Bailey's Brake Service, a bit of an eyesore at a main intersection near the faltering downtown area of Mesa, Arizona, was a family-founded, owned and operated business that had been open in its existing location since 1970. Lenhardt's True Value

Question

Hardware store was also a longstanding Mesa business with a location south and east of Bailey's and a desire for a better location as well as a professed desire to revitalize Mesa's downtown area. The Lenhardts had purchased the property abutting Bailey's but felt that the street-facing Bailey's property was necessary for its location, location, location. The city fathers and mothers were in favor of condemnation of the Bailey use, a taking by eminent domain, followed by a "reissuing" of the once Bailey property to Lenhardt's for its construction of a new and much less eyesoreish retail establishment on the site: Randy Bailey challenged the taking of his business as unconstitutional. Discuss the issues in his case and challenge to the city's taking by eminent domain.

Answer 1

Students should apply the doctrine of Kelo and note the following:
1. The U.S. Supreme Court now permits takings for purposes of economic development.
2. Such a taking requires that there be an economic development plan in place so that property is not simply transferred from one private party to another.
3. There must be adequate compensation.
In this case, Bailey won - the court refused to uphold the taking, but it was the Arizona Supreme Court and there were issues with whether there was an adequate economic development plan in place that required replacement of Bailey's.