Neighborhood doubts — The (Hagerstown MD) Herald-Mail, 10/15/04

Stadium, convention center plans raise questions

by Gregory T Simmons

Steve Parrotte is proud of his business on South Cannon Avenue and hopes it will be the financial source for his retirement, and his son's.

But a redevelopment plan that could bring a new stadium and a convention center in five to 10 years has cast some uncertainty on those dreams.

"My biggest concern is how it is going to affect me. Are they talking about making me leave this place? ... Right now, I have a lot of money invested in this place," Parrotte, owner of Stadium Tavern, said Thursday.

Parrotte and others who live and work in the area being discussed for redevelopment said they were not opposed to plans that could improve the area, but they were concerned about the direction plans could take.

Parrotte's business sits next to Municipal Stadium. On the other side of the establishment is another family-owned business; next to that is the City Light Department headquarters.

The land straddles the heart of a redevelopment plan that is being put together under the direction of a group of private business people and the Hagerstown Neighborhood Development Partnership, a nonprofit company created by the City of Hagerstown to speed redevelopment efforts.

The ideas being considered for the plan include either refurbishing the stadium or building a new one, building a convention center and bringing new residential and commercial development.

The private, yet unnamed group of business people paying for the redevelopment study has hired Washington, D.C.-based Brailsford & Dunlavey, a project management company with experience in municipal redevelopment projects. It was one of the lead contractors involved with bringing baseball to Washington.

Richard Phoebus Sr., president of the city neighborhood development partnership, said it would take several years to get that type of plan together, but said earlier this week he expected Brailsford & Dunlavey's study to be ready for review in January.

Phoebus said Thursday the plans are not intended to displace healthy businesses, and the plans would focus on properties that become vacant as time goes by, such as Washington County Hospital. Hospital officials are pushing plans to relocate the hospital to a site near Robinwood Medical Center.

Eileen "Sue" Titus has lived in her apartment a half-block away from Municipal Stadium for nearly 20 years. She said the area's gotten louder and more crowded. Within the past year, two duplexes were built on a piece of land across the street from her.

"Don't get me wrong. I'm for progress - but with taste," Titus said.

Debra Stoner lives on the same block, but she, her husband and daughter have only lived there for about a year. She said a reporter's description of the plan was the first she'd heard.

"It sounds like a pretty good idea to me," Stoner said. "I might not even be here then."

Rebecca Hovermale said she had lived in her house on South Cleveland Avenue since 1979. When she was told by a reporter there are plans being discussed to put a convention center in her neighborhood, she asked: "Where would you put it, for heaven's sake?"

Phil Physioc and his son, Phil Physioc II, both own businesses on East Baltimore Street next to Municipal Stadium. The elder Physioc is part owner of Hagerstown Spring Works, an auto repair shop that works mainly with large transport vehicles, and his son owns Fitness Priority, a workout center.

The younger Physioc said he's concerned his business could be affected by the sheer talk of redevelopment. His customers pay to work out for months in advance.

"It adds uncertainty," the younger Physioc said, adding that could scare off customers.

Both Physiocs said they'd be open to working with any development plans, so long as they were treated - and compensated - fairly for any relocation plans.

If, however, there was talk of using eminent domain powers - which allow governments to forcibly buy land - "We wouldn't be happy at all," the elder Physioc said.

The Herald-Mail: www.herald-mail.com

City makes case to high court — The (Fairfield County CT) Hour, 10/15/04

By Robert Koch

The city [of Norwalk CT] asked the state Supreme Court Thursday not to hear Maritime Motors' appeal of two lower court decisions clearing the way for seizure of the West Avenue car dealership for the Reed-Putnam Urban Renewal project.

"The boundaries remained the same, the goals remained virtually the same, and the blight in the redevelopment area had not been eliminated completely," wrote attorney Jonathan S. Bowman of Cohen & Wolf PC, the Bridgeport law firm representing the Norwalk Redevelopment Agency.

"For these reasons, there is no reason for this court to (hear the appeal) based on the Appellate Court's resolution of the blight issue," said Bowman, addressing the evolution of the renewal plan.

The high court is not obligated to hear Maritime Motors' appeal. The court typically accepts or rejects a case after six to eight weeks of review, according to the court clerk's office.

Maritime Motors President Peter Morley has been battling the city for more than a year over the fate of his car dealership at 51 West Ave. and his storage lot at 31 Putnam Ave. The renewal plan seeks to develop 70 acres between Interstate 95 and Norwalk River.

Morley has described the battle as a life-and-death struggle for an established business and its three dozen employees.

Under the plan, West Avenue and Reed Street would be widened into Morley's dealership. Reed Street would be extended through his storage lot and beneath the Metro-North Railroad tracks.

If the high court takes the case, the emergence of the renewal plan in 1983, and Morley's purchase of the property in 2000 likely will resurface.

"(Maritime Motors) knew all about this (plan) before they bought it. It had been on the books and on the public record for 17 years," Bowman said.

State Superior Court in Stamford last fall and the state Appellate Court last month ruled against Morley. On Oct. 4, Morley's attorney petitioned the high court to hear his appeal and throw out the lower court decisions.

The petition, prepared by attorney Michael S. Taylor of the Hartford law firm Horton, Shields & Knox PC, states the city did not attempt to integrate Maritime Motors into the renewal plan and erred by not including a renewed finding of blight in the 1998 revision of the plan.

City officials, Taylor said, "didn't do what they were supposed to do," leaving it unclear "whether the property can be integrated or the property is blighted." In response, Bowman rejects Taylor's argument that development in the Reed-Putnam area since 1983 — The Maritime Aquarium, Heritage Park and building renovations — merited a renewed blight finding in the 1998.

Taylor has argued that the Appellate Court decision sets a bad precedent by giving municipalities a "blank check" to exercise eminent domain powers over private property — whether blighted or not.

Both sides have cited the case of Pequonnock Yacht Club vs. the city of Bridgeport. In 2002, the state Supreme Court concluded that the city "acted unreasonably when (it) failed to consider or even discuss integration of the (yacht club) into the redevelopment plan." Bowman said the Pequonnock decision requires municipalities to make "reasonable efforts" to negotiate and consider integrating non-substandard properties. The case does not, he said, establish a "blanket rule" requiring that consideration

The Hour: www.thehour.com

Legal Precedents Against Fort Trumbull Folks — (New London CT) Day, 10/15/04

High Court Wants To Revisit Issue Of Eminent Domain, But Experts Not Sure Why

By Matthew J Malone

To understand how seven Fort Trumbull residents scored a date with the U.S. Supreme Court, one must travel back in time to tattered slums in Washington, D.C., an automobile plant in Michigan and sun-kissed estates in Hawaii.

In 1954, the Supreme Court opened the door for urban renewal, upholding a Washington plan to reduce its slums to dust.

Thirty years later, the court ruled in favor of the Hawaii Housing Authority, which planned to break up highly concentrated land ownership that prevented many residents from owning their own homes.

But this past July, the Michigan Supreme Court overturned a 23-year-old decision that had been consistent with those rulings from the federal Supreme Court. In the original ruling, filed in 1981, the Michigan court had approved of condemning homes so General Motors could build a new plant, ostensibly to provide jobs and tax revenue.

That reversal, several legal experts said, might have pushed eminent domain back to the doorstep of the Supreme Court.

