Eminent domain is the right that a governmental entity has to take private property and to use it for public purposes. The Fifth Amendment requires the government to pay reasonable compensation for the property that is taken and converted to public use. The process of taking the property is called condemnation. Condemnation is the governmental entity's official determination that the property is to be taken for a public use.

Reasons for Condemnation

Private property may be condemned under a government's eminent domain powers when it is needed for public improvements or for public purposes. Examples of public improvements include the repair or expansion of streets, roads, bridges, parks, public buildings, sewage treatment plants and public utility structures, including water lines and water holding and delivery facilities. Public purposes may include a project that the governmental entity has determined to be in the best interest of the public, including the purchase of vacant land or the condemnation and destruction of buildings that are in a state of disrepair. In addition, the governmental entity may transfer privately-owned land to other private parties for capital development when that development has been deemed a higher or better use of the property.

Reasonable Compensation

The governmental entity is required to pay reasonable compensation for a taking of private property for a public use. Reasonable compensation is usually determined by agreement of the parties. Each party is entitled to obtain a survey and an appraisal of the land to be taken in order to determine the land's value. If value of the surrounding land is decreased, the value of that land may be factored into the compensation amount. If the parties are unable to agree on the value, a court may ultimately decide the amount to be paid.

Copyright 2010 LexisNexis, a division of Reed Elsevier Inc.