Declaration of Taking Act

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The Declaration of Taking Act, 40 U.S.C. § 3116, provides for interest at the rate of 6% per year in calculating just compensation for eminent domain under the Fifth Amendment, excluding any amounts paid into the court pending resolution of the dispute. This interest rate was fixed in 1931 and can often result in less compensation than under ordinary rules for calculating interest on judgments. That gives the government an incentive to take more private property because it can pay less in just compensation for it than a citizen would.

But the Court of Appeals for the Sixth Circuit upheld application of this law against a victim of a takings of property in United States v. Certain Land Situated in the City of Detroit, 450 F.3d 205 (6th Cir. 2005).