By Kristen Moulton
There are dark clouds on the horizon for cities, which for decades have used eminent domain or its threat as a tool to replace run-down neighborhoods with tax-generating, job-creating businesses.
Not only are courts across the nation beginning to side with private-property rights' advocates, the Utah Legislature is cracking open the door to have a look. This is at the behest of educators and Gov. Olene Walker, who note the loss of revenue to schools from some redevelopment projects.
Cities also are paying attention to Kelo v. City of New London, a case scheduled for arguments before the U.S. Supreme Court on Feb. 22. The Institute for Justice, a Washington-based public interest law firm, is asking the court to rule that it is wrong for cities to take property from one owner to give to a developer.
Scott Bullock, a senior attorney for the institute, says another case decided last summer also has implications.
The Michigan Supreme Court overturned its 1981 Poletown ruling, which is a textbook case long used by cities and courts to allow eminent domain for commercial projects.
In the 1981 case, the court allowed General Motors to push 3,000 largely Polish immigrants out of their homes so it could expand its manufacturing plant. The new state Supreme Court said the decision was indefensible.
The strongest cases for such takings involve areas considered blighted. That means they have decaying buildings and inadequate streets, curbs, sidewalks and sewers. These projects are usually undertaken by city redevelopment agencies (RDAs).
Property owners are given rights by Utah Code, but if they want to stop an RDA, they have to act quickly. Residents have 30 days after a "blight" designation to file a complaint in District Court - or they lose their right to question the blight.
Once a redevelopment area is before the RDA board, residents can block a planned redevelopment area by submitting written objections from 40 percent of the property owners. That forces a vote at the next election.
Written objections by 60 percent of the property owners can force the RDA to shelve the project for three years. In both cases, the objections have to be submitted before the board accepts the plan.
Rarely, however, do property owners organize early enough to contest a blight designation. More often, people begin objecting when the issue is how much money they will be compensated for their property, according to Craig Call, Utah's ombudsman for property rights.
Senorina Fernandez grew up with 11 siblings in this neighborhood that hugs the Union Pacific rail yard on the west side of downtown Ogden [UT]. She raised six children here.
So it's with no small measure of sadness that she realizes this could be her last Christmas in her modest, well-kept home in the long-neglected neighborhood.
Ogden City wants Fernandez, along with residents of 33 other homes and owners of eight businesses, to move out to make way for a Super Wal-Mart.
"It's not a palace. But it's my home. It's my home!" says Fernandez, a widow who keeps a big garden and lives on a Social Security check.
Fernandez and other home and business owners in the 21-acre island are not optimistic. But they say they will go down fighting City Hall.
"I'll be danged if I'm going to let it go," says Fernandez who, like nine other property owners, has an attorney and is waiting for the city to condemn her property so she can challenge the action. "It's not fair."
While some residents are thrilled with the city's plans to buy property they have been unable to sell, the holdouts say Ogden instead should help them fix the blight - substandard housing, streets with no curbs, gutters or sidewalks, abandoned cars.
"I don't think in America we should ever be forced to do this," says Hal LaFleur, who owns several of the area's private parcels, including the 4-year-old building that houses his son-in-law's welding business. "This is not for public use. This is for Wal-Mart."
Cities and other government agencies have been taking private property through eminent domain and the threat of it for decades. They consider business expansion a public good, particularly when they clean up run-down neighborhoods in the process.
A wave of court rulings nationally gives property-rights advocates hope that that era is ending.
But in the meantime, Ogden looks at the redevelopment project and Wal-Mart's proposed superstore as a godsend.
"A retail destination": Stuart Reid, the city's director of community and economic development - and the LDS Church bishop for members in the redevelopment area - told City Council members earlier this year it could lead to Ogden's renaissance.
It would clean up an unsightly, old neighborhood where houses are squeezed in with manufacturers at a major entrance to downtown, 21st Street. And it could also mean an estimated $700,000 more each year in sales-tax revenue.
"It would go a long way in re-establishing downtown as a retail destination," says Richard McConkie, Reid's assistant director.
Mayor Matthew Godfrey acknowledges some residents are being asked to make a sacrifice.
