Eminent domain fears are exaggerated: Minneapolis (MN) Star-Tribune, 12/9/05

They're mostly red meat for the talk-radio crowd

What seemed a routine Supreme Court decision affirming the land-condemnation powers used by cities for 50 years and rooted deeply in the Fifth Amendment has ignited a national firestorm.

Few object to the justly compensated "taking" of private property for roads, schools and other direct public purposes. What bothers people is the use of eminent domain to benefit private development and the public tax base. But while that sounds alarming at first hearing, it's much ado about not very much. Mostly the case has provided an opening for right-wing property-rights groups to sow fears about big, bad government. "Your home could be next!" is a popular warning. Left-wing activists, too, have joined the chorus, vilifying cities as co-conspirators with wealthy developers to gentrify urban America.

Truth is, the court's decision in Kelo vs. New London, issued last June, changed federal law not one iota. What has changed is the fearful hype on both extremes. Already the U.S. House of Representatives has passed a bill to dissuade local governments from using eminent domain powers if developers benefit. Texas, Alabama and Delaware have passed new restrictive laws; 30 other states, including Minnesota, are eager to follow.

But everyone should take a deep breath and consider the consequences. Yes, some abuses have occurred, but there is no epidemic of abuse. Eminent domain is used sparingly in most states, including Minnesota. Its real value lies not in its execution but in its leverage. Just having the authority to condemn blighted land has been enough to help hundreds of cities reclaim abandoned industrial waterfronts, derelict warehouses and substandard residences for the greater good.

Those in Minnesota eager to impose new restrictions must explain why it's not in the state's best interest to have redevelopment projects like St. Louis Park's $150 million Excelsior & Grand. "We didn't condemn property, but everyone knew we had the big stick," said former Mayor Gail Dorfman, now a Hennepin County commissioner.

Opponents must explain why similar projects in Anoka and Chaska shouldn't happen. Anoka is condemning six properties to move ahead with a $90 million conversion of an old industrial area near a future commuter rail station. Chaska is using eminent domain to replace six derelict, flood-prone houses with 51 condos as part of downtown revitalization. Officials say neither project could go ahead without eminent domain. Private developers will profit in both cases, but so will most citizens. Is it responsible to let one justly compensated holdout prevent a wider public benefit? That's the main question.

Since 1998, only 5 percent of Minnesota cities have condemned property for redevelopment purposes, according to a recent survey from the League of Minnesota Cities. During that span, condemnations accounted for 0.037 percent of all real estate transactions. What critics really have here is a solution in search of a problem.

Here's the biggest consequence: Reducing eminent domain's value will tip the balance even further toward sprawl. That means saddling the state with extra costs for infrastructure, adding to the private costs of driving and traffic congestion, and sticking taxpayers with the social costs of urban neglect.

Before jumping on the property-rights bandwagon, Minnesota lawmakers should put aside the fears of a few and consider soberly whether they really want to make it harder for their hometowns to revive and renew themselves.

Minneapolis Star-Tribune: www.startribune.com

Lawmakers take aim at eminent domain: Atlanta (GA) Journal-Constitution, 12/11/05

Opponents say law requires restrictions

By Christopher Quinn

Mark and Regina Meeks don't relish their roles as poster children for the rights of landowners whose property is being taken by government for private development.

They'd really rather just be left alone.

Store co-owner Mark Meeks helps Gina Gibson at Stockbridge Florist and Gifts, which the city of Stockbridge is trying to force Meeks and his wife, Regina, to sell under the power of eminent domain.

But the city of Stockbridge is invoking the power of eminent domain to force the Meekses to sell their little Stockbridge Florist and Gifts shop to the city, saying the government has a pressing need for their property. Stockbridge wants the Meekses' land and 21 other acres to build a new downtown, including public buildings and privately developed townhomes, offices and shops. And the way Georgia law stands, backed by a U.S. Supreme Court decision, the city may be able to take the land whether the Meekses like it or not.

"If that's the way the law is written in Georgia, then the law absolutely needs to be changed. If what [the city] is doing is legal, then nobody's property is safe," Meeks said.

The Stockbridge case is held up by some legislators as an example of why they should change Georgia law quickly when the General Assembly session starts in January.

Government has traditionally taken land for public projects, like roads and schools. But vaguely written 50-year-old laws meant to hasten urban redevelopment and aid in slum-clearing give government the right to claim citizens' land for economic development — sometimes at the hands of private developers.

Those laws were upheld in June by a U.S. Supreme Court ruling that said governments could take land for economic development, but invited state and local governments to change that by writing more restrictive laws.

That's exactly what Georgia legislators such as state Sen. Jeff Chapman (R-Brunswick) want to do. Chapman believes landowners' rights are being trampled. He heads up the Senate Eminent Domain and Economic Development Study Committee, which is considering changes to the law.

A government should never take a person's property to turn it over to another private interest so that interest can build something bigger, more expensive or to generate jobs, he said.

The laws need to be changed and property protection should be reinforced by constitutional amendment, said Chapman.

"This thing is so important, that you want to double check it, so to speak," he said.

On the other hand, supporters of using eminent domain for redevelopment, such as the Association County Commissioners of Georgia, say the law should be strengthened to protect landowners and give them more ways to appeal, but eminent domain is a necessary part of a government's ability to improve communities.

Savannah redevelopment
Neighborhoods like Cuyler-Brownsville in Savannah are often cited as an example. The city used eminent domain to buy and clear more than 80 run-down homes and lots. Only a few of the condemnations were contested. The city created a public square and sold lots to small developers to build affordable homes. The formerly scary slum has come back to life as a vibrant community.

Martin Fretty, director of Savannah's Housing Department, said protecting individual homeowners' rights must be thought of in terms broader than the person whose property gets condemned.

"When properties are in that condition, [like those had been in Cuyler-Brownsville] whose rights are you protecting?" he asked.

The rights of nearby home-owners are put at risk if they must live in a slum created by absentee or uncaring landlords or landowners who could not improve properties because they inherited them without clear title, he said. Condemning a property clears the title.

Doing away with uses of eminent domain for community improvement or economic development "will end neighborhood revitalization as we know it," Fretty said.

Chapman is unconvinced. He wants to do away with all uses of eminent domain except for traditional public uses like roads.

"This is a night and day issue," he said. "If you leave a crack in this, I can assure you, abuses will occur."

Concern sparked
The Supreme Court decision that drew attention to the issue of using eminent domain to encourage private development arose out of a case involving 15 homes in New London, Conn.

The city condemned the homes scattered along city waterfront property as part of a larger plan to build luxury hotels, offices and upscale condos. Several homeowners challenged the taking.

The justices narrowly upheld the state court decision in Kelo v. New London that said economic development also serves a public purpose, like a new road does, and is constitutional.

The idea that homeowners can be forced out and their land sold or given to someone who will increase the tax base, build nicer buildings or lure new jobs created a whiplash of public resentment.

The Institute for Justice, the libertarian law foundation whose attorneys argued the Kelo case for the homeowners, said that 39 states are considering tightening eminent domain laws.

Larry Morandi, a director with the nonpartisan National Conference of State Legislatures, said there have been challenges to government condemnations for urban redevelopment going back for decades.

"So it's not a new issue. But Kelo got it from the back burner to the front burner of the stove," he said.

Dana Berliner, the Institute for Justice attorney who argued Kelo also testified before the Georgia Eminent Domain Committee in Savannah in September. She said having the laws on the books in Georgia presented a potential danger.

"Before Kelo, we knew that government could take property in deeply troubled, almost uninhabitable areas and transfer it to private developers. Now we know that government can take any property and transfer it to private developers," she said.

Some believe Berliner is overstating the case. The homes in Kelo were in an area surrounded by decaying streets, sewers and contaminated lots, and zoned commercial and industrial, said Tim Dowling, with the Community Rights Council. The council advocates for city and county governments and filed a brief in the Kelo case.

The landowners had property in an area ripe for redevelopment, which is far different from the average suburb.

"The suggestion that every church, house and synagogue is in danger of being condemned for a new Wal-Mart is just not true," he said.

Still, he and other supporters of eminent domain for economic development agree that steps need to be taken to protect landowners.

Safeguards to law
The Association County Commissioners of Georgia has recommended that terms like "blight" and "slum" that appear in the laws be clearly defined, said Jim Grubiak, the association's counsel.

It also is recommending that a property itself be blighted, not just in a blighted area, before it is condemned. The association also wants to delegate only to elected local officials — not appointed boards such as housing authorities — the power to condemn property.

"And we want to beef up the notice and due process procedures in law," Grubiak said, so that property owners have the time and the ability to contest the taking or choose to participate in a redevelopment plan by redeveloping their lot themselves.

"We are hopeful that enough legislators will see that what we are suggesting is reasonable and will fix the problem," he said.

Meanwhile, the Meekses are awaiting the ruling of a Henry County Superior Court judge on their challenge to Stockbridge's effort to take their property.

"I hope [the judge] rules in our favor," Meeks said, "but if not, we hope the Legislature will give us some help."

Meeks said he realizes the publicity brought by their case might save other Georgians from having to go through what they are going though. But his goal has always been more immediate.

"We are not doing some heroic thing. We are fighting for our lives here," he said.

