Eminent domain is 'zero-sum gain': Portsmouth NH Herald News, 2/4/07

When the government uses eminent domain to take private property for private development projects, it "usually results in zero-sum gain and may actually hinder the area's development." That is the finding of an important new report released this month by the Federal Reserve Bank of St. Louis.

In "The Taking of Prosperity," authors Thomas Garrett and Paul Rothstein write, "(The) taking of private property from one person and giving it to another for economic development ... is unlikely to create a net benefit to society. It is more likely to create economic inefficiencies and to reduce economic growth."

Demonstrating an understanding of markets that seems well beyond that of local government officials who abuse eminent domain for private gain, the report states, "When governments interfere in the private market, whether it be a market for apples, cars or property, the likely result is greater economic inefficiency and less economic growth. The reason is that even the most well-intentioned policymaker cannot comprehend or replicate the complex interactions of buyers and sellers that occur in free markets."

"In poll after poll conducted nationwide, as well as in testimony offered in state and federal legislatures, nearly all Americans are against eminent domain for private gain," said Steven Anderson, director of the Castle Coalition, a grassroots organization that brings together property owners and activists from across the nation to fight eminent domain abuse. "Just about the only people supporting eminent domain for private development are those who benefit from it: politicians, developers and planners."

Echoing that fact, Garrett and Rothstein state in their report, "Of course, there will be certain groups that do benefit from the taking of private property, such as developers, property managers and local politicians. Developers and property managers will gain income from developing the property. Many local politicians favor targeted economic development because of what they see as the immediate benefits from development, such as increased employment and tax revenue.

"These economic benefits also translate into political benefits for those politicians who pledge to improve local economic development," Garrett and Rothstein indicated. "Not realized, however, is that the supposed immediate and tangible benefits from taking private property for economic development are outweighed by the greater economic costs of government intervention in private markets."

The rich and politically powerful overwhelmingly profit from those benefits. As Justice Sandra Day O'Connor warned in her dissent in the Kelo eminent domain case: "The beneficiaries (of eminent domain) are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms."

"What can governments do to promote economic development that yields positive economic growth?" the authors ask.

Garrett and Rothstein answer with a series of commonsense and proven public policy suggestions: "Rather than use eminent domain or other tools to target individual economic development projects, local governments should ask the fundamental question as to why the desired level of economic growth is not occurring in the local area without significant economic development incentives. For example, are taxes too high, thus creating a disincentive for business to locate to the local area? Do current regulations stifle business creation and expansion?

"All of the targeted economic development in the world will not compensate for a poor business environment," the authors write. "From a regional perspective, local governments should focus on creating a business environment conducive to risk-taking, entry and expansion rather than attempting targeted economic development through eminent domain or other means."

The authors warn, "Research has shown that without property rights, individuals will no longer face the incentive to make the best economic use of their property, be it a business or home, and economic growth will be limited. Potential residents and businesses may avoid communities that have a record of taking private property for economic development because of a greater uncertainty about losing their property to eminent domain."

The authors conclude, "Supporters of Kelo argue that using eminent domain for private development will spur economic growth. ... Economic theory certainly suggests that eminent domain used for private economic development will likely result in a zero-sum gain and may actually hinder economic development in the local areas, as well as the region, rather than help."

"Perhaps it is time for government officials to take an oath like doctors and promise to 'first, do no harm,'" said Chip Mellor, president of the Institute for Justice, which argued the Kelo eminent domain case before the U.S. Supreme Court and has been leading the way for eminent domain reform nationwide. "The Federal Reserve's report is groundbreaking. At best, the government is robbing Peter to pay Paul when it uses eminent domain for private development. At worst, this practice is actually stifling real private development - the very thing the government claims it seeks to create. This finding makes absolute sense and should be a warning sign to tax-hungry governments nationwide that consider abusing this power on behalf of land-hungry developers."