As in the Michigan case, the City of New London argues the public purpose served by redevelopment of Fort Trumbull is the potential growth in tax revenue and employment. A new hotel, office building and Coast Guard museum would serve the community better, the city says, than leaving prime waterfront real estate in the hands of its middle-class residents.

When faced with eviction from their homes, the residents sued the city, arguing that the development benefited a private interest and that the city lacked concrete plans for some of the land it planned to acquire.

The Connecticut Supreme Court ruled in the city's favor. The residents appealed to the U.S. Supreme Court, which decided on Tuesday to hear the case.

In the Hawaii and Washington cases, the justices considered the meaning of the Fifth Amendment, which states that private property cannot be taken “for public use without just compensation.”

Rather than define a public use, however, the court unanimously found that state and local governments, and not judges, had the right to decide what plans were in the public interest.

“Subject to specific constitutional limitations, when the legislature has spoken, the public interest has been declared in terms well-nigh conclusive,” the court ruled in the 1954 Washington case, Berman v. Parker. “In such cases the legislature, not the judiciary, is the main guardian of the public needs to be served by social legislation...”

Several law professors specializing in property law were perplexed by the court's decision to take the New London case, given its earlier rulings. Thomas Merrill, a law professor at Columbia University, said that overturning the earlier rulings “would be a pretty dramatic departure from the trends of the last 50 years.”

In addition to leaving the definition of “public use” to the states, the Supreme Court ruled in the Hawaii case that it was also up to legislatures to decide how such plans would be carried out. It did not matter whether a private interest, like a hotel developer at Fort Trumbull, would benefit from the use of eminent domain.

“It is only the taking's purpose, and not its mechanics, that must pass scrutiny under the public use clause,” the court wrote in the 1984 Hawaii case, Hawaiian Housing Authority v. Midkiff.

The Fort Trumbull Municipal Development Plan is an example, several experts said, of a more expansive view of public use and, by extension, the powers of eminent domain born of the Washington and Hawaii cases. Cash-strapped cities competing with suburban and rural areas with more usable land face tough choices when seeking to revitalize their economy, they said.

“Creativity is the order of the day,” said J. Peter Byrne, a professor at the Georgetown School of Law. “What you are seeing is more creativity and maybe more desperation.”

Merrill noted that the use of eminent domain as a means to achieve economic and social growth began far earlier than the quest in Washington, D.C., to clear out the slums.

He said that in the mid-19th century the government supported the damming of rivers to help power the nation's mills, even though the dams would flood private property.

The same went for the Tennessee Valley Authority, which was established in 1942 to support the nation's growing need for power during World War II. After building the Fontana Dam in North Carolina, the Authority sought to take more land to address unexpected flooding that had isolated a nearby residential area.

In a 1946 decision, the Supreme Court affirmed the power of Congress to decide the scope of a project performed for a public purpose. The TVA got the green light to take over more land.

In the Hawaii case, the court reaffirmed and expanded on the standard set by the Washington case. All the justices, excluding one who did not participate, signed on to the Hawaii ruling.

Three current members of the Supreme Court — Chief Justice William Rehnquist and Justices Sandra Day O'Connor and John Paul Stevens — ruled on the Hawaii case. O'Connor wrote the opinion.

“When the legislature's purpose is legitimate and its means are not irrational, our cases make clear that empirical debates over the wisdom of takings ... are not to be carried out in federal courts,” O'Connor wrote.

As such, legal battles over eminent domain have taken place largely in state courts. States have the right to expand upon the protections granted in the Fifth Amendment. If a state wants to restrict the definition of “public use” to removing blighted areas, it can codify that standard.

From 1954 to 2003, there have been 544 reported appeals in which the question of what is a “public use” was actively litigated and decided, according to two studies. Only 31 were heard in federal courts, the studies found.

The rulings on many of those cases hinge on the Hawaii and Washington cases, several experts said.

In the Washington case, the District of Columbia wanted to take over a wide swath of land and redevelop it to address unsafe and unsanitary conditions. The court ruled that the legislature had the authority to take over properties in the area even if individual buildings did not contribute to the “slum” atmosphere.

In the Hawaii case, the court ruled that if the housing authority said that the redistribution of land served a public purpose, the fact that it would benefit private landowners was irrelevant.

Merrill cautioned against a system that would allow only municipalities to own such developments. In that case, Merrill said, cities would have to take on the financial risk of projects like football stadiums and hotels, rather than be able to transfer responsibility to a private entity.

The experts wondered what prompted the court to take up the Fort Trumbull case and noted the futility of such speculation. The possible reasons are many, they said.

Maybe only four judges — the minimum number required to put a case on the docket — were interested in rethinking previous interpretations. A fifth judge would be needed to overturn earlier interpretations of Fifth Amendment law.

Perhaps they want to reaffirm the ruling in the Washington case or define a stricter “public use” test. The court could also look at the Fort Trumbull case in relative isolation, ruling only on narrow points of law specific to the case.

“The facts matter,” Yale University law professor Robert Ellickson said. “The facts matter a lot.”

The Day: www.theday.com


Lowell eyes eminent-domain taking of building
Lowell (MA) Sun, 10/14/04

By Christopher Scott

Unable to come to an agreement with the property owner, the City Council this week unanimously gave City Manager John Cox authority to begin eminent-domain proceedings to acquire 65-87 Middlesex St., for a new city parking garage.

In a related development, councilors also voted to borrow more than $3 million to acquire another piece of property that would provide a crucial piece for an ambitious redevelopment plan.

City administrators haven't divulged numbers. But The Sun has learned that the city was leaning toward offering the owner of the Middlesex Street parcel, where Barney's Deli and several other small businesses are located, about $500,000. That number was based on real-estate appraisals.

But property owner Jim Gill, The Sun has learned, wasn't willing to go below about $1 million.

Gill is represented by James Masterman, a well-known Boston lawyer who is considered an expert in eminent-domain law.

Mayor Armand Mercier said the city has no choice but to pursue eminent domain.

"The project will not work with that strip there," Mercier said. "But you are not going to have a friendly taking."

There has been some talk of scaling back the $20 million garage and building it over "Barney's Block."

City officials, however, decided against that plan, instead favoring a blueprint that calls for new, street-level shops.

Meanwhile, councilors voted to borrow $3.6 million to buy the Freudenberg Nonwovens plant on Jackson Street.

At nearly six acres, Freudenberg's plant accounts for about a third of what city planners are calling the Hamilton Canal District, a 35-acre lot bounded roughly by the Lord Overpass, Middlesex and Central Streets and the Lower Pawtucket Canal.

If all goes as planned, within about a decade, the site will be home to 400,000 square feet of new, privately constructed commercial and retail space and as many as 1,000 new condominiums.

The vote was 8-1. Councilor Richard Howe, who believes the money would be better spent elsewhere, was the long vote against.

Lowell Sun: www.lowellsun.com

A king's divine right
San Antonio (TX) Current, 10/14/04

A brief history of eminent domain

By Michael Cary

Domingo Castelo had served five years in the Presidio of San Luis de Las Amarillas by June 21, 1762. He sent a letter to the governor and captain general of the Province of Texas and the New Philippines, continuing to plead for a "single lot on which to earn my living," in the City of San Fernando.

Governor Angel De Martos y Navarrete granted a lot 80 varas square in the vicinity of San Pedro Creek, near his mother in law's property. "He must plant trees and vegetables and occupy the land within the fixed period, with the understanding that if he does not comply," the governor wrote, "the land will be declared unoccupied and uncultivated and may be granted to any other deserving person who may present a petition for it."