Atlanta Journal-Constitution: www.ajc.com

City might drop eminent domain expansion: San Diego (CA) Union-Tribune, 12/10/05

National City plan will be discussed at meeting Tuesday

By Tanya Sierra

After spending nearly two years trying to persuade the public to support expanding the city's eminent domain boundaries, city officials will consider dropping the proposal altogether next week.

On Tuesday the City Council, acting as the Community Development Commission, will discuss whether to abandon the plan because it is "totally unnecessary and way ahead of its time," Councilman Ron Morrison said.

The proposal, which was first presented in February 2004, has drawn intense public opposition. Because so many people objected, the expansion was delayed more than a year and a number of changes in how it would work were made.

The proposal was Mayor Nick Inzunza's idea, Morrison said.

"This whole thing was the mayor's proposal," he said. "The problem was then he had to excuse himself from the process because he owns property in the area and the rest of us were stuck with it."

Inzunza did not return a call seeking comment on the issue. He had said last month that he would be on a family vacation in Big Bear from Dec. 1 through Dec. 21, but in the past week he has been at several social engagements, meetings and personal appointments in National City and Tijuana.

When he first proposed the idea, Inzunza said expanding the eminent domain area was an important tool in redeveloping the city.

"This is probably the biggest decision we'll make as an agency in a very long time," he said in 2004.

However, less than three weeks ago, Inzunza said that he believes the government has no business getting involved in private property issues and that he opposes using eminent domain.

"I have never voted for eminent domain," he said during a recent interview. "I'm in favor of private property rights."

Inzunza, Councilman Frank Parra and Councilwoman Rosalie Zarate have all had to recuse themselves from discussing or voting on the eminent domain expansion because they all own property in the redevelopment area.

With only two remaining council members able to participate in the vote, the three abstaining members drew straws to decide who would re-enter the debate. Zarate was chosen.

Eminent domain is a process by which the government forces private property owners to sell their land for redevelopment.

Property must be considered blighted in order for the city to seize it through eminent domain. In simple terms, law defines blight as property that is not economically viable and includes deteriorating physical conditions.

In the past, National City used eminent domain to clear out bars and the accompanying crime for an education center on National City Boulevard.

Councilman Luis Natividad, who was at a funeral yesterday, said he was not aware the eminent domain issue is on Tuesday's agenda but joked that the idea to possibly rescind the proposal comes at a critical time.

"It's election year," he said.

Morrison said the public has good reason to object to expanding the eminent domain territory, which currently consists of National City Boulevard and the Harbor District. The expanded territory would add East Plaza Boulevard, Highland Avenue and other business corridors.

"It was too blanket and it scared a lot of people," Morrison said.

San Diego Union-Tribune: www.signonsandiego.com

Eminent Domain Used for School Site: Gilroy (CA) Dispatch, 12/8/05

The [Gilroy Unified School District] is still ironing out the details in order to purchase the plot of land that will likely house the new high school.

The [district] is invoking eminent domain proceedings to purchase the northwest piece of property but in order to proceed with the deal they must get the go-ahead from the city.

On Friday, district officials will meet with city officials to coordinate the impact Christopher High School would have on transportation in Gilroy.

Christopher High would sit on about 40 acres of the 58-acre parcel of land. And because the district is invoking eminent domain the family has requested a two-acre life estate.

The elderly couple would live on the land until their death. If the land purchase is approved the district officials have to map out the high school and specify the boundaries of the life estate.

Christopher High will eventually cap out at 1,800 students. The preliminary sketch of the new high school shows classrooms, courtyards, parking lots and athletic fields and courts fitting nice and snug within the 40-acres. The high school will only have a practice football field. Football games will be played at Gilroy High School.

The high school is expected to be up and running for the 2009-2010 school year.

Construction for the first phase of the high school, which will house about 900 students, will be funded by Measure I, the $69 million bond approved by voters in 2002. The land and construction will cost the district an estimated $47 million.

Although the high school's namesake is Don Christopher, the local garlic producer actually donated 10 acres located off of Miller Road and Santa Teresa Boulevard.

The district will probably sell that land to generate funds for other projects.

Gilroy Dispatch: www.gilroydispatch.com

Missouri gets 18 suggestions: Kansas City (KS) Star, 12/8/05

Limits on eminent domain offered

By Tim Hoover

Private developers in Missouri should not be allowed to take land from property owners through the process of eminent domain, a task force recommended Wednesday.
Missouri property owners should have more rights and governments should have a greater burden when trying to take private property, it said.

“I think these (recommendations) go a long way toward stopping the abuses we heard testimony on,” said Terry Jarrett, chairman of the Missouri Task Force on Eminent Domain.

One of the most significant recommendations the task force made was to specifically reject the U.S. Supreme Court’s June decision in Kelo v. New London, Conn., in which the court ruled that taking land for economic development purposes qualified as a “public use.”

The decision riled public opinion nationally and in the Kansas City area, where governments took property to allow the development of the Kansas Speedway in Wyandotte County and a BMW dealership in Merriam. A 2003 report by the Institute for Justice called the Merriam seizure one of the 10 worst abuses of eminent domain in the nation.

The task force, composed of lawmakers, developers, lawyers and others, agreed that “the public benefits of economic development, including an increase in tax base, tax revenues, employment, or general economic health, standing alone, shall not constitute a public use.”

But the task force also agreed that allowing government to take land that is “blighted” should still be allowed, something that could certainly have economic development benefits.

So what is “blighted”?
The task force had a harder time agreeing on that, ultimately deciding it would be best to say what blight isn’t. The panel agreed that a finding of blight couldn’t be based on whether a higher amount of taxes would be collected on a property or on whether there would be economic development benefits if the land were used differently.

Critics have said that Missouri is one of the worst states in the nation for abuse of eminent domain and that the definition of blight now is so broad that practically anything — including vacant land in the suburbs — qualifies as blighted.

The task force deliberately avoided defining blight because not everyone could agree on a definition and because the panel did not want to “mess up” current law dealing with tax-increment financing projects, said Jarrett, general counsel to Gov. Matt Blunt.

Missouri and New York are the only states that allow private developers to initiate eminent domain proceedings against property owners once a property has been declared blighted.

The panel specifically recommended that the practice stop.

Lawmakers already have filed bills they will push in 2006 that would limit eminent domain. One bill would require that government bodies muster a two-thirds vote before they could condemn a property. Another proposes a constitutional amendment to eliminate government power to declare properties blighted.

The bulk of the task force’s recommendations, if enacted into law, would impose a greater burden on those using eminent domain. Landowners affected by a project would have to be notified early in writing of the possibility of eminent domain, and condemning authorities would have to notify property owners of their rights in the eminent domain process, which would include an opportunity to mediate.

The panel also recommended that condemning authorities be required to act in good faith in negotiations with landowners, and it said courts should have the discretion to penalize the condemning authorities if they don’t.

Finally, courts would have the power to review findings of blight without having to rely on the condemning authority’s decision.

What’s next
It’s up to lawmakers to decide whether to incorporate the recommendations into legislation in the next legislative session, which begins in January.

Kansas City Star: www.kansascity.com

SBE Council Critical of Eminent Domain Attacks on Small Business, 12/8/05

Press Release

The Small Business & Entrepreneurship Council (SBE Council) published a new report today highlighting the dangers faced by small businesses when government abuses its power of eminent domain.

Writing in "Under Attack: Small Business Faces the Abuse of Eminent Domain," [available for downloading at www.sbecouncil.org] SBE Council chief economist Raymond J. Keating noted that especially in the aftermath of the U.S. Supreme Court's decision in Kelo v. City of New London, "Homes and small businesses — indeed, the 'American Dream' — stand vulnerable to being bulldozed by politicians and government bureaucrats coupled with powerful special interests."

SBE Council President & CEO Karen Kerrigan declared: "The first duty of government is to protect private property. Indeed, the future of entrepreneurship is in peril as certainty with respect to property rights is central to a vibrant small business sector, and in turn a growing economy."

Keating criticized the economics behind government initiatives to take property from one private entity in order to hand it over to another private entity, noting that government schemes for urban renewal, economic development or industrial policy have a long track record of failure. He added: "In reality, the only reliable economic development program is for government to keep taxes low, maintain the lightest of regulatory touches, and protect property."

The report highlights various examples of government abusing small businesses through misuse of eminent domain powers.

Keating concluded: "Small business owners must worry that some government officials think they can rake in additional tax dollars if they replace small businesses with other ventures. Small business owners need to get active on this issue at the local, state and federal levels of government. They need to push aggressively for legislative and constitutional changes that will crack down on eminent domain abuses."

The U.S. House of Representatives has been praised by the SBE Council for passing the 'Private Property Rights Protection Act of 2005,' H.R. 4128. Now, it is critical that the U.S. Senate quickly do the same, according to the group.

The SBE Council, a nonpartisan, nonprofit small business advocacy group works to protect small business and promote entrepreneurship: www.sbecouncil.org

State eyes limits for eminent domain: Ashville (NC) Citizen-Times, 12/7/05

By Kerra L. Bolton

House Speaker Jim Black on Tuesday announced the creation of a special panel to examine whether North Carolina should do more to protect private property from public seizure.

This action comes in response to a U.S. Supreme Court decision in June letting local governments take private property to make way for commercial development. The court ruled municipalities have broad power to bulldoze people's homes and put up malls or other private development to generate tax revenue.

The decision sprang from a Connecticut case in which residents fought against having their homes destroyed to make room for an office complex.