A recent example of a zero-sum taking of property from one owner only to hand it over to another (more influential) private party for his private gain occurred in Port Chester, N.Y., where that village took land owned by Bart Didden and gave it to a politically favored developer. Didden planned to construct a CVS pharmacy on the lot; the developer plans to put up a Walgreens pharmacy resulting in no new taxes for the city and only a private financial gain for the developer. Just recently, the U.S. Supreme Court refused to take up Didden's case.

So far, 34 states have adopted eminent domain reform in the wake of the Kelo decision. The U.S. Congress failed to pass federal legislation last year, but is expected to again consider the issue this session, as will other states that have not yet amended their laws.

To read the Federal Reserve Bank of St. Louis report, visit: http://www.stlouisfed.org/publications/re/2007/a/pages/prosperity.html

Portsmouth NH Herald News: http://www.seacoastonline.com

Eminent domain legal case on county agenda: Victoria TX Advocate, 2/4/07

Apartment owners unable to agree on price for property

By David Tewes

The future of the Town House Apartments near Citizens Medical Center could be at stake when the Victoria County Commissioners Court meets Monday to decide whether to file an eminent domain lawsuit.

County Judge Don Pozzi said the commissioners court would probably meet in closed session at 10 a.m. in the courthouse before reconvening in public to vote on whether to pursue legal action. The apartments are at the intersection of Red River Street and Hospital Drive.

Pozzi referred questions about the pending legal action to the county's counsel, Kevin Cullen. "I'm hesitant to comment prior to the time we make a decision," Pozzi said.

Cullen said the county and the owners of the apartment complex have been unable to agree on a price for the property, which would be used by the hospital for parking. He said those negotiations have been going on for 18 months or more.

"We have made an offer of over $500,000," Cullen said. "I have never received an offer from them in writing. But in our discussions, the lowest price I'm aware of is over $1 million."

He said the county's offer is equal to the highest appraised value in the last 10 years.

The 2006 appraised value listed on the Victoria County Appraisal District Web site is $257,070. The site also lists 9632 Partners Ltd. in Houston as the owner.

Cullen said if the commissioners decide to use eminent domain to acquire the property, it would be as a last resort. "We certainly can't pay three times the value of the property."

Victoria TX Advocate: http://www.thevictoriaadvocate.com

Eminent domain allowed in Victory Drive project: Mankato MN Free Press, 2/3/07

By Dan Linehan

Blue Earth County [MN] can use eminent domain to take the land in the way of a Victory Drive expansion, a judge said Friday, but negotiations as to how much it will cost the public are nowhere near finished.

It didn’t take long for District Court Judge Norbert Smith to find that the land is being seized for a public purpose, which is the first of two main requirements for eminent domain. He called it “an obvious public use issue.”

The second rule — that the government must pay a fair price for the land — is the tricky one.

The county hired an appraiser to determine the land’s value and agreed to give a total of about $5.9 million to the owners of the six parcels that are in the road’s way. But none of the property owners have agreed to that price.

The Fifth Amendment to the U.S. Constitution says private property can’t be taken for public use without “just compensation.”

The issue wasn’t discussed at the hearing, aside from the appointment of a three-member commission that will decide on what the government will pay if the parties still can’t come to an agreement. All three have served in this role in earlier Victory Drive phases.

They are Dan Wingert, Mike Miller and Jeff Kaul.

Property owners who reject the commission’s determination can request a jury trial.

Construction on the third and final phase isn’t expected to begin until 2008, but razing the buildings in the area and relocating the businesses is a big task.

In August, the County Board agreed to a route through Rasmussen College, easily the most expensive property on the route and probably the most difficult one to relocate. The county’s appraisal values the land and the building at $3.2 million.

He didn’t return phone calls seeking comment Friday, but Rasmussen College, Inc. CEO Michael Locke said in August that the school doesn’t want to move after 10 years in that spot. But, if forced, he prefers a location close enough so that the school’s 400 students aren’t inconvenienced.

Locke also said then that it takes about a year for the school to acquire land and build. And the new location will need to be operational before the existing one can be demolished.

