Susette Kelo and several other homeowners in a working-class neighborhood in New London, Conn., filed suit after city officials announced plans to raze their homes for a riverfront hotel, health club and offices.
New London officials countered that the private development plans served a public purpose of boosting economic growth that outweighed the homeowners' property rights, even if the area wasn't blighted.
- New London never actually received those taxes. The case's notoriety dampened interest in doing business at the stolen property, and then the economic downturn killed the project. Journalists visiting the scene have found the land to be "barren."
That means the city lost money on the deal: the cost of the legal battle plus the potential tax revenues from homes and businesses forced out and never replaced.
Since the Kelo decision, dozens of states have revised their laws, either through the legislature or through citizen initiatives, to outlaw land grabs of the sort perpetrated in Connecticut. At least one bank -- BB&T -- announced it won't fund projects on land seized for economic development.
Outright theft of land to increase tax revenues is unpopular, and probably politically less supportable now, because people like Susette Kelo fought New London to keep their homes.
