Eminent domain proposal may be illegal, lawyer says: Stamford (CT) Advocate, 10/25/05

By Peter Davenport and Brian Lockhart

A proposed ordinance to ban Norwalk's ability to seize private property for economic development is illegal and would "likely expose the city to substantial damages" if passed unchanged, the city's attorney said yesterday.

Corporation Counsel Louis Ciccarello's six-page opinion cautioning the Common Council was issued on the eve of tonight's expected vote on the proposed ordinance to restrict use of eminent domain.

Democratic Councilman Michael Coffey, author of the ordinance, said Ciccarello's opinion, coming 24 hours before "one of the biggest votes the council will be faced with," is a ploy by opponents to "obstruct a vote" tonight.

The council is scheduled to vote on the proposed restrictions at a meeting beginning at 8 p.m. at City Hall.

After a public hearing last week, the council's Ordinance Committee passed the measure, 4-0.

A poll last week of the Common Council's 15 members indicated they were divided on whether to support it in some form or vote against it.

Mayor Alex Knopp and other Democrats, who control 13 seats on the council, were in a closed-door caucus last night to discuss the ordinance and other matters and could not be reached for comment.

Coffey's proposal would restrict Norwalk's use of eminent domain to three areas: construction of public facilities, such as schools or roads; preservation of open space; and protection of health or safety.

But Ciccarello wrote in his opinion that the ordinance, as approved by the Ordinance Committee, would be illegal because it falls outside the council's power under the city Charter, and "it conflicts with and frustrates existing state statutes."

Ciccarello said the ordinance does not make clear whether the local law would apply retroactively to projects now under way that do or could involve eminent domain.

"This is critical because the city and the Redevelopment Agency have an existing land disposition agreement (LDA) with the developers for the Reed-Putnam project, and are negotiating LDAs in conjunction with the West Avenue and Wall Street projects," Ciccarello wrote, referring to three plans to allow developers to remake once-blighted parts of Norwalk.

If the ordinance applied to those projects, Ciccarello wrote, "then the developers would likely have substantial claims for breach of contract" against the city.

Ciccarello said Norwalk is awaiting a ruling from the Connecticut Supreme Court on whether the Redevelopment Agency can seize the Maritime Motors property — a crucial piece of the Reed-Putnam plan located on West Avenue.

The ordinance could undermine a decision in favor of the city and lead to "an immediate lawsuit," he said.

But Coffey said yesterday the ordinance would not affect projects in which land disposition agreements have been signed.

He also said he was "baffled" and "flabbergasted" that he had not heard concerns about the legality of his ordinance sooner, noting that a city attorney, Katherine Lasberg, attends his Ordinance Committee's meetings each month.

Lasberg has attended discussions and public hearings of Coffey's ordinance, and the councilman said he "assumed" Ciccarello's office had reviewed it.

"There has never been any comment made to me about the legality (or) wording of it," he said.

Ciccarello, in an interview late last week, said it is up to council members to request such action by his staff.

Council President Fred Bondi, who has expressed concerns about the ordinance, requested the opinion last week.

The local re-examination of eminent domain laws follows the Kelo vs. New London controversial ruling, in which the U.S. Supreme Court narrowly supported efforts by the city of New London to give 15 homes to a private developer to build upscale housing, offices and a marina.

Coffey said that "hundred of municipalities" have passed ordinances restricting takings by eminent domain.

Stamford Advocate: www.stamfordadvocate.com

ACLU Joins Jersey City Tavern Owner's Eminent Domain Fight: North Country Gazette (Chestertown NY), 10/24/05

The American Civil Liberties Union [ACLU] of New Jersey is now representing tavern owner Cheng "Terry" Tan, who is fighting the Jersey City Redevelopment Agency's attempt to take his restaurant by eminent domain. Jersey City officials want to take Tan's land to give it to a parochial school, St. Peter's Prep, for its football field.

"I've been a business owner here for over 18 years," said Tan, the owner of The Golden Cicada on Grand Street. "I've worked hard and become part of the community. Now, the government is taking my property from me for no other purpose than to provide land for a private school's football field that the general public has no right to enjoy the use of."

Eminent domain is a legal doctrine that allows the state to appropriate private property for its own use without the owner's consent. Governments most commonly use the power of eminent domain when the acquisition of real property is necessary for the completion of a public project such as a road, and the owner of the required property is unwilling to negotiate a price for its sale.

