10/12/2007

Eminent domain in Coney Island? amNewYork, New York NY, 8/29/07

By Ryan Chatelain

As city officials play hardball with a developer over the future of Coney Island's amusement zone, rumblings of a land takeover by the Bloomberg administration through eminent domain have surfaced in published reports.

But that scenario remains a long shot, say eminent domain experts.

"It is a possibility, but I would say it's a remote possibility," said William Ward, a New Jersey attorney who has worked for the government and in the private sector, serving clients on both sides of eminent domain cases.

The city and Thor Equities, which is planning a $1.5 billion development for Coney Island that includes a new amusement park and water theme park, have been at odds over Thor's plan to build three high-rise hotels, including one for time-share units, on land mostly zoned now for amusements. The Bloomberg administration plans to unveil a rezoning proposal this fall for the beachfront property that will allow for other uses but said it's committed to protecting Coney Island's storied amusement district.

Some critics are concerned that if Thor gets its rezoning, it may flip the property at a large markup, leaving the future use of the land in question.

Other fears are that Thor could let the land sit idle to force the city's hand or wait until a new mayor is in office, who may be more receptive to the developer's ideas.

City officials recently embarked on a fact-finding tour to other amusement parks and are reportedly gauging whether the company behind the famed Tivoli Gardens in Denmark - said to be the inspiration for Disney World - might play in a role in a new Coney Island amusement park, fueling speculation that the Bloomberg administration might use eminent domain to push Thor out of the picture.

"I don't see this getting into an eminent domain situation very easily," Ward said. "It seems like the city should be able to work out everything with the owner rather than go through the eminent domain proceedings."

Ward added that city's best argument to invoke eminent domain would be if Thor indeed did nothing with the land and the city found a new developer who it backed, in which case the city could cite Coney Island as blighted property.

Thomas J. Miceli, an economy professor at the University of Connecticut who co-authored the book "The Economics of Eminent Domain," said he doesn't believe the situation at Coney Island would be a justified use of eminent domain. Miceli said eminent domain should only be used to force the sale of land to facilitate large-scale projects, in which acquiring property from various owners can become problematic.

"There may be a legitimate public purpose for having this land developed in a certain way, but that doesn't necessarily give the city the right to force the current owner to sell, because there should an ability for the market to handle that," Miceli said.

City officials continue to meet with "various stakeholders" in the Coney Island redevelopment, said Janelle Patterson, spokeswoman for the Economic Development Corp.

Thor spokesman Lee Silberstein said the developer continues to refine its vision for the project.


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