Eminent domain now big business: Chicago (IL) Tribune, 1/3/06

Lawmakers, owners confront land grabs

By Crystal Yednak

One day at the age of 82, Irene Angell received an unexpected letter. The city of Des Plaines needed her home and planned to use eminent domain to force her to sell it.

Angell lived in the home for more than 80 years. Before that, it was her father's home, and before that it was her grandfather's home.

And now, it's a Walgreens.

Opting to trade in Angell's home for a retailer with jobs and more tax revenues, Des Plaines invoked a power that local governments have used more than 250 times over the past five years for economic development, a Tribune review of court records shows.

With the national debate over eminent domain expected to sweep into Springfield in January, municipalities are cautioning against overreacting to a recent U.S. Supreme Court ruling that upheld the use of eminent domain for private economic development.

But property owners who have been forced to clear out for strip malls or big-box stores hope the public outcry against eminent domain will prompt Illinois lawmakers to act.

"I still don't think that with private property, a city or state should have the right to go in and force someone out to give it to someone else," said Angell, now 86 and living in Florida.

Overwhelmingly, the eminent domain cases filed in Cook, Kane, DuPage, Lake, McHenry and Will Counties are for traditional public purposes, such as highways, schools, libraries, police stations — projects that will be owned by the government for the public use.

But a review of court cases filed since 2001 shows local governments have used eminent domain powers in many redevelopment projects where private companies end up in control of the land.

Municipal officials say this is nothing new and the current system should not be changed. Chicago area communities have used eminent domain in this way for decades to dream up new plans, they say.

Recent cases range from Chicago's efforts to remake decaying blocks in Englewood and the stockyards area to St. Charles' attempt to replace businesses along the Fox River with condos and retail.

"When the city is taking land for economic development, it's taking it in terms of advancing the public purpose of eliminating slum and blight," said Steve Holler, chief assistant corporation counsel for the City of Chicago's real estate division.

Without eminent domain, Holler said, the city would not see the Wilson Yards project now underway at Montrose Avenue and Broadway. The project will bring senior housing, a Target store, movie theaters and other businesses to the site of a former CTA railyard and a building that housed an adult bookstore.

City officials say they need ways to move out holdouts who can stand in the way of projects that can benefit the whole community.

For example, Chicago recently used eminent domain to obtain land from some owners who were sitting on property along 79th Street, said Langdon Neal, a Chicago condemnation attorney.

"These were absentee landlords, and tax buyers not motivated to do a market transaction," he said.

In some cases, property owners are willing sellers, officials say.

But sometimes they are not.

Even condemnation cases filed for traditional public purposes sometimes provoke passionate speeches about the forefathers' intentions toward property rights.

For people like Clifford Heverly in Elgin, the outrage is compounded when eminent domain is used to make way for private development.

Heverly is still angry that the city condemned his coin and stamp business to make room for what he calls "grass and a tree " — or landscaping for a new downtown condo development.

Heverly said that once a city partners with the developer, it wipes out the need for any sort of market transaction.

"Why should the developer have to come to me and pay me fair market value when you can convince a group of politicians to take it?" Heverly said.

In Illinois, governments can use eminent domain to force the sale of private property and transfer it to another private owner if the property is found to be blighted or on its way to blight.

The state has a list of 13 factors that prove blight, such as dilapidated buildings, obsolete uses or code violations.

"In the Chicago metro area, I think we can all agree there are properties that truly are blighted," said Thomas Geselbracht, a Chicago attorney specializing in eminent domain. "Sometimes municipalities try to use eminent domain where there's not quite as much agreement as to what's blighted."

Critics say blight definitions are written in a way that allows city councils to use the power of eminent domain by citing issues such as cracked sidewalks, buildings older than 30 years, or the lack of a community plan when a place was built. A building with a poorly planned parking lot does not automatically signal blight to some, which has led to extensive criticism of the law in Illinois and elsewhere.

"Blight removal was meant to take away property that was dilapidated and falling down, with high rates of communicable disease and infested with vermin," said Steven Anderson, coordinator of the Castle Coalition, which has led a national campaign against what critics call eminent domain abuse. "Now it means taking a perfectly fine house that happens to be in a nice location."

Nationally, a band of politically diverse groups, including conservative grass-roots groups, civil rights organizations and farmers, have come together to say the pendulum needs to swing back in favor of property owners.

Both Democrats and Republicans in Illinois plan to propose legislation this year.

After being flooded with calls from constituents and holding hearings, state Sen. Susan Garrett (D-Lake Forest) is floating a draft bill that would give landowners more standing in court to contest a government's finding of blight.

State Sen. Ed Petka (R-Plainfield) said the process is now lopsided in favor of the government.

"[The local governments] can use taxpayer money to hire consultants and lawyers," he said.

Government officials argue that Illinois law already includes protections for property owners because the courts are there to prevent abuses.

Also, they point to a 2002 Illinois Supreme Court ruling in a case involving the Southwestern Illinois Development Authority and a metal-shredding facility located near a racetrack.

Racetrack representatives approached the authority about condemning the property on its behalf, offering to pay the acquisition costs and legal fees. They planned to build a racetrack parking lot and argued it would attract other development. Because it would also increase profits for the racetrack, the Illinois Supreme Court found that although governments did have an interest in promoting the local economy, the purpose of eminent domain was not to help a private company avoid the open real-estate market.

The court batted down the agency's attempts at condemnation.

A few years ago, a suburban car dealer wanted to locate a new Volvo dealership along the Eisenhower Expressway in Forest Park, on a site where a U-Haul rental facility had been operating since 1978.

Without making an offer to the U-Haul owners, the developer asked village officials to use eminent domain power to obtain the U-Haul property so the car dealership could be built on the site, according to court records.

Hoping for increased tax revenues, the town found the property blighted.

U-Haul owners contested the decision. A judge later killed the plan, although on a more technical issue. The Volvo dealership is now across the street in Oak Park.

While attorneys for the U-Haul argued eminent domain was being misused, Forest Park village attorney Michael Durkin said the municipality needed to attract the redevelopment project for its financial health, especially when facing escalating costs and static revenue.

Before the redevelopment started in Des Plaines, buildings located near the city center sat vacant, said David Wiltse, Des Plaines city attorney.

City officials saw a way to redraw its downtown into one that would include condos and retail, bringing people and their dollars back into the city center.

Using eminent domain to take about two-thirds of the property in the area, the city constructed a new public library, parking garage and a strip of retail on either side.

"It could not have been done without eminent domain," Wiltse said. "You only need one holdout."

Some of the businesses were relocated to other sites in town, and property owners received fair market value for their properties, Wiltse said.

In the case of Angell's home, the city filed the condemnation suit to build a municipal parking lot, though a Walgreens is now in its place.

Eventually, she and the city worked out a settlement. Her former homestead looks out over other redevelopment projects.

Friends have sent her photos of the Walgreens, but Angell, who once worked at a Walgreens soda fountain, can't quite bring herself to look at them.

"I probably will always get angry about it," she said.

Chicago Tribune: www.chicagotribune.com