University cleared to use eminent domain for arena: University of Oregon Daily Emerald, 9/17/07

Administrators still hope not to obtain land by force despite permission from higher education board

By Allie Grasgreen

The University is one step closer to beginning construction on the new basketball arena.

At the State Board of Higher Education meeting Friday, Sept. 7, the Board granted the University a resolution of necessity: permission to utilize eminent domain laws in order to obtain three properties on which, along with the Williams' Bakery site, the University hopes to build an arena to replace 80-year-old McArthur Court. Thus far, the University has been unable to come to voluntary sale agreements with the property owners, and should it fail to do so it may use condemnation to purchase the properties on behalf of public interest.

The Board also granted a resolution of necessity to the University in 2004 to purchase the Williams' Bakery site, although the University ultimately did not use condemnation. The site sold for approximately $22.2 million.

General Council Melinda Grier said the University does not wish to resort to condemnation, and will do so only as a last resort.

"In Oregon we have a strong preference... to try to acquire properties through voluntary means," said Grier.

Eminent domain allows the government to purchase private property for public purpose. Should the University exercise condemnation, the state of Oregon would sue on behalf of the University and the court would determine an adequate sale price.

At least two attorneys with background in condemnation law contributed at the board meeting.

"We relied extensively on that expertise in proceeding," said Jay Kenton, OUS Vice Chancellor for Finance and Administration.

"We hope it makes it so that we can really move forward," Grier said. She added there are other things that need to be put into place before construction can begin, but "obviously we have to acquire the underlying property first."

This specific case may violate Measure 39 because of speculation that the UO Foundation will form a private corporation to build the arena. Measure 39 prohibits a public body from condemning private property with the intention of transferring said property to a private party. In this case, the University would own the land but not the arena, but Grier said the University will not violate Measure 39.

The University needed four properties to move forward in planning the arena. One, the site of an abandoned gas station on Franklin Boulevard, the University purchased for $570,000 after "a couple years" of negotiation, property owner Peter Kryl said. The other three are still privately owned, and one is "particularly challenging," Grier said, because of the liens placed against the property. The vacant business property owned by Eugene resident Adesina Adeniji cannot be sold or transferred until the outstanding liens have been paid or otherwise addressed.

"The value of the liens is much greater than the value of the property," Kenton said. The landowner probably won't want to sell the property for less than the value of the liens, Kenton said.

The remaining two properties are a 7-Eleven store adjacent to the abandoned gas station and an endodontic practice on Villard Street. The office's owners, Karl and Jeanne Wagenknecht, argued unsuccessfully at the Board meeting that the University's intention for the property does not justify condemnation.

University of Oregon Daily Emerald: http://media.www.dailyemerald.com