I. Strengthening Property Rights Protection

America’s Founding Fathers recognized the essential link between property rights and individual liberty when they drafted the Constitution of the United States and incorporated numerous measures intended to enshrine the protection of those rights. Michigan’s constitution likewise provides for a considerable degree of property rights protection. However, court interpretations and various laws and regulations have undermined these all-important rights. The following recommendations will help make Michigan a leader in the reform of laws that infringe upon citizens’ rights to own and use their property.

1. Tighten rules on compensation for governmental "takings" of private property.

While both the U. S. and Michigan constitutions provide for "just compensation" whenever government takes a citizen’s private property for public use, court interpretations of various laws and regulations have undermined that principle. Property owners are usually awarded compensation in the courts only if all economically viable uses of their property are destroyed by government action. Even if a regulation decreases the value of a person’s property by half, for instance, so long as one use or some value of the total property remains, the owner is left without a remedy.

Some in Congress want to establish a "trigger point," requiring compensation by the federal government when its regulations deprive a citizen of more than 33 percent of his property’s value. At least two states—Florida and South Carolina—have passed legislation with no trigger point: The governments in these states must compensate citizens for any non-negligible reduction in a property’s value resulting from their actions.

Currently, Michigan law only provides compensation for property owners when an action of state or local government deprives an owner of all uses or value of his property. This open door for governmental abuse of citizens’ property rights must be closed by provisions that would require fair value compensation by government any time a person’s property value is diminished by regulatory takings. In a study entitled Reforming the Law of Takings in Michigan2, the Mackinac Center for Public Policy has proposed specific wording whereby this objective may be accomplished through executive order, legislative statute, or constitutional amendment.

2. Reform civil asset forfeiture laws.

In a recent year in Michigan, law enforcement agents used so-called asset forfeiture laws in 9,770 instances to seize more than $14 million in private property. In many cases, no charges were ever filed against the owners and no finding of guilt was ever made in a court of law. In civil asset forfeiture cases, law enforcement officials may do little more than meet a very low threshold of evidence to show that the property in question was involved in a crime. The owner himself need not be guilty of any crime for government to gain the power to seize and keep his property. Michigan Congressman John Conyers notes that forfeiture law is intended to give police the power to confiscate the property of major lawbreakers, but in actual fact it "mostly ensnares the modest homes, cars, and hard-earned cash of ordinary, law-abiding people."

The protection of property rights is a fundamental condition for the maintenance of a free society and one of the most important obligations of government. The practice of asset forfeiture is a manifest violation of property rights. Lawmakers must work to reform both state and federal forfeiture laws with three objectives in mind:

  • Ending the twin practices of allowing law enforcement agencies to profit from the sale of the assets they seize and paying informants to provide information to help build forfeiture cases;

  • Requiring government to show proof that disputed property is connected to illegal activity before it can be seized (and the amount of property seized should be in proportion to the crime committed by its owner); and

  • Strengthening language in forfeiture statutes to ensure that property owners who have not participated in, or acquiesced to, a crime committed with their property are not punished with forfeiture.

Other important recommendations for reform of asset forfeiture laws are contained in the Mackinac Center for Public Policy study, Reforming Property Forfeiture Laws to Protect Citizens’ Rights.3