The land in question is located in one of Jersey City's many redevelopment zones. The original plan, created in September 1999, called for the zone that included Tan's land to be used for residential or commercial purposes. However, when the final plan was adopted in October 1999, the area was re-zoned for use as an athletic field or educational facility. According to Tan, the change occurred because the Redevelopment Authority learned that St. Peter's Prep wanted to acquire the land for a school football field. St. Peter's did buy land in that zone and began to build a field. However, it then determined that it needed additional land so that its field could reach official football field length. After St. Peter's failed to persuade Tan to sell to them at a price it found acceptable, the Redevelopment Agency stepped in on St. Peter's behalf and initiated eminent domain proceedings.

Tan and the ACLU of New Jersey contend that the government is illegally using taxpayer dollars to fund a particular religious institution by re-zoning the area and taking his land in order to aid St. Peter's Prep. Under both the Establishment Clause of the United States Constitution and the "No-Preference" Clause of the New Jersey Constitution, a governmental entity such as the Jersey City Redevelopment Agency cannot act with the primary intent to aid a particular religious entity. Likewise, its actions cannot have the primary effect of aiding one religion over another or preferring religion over non-religion.

"Government is not allowed to invoke its power in order to benefit a particular religious organization," said Ronald Chen of Rutgers Law School-Newark's Constitutional Litigation Clinic. "Here, the power of eminent domain is being used to specifically benefit an institution that promotes a particular religious faith." Chen, along with Michael Kates of Nashel Kates Nussman Rapone & Ellis in Hackensack, are the ACLU of New Jersey's volunteer cooperating attorneys representing Tan.

The ACLU of New Jersey will also argue that the Redevelopment Authority's actions violate the Takings Clause of the United States Constitution, which permits the government to take a property owner's land if it is for a "public use" and the property owner receives just compensation. Last year, the United States Supreme Court held that, while the term "public use" can be read broadly, the Takings Clause does not permit the government to use its power of eminent domain if its purpose is simply to take property from one private party in order to give it to another private party.

In last year's Supreme Court case, Kelo v. City of New London, the city in question successfully argued that the increased tax revenue that would result from the taking met the "public use" standard. However, in the present case, the city will actually lose tax revenue if the land is given to St. Peter's Prep since, as a religious institution, it pays no taxes on the land it owns.

The case, Jersey City Redevelopment Agency v. Cheng Tan, et al., is scheduled for a hearing on Nov. 4. 10-24-05

North Country Gazette: www.northcountrygazette.org

Md. legislature late to eminent domain reaction: (Baltimore) Maryland Daily Record, 10/24/05

By Dori Berman

Last week the eminent domain issue bubbled to the surface in the Free State, but Maryland was not the first to react to a controversial Supreme Court decision from earlier this year.

The Maryland GOP’s promise to introduce a constitutional amendment to prohibit the condemnation of private property for economic development purposes follows a string of legislative proposals at the state and federal levels. While bills popping up across the nation aim to address the same issue, they vary widely in scope.

“Most of them have language that talk about prohibiting private-to-private transfer [of property] or prohibiting transfers for economic development,” said Steven Anderson, coordinator of the Castle Coalition, an arm of the libertarian nonprofit Institute for Justice in Washington that advocates against the use of eminent domain.

In many cases, though, that’s where the similarities stop. Three states — Delaware, Texas and Alabama — have already passed measures. Nine others have introduced bills, and legislators in more than 25 other states have announced intentions to propose legislation when they reconvene this year or next.

Some states, such as Alabama, have legislation proposing to prohibit the use of eminent domain for economic development purposes or to generate tax revenue, unless the property can be determined to be blighted. The Texas law has similar prohibitions, but specifies eminent domain may be used for sports stadiums, museums, transportation projects and other public venues.

While the new law passed in Texas has specific provisions, Anderson said many others contain vague language.

“To the extent you’re going to reform your eminent domain laws, you want to be explicit,” he said. Failing to define subjective terms, such as blight or economic development, could render the legislation useless.

In New York, one of several bills on the table would require local governments to vote on each project that would demand the use of eminent domain. Meanwhile, both California and Ohio have bills to place a moratorium on eminent domain until a task force can study and report on the issue.

Several proposals have also surfaced at the federal level. As with the state measures, the federal bills differ in scope, but they share the intention to withhold federal funding from state and local projects resulting from the use of eminent domain.

Those proposals worry some interested parties because individual communities have differing needs.

