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Indiana Property Rights

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Since the decision by the United States Supreme Court in Kelo v. City of New London many states across the country have taken measures to help protect the rights of private ownership.  The controversial Kelo decision held that a local government can take the private property of one person and give it to another private entity.  While the Court’s ruling was seen by many as a serious blow to citizen’s constitutionally protected rights of private property ownership, the decision prompted a number of states to initiate legislative reform to help curb eminent domain abuse.

The Castle Coalition has released a report, grading each of the states based on their efforts to protect private property owners and their rights based on changes in their respective state laws.  The Castle Coalition is the Institute for Justice's nationwide grassroots property rights activism project that teaches home and small business owners how to protect themselves and stand up to abuse by governments and developers who seek to use eminent domain to take private property for their own gain.  Stated below is the letter grade, as given by the Castle Coalition, along with a description of the changes that have occurred since Kelo v. City of New London.

Indiana Castle Coalition letter grade of

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The state of Indiana was quick to form a commission to study the abuse of eminent domain and ways to prevent it just after the landmark case of Kelo v. City of New London. Then, in 2006, the legislature adopted House Bill 1010, which states that in order to condemn property, the condemning authority must conduct a good faith negotiation with the property owner, as well as establish a proposed purchase price and provide the owner with an appraisal.

Additionally, they added a new chapter to the Indiana Code (SECTION 10. IC 32-24-4.5) which provides procedures and requirements for the use of eminent domain to transfer private property to a private owner.  This new chapter requires that the property in question meet certain criteria such as containing a dwelling that is unfit for habitation, or containing a structure that is unfit for use becuase of utilities, before eminent domain can be used to transfer private property to a private owner.  It also requires that the acquisition thru eminent domain accomplish more than just increasing the tax base for the government.   It also requires that agriculture land owners be paid 125% of the appraisal value and owner occupied residential property owners be paid 150% of the appraised value; both require payment of relocation costs.  Lastly, it states that the condeming authority is required to pay attorneys fees for any amount exceeding $1000.

This bill is meaningful in the sense that it establishes proof of evidence in fair compensation for property owners, as well as establishes objective and fair steps that need to be taken in order for a condemning authority to acquire property.   It also protects property owner rights by mandating attorneys fees be paid by the condeming authority for any amount over $1,000.

Summary

The state of Indiana has securities in place for property owners, along with an objective series of steps that must be taken by elected officials in the condemnation process. However, if other amendments were adopted or were in the state constitution, property owners would be ensured more security.

While the physical requirements of the property detailed in SECTION 10. IC 32-24-4.5 will limit the government's use of eminent domain, the statute states that only one of the criteria be met in order to acquire private property thru eminent domain for private use.  The vague descriptions provided on some of the requirements could make it easy for properties to fall under one of these categories.  However, with the expectation stated in the statute that the acquisition accomplish more than just an increase in tax revenue, and that attorneys fees are paid for by the condeming authority, we feel that property owner rights are well protected in Indiana.

Click to visit the Indiana legislature page that overviews House Bill 1010.

 

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