Rep. Wilma Sherrill, R-Buncombe, said the decision "greatly threatened the people of North Carolina's property rights."

"I believe that our (state) constitution needs to be changed to ensure that private property is not seized by governments in the name of economic development," she said.

Sherrill and Rep. Bruce Goforth, D-Buncombe, were tapped to lead the bipartisan committee.

"This committee will study what the (state) law is and write legislation that protects the property rights of people in Western North Carolina and across the state," Goforth said.

North Carolina law says local governments can mostly use eminent domain, or the taking of property with fair compensation, for public purposes such as building schools or roads. State law also allows municipalities to take property to redevelop blighted or unsafe areas.

Talk about using the powers in connection with private development is not without local precedent. Use of eminent domain came up in 2002 in considering widening Swannanoa River Road to handle traffic coming to and from a new Wal-Mart Supercenter.

Citizen-Times: www.citizen-times.com

Eminent domain restrictions fail: (St Paul MN) Pioneer Press, 12/7/05

By Steve Scott

Roseville's City Council has turned back an attempt by Council Member Amy Ihlan to pass an ordinance restricting the city's use of eminent domain.

Ihlan asked the council Monday to consider a policy barring the city from acquiring property for private development or redevelopment and to limit the transfer of such land to private uses for at least 10 years.

She sought to head off the next anticipated vote on the city's Twin Lakes project.
"I hoped a full policy discussion would happen first, before we're asked to actually vote on whether to use eminent domain in Twin Lakes," said Ihlan, a vehement opponent of that northwest Roseville redevelopment.

Mayor Craig Klausing asked Ihlan to frame Monday's council discussion as a formal motion, which was defeated 3 to 2.

Council Member Tom Kough supported Ihlan's proposal.

"There are valid concerns here, but you take action on eminent domain as a council when particular requests come before the council," Klausing said.

Controversy over eminent domain intensified after the U.S. Supreme Court ruled in June that local governments could force out property owners to make way for private development.

Pioneer Press: www.twincities.com/mld/pioneerpress

N.Y. Court Ruling Raises Hopes on Eminent Domain: New York (NY) Sun, 12/7/05

By Julia Levy

Property owners angered by the Supreme Court's decision this year that the government can seize their homes and businesses received a psychological boost when a federal appeals court ruled that a New York village had overstepped its eminent domain authority.

The U.S. Court of Appeals for the 2nd Circuit on Monday ruled that the village of Port Chester, N.Y., failed to properly alert a New York businessman of his right to challenge an eminent domain decision before it seized his four buildings on Main Street. It then gave a private developer the green light to erect a Stop & Shop parking lot where his four office buildings had stood.

The decision, which came after five years of litigation, doesn't mean customers will be forced to stop scouring the aisles of the new Port Chester Stop & Shop anytime soon. Nor does it mean that the plaintiff, William Brody, necessarily will be awarded damages.

It is, however, a warning to local governments tempted to take private property without properly notifying the people who own it, as required by the new state eminent domain law passed last year.

The ruling itself does not challenge the Supreme Court's extension of the powers of seizure, but the lawyer representing Mr. Brody said the ruling marked a victory for people looking to reform eminent domain laws in New York and across the country.

"Right now, the government holds all the cards, and the private citizen holds none," the lawyer, Dana Berliner, said. "This is an effort to restore some of the fairness to the process."

Ms. Berliner, a senior attorney at the Virginia-based Institute for Justice, said: "I think it's such a fundamental right that I can't believe any court would rule that someone wasn't entitled the notice. I'm incredibly happy because this why we brought it five years ago."

Ms. Berliner said current law in New York is far better for property owners than the law in 1999, when the village of Port Chester ran a legal notice in the newspaper, which was the only way Mr. Brody would have known his property was threatened by a sweeping economic development project.

The new law, which was championed by Assemblyman Richard Brodsky and was signed into law by Governor Pataki in September 2004, requires the government to notify property owners by mail or delivery if their property is at risk of being seized by eminent domain. It also requires the government to alert New Yorkers that they have only 30 days to challenge the condemnation.

The decision reached this week called the change in state law "a wise policy choice."

"This shows you that I was ahead of my time," Mr. Brodsky said yesterday in a telephone interview. "It's always nice to have the court of appeals say you did the right thing."

The Assembly member, who is fighting now for further reforms of eminent domain, said, "People have a right to really actually know when the state's trying to take their property, and they have the right to try to protect themselves."

While the decision was a partial victory for Mr. Brody, who did not return requests for comment yesterday, it was not a total victory.

Mr. Brody argued that the notice of condemnation should tell property owners not only that they have 30 days to challenge the decision but the procedures for challenging the condemnation. The ruling said that level of detail would not be necessary.

Mr. Brody also argued that due process requires "a full adversarial hearing" with the opportunity to call and cross-examine witnesses before a neutral arbiter. The court found, though, that due process requires no such thing.

The ruling also rejected Mr. Brody's claim that property owners are entitled to hearings before governments decide to use eminent domain. It explains: "Such a rule would impose an impossible burden on the contemnor and would represent an unwarranted judicial arrogation of the legislature's power to condemn."

The lawyer representing the village of Port Chester, Alan Scheinkman, viewed this week's decision as a victory for his side. "They lost on most of their claims," he said. "His claims have been whittled down, and whittled down and whittled down and the project has been allowed to move forward. At best this is a technical Pyrrhic victory for Mr. Brody."

In the next phase of the case, likely to begin early next year, the district-level court will decide if Mr. Brody is entitled to any damages.

New York Sun: www.nysun.com


Eminent domain bill offers just compensation: Ft Wayne (IN) Journal-Gazette, 12/6/05

By Andrea Neal

If Rep. David Wolkins had his way, he’d end all use of eminent domain for economic development. As chair of the interim study committee on eminent domain, he will settle for the next best thing: making it harder for government to seize private property and, when it does, ensuring owners get compensated fairly.

“I don’t like takings at all, unless it’s for public use,” says Wolkins, R-Winona Lake. But Wolkins knew early on that lawmakers wouldn’t go for language that might slow down efforts to clean up blighted neighborhoods across Indiana.

Under a bill to be introduced in the 2006 session, cities could still condemn property and hand it over to a private developer for commercial purposes, if it is of economic benefit to the community. But they would have to prove up front that the property is a nuisance, unfit for human habitation or tax delinquent. There will be no more reverse Robin Hood incidents misusing eminent domain to give to the rich what belongs to the less-rich, the poor and middle class.

More than a dozen states have passed, or are on the verge of passing, laws to rein in the government’s constitutionally prescribed power to take private property for public purposes. Historically, the power has been used to make way for utilities, rights-of-way and other public facilities. Recently, however, it has become a tool for economic redevelopment.

The legislation was prompted by the June 2005 Supreme Court ruling in Kelo v. City of New London, Conn. In that case, the court held that 15 homes in a waterfront Connecticut neighborhood could be acquired by the city and replaced by a luxury hotel, upscale condos and office buildings. The city justified the project as a way to generate tax revenue and jobs.

Critics charged the taking was a blatant violation of private property rights since the homes and businesses to be leveled were not dilapidated, posed no health hazards and had not been classified as blighted. The high court, in a 5-4 ruling, said, “Because that plan unquestionably serves a public purpose, the takings challenged here satisfy the Fifth Amendment.”

Since the decision, bills have been filed in more than a dozen states; several have taken preventive action:
  • Alabama passed a law that prohibits use of eminent domain for retail, commercial, residential or apartment development; for purposes of generating tax revenue; or in order to transfer property from one private party to another, except in the case of blight.
  • Delaware law now allows eminent domain “only be exercised for the purposes of a recognized public use as described at least six months in advance of the institution of condemnation proceedings.”
  • Ohio put a moratorium on eminent domain for economic development purposes until Dec. 31, 2006, and created a task force to study the issue. One of the more radical proposals pending before that legislature would amend the state constitution so cities and towns could not use eminent domain at all, unless approved by the legislature.

A report by the Institute for Justice found more than 400 instances of threatened or actual condemnations for private profit in Ohio cities in the five-year period from 1998 through 2002. In Indiana, the libertarian research organization documented 55 such cases. Wolkins said he understands why any eminent domain bill needs to have a blighted use exception in order to get through the General Assembly.

In Indianapolis, an acclaimed neighborhood redevelopment project, Fall Creek Place, could not have happened without the threat of eminent domain. The project has transformed one of the most crime-ridden parts of the city into a national model with housing opportunities that range from affordable to upper-end.

Wolkins’ bill is unusual in that it will essentially set the price at which government can acquire private property: 150 percent of market value for residential property and 125 percent of market value for farmland.

“That means, by the time all is said and done, they’re at least getting just compensation for it,” Wolkins said.

That is, of course, what the Fifth Amendment requires. Wolkins’ bill will put a check on a government power that was becoming limitless in the name of economic health.

Ft Wayne Journal-Gazette: www.fortwayne.com/mld/journalgazette

Andrea Neal is an adjunct scholar and columnist with the Indiana Policy Review Foundation: aneal@inpolicy.org

Boro mulls pay-to-play and eminent domain: The (Red Bank NJ) Hub, 12/15/05

By Sue Morgan


An anti-eminent domain ordinance should also be crafted and passed as a means of addressing the concerns of [Sea bright NJ] property owners who could be affected by the borough’s plans to revitalize its downtown business district and beachfront, [Councilwoman Dina] Long said.