“The National Council of State Legislatures’ position is that the power of eminent domain has always been the power of states and localities. We are very concerned,” Susan Parnas Frederick, an attorney with the organization, told Maryland’s House Environmental Matters last week during a briefing on the subject.

A Maryland task force, established in 2004 to study the issue of compensation for business owners in eminent domain cases, will vote on a final report next month. The report will likely result in legislation next year.

Sen. James E. DeGrange Sr., an Anne Arundel Democrat, has also confirmed intentions to propose legislation to prohibit eminent domain for economic development.

Maryland Daily Record: www.mddailyrecord.com

Norwalk council to debate eminent domain: Stamford (CT) Advocate, 10/24/05

By Brian Lockhart

Members of the [Norwalk] Common Council are weighing a compromise over a controversial eminent domain ordinance to allow developers engaged in revitalization projects to move ahead with seizures of private homes and businesses.

"My preference would be to have a total ban," said Democrat Michael Coffey, whose ordinance strictly limiting the city's powers of eminent domain to noneconomic development purposes is up for vote tomorrow.

But with opposition from some peers, Coffey said he is willing to change language so "it would not retroactively apply to projects already in place" along Wall Street and West Avenue.

"It would allow them to go forward," he said.

That was a major sticking point for Council President Fred Bondi, also a Democrat. He asked the legal department to review Coffey's proposal to determine how it could affect existing agreements between the city and developers.

Some of the agreements had been approved by council members who now oppose the use of eminent domain.

For several years the city has been working with Stanley Seligson to plan a revitalization of West Avenue. This year, the city tapped M.F. DiScala & Co. and POKO Partners to revitalize two sections of historic Wall Street.

"We've already committed to them, and we should honor our commitment," Bondi said. "How do you go back now?"

The city is in a legal battle to seize Maritime Motors, a West Avenue car dealership, for a 1-million-square-foot office complex in the Reed-Putnam urban renewal area to be built by 95/7 Ventures. Both sides are awaiting a decision from the state Supreme Court, which heard the case Sept. 20.

Coffey said his revised eminent domain ordinance may change what the city should consider fair compensation for all property owners whose homes or businesses are seized.

His initiative comes amidst a national re-examination of property seizure prompted by a U.S. Supreme Court decision backing efforts by New London to give 15 homes to a private developer for upscale housing, offices and a marina.

The legislation passed last week by the council's Ordinance Committee, which Coffey heads, would limit Norwalk's use of eminent domain to construct public facilities, such as schools or roads; preserve open space; and address health or safety hazards.

In a poll of all 15 council members last week by The Advocate, it appeared there were enough votes to pass at least some form of the ordinance, although perhaps not enough to back a full ban on seizing property for redevelopment.

Coffey said that, from his discussions with other council members, "it would appear a clear majority would agree with the compromise."

Opponents of Coffey's efforts, such as Democratic Mayor Alex Knopp, say the council should await action by the state Legislature, which is reviewing Connecticut's eminent domain laws.

Attorney Louis Ciccarello, who runs Norwalk's legal department, said he is reviewing whether it is legal for the council to pass its own eminent domain legislation.

Bondi said the council already has the responsibility to approve individual property seizures.

"We do have checks and balances," he said.

According to an analysis by the Norwalk Redevelopment Agency, since the late 1970s Norwalk has acquired about 50 private properties through eminent domain for the historic Washington Street improvement effort; for revitalization of Water Street, including construction of the Maritime Aquarium; for the ongoing Reed-Putnam project off West Avenue; and for construction of the newly opened police headquarters at South Main and Monroe streets.

The planned revitalization of Wall Street and West Avenue depends on acquiring at least 40 more private properties through negotiation or eminent domain.

Common Council Majority Leader William Krummel, a Democrat, said he is looking forward to tomorrow's discussion of Coffey's proposal and supports some form of local eminent domain legislation.

"Everybody I talk to is very much against the idea of eminent domain," Krummel said. "It's become a hot-button topic overnight and I think we should certainly do something about it."

The Stamford Advocate: www.stamfordadvocate.com

Reform eminent domain, within limits: Westchester County (NY) Business Journal, 10/24/05

Westchester lawmakers should grab the unique opportunity before them to craft an eminent domain bill that ensures local governments use their power of eminent domain for valid public purposes without defining "public" so narrowly that they slam the brakes on future redevelopment projects.

The county Board of Legislators' legislation committee will hold its first hearing Monday (Oct. 31) at 11 a.m. on the eminent domain reform bill introduced by Legislators Tom Abinanti (D-Greenburgh) and Jim Maisano (R-New Rochelle).

