The reason that Red House is so sparsely populated is because the vast majority of the town's land was used for the creation of Allegany State Park, which has no permanent population. Beginning in 1967, coinciding with the construction of the Kinzua Dam, the state began an eminent domain campaign to buy out the remainder of the town; at the time, the path of the Southern Tier Expressway (then "new Route 17," now Interstate 86) was routed directly through the core of the hamlet of Red House, allowing the state to seize and destroy most of the town residents' property. In 1973, the state tried but failed to claim the remaining privately held land in the town for park expansion. The eminent domain campaign has mostly gone quiet since the late 1990s; the state still has a standing offer to purchase any property that is either abandoned or put up for sale in the town. A small northwest corner remains outside the park's bounds, about half of which is on the Allegany Indian Reservation and much of the rest of which is occupied by Camp Li-Lo-Li, a Christian camp. The few residents remaining in the town are concentrated on a single road, Bay State Road (named after a lumber company from Massachusetts that built and used the road), sandwiched between the reservation and the park and southwest of the original hamlet. A local church was forcibly moved to Jimerson Town; another, a Roman Catholic chapel, remains standing but abandoned.