That plan is known informally among borough officials as “the Smart Growth plan,” a reference to the $50,000 state Department of Community Affairs (DCA) Smart Growth grant received by the municipality to come up with building proposals.

Long called for the proposed anti-eminent domain legislation to prohibit the borough government from taking homes or businesses for “private redevelopment or economic development.”

However, the same law would still safeguard the borough’s ability to use eminent domain for public uses such as schools or running utility lines, Long said.

“We need to show good faith to the residents of Sea Bright,” Long said, “particularly with the Smart Growth process going on.”

Eminent domain has hit home for [Mayor] Kalaka-Adams, who is presently battling Long Branch officials attempting to squeeze her out of her antiques and furniture refinishing shop on Broadway in that city.

The first-term Republican mayor, noting that she campaigned against the taking of private property for private uses in Sea Bright during her 2003 mayoral campaign, expressed support for an anti-eminent domain law.

The mayor and her husband, Jim, are fighting to keep their 20-year-old business that Long Branch officials hope to take in redeveloping the city’s downtown into the Broadway Arts Corridor.

The Hub: http://hub.gmnews.com


Eminent domain changes backed: San Diego (CA) Union-Tribune, 12/6/05

S.D. council panel OKs 60 days' notice

By Martin Stolz

The government's practice of condemning and acquiring private property in redevelopment areas of San Diego will be slightly modified, not eliminated, after city officials researched complaints.

In September, the City Council's Government Efficiency and Openness Committee heard three hours of testimony from redevelopment officials and opponents of eminent domain, which is the government's power to take private property for public uses, with just compensation.

Among other changes, the committee decided yesterday to give more notice to those who might be affected by eminent domain and to make sure the process is free of threats or intimidation.

"Redevelopment has many sides," Councilwoman Donna Frye said. "I don't think they are all good or all bad."

The emotional outpouring at the September committee meeting followed a U.S. Supreme Court decision affirming the government's power of eminent domain.

Much of the testimony focused not on the court ruling but on a controversial redevelopment effort in San Diego's City Heights neighborhood.

That project aims to create housing, a school, stores, medical facilities and a day-care center under the control of a special "joint powers agency" led by an employee of the San Diego Housing Commission with representatives from the city school system and City Council.

The City Heights project is outside the City Council's control; the project's scope has since changed, records shows.

At the September hearing, the committee asked city officials to conduct research into the procedures used in the condemnation process in redevelopment and address perceptions of abuse.

The city's staff researched recommendations made by Karen Frostrom, a lawyer in an eminent domain lawsuit against the Centre City Development Corp., which advises the council on downtown redevelopment.

Redevelopment proponents, who say eminent domain is rarely used, feared the council might eliminate or severely curtail the use of eminent domain.

Linville Martin, a real estate professional whose East Village home was seized to make way for Petco Park, said his experiences through the condemnation process "were totally positive."

"These's a campaign of fear out there that government will take people's homes," Martin said.

In response to a claim made in Frostrom's report that eminent domain "breaks the sacred contract between a government and its citizens," Martin said: "I am here, and I am not tainted."

Frostrom attended the meeting but did not speak.

Frye and Councilman Brian Maienschein voted to adopt the staff report. Councilman Tony Young, the third committee member, did not attend yesterday's meeting.

The staff report calls for modifications, such as educating real estate agents about redevelopment; lengthening the notification period for property owners from 30 days to 60; and expressly prohibiting "threats, and/or intimidation during purchase negotiations."

Half of Frostrom's 10 recommendations needed no action because they reflect current practices.

A separate report by City Attorney Michael Aguirre recommended that city officials follow state legislation on eminent domain and establish certain guidelines on its use in San Diego. Five legislative committees in Sacramento are reviewing eminent domain issues.

San Diego Union-Tribune: www.signonsandiego.com

KO’ing Kelo: New Jersey Lawyer, 12/5/05

By William J. Ward

We’re witnessing the Kelo-Effect — a corollary to Sir Isaac Newton’s Third Law of Motion which states, “For every action there is an equal and opposite reaction.” The public, waking up to the possibility that homes and small businesses could be taken for private gain, is galvanized as never before against the abuse of eminent domain.

In fact, the Economist characterized the Kelo backlash as “potent as the anti-abortion movement.” More than any other contemporary issue, this one cuts across party lines and hits the mother lode: private property rights. Redevelopment attorneys are disingenuous when they express surprise at this reaction. There are, after all, more than 1,000 redevelopment projects in progress in 64 New Jersey towns.

And the words of Justice Sandra Day O’Connor in her Kelo dissent continue to resonate: “As for the victims, the government now has license to transfer property from those with fewer resources to those with more. The Founders cannot have intended this perverse result.” Heightened awareness New Jersey court decisions, however, have evidenced a heightened awareness by trial judges to eminent domain abuse. The abuse for the most part comes about in redevelopment projects implemented under the Local Redevelopment Housing Law (LRHL) 40A:12A-1 et seq. through the relationships between developers and local municipal officials.

The New Jersey Constitution, Article VIII, paragraph 3, says takings for blight are a public purpose. The abuse has come about through the legislature’s broad definition of blight, most recently in the amendments to the LRHL in 1992: “Redevelopment area” or “area in need of redevelopment” means an area determined to be in need of redevelopment pursuant to sections 5 and 6 of P.L. 1992, c.79 (C.40A:12A-5 and 40A:12A-6) or determined heretofore to be a “blighted area” pursuant to P.L.1949, c.187 (C.40:55-21.1 et seq.) repealed by this act, both determinations as made pursuant to the authority of Article VIII, Section III, aragraph 1 of the Constitution. A redevelopment area may include lands, buildings, or improvements which of themselves are not detrimental to the public health, safety or welfare, but the inclusion of which is found necessary, with or without change in their condition, for the effective redevelopment of the area of which they are a part. An area determined to be in need of redevelopment pursuant to this section shall be deemed to be a “blighted area” for the purposes of Article VIII, Section III, paragraph 1 of the Constitution. If an area is determined to be a redevelopment area and a redevelopment plan is adopted for that area in accordance with the provisions of this act, the municipality is authorized to utilize all those powers provided in section 8 of P.L. 1992, c.79 (C.40A:12A-8).

This definition could include just about any property — and it has. “Blight is in the eye of the beholder,” Justice Kennedy said during the Kelo oral arguments. We have not seen a planning report yet where the consultant hired by the municipality rejected blight for the study area. Particularly problematic is the all-inclusive 40A:12A-5. Determination of need for redevelopment (section d): Areas with buildings or improvements which, by reason of dilapidation, obsolescence, overcrowding, faulty arrangement or design, lack of ventilation, light and sanitary facilities, excessive land coverage, deleterious land use or obsolete layout, or any combination of these or other factors, are detrimental to the safety, health, morals, or welfare of the community.

Recent cases
Justice Kennedy, in his concurring opinion in Kelo v. New London, said the following: “A court confronted with a plausible accusation of impermissible favoritism to private parties should treat the objection as a serious one and review the record to see if it has merit.” This is exactly what Essex County Assignment Judge Patricia Costello and Judge Richard Donohue cite in the recent cases Township of Bloomfield v. 110 Washington Street Associates, ESX-L-2318-05 and LBK Associates, L.L.C, et al v. Borough of Lodi, BER-L-8766-03 and Costa Realty Co., Inc. et al v. Borough of Lodi, BER-L-8768-03.

Although these decisions aren’t published, they are available online and frequently requested.

The 110 Washington Street case turned on two critical issues. Judge Costello found there was an impermissible conflict of interest in the Township of Bloomfield utilizing the services of the same attorney who represented the board of adjustment, the planning board, and the mayor and council. This is a blatant violation of the Municipal Land Use Law (MLUL). Thus, the conflict tainted the whole process underlying the municipality’s eminent domain complaint. In addition, the court found that Bloomfield’s consultant, Heyer & Gruel, did not include in its study a finding that the conditions complained of were detrimental to the public health, safety and welfare. All these defenses were properly raised with the trial judge on the return date of the order to show cause for the appointment of condemnation commissioners. The condemnation complaint and order to show cause were filed in a summary manner consistent with Rule 4:67-1.

Recent case law in Hirth v. City of Hoboken, 337 N.J. Super. 149 (App. Div 2001), and the unreported cases of Township of North Bergen v. Shiva Properties, et als, (HUD-L-6587-03) and Township of North Bergen v. Spylen of North Bergen, Inc (A-6868-03T2), clearly give a property owner the right to raise all these defenses to the eminent domain taking.

It should be noted there was a prerogative writ suit in the matter of 110 Washington Street v. Township of Bloomfield that was heard by Judge Claude M. Coleman and dismissed because it was filed beyond the 45-days to contest municipal action. Judge Coleman made no findings of fact or conclusions of law on the merits of the prerogative writ case, which effectively prevented Bloomfield’s counsel from arguing judicial estoppel.

In the consolidated Lodi cases — actions in lieu of prerogative writ contesting the municipality’s determination of blight — Judge Donohue found the municipality had not established by substantial evidence the premises in question were in need of redevelopment. The court concluded the municipality’s actions were arbitrary and capricious. The standard for judicial review of a blight declaration is limited to whether the municipality’s action is supported by substantial evidence. See Hirth v. City of Hoboken Supra 337 N.J. Super. at 161; Levin v. Township of Bridgewater, 57 N.J. 506 (1971).

