The question of Can SpaceX use Eminent Domain? Has sparked debate in Houston. A nonprofit in the area with eminent-domain authority is currently considering the possibility of buying out residents. The chairperson of the organization said the company is “willing to explore” this option. Ultimately, it may come down to a decision made by the state legislature. Regardless, SpaceX’s future spaceport will be a benefit for the city and local economy.
Regardless of the reasons, local officials are eager to see SpaceX’s plans. Local officials have offered tax breaks to attract private industry to their region. However, it is unclear whether SpaceX intends to evict residents. In the meantime, the company has created the Cameron County Spaceport Development Corporation, which has eminent-domain authority. While there are no guarantees that SpaceX will use eminent-domain to evict residents, the chairman says he’s willing to explore the condemnation process.
The Texas land-owners’ response echoes Old West stories. Outsiders pressurize the residents to surrender their land by threatening to use eminent-domain to take it. However, this argument is not yet clear in the Texas courts. According to Christopher Clough, the managing partner of Adler, Clough & Oddo, LLP, Texas-based eminent-domain defense law firm, “Eminent-domain authority is vastly more powerful than a local government could ever hope to exercise.”
Residents in Boca Chica, Texas, are facing pressure to sell their property to the space company. In Boca Chica Village, SpaceX has purchased 112 parcels of land in the area to house its employees. Although some residents accepted the offers, many refused. This would be a PR nightmare for SpaceX. While the residents of Boca Chica Village will enjoy tremendous benefits from the space industry, they will no longer have their homes.
There are many concerns that SpaceX is not providing adequate compensation to the property owners. The company purchased the property at a fraction of its value and has not offered fair compensation. The company is also accused of skewed appraisals. Many residents are refusing to sell their properties, and some are claiming that SpaceX is using eminent domain to steal their property. Whether or not SpaceX uses this method is unclear.
The company has permission to close Highway 4 and Boca Chica beach for 300 hours a year, but it has shut them down for as much as 1,000 hours a year. This has been the source of criticism from multiple nonprofit organizations, the U.S. Fish and Wildlife Service, and local residents. SpaceX has resisted all these claims, claiming that their efforts were necessary for the development of their Starbase.
But residents have complained that SpaceX’s offers are too low. In May, the Wall Street Journal reported that SpaceX had acquired 112 parcels in the area. Celia Johnson, a homeowner in Boca Chica, Texas, has been resisting SpaceX’s attempts to buy her house, but still hasn’t accepted the company’s offer. A comparable house in her neighborhood would have cost at least three times as much as SpaceX’s offer.
In recent months, the FAA has released a draft PEA for public comment. It hosted two virtual hearings in September and extended the public comment period until November. While both sides have cited benefits for the town and the local economy, critics have raised concerns over the impacts on the environment. They are calling for a new EIS before SpaceX can obtain its launch license. This process could take months or years.
The company continues to build a fourth Starship manufacturing facility at Starbase. The facility is estimated to produce three-4 Super Heavy boosters and four to eight Starships, depending on the size of the Starships they build. This project will also involve drilling five natural gas wells, installing a desalination plant, venting methane from their launches, and building a 250-megawatt gas-fired power station. All this is estimated to cost hundreds of millions of dollars.