The Fifth Amendment's Takings Clause is blunt: the government can't take private property "without just compensation." In practice, that means when a city condemns your house for a highway or a state seizes land for a pipeline, it must pay you fair market value -- what a willing buyer would pay a willing seller. In January 2025, the Arizona Supreme Court tripled a compensation award from $6 million to $18 million in State of Arizona v. Foothills/Hanke, ruling that homeowners deserved payment for lost property value caused by a new highway's proximity, not just the land directly taken.
The bigger fight is over what counts as "public use." In Kelo v. City of New London (2005), the Supreme Court ruled 5-4 that the city could seize Susette Kelo's home and transfer it to a private developer for an economic development project. Justice John Paul Stevens wrote that "public use" includes "public purpose" -- meaning private-to-private transfers are constitutional if a government claims economic benefits. The backlash was enormous. More than 40 states passed stricter eminent domain laws in response. And the development project that displaced Kelo's neighborhood? It was never built. The land sat empty for years.