Consistent with the decisions of Judges Costello and Donohue cited above, the Appellate Division approved for publication an opinion by Judge Parker in the matter of ERETC, L.L.C. v. City of Perth Amboy A-2035-04T2, decided Nov. 15, 2005. The plaintiff, ERETC, owns a light manufacturing building located in the proposed redevelopment area. ERETC uses part of the building, which is in good condition, and rents the remainder. The preliminary report of the city’s planner identified criteria D and E of the LRHL applicable to the area. At trial the plaintiff ’s expert testified she found the plaintiff ’s property to be neat, maintained and painted, with no apparent structural flaws. She concluded the city planner’s report was “inadequate and void of any information that would lead to the conclusion that was obtained by the City which was that the area was in need of redevelopment.” A mere recitation of the criteria of the statute without substantiation of the criteria is not enough to declare a property in need of redevelopment. In the appeal, the court states that nowhere in the report did the city planner “undertake an analysis of the statutory criteria as it applied to each of the properties in the designated area.” The court reversed and remanded to the planning board for reconsideration.

This is an example of a win, but the redevelopment plan could proceed once the errors and defects in the report are corrected. The developer behind the municipality will keep funding legal maneuvers. The power of eminent domain doesn’t go away. Even if municipalities such as Bogota pass resolutions that they are not going to use it, they cannot abolish it. Agencies can’t abolish it. Only the legislature can change it.

Federal legislative reform?
The U.S. House of Representatives Bill 4128 was passed Nov. 3, 2005. Also known as “Private Property Rights Protection Act of 2005,” its purpose is to preserve property rights granted under the Fifth Amendment of the U.S. Constitution following the Supreme Court’s decision in Kelo v. City of New London. Some key provisions:

(a) In General — No State or political subdivision of a State shall exercise its power of eminent domain, or allow the exercise of such power by any person or entity to which such power has been delegated, over property to be used for economic development or over property that is subsequently used for economic development, if that State or political subdivision receives Federal economic development funds during any fiscal year in which it does so.

(b) Ineligibility for Federal Funds — A violation of subsection (a) by a State or political subdivision shall render such State or political subdivision ineligible for any Federal economic development funds for a period of 2 fiscal years following a final judgment on the merits by a court of competent jurisdiction that such subsection has been violated ...

The Federal Government or any authority of the Federal Government shall not exercise its power of eminent domain to be used for economic development.

(a) Cause of Action — Any owner of private property who suffers injury as a result of a violation of any provision of this Act may bring an action to enforce any provision of this Act in the appropriate Federal or State court, and a State shall not be immune under the eleventh amendment to the Constitution of the United States from any such action in a Federal or State court of competent jurisdiction. Any such property owner may also seek any appropriate relief through a preliminary injunction or a temporary restraining order.

The bill now proceeds to the Senate where its companion, S-1313, sponsored by Sen. John Cornyn (R-Texas), will be taken up by the Senate Judiciary Committee. The committee conducted its last hearing Sept. 20, 2005. This act may be cited as the “Protection of Homes, Small Businesses, and Private Property Act.” Its objective is similar: to protect homes, small businesses, and other private property rights by limiting the power of eminent domain.

NJ’s eminent domain reform bills
  • ACR 255 proposes a constitutional amendment to limit exercise of eminent domain to acquisition of land for essential public purposes. The amendment defines “essential public purposes” as transportation corridors, educational facilities, airports, correctional facilities, stormwater management facilities, in-patient health facilities and recreational facilities. The sponsors believe Kelo left New Jersey homeowners more vulnerable to overreaching government action that impairs private property rights. The resolution was introduced Nov. 10, 2005.
  • ACR 256 proposes a constitutional amendment to limit the use of condemnation to traditional public purposes; repeals constitutional provision allowing condemnation and long-term tax exemptions for redevelopment projects. Introduced Nov. 10, 2005 and referred to the assembly Housing and Local Government Committee, this resolution amends Article I, paragraph 1 and repeals Article VIII, Section III, paragraph 1 of the constitution. It restricts the use of eminent domain to condemn land and transfer the land to a private person or entity to projects that fulfill a traditional public purpose, and would repeal the provision that allows condemnation of properties in blighted areas for redevelopment purposes.
  • S-177 specifies bona fide negotiations in eminent domain proceedings and clarifies establishment of compensation for business owners. This amendment to the “Eminent Domain Act of 1971” would increase government responsibility and accountability in condemnation actions and clarifies how active businesses should be treated in condemnation actions. The burden would be on the municipality or redevelopment entity to demonstrate that the proposed use of the business property is of significant public interest to justify relocation or closure of the business at that location.
  • S-2739 prevents use of condemnation to acquire residential property under redevelopment laws. This bill seeks to prevent the taking of private homes and residential units by condemnation in order to accomplish economic development objectives, such as the construction of non-public office buildings, mega-stores and shopping centers. This amendment would require the governing body of the municipality to authorize the planning board by ordinance — not resolution — to undertake a preliminary investigation to determine whether a proposed area is a redevelopment area. All notices of hearings must be sent to the property owners by certified mail.
  • S-2832 places a temporary moratorium on use of eminent domain for economic development purposes; and creates Eminent Domain Study Commission to examine its use statewide.

More than 30 states are reviewing or planning to review their eminent domain laws during upcoming legislative sessions. Since June 2005, Alabama, Texas and Delaware enacted laws that have revised their eminent domain procedures. Gov.-elect Jon S. Corzine addressed the power of eminent domain in a statement issued last summer during his campaign:
“While there have been many legitimate and appropriate uses of eminent domain throughout history, we have also seen abuses of this power. We have seen a family lose their home and receive just $14,000, only to see the town quickly sell the property to a developer for $60,000. We have seen so-called redevelopment plans knock down housing that was affordable to long time community residents, only to displace them with luxury condominiums, without giving any thought as to where people with roots in the neighborhood would live. With dozens of New Jersey municipalities focused on redevelopment — we need to act decisively to protect our citizens as we revitalize our aging neighborhoods. A Corzine administration will not tolerate abuse in the name of economic development.”

The eminent domain issue is on the front-burner with state and federal legislators. There will be changes made to state eminent domain acts, and prospects appear good for federal legislation that would severely limit federal funds to municipalities in violation of the act. This is a big stick.

The ball now is in the U.S. Senate’s court. It is clear from the overwhelming vote in the House, which more closely reflects the will of the people, that representatives are ready for change. The Senate must be aware of this or they will risk the wrath of the voters when up for re-election.

In New Jersey, it’s time for the governor to appoint an Eminent Domain Revision Committee to review the entire Eminent Domain Act of 1971 and the Local Redevelopment Housing Law. These acts should not be amended piecemeal. It has been almost 35 years since the eminent domain law was approved — it is now time for a comprehensive new act.

New Jersey Lawyer: www.njlnews.com

William J. Ward has been practicing eminent domain law for 35 years. He is managing partner at Carlin & Ward in Florham Park and author of the New Jersey Eminent Domain Law Blog: njeminentdomain.com.

Taking Notice: New York (NY) Sun, 12/7/05


Monday's ruling by a federal appeals court in an eminent domain case comes as welcome news for those who had worried that the Supreme Court's disastrous ruling in Kelo v. New London would be the last judicial word on whether and when and how the government can take a private individual's property. In this case, Brody v. Village of Port Chester, the 2nd Circuit here in New York ruled that the Empire State's old eminent domain law was unconstitutional. On its face, the ruling may look like a moot issue because the law that was challenged has since been changed, but it is actually an important decision that could have some significant effects.

William Brody bought two adjacent parcels of land in Port Chester in 1996, on which he renovated four buildings that he then rented out to local businesses. However, the village eventually developed a broader redevelopment plan for its downtown and waterfront areas and decided to seize Mr. Brody's property so that a private developer could build a parking lot on it. Under the state Eminent Domain Procedure Law in effect at the time, the village's industrial development agency only needed to publish a vague notice in a local newspaper to inform landowners of the one opportunity they would have to challenge the village's decision to take their property.

Mr. Brody argued that he had missed such a hearing because he had not been properly informed that it was going to occur, a claim a three judge appeals panel credited unanimously. The government violated Mr. Brody's 14th Amendment right to due process; the village should have mailed him - and other landowners - an individual notice that his property was in danger. In one sense, the practical effects of this case will be limited. Thanks to the efforts of Assemblyman Richard Brodsky, the state has long since changed the law to require individual notice of the sort the court has just mandated in Brody.

The assemblyman has moved on to further reforms, such as requiring local legislative bodies like city councils to actually vote on eminent domain takings. Mr. Brody's buildings have already been razed. But, as both a lawyer at the Institute for Justice who represented Mr. Brody, Dana Berliner, and a spokesman for Mr. Brodsky, James Malatras, told us, there may be many New Yorkers whose land had been condemned under the old law but who didn't even know about it because the government hasn't yet moved to seize control. It's hard to count these individuals because often they themselves do not even know they might be affected.