This was colonial Spain's version of eminent domain. The school of thought was that God gave the right of eminent domain to the king, and the king gave it to the viceroy, who gave it to the Spanish governor, who parceled it out to settlers. Yet, the king always had the right to reclaim his land for the public good.

Castelo was dead by 1770, and the property was reallocated to a succession of settlers. But Castelo's wife, María Ejeciaca Rodriguez petitioned to reclaim the land, and in 1778, Alcalde Phelix Menchaca restored her title after determining that she had made improvements with a fence and a water conduit for irrigation on the property.

María won her case in a time when rebellious British colonists had yet to pen the U.S. Constitution, and include the last line in the Fifth Amendment which reads: "nor shall private property be taken for public use, without just compensation."

Note two key words, "public use" and "just compensation."

"Eminent domain is the exclusive right of the state, county and the city to exercise discretion in taking private property," says Suzette Berry, a senior analyst in the Bexar County Clerk's office, which oversees the collection and storage of public records. "But it has to be for a HemisFair or to build expressways, with a purpose to serve all of the citizens."

The first eminent domain case on record in the courthouse (from the Republic of Texas era) was dated June 11, 1885, and pitted the San Antonio & Aransas Pass Railway Co. against property owner George Witte. The railroad had its heart set on a 600-foot wide swath of land between the San Antonio River and Probandt Street for a railroad right of way. The railroad won the first of a series of cases, and Witte was paid $125 for his property.

"Eminent domain removes your right to property, and the rights to water and minerals under that property - you can kiss that oil well goodbye, too," says Berry.

Jump ahead to November 1964, when the Texas Attorney General conducted a seminar for attorneys who had worked, or were about to work, on eminent domain cases. "While the concept of eminent domain stretches back in time to almost the beginning of law ... the development of this area of law, as we know it today, has taken place almost entirely within the past 15 years," explained Assistant Attorney General Hawthorne Phillips.

The Texas Highway Department had only three attorneys working condemnation cases in 1958, but by 1964, there were 30 attorneys involved with condemnations for interstate highway rights of way.

San Antonio residents were getting a taste of it from the north, south, and downtown. Families were displaced in the 1960s to make way for HemisFair and the convention center, as urban renewal programs opted to demolish neighborhoods instead of rebuilding them.

And the highways were indeed coming. City Council in August 1963 approved a "schematic" for the North Expressway, known today as Highway 281 and Interstate 37. The Sisters of Charity of the Incarnate Word didn't have to consult an oracle to see what would happen to them. The highway plan published in local newspapers showed the project's first route would cut through the Incarnate Word High School Campus.

The sisters hired attorney Pat Maloney and filed suit. The state attorney general's office was prepared to use taxpayer money to condemn the property. Other lawsuits followed, and the newspapers reported that City Hall had hinted at following a strategy to get a court to "stop legal bushwhacking of the freeway program." Maloney promised "a decade of court action."

But Incarnate Word was not only concerned about the taking of property. There was the integrity of Olmos Dam, the San Antonio Zoo, the Japanese/Chinese Sunken Gardens and the theater. The Conservation Society, led by Wanda Ford, sued to protect Brackenridge Park. Ford faced the prospect of losing her home to the project.

It was the first time the nation would build a highway through a school campus. Another irksome fact was that an alternate route would have followed Devine Road through the "walled city" of Olmos Park, but political pressure convinced the state to avoid building a highway through a municipality that did not want a highway. "A nun and a college administrator have to stand up here today to defend themselves against bricks, mortar and asphalt taking precedence over an educational institution which has given outstanding service to the city for some 100 years," said Sister Thomas Greenberg, president of Incarnate Word.

The nuns settled with the City for $972,000, and a walkway over the highway that twists and turns wildly on its route from Corpus Christi to Wichita Falls. Legal strategy and political clout delayed its opening until 1978. Ultimately, the City has benefited from the highway project, says former mayor Howard Peak IV, whose father had joined a lawsuit as an individual in the 1960s against building the expressway. "The net result was a roadway realigned to minimize the taking of the park, and so while it was long and involved, and expensive, some good did come out of it," says Peak. "In the end, the City would be in a bit of a mess if we didn't have the freeway."

Although eminent domain is used throughout the U.S., in Texas the stakes are higher, says County Clerk Gerry Rickhoff. "Texas has a higher level of concern because roots to the land are deeper. Land is 98 percent privately owned. You're entering the land of the unhappy people."

Just ask Elizabeth Small, whose grandfather was Edward Patrick Walsh. The Walsh Ranch along the Medina River had been in the family since the Spanish granted the land to them in 1794. Then in the late 1980s, the City decided it wanted a large piece of Walsh property to build a giant mosquito bog, the Applewhite Reservoir. Edward Walsh encountered then-mayor Henry Cisneros in an elevator in a local hospital and was told, "We're gonna get your ranch."

Small contends that the Walsh Ranch was chosen for political reasons. She says the City left the nearby Strauss Ranch alone, since that family carries more political clout. And today, the Walsh Ranch is under construction as Toyota Acres.

"In 1991, the condemnation was very rough on the family," says Small, who grew up on the ranch. "We were told the only thing the land was good for was for tire recycling or trailer parks. Then suddenly it was too valuable to sell back to us, and they were using taxes to condemn our property." "They weren't too sensitive to the family," says Rickhoff, referring to the City's tactic in the Applewhite episode.

The Small family has located another ranch farther south, near Pleasanton, and Elizabeth has graduated from UTSA with a degree in marketing and is moving on with her life, although it still hurts to think about losing 5,000 acres and a family homestead. "It's hard to drive by there, very hard. It was a unique place."

There were 67 condemnation cases before two probate courts in Bexar County in 2002. There were 35 in 2003, and 39 so far in 2004. Various public entities, including the City, the State, school districts, and even Canyon Regional Water Authority, have filed the cases, and the public rarely gets a glimpse of them. On the City side, condemnation proceedings are listed under the "Consent" portion of the City Council Agenda, and rarely get a mention in public.

But the results can be seen everywhere, in drainage or utility easements, or property taken for a road project. There is one substantial example on the City's North Side, along Babcock Road, between De Zavala and Hausman roads. The City condemned property owned by the Bertetti Family Trust, paid more than $600,000 for the property, and built a new bridge over Leon Creek.

Owning a piece of property and a home has for decades been the American Dream, but if the Kingdom of Government wants its property back, there's nothing to do but jump out of the way of the legal bulldozer known as eminent domain.

San Antonio Current: www.zwire.com/site/news.asp?brd=2318

Smoke on the water
San Antonio (TX) Current, 10/14/04

Developers wonder if the City is abusing its regulatory power

By Elaine Wolff

A bird's-eye view of Northside San Antonio would reveal the extent to which the clusters of shiny new neighborhoods have been developed around two geographic features: natural waterways that are brush-filled and dry a good portion of the year, and stone quarries. As the Salado and Panther Spring creekbeds wind their way toward the center of town, they are punctuated by a series of earthen dams that almost disappear into the landscape. Ranging from 4 to 33 years old, the dams are a first line of defense during heavy rains such as the '98 and 2000 downpours that overwhelmed the city's flood control measures.

