For approximately the first 100 years in U.S. history, eminent domain lay dormant. In Kohl v. United States, the court ruled that the federal government could seize private property within the states, with just compensation, to build a post office and other government buildings. Justice William Strong emphasized that the federal government’s eminent domain power was “essential to its independent existence and perpetuity.”

In this case, the Penn Central Transportation Company wanted to build an office tower above its Grand Central Terminal in order to generate more income. The city’s Landmarks Preservation Commission ruled that the company could not go forward with the plan because it would alter the existing landmark (Grand Central) too much. Although Penn Central argued that this constituted a taking for which it should be compensated, the court disagreed, stating that a regulatory taking occurs only when the current use of the property is damaged.