The case will have larger implications. Ms. Berliner notes that many states and localities attempt to use procedural tricks such as hiding notice of hearings to make it easier to exploit their powers of eminent domain. Now, a federal appeals court has quashed that. Even though the Supreme Court's Kelo ruling stands, allowing takings for private economic development projects, government will not have carte blanche in respect of how it takes the property. Mr. Malatras points out that, in basing its ruling on the Fourteenth Amendment, the appeals court has reminded everyone that significant constitutional issues remain to be considered in the eminent domain debate. Brody will serve as a wake-up call to eminent domain exploiters and reformers alike that the fight over how to restrain this government power is not over yet.

New York Sun: www.nysun.com

Senate acts to limit economic use of eminent domain: Philadelphia (PA) Inquirer, 12/8/05

Critics warned that community renewal could be harmed. Rendell has reservations over the bill.

By Diane Mastrull and Angela Couloumbis

Despite warnings that the revitalization of cities and older towns would suffer, the Pennsylvania Senate yesterday passed legislation to limit government's ability to seize private land for economic reasons.

The so-called Property Rights Protection Act, which prohibits the use of eminent domain for private economic development and tightens the definition of blight, was unanimously approved and heads to the House for consideration. The House passed a similar measure last month.

But Senate Bill 881, written by Senate Majority Whip Jeffrey Piccola (R., Dauphin), has been considered the leading legislation of several bills pending in Harrisburg aimed at reining in the controversial property condemnation process of eminent domain.

Those efforts, along with others in Congress and in more than 30 states, are in response to a U.S. Supreme Court decision in June that expanded the concept of what is a justified use of eminent domain.

In Kelo v. the City of New London, the justices ruled that the Connecticut city could force the sale of homes and businesses in a neighborhood not deemed blighted to make way for private economic development.

What followed were predictions by property rights groups of land grabs by local governments. Lawmakers rushed to their statehouses with proposals aimed at slamming shut a door the justices opened.

"The idea that a citizen's property can be taken by the government and turned over to another citizen for nongovernmental use is simply an outrageous proposition and something that was never intended by our founding fathers," Piccola said in a statement yesterday.

Redevelopment advocacy groups lobbied right up to yesterday's late-afternoon vote to try to get what they considered the most objectionable provisions in the bill stricken. Those included a ban on the use of eminent domain for private investment and a requirement that a majority of a property must be blighted in order for condemnation to be used to acquire it.

Those efforts were fruitless.

"The bill is detrimental to the state as a whole and particularly to our older communities," said Janet Milkman, president of 10,000 Friends of Pennsylvania. "Private investment is the key to their survival and this bill chases it away."

Milkman said her group would now work on getting the House to amend the bill or pass another bill "that better reflects the realities of redevelopment and the actual impact of eminent domain in Pennsylvania."

Among those supporting Piccola's bill is the Washington-based Institute for Justice, a Libertarian public interest, nonprofit law firm that locally has helped Lower Merion residents fight a plan by the township to possibly use eminent domain to revitalize the Ardmore business district.

Steve Anderson, a lawyer with the institute, said the Piccola bill could serve as a national model for eminent domain legislation in that "it attacks both condemnations for private commercial development and blight."

Gov. Rendell is not yet won over.

"We still believe there is more work to be done," said Rendell spokeswoman Kate Philips. "The governor has said he can support a bill that strikes a fair balance between homeowners' rights and the good of an overall community. Hopefully, we can get something to the governor's desk that does that."

Philadelphia Inquirer: www.philly.com


Rangel wants eminent domain bill reworked: New York (NY) Business.com, 12/5/05

By Erik Engquist

The bill to restrict the use of eminent domain that overwhelmingly passed the House should be revised in the Senate, said Rep. Charlie Rangel, D-Manhattan.

Speaking at a Crain’s New York Business forum today, Rep. Rangel said the bill should clarify the conditions for eminent domain usage rather than leave the question to courts. He would allow eminent domain if it were used to produce affordable housing, he said. The bill seems to allow for that, though it isn't mentioned specifically in the text, his office said.

Reps. Anthony Weiner, D-Queens, and Carolyn Maloney, D-Manhattan, who appeared with Rangel at the forum and who also voted for the House bill, remain opposed to any use of eminent domain to benefit a private developer. “Eminent domain is one of the most awesome powers of government and should only be used for public good,” said Rep. Maloney. They didn’t mention the affordable housing issue.

Rep. Weiner said he supports the Atlantic Yards project proposed for Brooklyn by Forest City Ratner Cos. He predicted the company will be able to purchase all the needed property without using eminent domain.

New York Business.com: www.newyorkbusiness.com

Sanford to push for protection against eminent domain: WIS-TV (Columbia SC), 12/5/05

By Bryce Mursch

Governor Mark Sanford was in Aiken on Monday to emphasize the need for strengthening the state's eminent domain laws in the wake of a recently-defeated local TIF proposal.

Earlier this year, the governor vetoed S.97 because of his concern that it expanded eminent domain powers at the expense of private property rights. That same bill was almost used to create a TIF district that gave benefits to private developers.

Governor Sanford said that issue, combined with the recent US Supreme Court decision, Kelo v. City of New London, Connecticut, have illustrated the need for stronger eminent domain protections in our state, and that he will work with leaders in the General Assembly to promote that legislation in the coming year.

"Protecting property that people have invested money, work and time into over the course of many years is key to allowing families to create wealth, and key to the notion of quality of life," Gov. Sanford said. "I think the recent US Supreme Court decision was a step in the wrong direction when it comes to protecting one of our most important constitutional rights, and it means we have to take a new look at and shore up existing laws rather than be forced to react later on down the road."

Sanford identified several issues for possible incorporation into a bill in the coming legislative session. Among those are limiting which governmental authorities can use eminent domain, better defining the term "public use," and tightening the definition of what constitutes a "blighted area."

Gov. Sanford also thanked key legislators that have committed to working on this issue going forward.

Since the Kelo decision, at least 21 other states have begun work on strengthening their eminent domain statutes. Several states are considering constitutional amendments, while the governor of Connecticut, where Kelo originated, has called for a moratorium on cities using their eminent domain powers.

Alabama and Texas both called a special legislative session to deal with the issue.

WIS-TV: www.wistv.com

The Kelo Backlash So Far: Positive Liberty, 12/05

By Timothy Sandefur, Pacific Legal Foundation

In the months after the Kelo decision was announced there was much talk of a "backlash" in the states. Since state law can provide greater protections to people than federal law does, people hoped to change state law to protect themselves from eminent domain abuse. But, as I argue in a forthcoming paper, the backlash so far has accomplished little.

Most state legislatures have been out of session since shortly after Kelo was announced, which means that so far only four states have enacted laws in response to Kelo: Alabama, Texas, Ohio, and Delaware. Unfortunately, these four provide little protection for property owners, despite their big promises. In other states, the situation has been even more disappointing. California's legislature considered three measures to limit eminent domain abuse, and turned all three down, even though two of these would have been band-aid solutions that would have done very little.

When the other state legislatures come back into session in January, can citizens of other states hope for greater protection? Only time will tell, but I'm pessimistic. There are two major obstacles to serious eminent domain reform: the public choice effect, and the sad state of American political philosophy. Still, there may be reason for optimism: the Pennsylvania state house has passed a bill which, if enacted, would create excellent protections for the state's property owners, and the U.S. House of Representatives has also passed an excellent bill limiting the availability of federal funding for projects in which eminent domain is used for economic development.

Let's take a very brief look at the four bills that have passed, as well as the three proposals that failed in California, and then the Pennsylvania and federal laws that have each made it half way through their respective legislatures.

On August 3, Alabama became the first state to respond to Kelo by enacting S.B. 68A. This law adds two sections to the Alabama State Code. After reaffirming the power of eminent domain, the operative paragraph of the first section declares that

Notwithstanding any other provision of law, a municipality or county may not condemn property for the purposes of private retail, office, commercial, industrial, or residential development; or primarily for enhancement of tax revenue; or for transfer to a person, nongovernmental entity, public-private partnership, corporation, or other business entity. Provided, however, the provisions of this subsection shall not apply to the use of eminent domain by any municipality, housing authority, or other public entity based upon a finding of blight in an area covered by any redevelopment plan or urban renewal plan pursuant to Chapters 2 and 3 of Title 24, but just compensation, in all cases, shall continue to be first made to the owner.

The italics highlight the problem. Although SB 68A forbids the use of eminent domain for private uses or solely to enhance tax revenue, it continues to permit the use of eminent domain for redevelopment pursuant to two chapters of Title 24 of the Alabama Code, sections devoted to urban renewal and redevelopment projects.

Chapter 2 of Title 24 targets neighborhoods which "impair economic values and tax revenues, cause an increase in and spread of disease and crime and constitute a menace to the health, safety, morals and welfare of the residents of the state." It allows "the clearance, replanning and preparation for rebuilding of these areas and the prevention or the reduction of blight." The "clearance" — i.e., condemnation — of such areas is declared to be a "public use[] and purpose[] for which public money may be spent and private property acquired." The chapter specifically authorizes a government "housing authority…or any incorporated city or town" to use eminent domain

(1)…[t]o acquire blighted areas, which are hereby defined as areas, including slum areas, with buildings or improvements which, by reason of dilapidation, obsolescence, overcrowding, faulty arrangement or design, lack of ventilation, light and sanitary facilities, excessive land coverage, deleterious land use or obsolete layout, or any combination of these or other factors, are detrimental to the safety, health, morals or welfare of the community;

(2) To acquire other real property for the purpose of removing, preventing or reducing blight, blighting factors or the causes of blight….[and]

(4) To sell or lease land so acquired for uses in accordance with the redevelopment plan….

