Lawmakers may curb eminent domain use: (Louisville KY)Courier-Journal, 11/27/05

Taking of property for profit at issue

By Lesley Stedman Weidenbenerand Ben Zion Hershberg

State legislators are poised to pursue changes to the Indiana law governing eminent domain in the wake of a controversial U.S. Supreme Court decision earlier this year that expands its use.

But it's not clear whether they will succeed in their quest to restrict eminent domain — the government seizure of private property — to government projects, including roads, airports and stadiums.

"I would love to see that," said one of the General Assembly's most ardent property-rights advocates, Rep. David Wolkins, R-Winona Lake. "But I don't think we can do it. So my approach is going to be more expensive, significantly more expensive … for private developers."

The debate's outcome could affect a number of projects and property owners in Floyd County, where developers may try to use eminent domain to extend privately owned sewer lines.

Jack Vissing, a lawyer representing some Floyd County property owners who have been threatened with eminent domain, said the law "needs to have some limits."

And Sen. Connie Sipes, D-New Albany, said she plans to seek them. Forcing property owners to sell just so private developers can make more money is unfair, she said.

But in a decision in June, the Supreme Court said governments can force property owners to sell for private economic development if local officials determine that the project is in the public's best interest.

That has outraged property-rights advocates. They say it greatly expanded the authority traditionally granted under eminent domain and makes it possible for local officials to destroy neighborhoods in favor of shopping malls, condos or other development.

"We were all really amazed when the Supreme Court ruled that a private entity could take private property for their own gain," said Rep. Paul Robertson, D-Depauw.

In fact, lawmakers last year postponed making changes in the eminent domain law because the Supreme Court was deliberating the case. Few lawmakers believed the justices would expand what had traditionally been the purpose of eminent domain.

The justices did leave room for states to impose restrictions. Now, energized by the court decision, lawmakers are doing just that.

Earlier this month Sipes and Robertson met with a group of Floyd County homeowners to discuss the issue.

Households in two neighborhoods have gotten letters from developers this year asking them to sell easements for sewer lines across their land and threatening to take the property through eminent domain by privately owned sewer utilities if the owners won't sell.

For the Heritage Springs subdivision near Greenville, Thieneman Development LLC and a sewer company it's forming need the easement to discharge treated sewage to nearby Jersey Park Creek.

For his planned Lafayette Landings and Lafayette Ridge subdivisions near Stiller Road, developer Robert Lynn needs easements across several neighbors' property to pipe sewage about a mile and a half to the Wymberly Woods sewage-treatment plant.

Lynn said that, if the neighbors aren't willing to sell the easements, the Wymberly Woods utility will use its powers of eminent domain to take the easements.

Tom Cairns is one of the neighbors who could be affected by Lynn's plans.

"To me," said Cairns, 83, "this is a real threat, and it's something you worry about and agonize over."

He said he has been tending his 60 acres, keeping it "pristine," for the past 15 years, since his retirement. The pressurized sewer line Lynn wants to install across 3,269 feet of his property, Cairns said, "would wreck it."

Lynn has offered him $12,258 for the right to install the line, Cairns said, but he doesn't believe that would even cover the cost of the damage the sewer line would cause, much less his loss in property value.

He hopes the General Assembly will take action to protect private property owners like himself, Cairns said, with an immediate moratorium on the use of eminent domain to give lawmakers time to study the issue.

Lynn, who is considering at least one other route for the line, said he is prepared to ask the Wymberly Woods system to use its powers of eminent domain to obtain easements because sewers are necessary for the subdivisions he's planning.

He acknowledged that the use of sewers generally allows more homes to be built in subdivisions, providing a larger return on a developer's investment. But new sewer lines also provide many public benefits, Lynn said, including more efficient use of available land and higher property values.

He said he doesn't believe the General Assembly will impose stricter limits on the use of eminent domain in Indiana because "nothing would ever get done if eminent domain wasn't used."

But such efforts are likely to be made. Last week Sipes and Rep. Bill Cochran, D-New Albany, met with Gov. Mitch Daniels, a Republican, to express their concern about the issue.

"We wanted him to know what some of our constituents are dealing with, how this affects people," Sipes said. "We want to see where he's headed with this."

Daniels has not weighed in publicly about eminent domain. But through his press secretary, Jane Jankowski, the governor said he believes "we should be very careful about its use" and it should be reserved for "truly public purpose."

He did not say whether he believed eminent domain should ever be used for transactions that involve private landowners.

