Friday, June 27, 2008

Concept Review: Government Rights & Enabling Acts

Usually, when someone says they ‘own’ their property they are indicating to you that they possess a fee simple interest.  The fee simple interest is the broadest and most complete bundle of rights that private citizens can possess in real property.  However, even fee simple ownership does not give owners the right to do what ever they desire with their real estate.  For example, an owner might not be able to use her property as a junkyard, pollute the site, or refuse to pay property tax without loosing the property and/or going to jail. 

The governmental rights in real property supersede even the highest private ownership rights.  The government rights in real property include police powers, eminent domain, taxation, and escheat.  The government rights and interest in real property can be remembered as PETE (Police Power, Eminent Domain, Taxation, and Escheat).  Don’t like PETE?  Try TEPE instead. 

Government rights in real property are usually exercised by local and sometimes state governments (and generally not by the Federal government).  For example, zoning is usually established and enforced by municipalities and property taxes are assessed and administered by counties.  

These leads to the question: who give local governments the power over our property?  

The US Constitution grants all government power.  However, the Constitution defines federal and state rights only, with no mention of any local governments.  Though power granted to states by the US Constitution called enabling acts, states pass police power, eminent domain, and taxation to county, city, and municipal governments.

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