Small Business Fights for Property Rights
Eminent Domain
A number of small-business owners have expressed concern about abusive uses of government's power to condemn property under "eminent domain." Though intended to be used for "public purposes," for example, to take land for schools or roads or parks, the government is increasingly using this power on behalf of large businesses to take property that these businesses otherwise would have had to buy on the open market. Small-business owners are already struggling under the weight of onerous government regulations and swimming in paperwork. To have to worry about large businesses using the power of eminent domain to force them off of their properties is simply outrageous.
On July 23, 2005, the U.S. Supreme Court issued a ruling that opened the floodgates to eminent domain abuse. By a 5-4 decision, the Court condoned the right of local governments to seize private property for public use in the name of "economic development." In response to the Court's decision, Sen. Jon Cornyn (Texas) introduced S. 1313, the Protection of Homes, Small Businesses and Private Property Act of 2005. In the House, Rep. Jim Sensenbrenner (5th Dist.-Wis.) introduced H.R. 3135, the Private Property Rights Protection Act of 2005. Both of these bills will prevent the federal government from using eminent domain for economic purposes and will prevent states from using federal money in economic development projects where eminent domain has been used.
NFIB supports S. 1313, the Protection of Homes, Small Business, and Private Property Act of 2005 and H.R. 3135, the Private Property Rights Protection Act of 2005 and hopes to see their passage.
NFIB is also working on various bills in Congress that reaffirm the importance of property owners and small businesses, including H.R. 4772, the Private Property Rights Implementation Act of 2006. This legislation will allow private property owners and small businesses access to federal courts when bringing up a property rights claim that is protected by the Constitution. Currently, property owners and small businesses do not have the option to take a Fifth Amendment Takings Clause claim directly to federal court. Instead, they are faced with exhausting all possible state court remedies because of a 1985 Supreme Court ruling, even though all other civil rights plaintiffs can take their claims directly to federal court. This issue is complicated further by a 2005 Supreme Court ruling that precludes property owners from having their cases heard in federal court if the state courts have already heard their takings claims.
Endangered Species Act Reform
With 90 percent of endangered species living on private land, it is important that regulators work with property owners during the species recovery process. The ESA should be reformed to minimize its negative impact on small property owners. The ESA has led to devastating results for small businesses. When land is designated as habitat for an endangered species, any human activity that affects that species must stop until government officials can assess its impact, which can take years. The results can be the failure of a family business, the loss of jobs, higher prices for goods and services, and decreased tax revenues — all of which can cripple a community.