Chapter 3 gives similar authority to officials to "plan and undertake urban renewal projects," including the authority to "eliminat[e] (and…prevent[]…the development or spread) of slums or blighted, deteriorated or deteriorating areas." Among the things that cities may do to "prevent the development of deteriorating areas" are the following:

Acquisition of real property [through eminent domain] and demolition, removal or rehabilitation of buildings and improvements thereon, where necessary to eliminate unhealthful, unsanitary or unsafe conditions, lessen density, reduce traffic hazards, eliminate obsolete or other uses detrimental to the public welfare, or to otherwise remove or prevent the spread of blight or deterioration or to provide land for needed public facilities.

Before exercising the power to "acquire," or "demolish," or "remove" buildings which are "obsolete" and "detrimental to the public welfare," city officials must create a redevelopment or urban renewal plan. Such a plan must "provide[] an outline for the development or redevelopment of [the targeted] area and [must be] sufficiently complete:

(1) To indicate its relationship to definite local objectives as to appropriate land uses and improved traffic, public transportation, public utilities, recreational and community facilities and other public improvements;

(2) To indicate proposed land uses and building requirements in the area; and

(3) To indicate the method for the temporary relocation of persons living in such areas and also the method for providing, unless already available, decent, safe and sanitary dwellings substantially equal in number to the number of substandard dwellings to be cleared from said area, at rents within the financial reach of the income groups displaced from such substandard dwellings.

This requirement is a procedural barrier that is quite easy for city officials to cross. The requirements impose no limit on the uses to which private property may be put as part of a redevelopment plan, so a plan may include redistribution of property to private developers. Even non-blighted, commercially viable property may be condemned in Alabama if it is part of a neighborhood that is declared blighted: "the mere fact that some of the buildings in the area are standard and substantial does not require that they be omitted from the operation of the project." And since Alabama's redevelopment laws allow not only for the eradication of slums, but also for the "prevention" of "deteriorating" areas, redevelopment authorities are free to condemn property solely for the purposes of improving the local economy.

So, under Title 24, city officials may declare property "deteriorating" whenever it fails to perform economically up to an standard that they would prefer to see. Officials may draft a redevelopment plan, adopt it by a city council vote, and use it to condemn homes and businesses for economic development.

None of this is changed by SB 68A. It specifically preserves the operation of Chapters 2 and 3 of Title 24 without alteration. The new law simply reiterates that the state may condemn property only after it has followed the relatively simple procedure of declaring the area blighted and preparing a redevelopment plan. These are not serious obstacles to determined developers and bureaucrats.

On September 1, Texas Governor Rick Perry signed SB 7B, a long bill which in some ways repeats the errors of the Alabama legislation, and in other ways, does improve protections for Texas property owners. SB 7B amended Texas' eminent domain laws to prohibit "the use of eminent domain" if the taking:

(1) confers a private benefit on a particular private party through the use of the property;

(2) is for a public use that is merely a pretext to confer a private benefit on a particular private party; or

(3) is for economic development purposes, unless the economic development is a secondary purpose resulting from municipal community development or municipal urban renewal activities to eliminate an existing affirmative harm on society from slum or blighted areas under:

(A) Chapter 373 or 374, Local Government Code, other than an activity described by Section 373.002(b)(5), Local Government Code; or

(B) Section 311.005(a)(1)(I), Tax Code.

As with the Alabama law, the exceptions provided for in subsection 3 undo many of the promised protections of subsections 1 and 2. Under the Fifth Amendment's Public Use Clause, even after Kelo, it is already unconstitutional for states to employ their eminent domain power to "confer a private benefit on a particular private party" or to do so under a pretext. The problem is that "public benefit" is defined so broadly, and that legislatures are given so much judicial deference, that almost any private benefit can be rationalized as being public benefits, and hence evade the supposed limits on eminent domain.

Although the Texas Constitution declares that property may only be taken for a public use, the state's courts, like federal courts, have interpreted the "public use" requirement to allow the transfer of condemned property to private parties so long as doing so benefits the public in some way. In fact, chapters 373 and 374 of Texas' Local Government Code — which cover "community development" and "urban renewal," respectively — are unusually explicit in the degree to which they allow for private entities to benefit from the use of eminent domain. Under Texas law, eminent domain may be used to condemn private property that fails to perform economically, and to transfer, lease, or sell that property to private developers who use the property for their own profit.

There are, however, two significant improvements in the Texas reform measure. First, although it allows condemnations under chapters 373 and 374 to continue unaltered, it does limit the use of eminent domain as provided for by other Texas statutes. The state's laws allow cities to condemn property to construct sports stadiums, or to provide "librar[ies]," "auditorium[s]," "market house[s]," "recreational facilit[ies]," or "for any other municipal purpose the governing body considers advisable." Texas even explicitly allows local governments receiving federal economic development grants to "lease or convey [condemned] land…without the solicitation of bids, to a private, for-profit entity or a nonprofit entity…if the land or interest will be used by the private, for-profit entity…in carrying out the purpose of the…grant…if the [city] adopts a resolution stating the conditions and circumstances for the lease or conveyance and the public purpose that will be achieved." All of these provisions are now restricted. This was made clear by the fact that, at the last minute, some craven legislators amended the bill specifically to allow the Dallas Cowboys to continue with their plan to condemn private property for the construction of a football stadium!

The second improvement in SB 7B is its limitation on the deference accorded to condemnation decisions. It declares that "the determination by the governmental or private entity" that a proposed condemnation "does not involve" a forbidden private taking "does not create a presumption" which courts are obliged to follow. In simpler terms, a legislative declaration that a taking is for a public use shall not receive judicial deference. This is probably the most significant part of the legislation, given the threat that such deference poses to property owners. In the past, Texas courts have declared that "where the legislature has declared a certain act to be for a public use, such declaration must be given weight by the courts," which makes it difficult for property owners to prevail. By eliminating this presumption, SB 7B provides for genuine judicial review of the legitimacy of takings.

S.B. 217, signed by Governor Ruth Ann Minner on July 21, is little more than a paragraph long. It declares that:

Notwithstanding any other provision of law to the contrary, the acquisition of real property through the exercise of eminent domain by any agency shall be undertaken, and the property used, only for the purposes of a recognized public use as described at least 6 months in advance of the institution of condemnation proceedings: (i) in a certified planning document, (ii) at a public hearing held specifically to address the acquisition, or (iii) in a published report of the acquiring agency.

The bill also amends a section of the law to pay for the attorneys' fees of parties whose property is taken through eminent domain.

While the six month cooling-off period may have its advantages, it has three major flaws. First, the provision does not affect the definition of a "public use" in any way. Second, while allowing the public an opportunity to protest the condemnation of property is certainly laudable, the security of private property rights cannot be entrusted to the political process. Third, a six-month cooling off period may prove unworkable without exceptions, which may doom this provision to being amended and eventually repealed.

The definition of "public use" is, of course, at the heart of the entire controversy over eminent domain. The Delaware reform measure simply refers to "a recognized public use." But the state's courts have held that "agencies of the State may condemn private property [and transfer it to private parties] provided that the primary purpose of the condemnation is to benefit the public." Without defining "public use" with greater precision, the Delaware reform measure will do little.

The six-month requirement is likely to give residents of affected neighborhoods time to rally in opposition to an exercise of eminent domain, and such political opposition has proven effective in restraining abuses of eminent domain. But political opposition is simply not enough to prevent the abuse of this power. As Justice Robert Jackson famously noted, "[t]he very purpose of a Bill of Rights was to withdraw certain subjects from the vicissitudes of political controversy, to place them beyond the reach of majorities and officials and to establish them as legal principles to be applied by the courts. One's right to…property…may not be submitted to vote; they depend on the outcome of no elections." While it is gratifying to see citizens protesting the abuse of their rights and challenging such abuses at the ballot box, it is not a sign of constitutional health.

Finally, the prevalence of so-called "quick take" measures reveals that in many circumstances, a strict waiting period is simply not considered possible, and it is easy to conceive of at least some emergency instances in which it would be legitimate for government to condemn property more quickly. In such a circumstance, it is far more likely that exceptions will be added to the sixth-month requirement than that the state will abide by it in the face of extraordinary pressure. As Alexander Hamilton once observed, "[w]ise politicians will be cautious about fettering the government with restrictions that cannot be observed, because they know that every breach of the fundamental laws, though dictated by necessity, impairs that sacred reverence which ought to be maintained in the breast of rulers towards the constitution of a country, and forms a precedent for other breaches where the same plea of necessity does not exist at all, or is less urgent and palpable."

Ohio is one of the most abusive states when it comes to eminent domain. The state's courts are extremely deferential to legislative declarations that an area is "blighted," and they will only overturn such declarations when they are "arbitrary," "unconscionable," or if there is "no sound reasoning process that would support that decision." Thus Ohio courts not only interpret "public use" liberally, but even give "a liberal interpretation" to the term "blight."

Ohio's reaction to Kelo, SB 167, imposes a moratorium, effective until December 31, 2006, on all condemnations of "private property that is not within a blighted area, as determined by the [condemning agency], when the primary purpose for the taking is economic development that will ultimately result in ownership of that property being vested in another private person."