What they came up with is a starting point for a sensible new law, but just that. Abinanti and Maisano would limit the use of Westchester County funds to condemnations carried out for "public" purposes such as utilities, removing public nuisances or structures "that are beyond repair or that are unfit for human habitation or use," and acquiring abandoned property. The legislators would ban county funding for "private" uses, defined as "development projects for retail shopping, commercial office space, industrial development and/or residential facilities."

But when developers complete such projects whose jobs, taxes and quality of life benefit a community, the developers carry out a public purpose for which eminent domain could and should be allowed. The U.S. Supreme Court didn't create that doctrine in June when a majority upheld the right of New London, Conn., to condemn homes for a private developer's hotel-office-condo project. The high court upheld what has been practiced for decades nationwide, including Westchester, where urban renewal projects that included condemnation have revitalized White Plains and other communities.

The question for the county board and local boards, then, should be how to prevent abuses of eminent domain that benefit a developer without benefiting the community. Abinanti and Maisano go too far by limiting "public use" to government purposes which could also be abused. Additional criteria that include the community benefits of future projects should be included.

At the same time, the lawmakers have a valid point in expressing the need to protect existing property owners in future uses of eminent domain. Among additional protections Abinanti and Maisano might also consider:
  • Legislative approval: Industrial development agencies and other unelected bodies should never be the final say in any project involving the taking of land. That say should rest with an elected (and thus accountable) town board, village board or city council.
  • Master planning: A taking should satisfy a use called for in an approved comprehensive plan.
  • Compensation: Property owners should be compensated not only for the land they lose "at least at full market value" but for their relocation expenses as well. That's especially needed in Westchester, where land values are so high that single-family house median prices hit an all-time high of $700,000 during the second quarter.

"The outcome of eminent domain should never be that a business goes out of business," said Brian McMahon, executive director of the New York State Economic Development Council. The council, which represents municipal economic development professionals, is crafting its own eminent domain recommendations and will announce them later this year.

While there are occasions for government to condemn land, McMahon's words here could also be our own: "It's an extraordinary power, so extraordinary procedures should follow in the exercise of eminent domain."

Westchester County Business Journal: www.westchestercbj.com


Protests Against Eminent Domain Speak to Deeper Problem — Distrust: The Washington (DC) Post, 10/22/05


By Judy Coleman

This year’s story about property rights is a tale of two cities.

The first is New London, a Connecticut port town whose economy depends upon two pieces of property: a submarine base and a planned waterfront development, which has been the subject of legal wrangling since 1998.

The city seized homes to assemble land for the project, which was conceived after the drug giant Pfizer announced that it was building a new research center on adjacent land. One resident, Susette Kelo, sued, claiming the city had abused its powers of eminent domain by taking her property for a redevelopment project. The Supreme Court recently ruled in the city’s favor in Kelo v. New London. The result was a firestorm of public resentment that cut across party and ideological lines.

The second city is New Orleans, center of a colossal rebuilding effort costing an estimated $200 billion. Much of this funding will go to tax incentives and multimillion-dollar contracts with private corporations. Eminent domain, to clear blighted and flood-devastated areas, will no doubt be involved.

Had Kelo turned out the other way, the rebuilding of New Orleans would certainly have taken a different tack. That incendiary public reaction has influenced how lawmakers think. A House committee recently nixed a provision that would have enlarged federal eminent domain powers so that new oil pipelines could be built to back up those damaged during Hurricane Katrina.

It’s not surprising that Kelo incited a hostile reaction. On its face, the ruling appears to dilute classical American values, such as the right to own property and the freedom from government intrusion. That’s certainly how many commentators and editorial writers have interpreted it, and letters to the editor from San Diego to Sarasota echoed that view, invoking Madison, Jefferson and Enlightenment philosophers as support.

These arguments are poetic and viscerally powerful. They’re also overstated and abstract. After the hurricane, it was easier to see why so many different people felt threatened by eminent domain. What fuels their outcry is not the more abstract concept of freedom but a very concrete fact of American life: class inequality. The poor residents of New Orleans and the middle-class homeowners railing against Kelo agree on at least one thing: The rich are about to get richer.

Through eminent domain, the government theoretically sacrifices the property rights of a few to create public projects that benefit the many. Because corporate interests invariably take the lead in developing these projects, though, some people have come to see eminent domain as benefiting the privileged few at the expense of the hapless many.

