Orlando condemns private property in order to build a Major League Soccer stadium

February 7

A Florida judge recently approved the city of Orlando’s efforts to use eminent domain to take private property in order to build a stadium for a Major League Soccer team, the Orlando City SC.

The two property owners whose land was taken did not contest the city’s claim that the land is being taken for a “public use,” as required by Florida law. If they had, it is quite possible that the taking would have been invalidated under Florida’s post-Kelo eminent domain reform law. Florida’s 2006 reform law forbids the condemnation of property for transfer to a private owner unless at least ten years have passed since the initial condemnation, and the land is no longer being used for the purpose it was initially condemned for. Unlike many states that passed essentially ineffective “reforms” in reaction the Supreme Court’s controversial 2005 decision upholding “economic development” takings in Kelo v. City of New London, the Florida law provides strong protection for property owners. It is in fact one of the toughest such reforms in the entire country.

Although the Orlando stadium will be owned by the city and only leased by the team, the 2006 law also forbids transfers of condemned property to private parties “by lease or otherwise” until the requisite ten year period has elapsed (subject to some exceptions that do not apply in this case, such as condemnations for common carriers and public utilities). Thus, it seems likely that the taking is illegal, and should have been struck down if the property owners contested it, unless there is some new exception for sports stadiums that I am not aware of. In 2008, another group of Orlando owners used the 2006 law to resist the use of eminent domain to build a new stadium for the Orlando Magic NBA franchise, but ultimately agreed to settle after the city increased its compensation offer.

Legal scholar Marc Edelman argues that the Orlando taking is consistent with Florida court decisions holding that sports stadiums are a legitimate “public purpose.” But he ignores the fact that Florida, like many states, sets tougher public use requirements for the use of eminent domain than for the appropriation of public funds; the cases he cites upheld the latter. Edelman also does not consider the relevance of Florida’s tough post-Kelo eminent domain reform law.

Legal or not, using eminent domain or other public subsidies to build sports stadiums is a terrible idea. Studies almost uniformly show that sports stadium subsidies nearly always fail to provide broader economic benefits to the community. This is likely to be even more true when the stadium in question is used for a relatively unpopular sport such as soccer. Because American sports fans, on average, are less interested in soccer than in baseball, football, or basketball, a soccer stadium is likely to generate less economic activity than stadiums for these other teams.

As long-time VC readers know, I am a big sports fan myself. Unlike some more traditional US sports fans, I even like soccer. But professional sports teams should pay for their own stadiums, and should not rely on government subsidies – including the use of eminent domain to take property from unwilling owners.

NOTE: I am grateful to Orlando Sentinel reporter Mark Schlueb, who has been covering this issue, for providing me with information about the planned ownership status of the stadium, and about the property owners’ failure to contest the public use issue.

Ilya Somin is Professor of Law at George Mason University. His research focuses on constitutional law, property law, and popular political participation. He is the author of "The Grasping Hand: Kelo v. City of New London and the Limits of Eminent Domain" (forthcoming) and "Democracy and Political Ignorance: Why Smaller Government is Smarter."
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