NLV mayor cautions against overuse of eminent domain: Las Vegas (NV) Business Press, 1/23/06

By Arnold M Knightly

As the City of North Las Vegas moves ahead with redevelopment in the downtown area while managing growth elsewhere in the city, Mayor Michael Montandon says the abuse of the expanded eminent domain legal precedent set last June by the U.S. Supreme Court could lead to a loss of an important government tool.

"We will use it if it is necessary and if it is a bona fide, legitimate public use," Montandon said. "But we will not use it for economic development, those kind of purposes."

In a 5-4 decision, the Supreme Court backed a lower-court ruling, stating that a city's redevelopment plan did serve a greater public need and by promoting economic growth it could be classified as a public use project and therefore the land could be purchased for a fare market value from the owners against their wishes.

Older North Las Vegas properties such as this motel might be subject to eminent domain. However, like Mayor Oscar Goodman in Las Vegas, who is also facing redevelopment challenges, Montandon insists that eminent domain will be used for public use, not private-to-private exchanges. Earlier this month, city officials told the Las Vegas Sun that they wouldn't rule out using eminent domain in the pursuit of a new city hall.

Montandon stated that eminent domain could be used for public uses, like acquiring land for a waste-water treatment plant or for widening Fifth Street. "Those are legitimate public uses that the city should have eminent domain in their bag as a tool if they need it."

In an application for a brownfield grant for the downtown area, the city stated that it already owns a lot of land within the redevelopment area, but that it "will continue to acquire remaining property" through many channels, including "eminent domain."

Montandon agreed with the dissenting opinion written by Justice Sandra Day O'Connor in Kelo v. New London, Conn., saying he "would have written the exact same opinion."

"Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random," O'Connor wrote. "The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms. As for the victims, the government now has license to transfer property from those with fewer resources to those with more. The [Constitution's] Founders cannot have intended this perverse result."

As the City of North Las Vegas moves ahead with its master plan as outlined in an 18-page booklet titled, "Visioning 2025 Strategic Plan," city officials expect to face some hard choices during redevelopment.

"The reality is you're going to have some displacement," said Jeremy Aguero, a principal at Applied Analysis, who points out that to attract new businesses to North Las Vegas Boulevard, East Lake Mead Boulevard and Cheyenne Avenue that some use of eminent domain may be necessary.

The City of Las Vegas settled an eminent domain suit in 2004 for $4.5 million brought by the Pappas family who lost retail space downtown for the building of the Fremont Street Experience.

"It could be bad because some of those businesses are people's livelihoods," Aguero said. "I don't think you want to discount the reality for those people."

The state Legislature passed, and Gov. Kenny Guinn signed, two bills that could limit the abilities of local governments to use eminent-domain powers. The city must prove that two-thirds of an area claimed for redevelopment is blighted by showing four out of 15 blighting factors. Some of the factors include structural damage, flood problems, sanitation violations and improper land use.

Las Vegas Business Press: www.lvbusinesspress.com