5/25/2006

Eminent domain turning into fight about money rather than property rights: Kansas City (MO) Star, 4/30/06

By Chris Blank, Associated Press

The specter of private homes and businesses being seized and given to others for redevelopment has lawmakers neck deep in property law statutes, textbooks and court decisions.

But deciding how much property owners should get paid, rather than what restrictions there should be on taking private property, has become the tipping point on efforts to deal with eminent domain.

More than 10 months ago, the U.S. Supreme Court sided with a Connecticut city seeking to seize homes to complete an inner-city redevelopment project. The ruling, which cleared the way for private property to be taken through eminent domain for private economic gain, has prompted a firestorm of action by state legislatures, including Missouri's.

With a cadre of citizens speaking from personal experience about the loss of their homes and properties to an assortment of projects - as well as a powerful group of businesses, economic developers and municipal leaders warning that the state could end most redevelopment through the state - the issue facing lawmakers from the get go was deciding when, if ever, private land should be allowed to be turned over to other private groups.

But rising out of that slugging match is a plan to boost compensation for property owners who lose their land. Some say the provision would make Missouri unique.

The plan calls for requiring anyone who takes private property to make a "heritage value" payment over and above what the land is worth.

Rep. Steve Hobbs said he included the extra payment in the bill because those who lose land to eminent domain aren't willing sellers.

"They should get more if their property is taken against their will," said Hobbs, R-Mexico.

Supporters of the idea said the parts of the state constitution that allow for takings through eminent domain also require "just compensation" - a standard they say has wrongly come to mean the price that the property would likely fetch on the open market.

Rob Korff, a landowner in Norborne, told a Senate panel considering eminent domain legislation that it's troubling that private property can just be taken but far worse that landowners get so little in return.

"When eminent domain can be used for a project, there ought to be a different set of guidelines," he said. "You do not want to move - you're forced out."

The heritage value payment started as simply as a factor that would have had to be weighed when considering how much money is awarded in exchange for property seized through eminent domain. As the bill now stands, it's a formula that would require the market value of the property to be calculated first, and then add up to 1 percent for each year a landowner's family has owned the property. The heritage bonus could go no higher than doubling the price.

That current proposal, expected to be considered in the Senate next week, has some people nervous.

"I agree with a premium that should be paid when a family has their property taken," said Sen. Chris Koster, R-Harrisonville. "I'm just not sure that heritage value is the fairest way to do that."

Although the bill has been revised numerous time, the heritage value payment has stuck - a bane for developers even when they generally liked the bill and a life raft for property rights groups when they didn't.

Developers and business groups say making condemners pay different prices for identical property based solely on how long it's been owned is bizarre at best and unconstitutional at worst.

Dale Whitman, a law professor specializing in property use at the University of Missouri-Columbia, said paying more for a piece of property than an identical one just because its owner has had it longer is "nonsensical" and isn't being tried by anyone else.

"It's just weird, and I don't think there's any justification for it at all," Whitman said.

Jeff Craver, a tax counsel with the Missouri Chamber of Commerce and Industry, went even further.

He said the companies or local governments seizing the land would probably pass the extra payment on to consumers making it a burden on everyone. Even if the condemner ate the cost, he said, heritage value payments would violate constitutional requirements that everyone be treated the same by the law.

The Missouri Farm Bureau has pushed for the idea of accounting for how long a family has owned a piece of property since a special task force was appointed last year by the governor to study eminent domain.

Blake Hurst, the bureau's vice president, said the problem with only considering the literal worth of a piece of land to be taken through eminent domain is that "it will never be a level playing field," or "an arms length transaction."


Kansas City Star: http://www.kansascity.com