As the Northside is transformed from ranch land to tract homes and big box stores, additional impervious cover has increased the burden on those measures - what we have learned to think of as a 100-year flood may become a 50, or even 10-year occurrence. How the City chooses to work with area developers over the next decade will have a measurable impact on the City's ability to survive heavy rainfall without a natural disaster. Two of the tools at the City's disposal are eminent domain and zoning, but some local developers feel the City is abusing those powers while doing a disservice to its citizens.

When the Supreme Court announced in September that it would hear Kelo v. City of New London, it sent ripples through state and local governments everywhere. At issue in the Connecticut case is whether the city can exercise its right of eminent domain - the constitutionally based power to take private land for "public use" in exchange for "just compensation" - not for historical purposes such as a highway or flood control, but to bring in more tax revenue through private development.

The Court has decided a handful of related cases throughout its history, but it has always expressed doubts that a judicial rule-of-thumb can be applied to a process that is grounded in so many local variables, including a community's economic needs and real estate prices. Its position has essentially been that the local governing entities are in the best position to decide those questions.

Despite its remove from direct electoral politics, the Court is not insensitive to the winds of change, and its willingness to take on Kelo v. City of New London reflects two trends: perceived abuse by governmental entities that have used the power to take private land for private development, and a conservative campaign to roll back eminent domain to the bare minimum by making the purchase costs too burdensome for local governments.

Opponents to the use of eminent domain for environmental preservation and other types of public improvement have been savvy in linking the common complaints of developers and homeowners in an anti-government agenda. While large landowners have long been mobilized against eminent domain, homeowners and small businesspeople have been drawn to the cause by the governmental move to expand the definition of "public use." Institute for Justice, an anti-eminent domain clearinghouse, documented 4,000 condemnation cases filed nationwide between 1998 and 2002 to benefit private parties. The appellants in Kelo v. City of New London are mostly single-family homeowners, many of whom have neighborhood roots going back 100 years. Sympathy for the anti-eminent domain cause has arguably been stoked by governmental abuse.

Zoning is another way in which cities can exercise a virtual taking of property by restricting its uses, sometimes resulting in a radical devaluation of the land. In San Antonio, the issue was most recently raised by the City's effort to restrict development on the parcel of land owned by the Bill Miller family adjacent to the forthcoming Toyota property by re-zoning it as farm and ranch land (prompting one local developer to ask whether the Millers now de facto qualify for the Ag Exemption on their property taxes).

Dan Parman and his son Brad are two of the developers behind much of the Stone Oak area in north San Antonio. Among the tracts of open land in which they have an ownership interest are two large lots on the Rhapsody cul de sac off of West Avenue. The lots are adjacent to City-owned parkland and just south of Panther Spring Creek. Brad Parman says that a few years back they talked with the City about selling it the lots for around three dollars a square foot. "They said, 'We don't need it,'" recalls Parman. "We said, 'Oh, no, we think you do.'"

This year, the Parks & Recreation department is back, but now they want both parcels for a mere $3,000, he says. The difference? In 2002, the flood plain was redrawn for the area and the lots are now considered to be in the 100-year flood plain, considerably reducing their commercial value. Flood plains were originally set by the Federal Emergency Management System in the '50s, and have been updated by a patchwork of private developers, and local and state government studies. The City, however, makes its own flood plain determinations for zoning and development purposes, which estimate the amount surface run-off would increase if the entire Northside were fully developed under the existing Unified Development Code.

Parman says the City has told them that, in another deluge like '98, when 30 hours of solid rain threatened to top the Olmos dam, or even the 2000 downpour, the Rhapsody properties will be under water because earthen dams upstream are likely to breach. Monica Ramos, public information officer for San Antonio's public works department, says the land is being bought by Parks & Rec and if successful, it will remain undeveloped. Parks & Rec could not be reached for comment.

"It's hard to tell what the City's goal is," says Ofelia "Ofie" Garza, president of Consolidated Office Systems, whose business sits across the street from the Parmans' lots. "Neither of those floods ever impacted us here ... some of us believe they really want that land." The City hasn't offered to buy her property, but Garza has been hit with increased flood insurance rates, although it took her almost two years to realize a commensurate reduction in property taxes.

Developer Don Kuyrkendall's signs can be seen poking above the brush on eight undeveloped acres on north Blanco road by Camp Bullis - lots for which he can't get commercial or residential zoning even after SAWS requested a flood plain study and the City asked for a dam breach analysis of two nearby dams that constitute part of San Antonio's flood water retention system. The San Antonio River Authority operates some 13 earthen dams in the Salado Creek and Panther Springs Creek watersheds. During the '98 flood, those dams were full, but they held. Now, say Parman and Kuyrkendall, the City is playing politics, holding up zoning applications and devaluing land, telling developers that those dams will breach during another 100-year flood. SARA's Stephen Graham, however, says all of their dams are safe and sound, and the Texas Commission for Environmental Quality, which oversees the Dam Safety Program, could not confirm any relevant studies on the SARA dams by press time. On October 7, Bexar Regional Watershed Management announced a county-wide initiative to update the entire county's flood insurance rate maps based on current development, but the project is not scheduled to be completed until 2006.

"The scenario is that nobody downtown is telling anybody the truth, the whole truth, and nothing but the truth," Kuyrkendall angrily charges. "They're not gonna condemn our property. They're not gonna grant us our zoning ... the answer you always get downtown is 'Give us six months.'" In the meantime, he says, he is sitting on a potential $30 million tax base. But the real money question for the City, if it doesn't come to a resolution with the developers, is what "just compensation" may be. Kuyrkendall says he intends to pursue legal measures if he can't reach an acceptable agreement with the City.

In addition to his frustration as a land owner, Parman says that cases like Ofelia Garza's demonstrate the City's irresponsibility when it comes to exercising its power over development and private land. "You can't just casually say things like [the dams may breach]," says Parman. "If Ofie has to buy flood insurance, you couldn't buy enough insurance for downtown San Antonio."

San Antonio Current: www.zwire.com/site/news.asp?brd=2318


Gardena's Measure G foes mount a stiff challenge
(Los Angeles CA area) Daily Breeze, 10/13/04

Proponents are late for debate on Nov. 2's ballot item, which would create a redevelopment agency

By Eddie North-Hager

Pro-redevelopment forces in Gardena got off to a shaky start this week at a debate on Measure G, the Nov. 2 ballot measure that would create a redevelopment agency in the city.

Representatives showed up 30 minutes late for Tuesday night's forum, didn't have anything prepared and hadn't chosen a speaker.

"Why isn't the rest of the council here?" Councilman Steve Bradford asked minutes before his colleagues, Mayor Terrence Terauchi and Councilman Oscar Medrano, appeared. "When did this become a one-man issue?"

Their opponents, No Gardena Redevelopment Agency Boondoggle (No GRAB for short), came prepared for battle.

They had a booth with a large map of the redevelopment study area and pictures of at least eight residences in the study area (though some photos were of the same house). The public could also take booklets pointing out the evils of redevelopment and fact sheets.

No GRAB Chairman Steve Sherman gave a 15-minute address that not only shared his fears of property seizure but also succinctly explained how redevelopment works.

Sherman also cited a sentence in the ballot arguments for Measure G that reads: "No residential zoned areas are included whatsoever." The argument is signed by the city's four councilmen.

"If they lied about something so easy to prove incorrect, who knows what else that is not so obvious is untrue," Sherman said.

Terauchi said Wednesday that the one street of about eight single-family homes near Rosecrans and Normandie avenues "got swept up" in the study area because of its proximity to a commercial area.