Also in Victory Drive’s path is Belle Mar Mall.

Much of the space that the road will need is vacant, but the Moose Lodge could be forced to relocate.

Lodge members complain that this word — “could” — has been haunting them for years, said Donna Jean Peterson, secretary of the fraternity’s business arm.

Mankato MN Free Press: http://www.mankatofreepress.com

Eminent domain use OK'd: Jersey City NJ Jersey Journal, 2/3/07

By Ronald Leir

Plans for the new highway shopping center in Bayonne have taken another step forward, with the Bayonne Local Redevelopment Authority commissioners giving BLRA Executive Director Nancy Kist the go-ahead to sign a redeveloper agreement with Cameron Bayonne LLC.

At the same time, the commissioners last week authorized the use of eminent domain to take a piece of land needed to complete the 26-acre tract that will accommodate the Bayonne Crossing shopping center on the east side of Route 440 between East 22nd Street and Hook Road.

Cameron partner Eric Alderman told commissioners that negotiations with private owners were going well, but sources in the city administration said talks between Cameron and one of those owners - AGC Chemicals Americas on East 22nd Street - have stalled after more than a year of talks.

Kist said that Cameron wants to buy a vacant, 14-acre, contaminated parcel from AGC, a subsidiary of the Japanese-owned Asahi Glass. She said that land is targeted by Cameron for "several anchor tenants - big box stores."

Kist said the BLRA won't wait much longer for an amicable resolution.

"We expect that Cameron will continue to negotiate in good faith (with AGC), but this is too important a project not to use eminent domain when we're talking about the future of an environmentally compromised vacant piece of land," Kist said.

AGC officials could not be for comment.

City officials have projected that the 10-building, 358,418-square-foot shopping center would account for 800 jobs, $1.2 million in annual taxes and between $3 million and $4 million in local Urban Enterprise Zone sales tax proceeds.

ExxonMobil, whose predecessor, Standard Oil, operated an oil terminal on part of the site, has pledged to clean up the land. Under the redevelopment agreement, Cameron would be locked into a three-year timetable for completion, with construction expected to start this year.

The BLRA also authorized Kist to sign a redevelopment agreement with Kaplan at Bergen Pointe LLC, of Highland Park, for the old 60-plus-acre Texaco site at the city's southern tip, which ExxonMobil has also agreed to clean up.

Kist said the agreement calls for Kaplan to hold another public forum on plans for the site by June, submit a site plan for the mixed-use project's first phase by year's end and to complete the project within 10 years, with an option for two five-year extensions.

The project would include some 1,310 housing units, and 150,000 square feet of retail, 180,000 square feet of offices, and parking for 4,200 cars, plus seven acres of parks, a public fishing pier and waterfront walkway.

Jersey City NJ Jersey Journal: http://www.nj.com/news/jjournal

Eminent domain would be curbed: Salt Lake City UT Tribune, 2/2/07

HB334 Deals with eminent domain issues; Next step: Moves to the full House

By Rosemary Winters

The [Utah] House Government Operations Committee advanced a bill Thursday that adds to restrictions placed on eminent domain in 2006. It also might prove useful in a Mapleton land dispute.

HB334 would re-enforce the idea that property condemnation cannot be used for recreational trails, and it would forbid using the power to establish emergency access ways. It also declares that the trail prohibition has always been part of Utah law.

Although the bill's sponsor - Aaron Tilton, R-Springville, - told the committee that courts are not bound by intent language, the measure is supported by Wendell Gibby, who is engaged in a legal fight with Mapleton City. For years, the city has been trying to establish a public right of way through Gibby's 120 hillside acres to provide emergency access for fighting wildfires and a connection to the Bonneville Shoreline Trail. "There are parties who are using legislation to attempt to manipulate litigation" that is going on now, said Rep. Lorie Fowlke, R-Orem, one of two committee members to vote against the bill. "I have a real, real problem with intent language."

