What is “Eminent Domain”?

“Eminent Domain” is the power of a government to force private property owners to sell their land for a “public purpose.” Eminent domain exists outside of TIF districts as well, but the TIF law gives cities such as Chicago more leeway to acquire land. In short, the TIF law expands what is considered a “public purpose.” Before, cities would use eminent domain to buy up the land they need to build a highway, a public transit line, a new school, a park, or other facilities that are clearly “public” in nature. But under the TIF law, it is possible to use eminent domain much more broadly. Most often, the City uses eminent domain to buy up a large number of adjacent, smaller pieces of land in order to create a larger parcel that it can then sell to a developer at a below-market price. This is one of the major ways that the City can subsidize TIF developments and “grease the wheels” of development.

Before the City can acquire land, it must draft and publish an “acquisition map” that shows which properties it has targeted. Including a piece of property on the acquisition map does not necessarily mean that the City will move forward with the purchase. Whether or not the City goes through with the eminent domain process depends on a number of factors, including whether there is money in the TIF to buy the land and whether it has located a developer who wants the property. But inclusion of your property on the acquisition map is a strong indication of the City’s intentions, and requires immediate action on your part to protect your assets. Acquisition maps are often included in the original redevelopment plan for the TIF, but can be changed after the TIF is passed. In those cases, property owners must be notified of the change by mail at least 15 days before the matter is voted on by the Community Development Commission.

Property owners are entitled to be paid for their land and buildings when the City invokes eminent domain. The City is required to pay “fair market value” for the property, as determined by a private appraiser who estimates the value of the property. Often, however, the price that property owners are offered is unrealistically low, and does not permit them to relocate their home or business without losing money.

Why Would the City Want To Take Private Property in a TIF?

Obviously, the power of eminent domain must be used extremely cautiously. Almost nothing has the power to change a neighborhood more quickly than the ability to acquire properties and demolish buildings. The City has used its power to acquire occupied residential and commercial buildings, and there is no indication yet that they will stop. Together with rising property tax bills, the power of eminent domain is the most direct way that TIFs can result in the displacement of residents and businesses.

There are some legitimate uses of eminent domain, however, in areas where there is a large amount of vacant land with absentee landlords. Often, what looks like a single large piece of vacant land is actually many separate parcels owned by different individuals. Much of this land may be delinquent on its property taxes or off the tax rolls altogether. In many cases, it is difficult if not impossible to even figure out who owns the land. For a private developer to invest the time, effort and expense to locate all these property owners and negotiate with them separately is often a major barrier to development. By taking on this part of the project itself, with its ability to fast-track the process, the City is often able to bring jobs or investment to areas that otherwise would remain vacant and unproductive. In these cases – where there is no displacement of residents or businesses, and the project would benefit the community – the power of eminent domain can be helpful.

What Can You Do?

If you are concerned about the City acquiring your property as part of a TIF, it’s important to act quickly:

1. Get a copy of the acquisition map to know for sure if your property is targeted. The City is obligated to disclose this information to you.
2. Contact your Alderman. The Alderman plays a key role in the development of a TIF plan, and has the power to remove your property from the map.
3. Get in touch with your neighbors or community organization to find out if other people are in your situation. A group of people acting together is more effective than a single person acting alone.
4. Testify at the public hearing. If you own your property, you are required to be notified by mail at least 15 days before the public hearing, generally administered by the Community Development Commission. If you lease or rent your property, be sure to sign up for the Interested Parties Registry to get notices of public hearings by mail. The CDC has become more sympathetic to the public when the City tries to acquire viable businesses or occupied homes. In several instances, they have sent Dept. of Planning and Development staff back to the drawing board to reconsider taking occupied property. If at least 10 residential units will be displaced by the TIF, then your neighborhood qualifies for the Housing Impact Study. In these cases, the City must hold an additional public hearing devoted solely to the land acquisition issue each time it seeks to use eminent domain.

If your property has been on an acquisition map for four years, then the City must either move to acquire it immediately or remove it from the map, according to a new land acquisition policy approved by the CDC at its May 22, 1999, meeting. While this policy is a small step in the right direction, there remains a need for systematic reform of how the City uses its power of eminent domain.

(For more information, see Organizing in Your TIF )