But he insisted: "Our city is not interested in those lots."

The City Council recently approved town houses across the street from the homes in question, proving the city's commitment to keeping the area residential, Terauchi said.

There weren't a lot of minds up for grabs at the Chamber of Commerce-sponsored debate at the Nakaoka Community Center. Nearly all of the 25 residents in attendance sported black hats or white T-shirts reading "No on G."

Redevelopment agencies, usually controlled by the City Council, are designed to generate money by improving areas that are deemed blighted.

Once an area is chosen, the total property tax value of the area is set as a baseline over which any increase can be used by the agency to improve the area. The agency does not increase taxes.

Usually the agency floats bonds to finance projects and attract new businesses to the area, boosting sales taxes that can be used by the entire city. In turn, the new businesses help improve land values, which increases property taxes that are used to pay off the bonds.

"I am not opposed to redevelopment, just redevelopment agencies, because of the extraordinary powers they have," Smith said.

One of those powers is to sell bonds without a public vote.

Another is the ability to force property owners to sell their land for fair market value and then give or sell the land to a private party. City governments also have the power of eminent domain, but the land then could only be for public use.

Eminent domain is a necessary tool to move the city forward, Terauchi argued.

"We could get a Home Depot or a Vons superstore. They will come in, but only if we have a large enough property," Terauchi said. "We need to package the parcels together to attract larger businesses, because the city needs additional revenues."

The city has $26 million in bond debt that is due in January. Redevelopment wouldn't provide a new revenue stream to help until the opening of new businesses that generate sales taxes. But the property taxes that would be diverted to the city would alleviate some of the financial pressure to care for the blighted areas.

Redevelopment agencies can also use incentives to lure businesses.

Sherman contended that Gardena has managed to attract a cadre of large, successful businesses along Redondo Beach and Artesia boulevards without using the tools of redevelopment.

And that's one of the reasons why the city is in the shape it is in fiscally, Bradford said. The reserves the city had were used to lure businesses and sales tax rebates are being used to retain businesses.

"We used general fund money as a carrot," Bradford said.

Bradford said that it should say volumes about the merits of redevelopment that the sometimes fractious council is unanimously in support of forming an agency.

"Gardena is the hole in the doughnut of development," Bradford said. "We are not a destination. You pass us on the way to Carson and Inglewood."

What the city will eventually include in its redevelopment area caused concern for Sherman. He pointed to a map of the city's study area and wondered why some residential areas and mobile home parks are being considered for the redevelopment area.

Bradford said Sherman was playing on the public's fears and stated again the city wasn't looking at single-family homes. The map is just a study area that will likely be greatly reduced if redevelopment passes.

"No on G only looks at the negative," Bradford said. "We want to take a what-if-good-things-happen approach."

Daily Breeze: www.dailybreeze.com

Contributed by Terri Haase, No GRAB committee: www.nograb.org

Freeport sees future in old town site
The Houston Chronicle, 10/10/04

But some plot owners say offer of $100 from city for their property is a 'land grab'

By Richard Stewart

For almost 40 years, the city of Freeport has been trying to buy
up almost 3,000 lots of privately owned land that city leaders say were part
of a land scam more than 100 years ago.

But some property owners say the real land scam is that the city is offering
them only $100 per lot in the big, undeveloped field on the north side of
the old Velasco town site.

Once the city acquires all the land, it plans to offer it to a developer for
a neighborhood of parks, lakes and upscale homes.

In the next few months, the city plans to take the last 140 holdouts to
court to seize the land through eminent domain and pay the $100 per lot -
all that was ever offered and the lots' longstanding assessed value on the
tax rolls.

"I'll sell them," Jeanne McKenzie said of two lots owned by her family. "But
$100 is ridiculous. The people who buy those houses sure aren't going to pay
$100 a lot for that land."

She said her family should get at least $1,000 a lot, and probably much

The city is embroiled in another eminent-domain dispute on the waterfront.
It wants to create an upscale marina, but several shrimp-boat dock
facilities won't sell for the price the city is offering.

There are no landmarks to show the location of any of the 2,960 lots in the
400-acre field laid out by a land company more than a century ago. No
streets were ever put through, no water lines or sewers, no telephone lines,
and no electrical service. No houses were ever built.

The only way the property can be used, city officials said, is if the city
buys all the lots and combines them into one large parcel that can be
developed into a modern neighborhood - a neighborhood that will increase the
city's tax base.

Assessed value

But the offer of $100 per lot is one that McKenzie and other opponents said
virtually steals property from longtime owners to make a profit for the city
and developers.

"Now the city just wants to take it," McKenzie said, "and they don't want to
pay us anything for it. It's just a land grab."

Paying $100 for each of the lots is fair, said Mayor James Barnett, because
the land is now nearly worthless. Tax appraisers have long valued the lots
at $100 for tax purposes.

Freeport wants a developer to build a neighborhood of $80,000 to $120,000
homes. Only by doing that can the land have any value, Barnett said. If the
city had to pay much more than the assessed value, the new development plan
wouldn't be affordable, he said, and Freeport needs such development.

Most of the tiny 25- by 125-foot "town lots," as they were called when they
were sold by the Brazos Coast Development Co. between the 1890s and World
War I, were given as free premiums for people who bought 5-acre plots of
land farther out in the county, said Nat Hickey, Freeport's urban renewal

"A lot of these people didn't even know they were getting town lots," Hickey
said. "There'd just be a little note at the end of their other deed saying
they also had a town lot."

And, because company salesmen would travel throughout the country selling
property, many buyers never saw the land they'd bought.

The town lots were a few blocks behind a new Velasco town site laid out by
developers in 1891. The new town was a few miles upstream from Velasco's
original site at the mouth of the Brazos River, where Surfside Beach is now.

Though the new town was in a more protected spot, it was still vulnerable to
storms. In 1900, it was wiped out by the same storm that devastated
Galveston. Another destructive storm hit in 1919.

Vacant land

Freeport, on the other side of the river, was founded in 1912 by the
Freeport Sulphur Co. and soon eclipsed its older neighbor. In 1928, the
river channel was moved west. What had been a river between the two towns
became a long, narrow tidal lake, now home to shrimp and charter fishing

Shortly before World War II, the federal government scooped up many of the
old 5-acre plots and combined them into areas where chemical plants now

Freeport and adjoining areas such as Lake Jackson grew. In 1957, Velasco
became part of Freeport.

Meanwhile, the 400 acres of town lots went undeveloped.

"Every now and then somebody would come up with an idea to do something with
them," Barnett said, "but nobody could get title to enough of them to do

Most of the lots passed from generation to generation of owners. Today, some
lots have 40 or more owners.

Most agree to sell

Acie Frizzell, who was Bill Frizzell's father and Jeanne McKenzie's
stepfather, bought two of the lots in 1973. He said he planned to build a
home there, but he died a few years later.

In 1966, the Texas Urban Renewal Act gave Freeport the power to acquire the
property through eminent domain condemnations.

Most landowners agreed to sell at $100 per lot, Hickey said, but the city
has been unable to find some owners and others have refused to sell.

About 140 owners are holding out, he said.

By the first of the year, the city is set to file eminent domain lawsuits to
try to take the rest of the lots for $100 each.

Getting the property is important for Freeport, Barnett said, because "it is
the last good-sized piece of property in Freeport that can be developed for

It is one of the city's two biggest development projects, and both have
become embroiled in eminent domain controversies.