Salt Lake City UT Tribune: http://www.sltrib.com

Stillwater property owners await decision on appeal: Bartlesville OK Examiner Enterprise, 2/2/07

By Justin Juozapavicius, Associated Press

The [Oklahoma] state Supreme Court could decide Monday whether to remove a district judge from a heated eminent domain case in Stillwater.

Last month, a Noble County judge ruled that Payne County District Judge Donald Worthington could hear the case, involving the last piece of property Oklahoma State University needs to build the first phase of a $316 million planned athletic village.

An attorney for holdout homeowners Kevin and Joel McCloskey appealed to the Supreme Court, claiming the judge should be removed from the case because he had pre-decided its outcome by finding that the Board of Regents is constitutional and could acquire their property.

For months, the McCloskeys claimed the university had no authority to force them to sell their land because its governing body, the Board of Regents, has failed to abide by a long-forgotten requirement that at least five of its eight members be farmers.

Worthington is to decide whether OSU can acquire the property for the village through eminent domain, the taking of private property for a public use.

OSU spokeswoman Carrie Hulsey-Greene said, "Worthington is more than able to be fair in this case and should stay on the case."

If the lower court decision stands, Worthington is expected to hear the eminent domain argument next month.

"If we lose, we go back to a judge that knows we tried to have him removed twice," Kevin McCloskey said Thursday.

Meantime, the 66-year-old ranch home remains vacant in Stillwater. It looks as out of place as it did last fall, when the university began bulldozing the neighborhood around the house.

Oklahoma State says the home will not be in the way of the spring groundbreaking on the first project in the village, an indoor practice facility. The village is being built with a record, $165 million gift from oilman alumnus T. Boone Pickens

Eventually, OSU wants to install outdoor practice fields where the home stands. Now, it is a tiny island amid gravel student parking lots.

The brothers wanted to fix the place up and rent it for $550 a month, mainly to help pay for their grandmother's nursing home care, Kevin McCloskey said.

"Joel and I are broke," he said. "This is a very expensive fight ... we're looking at a $30,000 defense."

Hulsey-Greene said the regents are still open to settling out of court with the McCloskeys.

"We're at the part of the case where you just have to do the work and gather the evidence and prove your case, which I think we're going to do," said Harlan Hentges, attorney for the McCloskeys.

Last year, OSU offered the McCloskeys $62,000 for the home, about 2 1/2 times more than they paid for it.

But they turned it down. Later, a board of court-appointed appraisers estimated the property to be worth $84,000.

A jury will eventually decide how much the property is worth.

Bartlesville OK Examiner Enterprise: http://www.examiner-enterprise.com

City to consider appeal on eminent domain award: Winona MN Daily News, 2/2/07

By Brian Voerding

The city of Winona might appeal an eminent domain award.

A court ordered the city last fall to pay an additional $28,000 for a property it took for the Pelzer Street project, owned by the Goodview partnership Evanson and Evanson.

The city had offered the partnership $115,000 for the land, but Evanson and Evanson contested the amount, and a court ordered the city to pay $143,100.

At the time, the city said it wouldn’t appeal the ruling; now the Winona City Council will consider an appeal during a closed session Monday.

The city is already in the process of appealing another court decision on property it took for the railroad overpass project.

A court awarded businessman Rich Mikrut $903,000 for losing a quarter-acre of land and a primary access point for a proposed truck-to-train transfer station. The city had initially offered Mikrut $72,500.

The Pelzer Street project, which will create the city’s first railroad overpass, is expected to be completed sometime this summer.

Winona MN Daily News: http://www.winonadailynews.com

Two lawsuits filed against Union Township contest blight designation: New Jersey Eminent Domain Blog, 2/1/07

By William Ward

Two lawsuits were filed today against Union Township in Superior Court at the Union County Courthouse on behalf of 20 property owners. The lawsuits contest the action of the planning board, mayor, and council declaring the properties “in need of redevelopment.” The planning board met on December 19, 2006, and the mayor and council approved the resolution of the planning board declaring all the properties in the study area “in need of redevelopment” on December 26, 2006. The action taken by the mayor and council give the municipality the right to condemn all the properties by eminent domain. The property owners vigorously contest the conclusions of the planning board. The two prerogative writ suits had to be filed within 45 days of the township’s resolution in order to contest the determination of blight or “an area in need of redevelopment.”