During the moratorium period, a Legislative Task Force to Study Eminent Domain and Its Use and Application, will convene to study the issue and write a legislative report. This task force will be made up of 25 members: three members of the state House, three members of the State Senate, one "member who shall be a statewide advocate on the issues raised in Kelo," one attorney representing Ohio property owners, two attorneys with special expertise in eminent domain law, one non-attorney representative of Ohio property owners, one person representing small businesses, one person delegated by the Director of Development, another delegated by the Director of Transportation, and one member each representing the following: the "home building industry," the real estate industry, the planning industry, licensed realtors, labor unions, historic preservation organizations, municipal corporations, counties, townships, and a representative of the Ohio Prosecuting Attorneys Association or the Ohio Association of Probate Judges.

Three observations come immediately to mind: First, this moratorium does not apply at all to condemnations of property that are already "within a blighted area." Condemnations in these properties may proceed unhindered. Second, it seems to apply only to condemnations of property for "economic development," as distinguished from condemnations that are supposed to eradicate blight. But these are not distinguishable concepts. Because properties are often declared blighted due to their failure to perform up to a desirable economic level, economic development projects routinely start with a declaration that the current use of property constitutes a blight. Finally, and most importantly, the Ohio Legislature is not obligated to act on the Task Force's report in any way. Considering the state's record it seems highly unlikely that serious reform will follow the Task Force's report.

Despite much public outrage over the Kelo decision, California has yet to enact any provision to limit the abuse of eminent domain. Three attempts to limit the power redevelopment condemnations were quickly buried by the state Legislature.

The first proposal, SCA 12, would have amended the state Constitution by adding a single sentence: "Public use does not include the taking of owner-occupied residential property for private use." This provision has two flaws. First, it is already the law, and always has been, both in California and nationally, that private property may not be taken for "private use." Kelo does not declare otherwise. It simply held that a taking is not a "private use" if it is rationally related to a legitimate public interest. Since condemnation and private transfer of property in blighted areas is considered a public use, a ban on takings for "private use" would be legally meaningless. Second, SCA 12 would have applied only to "owner-occupied residential property," and not to businesses, apartments, churches, or other private property throughout the state. This is startling, given that most victims of private takings in California appear to be small businesses. The condemnation of the Gran Havana Cigar Factory in San Diego is a prime example.

The second California proposal, SB 1026, was also limited to "owner-occupied residential property." Like the Ohio reform measure, this proposal would have imposed a two-year moratorium on condemnations of such property, while a committee wrote a report on eminent domain abuse. Like SCA 12, this proposal would have done nothing to protect businesses, churches, apartment buildings, or other properties. Unlike SCA 12, this proposal actually defined "private use" — as "any use other than as a public facility or a public works that is owned and operated by the public entity" — which would have given the proposal at least some legal significance. But since it only imposed a moratorium, without requiring that the state legislature do anything once the investigation was completed, the proposal would probably have accomplished little.

The third proposal, SCA 15, would have imposed meaningful limitations on the abuse of eminent domain. It would have amended the state Constitution to prohibit the use of eminent domain except where the taken property was "owned and occupied by the condemnor, or another governmental agency utilizing the property for the stated public use…or…leased only to entities…regulated by the Public Utilities Commission." Although it allowed for the incidental use of government property for "gift shops, newsstands, shoeshine stands" and other occasional uses, as well as the use of eminent domain to provide for public utilities, SCA 15 would have forbidden government from taking people's homes, businesses, farms, churches, or other property, and giving the land to private commercial entities for their own use and profit. SCA 15 would therefore have restored the "actual public use" interpretation of the public use clause, whereby eminent domain could only have been used to provide government-owned, and government-operated buildings, including roads, schools, or parks.

All three of these proposals were defeated in the state legislature. As well-known Sacramento journalist Dan Walters noted, defenders of eminent domain hoped to "cool off the anti-eminent domain fervor," by drafting "legislation that would place a two-year moratorium on the seizure of private homes (but not commercial property), and authorize a study of the practice, thus giving their members a chance, or so it seemed, to side with the anti-eminent domain sentiment without doing any real damage to redevelopment agencies." But even such watered-down proposals failed. At the time of this writing, several other bills are still pending in the legislature, but few of them promise serious protection for property owners.

On November 1, the Pennsylvania House of Representatives passed HB 2054. This bill prohibits the use of eminent domain "to take private property in order to use it for private commercial enterprise." The only exceptions are cases in which the property owner consents, where the property is transferred to "a common carrier" or "incidental" commercial activities such as gift shops or newsstands in government buildings, where the condemnation is necessary to eliminate public nuisances or dangerous buildings, or where the condemnation is necessary to eliminate "blight" as narrowly defined by the bill itself.

The definition of blight in HB 2054 eliminates the possibility of economic development condemnations in the style of Kelo: it allows government to declare property blighted only if it is actually a danger to the public (e.g., "a structure which is a fire hazard or is otherwise dangerous to the safety of persons or property"; or "any vacant or unimproved lot…in a predominantly built-up neighborhood which, by reason of neglect or lack of maintenance, has become a place for accumulation of trash and debris or a haven for rodents or other vermin"). In addition, it places a 10-year limit on the lifespan of any declaration of blight.

The Pennsylvania bill is a well-crafted, carefully thought-out measure which provides serious protection for property owners, while allowing government to eliminate actual cases of dangerous or misused property. It contains none of the loopholes of the Alabama or Texas measures. The bill is now awaiting approval in the Pennsylvania State Senate.

The United States
Although the federal government does not usually engage in redevelopment condemnations itself, federal funding is behind a great many such cases, including the notorious Poletown case in Michigan. HR 4128, the "Private Property Rights Protection Act of 2005," received an overwhelming vote of 376 to 38 on November 3. The bill prohibits states or cities from exercising eminent domain "over property to be used for economic development…if that State or political subdivision receives Federal economic development funds." It defines condemnation for economic development as "taking private property, without the consent of the owner, and conveying or leasing such property from one private person or entity to another private person or entity for commercial enterprise carried on for profit, or to increase tax revenue, tax base, employment, or general economic health." It allows condemnations for common carriers, roads, military installations, the elimination of nuisances, and other traditional uses of eminent domain. States or cities violating the prohibition are punished by being made ineligible for federal funding for two years.

Considering the enormous influence that federal funding has on local governments, there is reason to believe that if HR 4128 is passed by the Senate and signed by the President, it will greatly limit the number of Kelo-style redevelopment takings.

Positive Liberty: http://positiveliberty.com

Timothy Sandefur is an attorney with the Pacific Legal Foundation:

Lawmakers will seek to limit eminent domain: Pueblo (CO) Chieftan, 12/2/05


By Lewis Entz, CO State Senator

One of the most critical issues that the Colorado General Assembly will take up in the coming session is the limitation of eminent domain. Eminent domain is the process that the government uses to take private property away from landowners and use it for the public good, such as for a highway or a school.

Last June, the U.S. Supreme Court delivered a very troubling ruling, in Kelo v. City of New London, that expands eminent domain powers far beyond this traditional role. The Kelo ruling allows governments to take land from one private owner and give it to another private owner for no reason other than to generate more tax revenue. I’ve received many cards and letters from constituents concerned about the abuse of eminent domain following that widely reported court decision. I’m writing to let all my constituents know I’ve heard your concerns on this important issue - and I’m on your side.

Any time the government takes land by force and gives it to another private party, we’re treading on dangerous ground. But this Kelo decision sets such a low standard for justifying it - that there be some vague “public benefit” - that abuse is all but certain.

I’ve been serving in the Legislature long enough to know that the “public benefit” usually is not in the best interests of the homeowner or the business owner.

As Justice Sandra Day O’Connor pointed out, this new standard places all private property at the whims of politicians: "The specter of condemnation hangs over all property. Nothing is to prevent the state from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory."

The good news is that Colorado can still place legal restrictions on eminent domain in order to curb the ability of local governments to condemn private land. The scope of eminent domain is a perennial issue in the Legislature, but this year there will be need to comprehensively review and define the limitations of government takings.

Even before the Kelo decision, many local governments in Colorado have used eminent domain to supplant private property with more lucrative big-box developments. These abuses have generally taken place in the Denver metropolitan area, and it is unlikely that they would occur in the San Luis Valley and other rural areas. However, property rights are too fundamental to our way of life to leave this to chance.

There are other concerns here as well. As unlikely as it might seem, the Kelo ruling could open the door for local governments to pursue other agendas at the expense of landowners. It could easily be used to turn private property into open space for environmental protection. More radically, it could be used to condemn gun shops, shooting ranges, and hunting lands in an indirect attack on gun rights. I think we can all agree that such pursuit of political agendas would be unacceptable, and an unconscionable abuse of eminent domain.

As the Legislature works next year to clearly define what is and is not a legitimate use of eminent domain, I will be making sure that property rights of all kinds are protected from egregious abuses. The standard for taking property from one private party and giving it to another needs to be a very, very high hurdle.

Pueblo Chieftan: www.chieftain.com

Lewis Entz represents Senate District 5, which includes Alamosa, Conejos, Costilla, Mineral, Rio Grande, Saguache, Delta, Pitkin, Chaffee, Gunnison, and Hinsdale counties. He serves on the Senate Agriculture Committee and the Senate Local Government Committee. He can be reached at the capitol at 303-866-4866 or by email at lewis.entz.senate@state.co.us.