Marina troubles

The city, through its economic development corporation, has contracted to
loan $6 million to investors to create a marina for upscale pleasure boats
along the old downtown riverfront.

Investors already own a big block of downtown land, but two companies that
operate shrimp boat dock facilities have refused to sell waterfront land for
what the city wants to pay.

A federal judge recently ruled that the city has the right to condemn the
property through eminent domain, but the issue is on appeal.

Making plans

An investor has not been chosen for the old Velasco town lots, but the city
has drawn up preliminary plans for the property.

They include a raised berm to provide a visual and sound barrier between the
area and a chemical plant that is just across a canal. Jogging and biking
trails snake for 3.6 miles along the berm.

The plan also calls for three lakes, a nine-hole golf course, a skating park
and a picnicking park.

McKenzie, who lives in a comfortable home in a nearby middle-class
neighborhood, said she agrees that the development plans look nice, but she
said her family shouldn't have to pay for them.

"I want Freeport to progress," she said, "but I don't want it to come out of
my pocket."

The Houston Chronicle: www.chron.com

Keeping the economic momentum
The Cincinnati Enquirer, 10/12/04

Newport KY candidates' views on eminent domain

By Jeanne Houck

• Gassert [for mayor]: Wants four-year ban on use of eminent domain. Cities don't appreciate personal ties families have to buildings. Eminent domain has turned into way to make developers rich, as opposed to taking land for public good.

• Guidugli [for mayor]: Legal tool city has used appropriately to benefit community. Gives city a strong financial base to deliver quality police, fire and public works services and to reduce tax burden.

• Ballard [for City Council]: Should be used only as last resort. Acknowledges aging tax base and lack of land that can be developed makes projects like retail-office-residential plan in Cote Brilliante neighborhood attractive, but thinks residents there have been shabbily treated by some on city commission.

• Buechel [for City Council]: Doesn't like eminent domain but thinks it necessary at times. City must offer fair market price when buying homes.

• Fennell [for City Council]: Prefers developer negotiate with property owners rather than city use eminent domain.

• Hall [for City Council]: City would die slow but sure death were it not for power of eminent domain and creation of redevelopment districts. But says using eminent domain never an easy decision.

• Hayden [for City Council]: Eminent domain should never be used to take homes and should be restricted to public projects like schools and highways.

• Knepshield [for City Council]: Fear and criticism over eminent domain is overblown in Newport. City has used it to appropriate very few properties for Newport on the Levee and Newport Aquarium.

• Jerry Peluso [for City Council]: Eminent domain only appropriate when property is taken for overall public good and property owners are justly compensated.

• Johnny Peluso [for City Council]: Would oppose use of eminent domain unless every single property owner affected agreed to sell their property and city gave them a fair price.

The Cincinnati Enquirer: www.cincinnati.com

Abuse of Eminent Domain
The Point, 10/12/04

Commentary by Bruce Hyman

"Private property [shall not] be taken for public use without just compensation." So says the Constitution's Fifth Amendment. In other words, your home is your castle and the local government must pay you a fair value if it puts a new road through your backyard for the public good.

But some states have stretched the meaning of the phrase "the public good." Last year, city fathers in Alabaster, Alabama in suburban Birmingham wanted to condemn 10 homes to make way for a shopping center. Two years ago California's Cypress City leaders tried to seize church property so that Costco would build a discount warehouse.

Officials in New London, Connecticut thought bulldozing several private homes in a working class neighborhood so that a developer could build a riverfront hotel made sense. But homeowners there fought back. The Connecticut Supreme Court ruled that getting more tax revenue outweighed the interests of the homeowners. And now the U.S. Supreme Court has agreed to hear the case.

A Supreme Court decision will have wide-ranging repercussions. At least seven states Connecticut, Kansas, Maryland, Michigan, Minnesota, New York and North Dakota allow local governments to seize property for economic development reasons - in other words, to increase tax revenues.

Hopefully, the highest court will strike down such laws. Planning a new highway, building a new school or opening another firehouse makes sense. But it seems to me that seizing private property so a deeper pocketed constituent can use it and oh by the way, pay more in local taxes does not fall within the spirit and intent of serving "the public good."

In fact, serving "the public good" would seem to mean preserving homeowners rights except in the most critical and dire circumstances, such as planning a new highway that everyone can use and not just for launching a new membership store or for building a four-star resort hotel. Let's hope the Supreme Court rules the right way on this case.

And that's the Point.

I'm Mark Hyman

The Point on News Central: www.newscentral.tv

Eminent domain, eminent nonsense
The Washington Times, 10/12/04

Op-Ed By Bruce Fein
Bruce Fein is a constitutional lawyer and international consultant at Bruce Fein & Associates and the Lichfield Group

Movement is afoot to make the Constitution pivot on Marxist-like class distinctions when private property is taken for public use. The endeavor should be smartly defeated. The Constitution was framed under an inclusive political philosophy that celebrated the Benjamin Franklin's axiom that if we do not all hang together, we shall all hang separately.

The government routinely destroys the blighted housing of the poor for urban renewal by wielding the power of eminent domain. The indigent are uprooted and frequently distraught, but are paid "just compensation" as required by the Fifth Amendment.

The taking of private property to eliminate urban eyesores was held constitutionally irreproachable by the United States Supreme Court 50 years ago in Berman vs. Parker (1954). Private property exponents, however, are insisting the middle and upper classes should be shielded from the government devastation and sacrifice for the common good that afflict the impoverished property owner.

In Kelo vs. City of New London, a case now pending in the high court, the argument is passionately made that to take stylish, as opposed to decrepit private property, to spark economic growth is not a constitutionally permissible "public use" demanded by the Fifth Amendment. The power of eminent domain, however, does not expand and contract like an accordion depending on the wealth of the owner whose property is taken.

In the United States, the hovel is as protected as the chateau from unreasonable searches under the Fourth Amendment. The Founding Fathers embraced William Pitt the Elder's lecture to the House of Commons in 1763: "The poorest man may in his cottage bid defiance to all the forces of the Crown. It may be frail; its roof may shake; the wind may blow through it; the storm may enter; the rain may enter; but the King of England cannot enter — all his force dares not cross the threshold of the ruined tenement."

In Berman, private property was taken in the District of Columbia for slum clearance and prevention. Blacks constituted 97-1/2 percent of the population dislocated by the redevelopment. Writing for a unanimous court, Justice William O. Douglas repudiated a cramped construction of public use.

He explained eminent domain may be invoked to make a community "beautiful as well as healthy, spacious as well as clean, well balanced as well as carefully patrolled." Justice Douglas further elaborated that single properties which harbored no evils were not shielded from eminent domain if they fell within the boundaries of urban decay. When a piecemeal approach would handicap area redevelopment, then all properties within the region may be taken to facilitate an integrated plan: "Community redevelopment programs need not, by force of the Constitution, be on a piecemeal basis — lot by lot, building by building."

The Kelo litigation is a middle-class re-enactment of Berman. The city of New London, Conn., afflicted by economic distress and a slumping tax base, employed eminent domain in 2000 to take 90 acres downtown and waterfront private property.

The goal was to jump-start economic revitalization. A public development corporation would use the acquired properties to build hotels, new residences, office space, public walkways, and retail space. The development plan is estimated to create more than 2,000 jobs and raise the city's revenue base.

