State can tighten rules without banning procedure
After a study in 1981, Daytona Beach declared that the Boardwalk and much of the area surrounding Main Street as blighted. The city then used the study to create a community redevelopment area, with greater powers for renewal, including the potential use of eminent domain. Although the city has three times gone to court to force the sale of property (twice for condo/resort projects and once for a hotel expansion), most property owners in the redevelopment area agreed to sell.
In the latest case (in which the judge ruled for Daytona Beach on Friday), the city sought eminent domain because the owners of three properties along the Boardwalk were unwilling to sell. A development group plans to build a $120 million condo/resort project, and the three properties represent small but critical areas of that project's footprint.
Paradoxically, as the city was arguing its case before Circuit Court Judge John W. Watson in June, the U.S. Supreme Court ruled on Kelo v. New London (Conn.) a 5-4 decision in which it supported eminent domain under Fifth Amendment restrictions (for public purpose with just compensation).
The high court's decision did not affect Florida law, which is stricter than Connecticut's, but it sent reverberations that has political leaders thinking state laws are not strict enough.
While a useful tool in putting parcels of property together to attract developers, eminent domain should be a last-resort action. For Volusia and Flagler counties, that has been the case. There have been no instances of abuse here and no leaders have suggested bulldozing someone's house to benefit developers. (In the case of the Boardwalk, the developers will benefit but so will the public through the amenities that accompany the redevelopment project, such as improved economic viability.)
The controversy in Florida is not with eminent domain for traditional purposes, such as for roads, utilities, airports, etc. Property owners should understand that the purchase of real estate always comes with the risk that some or all of it could be needed for such purposes.
The concern in Florida is with eminent domain under the 1969 Community Redevelopment Act. Indeed, there is room for abuse, which is why governments should vigilantly restrict new redevelopment areas to properties that meet the intent of the original CRA law which is to assist in the renewal of a truly rundown area without hope of recovery on its own.
When it was created, the CRA law had six criteria to define blight. Regrettably, the Legislature a few years ago expanded the definitions to 14 criteria requiring only two criteria be met to set up a redevelopment district. The criteria range from a large number of building-code violations to higher crime rates to unusual property titles to adverse environmental conditions. To prevent abuse, it makes sense to require half or more of the criteria be met before eminent domain can be used. Additionally, rules might be set that regulate conditions under which property can be taken for predominately private use.
The state, however, should not go so far as to outlaw eminent domain when there is private benefit. Without eminent domain, a property owner could block private development that not only improves a once-blighted area but also acts as a public place with parks and entertainment.
While Florida's laws restricting the taking of property would make it difficult for a city to force the sale of property for a big-box retailer, it is not impossible. Legislators should not overreact but instead seek ways to ensure that governments fully weigh the public good before using eminent domain.
What Florida allows
If an owner refuses to sell property needed for public purposes, including redevelopment, government can claim the property under eminent domain for "just compensation" usually defined as fair market value.
Under Florida law, the state or local government (or delegated authorities, such as utilities) must first negotiate in good faith to buy the property. Before property can be taken, public hearings must be held and the government must gain approval from a circuit court judge in a public trial. Extensive legal steps must be taken to prove the need for the claim. If eminent domain is allowed, a jury then determines the amount to be paid to the property owners. The government (and/or delegated authorities) must pay all legal fees incurred by the owners fighting eminent domain.
Eminent domain is most often used to acquire property for roads, parks, sewers and other public purposes.
Eminent domain also may be used under the state's Community Redevelopment Act. In these cases, local governments may force the sale of properties for redevelopment, which is usually done by private entities. The properties must be included in a redevelopment plan and the projects must benefit the public.
Daytona Beach News-Journal: www.news-journalonline.com