This division between the rich and the rest explains the reaction to Kelo. Members of Congress have expressed their disapproval and 30 state legislatures have taken action on bills and constitutional amendments proposing limits on the power of eminent domain. Governors in three states have declared moratoriums on property seizures.

Nevertheless, Kelo actually changes little in the legal landscape. Citizens still have two options when government acts in ways that negatively affect their property: They can go to the voting booth, and they can go to court. Elections certainly work, while the courts have been less amenable.

For decades, both federal and state courts have deferred to local governments on the use of eminent domain. In the 1954 landmark case Berman v. Parker, the Supreme Court decided that the Fifth Amendment’s “takings” clause allows government to seize land for any “public purpose.” The court defined public purpose broadly, to include, for example, economic redevelopment to solve urban blight.

The Berman decision came after World War II, a time of great optimism about the power of government. Cities were embarking on massive urban renewal efforts using federal funds. These plans, despite meeting the “public purpose” requirement, often met with failure rather than success — parts of many American central cities look like ghost towns.

The “public purpose” served by the redevelopment is New London’s very economic survival. In the 1990s, a state agency declared the city a “distressed municipality” after its unemployment numbers hit double the rate in the rest of Connecticut. The Supreme Court made clear it was deferring to the city’s judgment that the development would be “a catalyst to the area’s rejuvenation.” New London would be allowed to seize Susette Kelo’s home.

Generally, the right to private property has never been absolute — think of taxes, or zoning laws. So why did Kelo strike such a powerful chord?

The letters, columns and commentary on Kelo had a common theme: The government’s motives were suspect. The city might have invoked the “public good,” but opponents of Kelo saw the government as a too-eager partner of private interests — in this case, Pfizer.

There’s a deeper distrust at play here. Many opponents feel alienated from their elected leaders, and disenfranchised with respect to property rights. It’s not just that government can seize your property, it’s that government is taking it to benefit people who matter more — because they can pay more.

The Institute for Justice, which represented Susette Kelo, has compiled a list of over 10,000 such “abuses” of eminent domain. Among them: Ace Hardware convinced the city of Mesa, Ariz., to condemn a nearby auto repair shop so it could build a bigger store. Donald Trump, using the leverage of a local redevelopment agency, tried to evict an elderly woman from her Atlantic City home.

It seems everyone can dream up a different, well-heeled villain. A Florida man, in a letter to the editor, tells a cautionary tale about a mobile home park condemned to make way for a townhouse development. A professor writing online in a legal blog, the Volokh Conspiracy, warns that Wal-Mart will be able to capture city governments and leapfrog over citizen opposition. Justice Sandra Day O’Connor, in her Kelo dissent, lists the Motel 6 chain and Ritz-Carlton hotels as likely beneficiaries of future eminent domain decisions.

Multinational franchises make easy rhetorical scapegoats. But the real problem here is a malfunction of democracy. The middle class believes it has lost equal citizenship with the rich. Hurricane Katrina revealed a dangerously entrenched caste system in America; Kelo alerted members of the middle class that they weren’t at the top of it.

When the people in power are not affected by the decisions that affect everyone else, citizens have good reason to start distrusting government. Some eminent domain opponents have turned to action: An enterprising Californian has filed a petition to condemn the New Hampshire home of Justice David Souter, who voted with the Kelo majority. This forceful statement turned the tables on someone in power, one unlikely to have his home seized because he is a member of the elite.

The situation in New London is a time-extended version of the crisis in New Orleans. Lawmakers in New London observed a long economic decline that would culminate in the city’s obsolescence if government did not intervene. The city benefited from having time to make a choice about its future, but has lost public support exactly because it had time to choose otherwise. Now a state moratorium on property seizures has stalled the plan yet again.

New Orleans saw its demise in the course of days, not decades. There was no choice but to create a package of initiatives that would bring the private sector in on the rebuilding effort. In some areas, eminent domain may be the only answer. The urgency of government planning, however, is offset by the fact that the first contracts have gone out to some of the usual suspects — namely, corporations with strong ties to the administration in Washington.

Neither New London nor New Orleans presents a clear case of representation at its finest, nor cronyism at its worst. What matters is that citizens are increasingly likely to see only the latter. Just as the future of New Orleans depends upon the ruling in Kelo, the legacy of Kelo will depend on how government uses New Orleans to erase the fault lines of class that the case laid bare.

The Washington Post: www.washingtonpost.com

Judy Coleman is a third-year law student at Yale University; she edits the Pocket Part, the online magazine of the Yale Law Journal