But some, including Sen. Brent Steele, R-Bedford, said it should never be used to take property from one private owner and provide it to another for financial gain -- no matter the public purpose or the compensation provided to the original owners.

Steele called the Supreme Court's decision "erroneous" and "wrong-headed."

"To take my home away from me — where I've raised my kids and my members are so a developer can make a profit and government can tax it more is contrary to what our forefathers believed about owning property," he said.

The Association of Cities and Towns opposes such restrictions. They say local officials rarely use the procedure, although the threat of it often prompts residents to sell their land.

Cities also claim that they need the authority to eliminate blight and foster economic development, although lawmakers say both terms are undefined in state law, leaving the option open to abuse.

This summer a legislative committee assigned to study the issue recommended that lawmakers better define blight and economic development.

Following the group's other recommendations, Wolkins plans to introduce legislation that would put other requirements on private-to-private land transactions through eminent domain. Property owners would receive at least 150 percent of the fair market value of their owner-occupied homes, plus compensation for their relocation costs and attorney fees for fighting the seizure under his proposal. "We're going to work to make sure people get something out of this," he said.

Wolkins also wants a law that prohibits eminent domain for private development unless the next-best alternative would increase the project's cost by 10 percent or more.

Even if Indiana lawmakers aren't successful in imposing restrictions, Congress might be.

The U.S. House of Representatives has passed the Private Property Protection Act, which would withhold all federal development funds from any city or other local jurisdiction that takes property for economic development, said Rep. Mike Sodrel, R-9th District.

As passed by the House, the act includes an amendment written by Sodrel that would give the government — rather than the property owner — the burden of proof in determining whether the project is economic development.

The Senate is now considering the bill.

Sodrel said he believes the Supreme Court's decision "was a bad interpretation of the 5th amendment."

"Public use has always meant a highway, an airport, a sewage disposal plant, some public need," he said. "We can't allow property to be taken from one private property owner and given to another private property owner."

Courier-Journal: www.courier-journal.com

An Eminent Domain High Tide: Los Angeles (CA) Times, 11/29/05

Riviera Beach, Fla., wants to displace about 6,000 of its residents and raze their homes to build a yachting and residential complex

By John-Thor Dahlburg

It's across the inlet from Palm Beach, but [Riviera Beach] — mostly black, blue-collar and with a large industrial and warehouse district — could be a continent away from the Fortune 500 and Rolls-Royce set.

But Riviera Beach's fortunes may soon change.

In what has been called the largest eminent-domain case in the nation, the mayor and other elected leaders want to move about 6,000 residents, tear down their homes and use the emptied 400-acre site to build a waterfront yachting and residential complex for the well-to-do.

The goal, Mayor Michael D. Brown said during a public meeting in September, is to "forever change the landscape" in this municipality of about 32,500. The $1-billion plan, local leaders have said, should generate jobs and haul Riviera Beach's economy out of the doldrums.

Opponents, however, call the plan a government-sanctioned land grab that benefits private developers and the wealthy.

"What they mean is that the view I have is too good for me, and should go to some millionaire," said Martha Babson, 60, a house painter who lives near the Intracoastal Waterway.

"This is a reverse Robin Hood," said state Rep. Ronald L. Greenstein, meaning the poor in Riviera Beach would be robbed to benefit the rich. Greenstein, a Coconut Creek Democrat, serves on a state legislative committee making recommendations on how to strengthen safeguards on private property.

With many Americans sensitized to eminent-domain cases after a much-discussed ruling by the Supreme Court in June, property-rights organizations have been pointing to redevelopment plans in this Palm Beach County town as proof that laws must be changed to protect homeowners and businesses from the schemes of politicians.

"You have people going in, essentially playing God, and saying something better than these people's homes should be built on this property," said Carol Saviak, executive director of the Coalition for Property Rights, based in Orlando. "That's inherently wrong."

"Unfortunately, taking poorer folks' homes and turning them into higher-end development projects is all too routine in Florida and throughout the country," said Scott G. Bullock, a senior attorney for the Institute for Justice, based in Washington. "What distinguishes Riviera Beach is the sheer scope of the project, and the number of people it displaces."

In June, a divided U.S. Supreme Court approved the plan of New London, Conn., to force some homeowners to sell their properties for a private development that was supposed to generate more jobs and tax revenue. That ruling has led to moves in Congress and at least 35 states, including Florida, to restrict the use of eminent-domain seizures of private property.

