economic development.

This Act shall apply to—

(1) all exercises of eminent domain power by the Federal Government; and

(2) all exercises of eminent domain power by a State or local government using Federal funds.