The plan did not target a politically helpless or disfavored minority. Most owners within the 90-acre development area accepted "just compensation" for their properties without legal protest. Ten owners did not, and sued to enjoin condemnations of their properties. Economic uplift, they maintained, was a tainted eminent domain objective, in contrast to slum clearance, which largely displaces the poor.

Two plaintiffs testified to their deep and long personal attachments to their homes. One loved her house view and proximity to the water. Two owned their properties as business investments — rental apartments — for 17 and eight years, respectively. They had devoted much time, effort and money towards renovations.

The Connecticut Supreme Court unanimously denied that the Constitution prohibits the use of eminent domain to spur economic growth, simpliciter. The Fifth Amendment requires the government to pay owners a fair market price for their properties. The properties taken by government must be put to a "public use." But as Adam Smith recognized in "Wealth of Nations," public and private interests merge in free economies: "Every individual necessarily labors to render the annual revenue of the society as great as he can. He generally indeed neither intends to promote the public interest, nor knows how much he is promoting it. ... He intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. ... By pursuing his own interest he frequently promotes that of society more effectually than when he really intends to promote it."

The United States Supreme Court should affirm the Kelo ruling, and rebuke the notion of class consciousness in the law of eminent domain.

The Washington Times: www.washingtontimes.com

Kelo and Marxist Class-Based Schadenfreude — A Stitch in Haste, 10/13/04

A repudiation of the opinion by Bruce Fein (see the above item from The Washington Times)

by Kip Esquire

Some hasty stitches:

1. Fein gets it wrong from his very first sentence: The Kelo challenge, and the Hathcock decision in Michigan which inspired it, are not about drawing class-based lines in the sand regarding eminent domain. They represent a wholesale repudiation of any expansive definition of "public use" (more on that below). No hypocrisy, no double standard. Just a simple "this is wrong." Fein repeats this fallacy throughout the piece, without a single primary source to support his assertion.

2. For a "constitutional lawyer" (Fein's self-description) to ever use the phrase "constitutionally irreproachable" is downright terrifying – has Fein never heard of Brown v. Board of Education?

3. Similarly, Fein misses the point in comparing Kelo to Berman. The far more relevant comparison is to Wayne v. Hathcock, the trailblazing repudiation of expansive "public use" by the very court that started the whole mess: the Michigan Supreme Court, whose monstrous holding 23 years ago in Poletown v. Detroit was the hook upon which all the eminent domain abuse Fein purports to lament was hung. If Fein is truly concerned about not displacing the poor in their "blighted housing," then he should be among those screaming the loudest for federalizing Hathcock. But of course his concern is not for helping the poor, but rather for hurting the not-poor (i.e., naked Schadenfreude).

4. The idea that Fein could invoke Adam Smith with a straight face is beyond amazing. The whole point of "The Wealth of Nations" and its progeny was to show that individual decision-making tends to lead in the aggregate to optimal allocation of resources. Adam Smith's thesis was that people should be left alone to make their own decisions – that citizens and not government should control property – even if all you really care about maximizing output and welfare rather than respecting individual rights.

5. Fein is his own worst enemy in another way. He spends most of the piece invoking (tongue-in-cheek, to some extent) the "just compensation" element of the Takings Clause, but conveniently glosses over the other, more important element with respect to Kelo, namely the "public use" requirement, which is exactly the nexus of the debate. In the one passage where he mentions it, he actually winds up arguing against his very thesis. He writes: "A public development corporation would use the acquired properties to build hotels, new residences, office space, public walkways, and retail space." Translation: "Private, private, private, worthless, private." How again is that a "public use" warranting trampling property rights? Incidentally, who would benefit from such an eminent domain action – Fein's despised middle class or wealthy corporate developers (does he somehow hate the rich less than the middle class)? Go figure.

When Adam Smith wrote of the "invisible hand," he didn't envision it carrying a sledgehammer. The Supreme Court has an historic opportunity to stop a runaway government abuse that has wreaked havoc and heartache for decades, and not just for the poor.

Fortunately there aren't many Marxists on the Court, so hopefully nonsense thinking like Fein's will be summarily discarded.

A Stitch in Haste: www.kipesquire.blogspot.com


Court should condemn eminent domain abuse — The (Hampton Roads VA) Virginian-Pilot, 10/11/04

Editorial Opinion

In 1981, the Michigan Supreme Court OK’d the condemnation of a Polish neighborhood in Detroit to make way for a new Cadillac plant.

Ever since, too many municipal officials have assumed they had carte blanche to take title to one person’s land and then sell it to someone else pledging to extract more jobs and taxes from it.

That’s why it’s welcome news that the U.S. Supreme Court has decided to intervene. It has taken up an outrageous case of eminent domain abuse on appeal from Connecticut. The case permits the court to curb a surge in condemnations motivated solely for economic development, not for the legitimate reasons of clearing slums and blight, or public necessities, such as roads, schools and hospitals.

State constitutions allow local governments to take private property for “public use.” The 1981 Michigan ruling had the effect of distorting “public use” by expanding it to mean public benefit. Property rights advocates rightly portray this as eminent domain without limits.

How far the bounds have been stretched is illustrated in the Connecticut case the Supreme Court has agreed to hear. New London leaders, faced with a deteriorating tax base and rising expenses, decided to sacrifice an old waterfront neighborhood on the altar of economic development. The New London council took the Fort Trumball neighborhood and conveyed it for $1 a year of rent to a developer promising upscale homes, hotels and offices.

Hampton Roads officials are not immune to similar temptations. A few years ago, the Virginia Beach City Council condemned an Oceanfront restaurant for a garage to serve visitors and guests of a resort hotel, citing “public use.” But a Virginia Beach judge, H. Thomas Padrick Jr., saw it for the subterfuge that it was. He found that that the hotel, not the public, was the principal beneficiary of the garage and halted the taking.

In the end, the restaurant’s owners lost their business, but the judge’s decision leveled the playing field in the subsequent negotiations for its sale and they got more money.

An example more closely resembling the issues in the New London case occurred two years ago in Chesapeake. A shopping center builder asked for the city government to pave his way into valuable, but bottle-up, land just off Battlefield Boulevard. Not literally pave it with road crews, but figuratively with eminent domain.

He pledged $4 million to build the road, sparing taxpayers the expense. In return, he asked the council to condemn two gas stations whose owners had refused to sell their land to the developer.

The road to the shopping center would have gone through the gas stations. The enthusiasm for the deal was motivated by the windfall it would have created for the city treasury.

Public opposition and wiser heads prevailed, but barely. The move was blocked on a vote of 5-4.

That the vote was so close suggests how much the Michigan case of two decades ago has eroded private property protections that once were taken for granted.

Earlier this summer, the Michigan Supreme Court reviewed the principles established in the Detroit cases and admitted the decision was a mistake. It reversed course, effectively outlawing condemnations solely for reasons of economic development. Let’s hope that’s a harbinger of a ruling from the nation’s highest court.

The Virginian-Pilot: www.PilotOnline.com

Supreme Court taking on sticky issue of eminent domain
Copley News Service, 10/11/04

by Phyllis Schlafly

The American Dream is to start a small business and develop it through years of hard work and investment. Millions of small businesses form the backbone of the United States' economy, annually creating between 60 percent and 80 percent of new jobs.

Location is the key to most businesses, and entrepreneurs typically build their reputation at a particular spot. But lately, many have been greeted by a surprise message from city hall: Their town is taking their property for the benefit of someone else.

