Nevada Joins National Trend in Responding To Kelo Decision On Eminent Domain

On May 23, 2007, Nevada Governor Jim Gibbons signed into law Assembly Bill No. 102 ("AB102"), a reform measure seeking to curb perceived abuses of the power of eminent domain in response to the U.S. Supreme Court's Kelo decision. The measure comes nearly two years after the Supreme Court rendered its controversial opinion, holding that the promotion of economic development served a legitimate "public purpose" and that no finding of blight was required for condemnation, and affirming that the transfer of property from one private owner to another private owner was sometimes necessary, and permissible, to realize such a public purpose. Kelo v. City of New London, Connecticut, 545 U.S. 469 (June 23, 2005).

At the time the decision was entered, Kelo created an immediate storm of public outcry and spawned a flurry of proposed legislative measures seeking to limit redevelopment efforts and to rein in the use of eminent domain. Indeed, the Supreme Court invited this reining in of the power of eminent domain when it stated in Justice Stevens' majority opinion: "We emphasize that nothing in our opinion precludes any State from placing further restrictions on its exercise of the takings power." While many of the proposed bills have stalled or died in other states, Nevada has managed to follow through with its attempt to balance the impact of the Kelo decision, even if it only did so after staring down the barrel of a "PISTOL."

AB102 is considered a compromise plan that restricts governmental agencies' use of eminent domain to acquire private property, but does not unreasonably hinder large public works such as transportation projects. It was initially a companion measure to a proposed constitutional amendment ("AJR3"), which received final approval from the Nevada Assembly, but has to be passed by the Legislature again in 2009 before advancing to a statewide vote in 2010. AB102 contains the same provisions as AJR3; however, it took effect immediately upon the governor's signing.

Perhaps more so than the Kelo decision, AB102 and AJR3 were prompted in response to a ballot initiative petition entitled "Property Owner's Bill of Rights" that was championed by, and more commonly referred to as, the People's Initiative to Stop the Taking of Our Land, or PISTOL. While a trimmed-down version of PISTOL eventually passed following a challenge to the initiative in Nevada's Supreme Court, PISTOL still goes further than either AB102 or AJR3. Among other...