In Florida, the law allows local officials to take private land for redevelopment if they deem it "blighted." In May 2001, a study conducted for the city found that "slum and blighted conditions" existed in about a third of Riviera Beach, and that redevelopment was necessary "in the interest of public health, safety, morals and welfare."

A skeptical Babson, who lives in a single-story, concrete-block home painted aqua that she shares with parrots and a dog, did her own survey. For three months, she walked the streets of Riviera Beach photographing houses classified as "dilapidated" or "deteriorated" by specialists hired by the city.

The official study, she said, was riddled with errors and misclassifications. Lots inventoried as "vacant" (one of 14 criteria that allow Florida cities or counties to declare a neighborhood blighted) actually had homes on them built in 1997, she said. One house deemed "dilapidated," she found, was two years old.

Rene Corie has lived for nine years in a custard-yellow home near the Intracoastal. When the house was earmarked for acquisition under eminent domain four years ago, the 56-year-old seamstress became so depressed she couldn't put up her Christmas tree. She and her husband decided to fight City Hall in order to keep their home, or at the least, be paid a fair market price for it.

"We tried to elect a new mayor, we went around to churches, we stood on street corners with signs," Corie said. "When we got home from work, me and David would get into the truck and go door to door, and all day Saturday and Sunday."

Corie said she could be served at any time with another letter of acquisition for the house and the double lot it sits on. "My home is no longer my own," she said.

Mayor Brown and Floyd T. Johnson, executive director of the Riviera Beach Community Redevelopment Agency, did not respond to repeated requests from The Times for an interview.

The redevelopment agency's website says the plan will "create a city respected for its community pride and purpose and reshape it into a most desirable urban [place] to live, work, shop, and relax for its residents, business and visitors."

In past media interviews, Brown has said his city was in dire need of jobs, and that if officials weren't allowed to resort to eminent domain to spur growth, Riviera Beach could perish.

Dee Cunningham, who made an unsuccessful bid for mayor in 2003, said the blueprint was written to benefit developers. Her own flower shop has been classified as "functionally obsolete" under the plan and could be razed.

"People here are so stressed out from being under threat of eminent domain," said Cunningham. "It's like living in Iraq with a bomb threat."

The median household income in Riviera Beach in 2000 was $32,111 compared with $94,562 in nearby Palm Beach, the U.S. Census said.

The redevelopment project designed to bootstrap Riviera Beach to prosperity is supposed to take 15 years. It involves moving U.S. Highway 1 and digging an artificial lagoon to serve as a yacht basin.

In September, the City Council chose a joint venture between a New Jersey-based yacht company and a builder of condominiums in Australia to serve as master developer. The developer, Viking Inlet Harbor Properties, and the city now must agree on a contract.

Residents affected by the plan are supposed to be eligible for new homes elsewhere in Riviera Beach and compensation for business damages. But the uncertainties have been maddening for some.

For 25 years, Bill Mars has sold and serviced luxury sportfishing boats in Riviera Beach. He hasn't been told yet, he said, whether a place in the redevelopment zone has been kept for him.

Under the plan, his sales and service center is supposed to make way for an aquarium.

"If you look at our business, we're one of the shining stars of Riviera Beach," Mars said. "Yet no one has come to us to say, 'We're going to take care of you and relocate you.' " That despite the plan's incorporation of a "working waterfront," including boat sales and repair.

The owners of another business in Riviera Beach's downtown accuse local leaders of not enforcing city codes in order to produce the decay that redevelopment is supposed to remedy.

"They want to leave everything in a dilapidated condition so it seems to everybody and to the government like it's blighted," said Mike Mahoney, a Riviera Beach native who runs Dee's T-Shirts.

Some foes of the redevelopment plan have attended seminars in Washington organized by property-rights advocates to learn how to better fight to save their homes.

Some residents have accepted offers from developers and moved out; others have retained lawyers to try to get a better price from the city. Still others are waiting to see what happens, noting the troubled history of local redevelopment efforts. "This is the fourth eminent domain CRA plan I've seen since I've been here," said Mars. "I survived those, and I may survive this one too."

Babson said she was counting on the Florida Legislature, as well as public interest kindled by the recent Supreme Court case, to halt the developers.

"We're definitely in Tiananmen Square: one little guy in front of all of those tanks," Babson said. "We've slowed them down, but we haven't stopped them."

Los Angeles Times: www.latimes.com