A lifetime of effort is suddenly snuffed by the arbitrary decision of a few councilmen or unelected city planners. Business owner can claim only an appraised value for the hollow building and land that he actually owns. He receives zero compensation for the goodwill and revenue stream from customers he has nourished for years. A business leasing its property usually receives no compensation. Employees get nothing.

Citizen outrage about these intrusions into private enterprise has reached the U.S. Supreme Court, which announced Oct. 3 it will address this controversy.
It has been 50 years since the high court has issued a major ruling in this area (Behrman v. Parker, 1954) and much mischief has happened in the meantime.

U.S. and state constitutions recognize the power of eminent domain but prohibit governments from taking property unless for a "public use," which traditionally meant building a public facility. The rationale was that some properties are essential to public functions, such as roads or even a city hospital, and there must be some way to deal with owners who refuse to sell.

But activist judges have redefined "public use" to mean almost anything, including unproven claims of economic benefit to the community. Increasingly, local politicians are ignoring constitutional limits.

Municipalities are seizing properties from small businesses to hand over to big businesses for private development. A small business that has existed successfully on a street corner for 40 years can be taken and replaced by a big shopping mall or office building that might end up in a massive bankruptcy a few years later.

The sharp increase in these "takings" of private property from one business to give to another is often traced to the "Poletown" decision by the Michigan Supreme Court in 1981. That ruling authorized the demolition of hundreds of businesses, more than 1,000 homes, and even several churches in a community made up of Polish immigrants near Detroit in order to build a new General Motors plant.

Thousands of businesses in several states are under similar threats of having their properties confiscated by local governments, typically for the benefit of large corporations. This deters investment and subjects millions of workers to the risk that a bureaucrat may force them out of their jobs.

In some cases, a municipality even announces a massive plan to seize properties for development long before it could become a reality. That depresses property values, scares away improvements, and lowers appraised values, thereby reducing the price the town eventually pays.

Good news arrived in July when the Michigan Supreme Court unanimously repudiated its own Poletown decision and held in favor of property owners. Siding with Edward Hathcock against the County of Wayne, the court declared its prior ruling against private property to be a "radical departure from fundamental constitutional principles."

But that "radical departure" lives on in other states, and even the new Michigan decision continues to allow takings of so-called "blighted" property. It's not too hard for a town to hang the "blighted" label on almost any property it wants to seize for a lucrative development project.

In the densely populated Northeast, outrage over threatened seizure of property has boiled over in local elections. In the Democratic township of Franklin, N.J., a powerful incumbent mayor was upset in November 2003 by a Republican challenger who opposed a planned use of eminent domain.

Elderly homeowners are just as angry as businessmen. A "big box" retailer such as Costco or Home Depot might look at a group of modest attached houses and dream of a parking lot, but residents see a lifetime of memories.

Often the projects are financed on the backs of the same taxpayers fighting to oppose them. Development bonds are guaranteed at public expense, with the ultimate benefits going to large corporations that flatten the area for a megastore to sell goods made in China.

In March, a 4-to-3 decision by the Connecticut Supreme Court authorized the town of New London to take the properties of Susette Kelo and many others for a private development by the wealthy pharmaceutical corporation Pfizer Inc. Manufacturing Viagra surely is not the public use that the Founding Fathers had in mind when they wrote eminent domain into the U.S. Constitution.

President Bush has an excellent opportunity to win the support of small business in the coming election. He should announce that his administration will defend private property before the Supreme Court this fall.

Phyllis Shafley, Copley News Service: https://www.copleynews.com/1cns/features/PSchlafly/#EMAIL


Couple's tale gives insights on eminent domain
The (Northern Westchester/Putnam NY ) Journal News, 10/10/04

By Phil Reisman

Nearly five years ago, Dom Gataletto was fighting to save his house against a powerful alliance of government and big business. Looming was the threat of eminent domain, a legal fulcrum whose purpose was to raze his house and the New Rochelle neighborhood his family had lived in since 1925 with a 325,000-square-foot IKEA furniture store.

IKEA aggressively bought up about 70 percent of the City Park properties, which included many small businesses, private residences and two churches, but Gataletto, who is 81 today, wouldn't sell at any price.

"Ultimately, I think I made the right decision," he said one day last week. "I feel comfortable here. Like I said to them, I want to stay here. I would do anything to stay."

Indeed, Gataletto and his wife, Virginia, did stay there.

That's because the city of New Rochelle ultimately declined to invoke its power of eminent domain — and IKEA went away. A failure to secure permission for building an exit ramp off Interstate 95 was the official reason for the pullout, but that may have been a face-saving excuse (literally an "exit strategy") for the mayor and City Council, who were caught off guard by an organized public outcry that painted them as villains in a Victorian-style melodrama.

Ever since the IKEA saga, I've written a number of columns about the disturbing evolution of eminent domain, which was originally conceived by the Founding Fathers to allow government to take private property for "public use." If not for the Fifth Amendment's allowance of a such right, many of today's bridges, highways and other important forms of public infrastructure would never have been built.

But over a span of about 50 years, the courts have inexorably changed the generally accepted justification of "public use" into a broader concept of "public benefit," a critical distinction that opened the way for local governments in fiscal crisis to condemn whole neighborhoods as "blighted" and turn them over to private, profit-seeking developers and corporations. The rationale is contained in a kind of trickle-down corollary that presumes the public would benefit from the jobs and tax revenue generated by the redevelopment. That was the thinking behind the gigantic IKEA project in New Rochelle's City Park.

By any definition, eminent domain for private benefit is corporate welfare. And it continues to spread at an alarming rate across the land, here and in most states.

According to the Institute for Justice, a Washington-based group that has waged numerous legal battles against this abusive form of eminent domain, 1,000 (sic -- the Institute for Justice actually gives the number as 10,000) properties were targeted for condemnation between 1998 and 2002, but those stark numbers hardly tell the story of the individual lives that are disrupted or ruined by the heavy-handed process.

Virginia Gataletto recalled having many sleepless nights during the IKEA controversy. The stress became so intense that Dom Gataletto, a World War II veteran who fought at Anzio and in France, believes it may have contributed to a heart attack he suffered.

"I visualized the house being torn down," he said. "Where the hell was I going to go? I didn't want to pick up my roots and start all over again, if I could avoid it. And I did everything I could to avoid it."

After years of court battles (and sorry faits accomplis) over eminent domain, the U.S. Supreme Court has agreed to decide the issue based on a case from New London, Conn., which pits private homeowners in a working class neighborhood against a development that would bring in a riverfront hotel, health club and offices. For those who believe strongly in the constitutional protection of private property rights, just getting a hearing before the highest court in the land is considered a major victory.

Some of the human elements of the New London case recall the plight of the Gatalettos.

In her report, "Public Power, Private Gain," Dana Berliner, an attorney for the Institute of Justice, told of Wilhemena Dey, an 84-year-old who is trying to save the New London house where she was born. She told of another family going through its second ordeal with eminent domain. The first house they owned was condemned to make way for a sea wall, "but (the property) in fact became part of an office complex," Berliner wrote.

The Gatalettos said they are watching the Supreme Court case with interest; it is expected to go before the court in the spring.

Meanwhile, they've still got their house on Pleasant Street. They outlasted IKEA. The city backed down.

Nevertheless, the hard-nosed experience of fighting for their rights has left them wary — and understandably so.

"You never know," Virginia Gataletto said. "They could change their minds overnight."

The Journal News: www.nyjournalnews.com