"The hardest part in all of this is the emotion," Godfrey says. "I don't like for the people to go through the trauma because of what we're doing. We feel bad they have to . . . go through something that's for the betterment of the community, but that's clearly the situation here."
The Ogden Wal-Mart redevelopment case has attracted the attention of a Washington, D.C.-based public interest law firm, which argues that eminent domain is unconstitutional when governments take property for private business.
The law firm - the Institute for Justice - will argue a major Connecticut case along those lines before the U.S. Supreme Court on Feb. 22.
"Wal-Mart should simply not be the recipient of land through eminent domain," says the institute's senior attorney, Scott Bullock. "It's bad business [and] it's wrong."
The institute is not involved in the Ogden fight, but is in contact with Dorothy Littrell, a North Ogden accountant. Littrell bought property in the Wal-Mart project area just so she could sue the city, on constitutional issues, in 2nd District Court.
"I am 76 and a great-grandmother, and I will not let my experience go to waste when I can fight this injustice," Littrell says.
Ogden City attorney Norm Ashton says the characterization of the city's action as "unconstitutional" is simply wishful thinking.
"That's their desire or hope, but that isn't the present state of the law."
City officials are still negotiating with the holdout residents and business owners, and Ashton said he is confident they will reach a settlement. But if not, he said, the city will use eminent domain.
Amy Butters, a Syracuse-based attorney, is working for free for property owners in the neighborhood, fueled in part by a wrenching childhood memory. Her grandfather was forced to sell his tailor shop on Washington Boulevard to make way for the Ogden City Mall in the early 1980s.
After the mall failed, the city bought the property, razed the buildings, and is slowly redeveloping the property.
"It's frustrating to me that cities think Wal-Mart is the economic answer to all their problems," says Butters.
If the city condemns her clients' properties and they go to court, she will argue, "You can clean up an area of the city without taking the property away and giving it to somebody else."
But Mayor Godfrey says that argument misses the point: The neighborhood is not supposed to be a neighborhood.
Zoning out: More than 50 years ago, the city zoned it for manufacturing. Officials assumed that the houses, already decades old by then, would eventually be replaced. That's also why the city has never invested in curbs, gutters, storm drains or sidewalks, Godfrey says.
The neighborhood clung on, though, and now it's an eyesore, Godfrey says, adding that "the revitalization of the urban center of the city is key."
Nonetheless, residents say if their neighborhood is blighted, it's the city's fault.
Fernandez and Donna Marti, who lives with her 80-year-old husband in the home where he was born, say the city has ignored calls seeking enforcement of lawn and abandoned-car ordinances.
She and her husband, Evo, have signed an option for the city to buy their home, which they have upgraded frequently through the years. But they are not happy about having to leave.
It rankles Marti that her LDS bishop is one of the city officials pushing her out of her home. Reid did not directly try to persuade her to sell, she says. But that was the subtle message.
"He said, 'Sometimes we all have to give up something.' That didn't set well with me. He said, 'As your bishop, I will say if it's meant to be, it will be,' " says Marti.
Reid did not return a request for comment.
But Godfrey said that Reid's church position cuts the opposite way residents suspect and is no conflict.
"It gives him more compassion. He knows some of these people very personally." Reid, Godfrey says, has stayed away from negotiations involving church members.
Milton and Cristina Rodriguez say they see an irony. In other projects, Ogden is encouraging people to live and work downtown - exactly what the Rodriguezes do.
Cristina lives just a block from her job at the Internal Revenue Service. Milton owns vacant properties adjacent to his home so he could build a shop for his growing chain-link fencing business.
"I'll fight it. I don't want to move," says Milton. "I've had the ideal situation here."
And Jerry Wells, who owns an auto-repair and body shop on land the city wants, is worried he won't be able to replace his acre of concrete-covered land and shop for less than $500,000 - the going price for similar properties elsewhere. The city's latest offer: $186,000.
"This isn't right. This isn't a school or a highway. It's a Wal-Mart! That's not how it's supposed to be," says Wells. "If they can do this now, they can do this any time to anybody."
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