This Saturday, New Jersey Governor Jon Corzine will be present at Union Township between 1:00 and 2:30 p.m. to address residents on property tax reform and other issues. It is expected that citizens opposed to eminent domain will appear and rally in support of the property owners in Union Township who are threatened with eminent domain by virtue of the blighting of their properties in December by the township planning board, mayor, and council. The Governor will be asked where he stands on his campaign promise to halt eminent domain abuse and reform the eminent domain laws in New Jersey.

The reform of the Local Redevelopment Housing Law, Bill S-1975, is presently languishing in Senator Rice's Community and Urban Affairs Committee while the property tax issues dominate the agenda. This bill will only be acted upon if the Democratic leadership - Governor Corzine, Senate President Codey and Assembly Speaker Roberts decide to vote it out of committee and onto the Senate floor for action.
“If I am elected Governor, I will ensure that the people of New Jersey are secure, knowing that their home, which they worked and saved to own, belongs to them and may not be unfairly seized by the government. My principle on this issue is a simple one: there should be no takings of homes for economic development except in rare and exceptional circumstances and then only with adequate safeguards to ensure that the process is fair and transparent. To obtain this outcome, I support major reforms of New Jersey's public use and development laws.

While there have been many legitimate and appropriate uses of eminent domain throughout history, we have also seen abuses of this power. We have seen a family lose their home and receive just $14,000, only to see the town quickly sell the property to a developer for $60,000. We have seen so-called redevelopment plans knock down housing that was affordable to long time community residents, only to displace them with luxury condominiums, without giving any thought as to where people with roots in the neighborhood would live. With dozens of New Jersey municipalities focused on redevelopment - we need to act decisively to protect our citizens as we revitalize our aging neighborhoods. A Corzine administration will not tolerate abuse in the name of economic development." - Jon S. Corzine

New Jersey Eminent Domain Blog: http://www.njeminentdomain.com

Eminent domain bill on track: Tacoma WA News Tribune, 2/1/07

Legislation would require certified letters to targeted property owners

By Sean Cockerham

State lawmakers have fast-tracked eminent domain legislation inspired by a Tacoma couple who are losing land to Sound Transit.

The bill would require public agencies to send a certified letter notifying property owners of any meeting to take action on acquiring their land. It says notice also has to be published in the newspaper.

“It is going to sail through the Senate,” said Sen. Adam Kline, a Democrat from Seattle who chairs the judiciary committee in the state Senate.

Ken and Barbara Miller said no one told them beforehand about the 2003 meeting where the Sound Transit board made its decision to go after some property they owned near South Tacoma Way and South 60th.

Sound Transit advertised the meeting on its Web site. But the couple didn’t see it and said they can’t be expected to constantly check the Web site. The Millers fought, but the state Supreme Court last year sided with Sound Transit, saying the online posting was good enough and the agency wasn’t required to send the Millers an individual notice.

There was a public outcry over the ruling. Now it looks like legislation to give property owners more notice could be among the first measures to pass in the 2007 legislative session.

Senate Bill 5444 passed Kline’s judiciary committee in minutes last week. No one testified against it.

“I don’t believe there is any opposition at all,” Kline said.

Republican Sen. Mike Carrell of Lakewood sponsored the bill at the request of the governor and attorney general.

“I believe this is a case that cries out for the Legislature to act,” Carrell said.

Support is not limited to the state Senate. A companion bill in the House has a hearing on Friday, and 56 state representatives have signed on as co-sponsors. That is a majority of the House, enough to ensure the bill can pass.

House Majority Leader Lynn Kessler is among those sponsors. Kessler said it’s just a basic courtesy to send people a certified letter to let them know they could lose their property.

The Millers have come to Olympia to support the bill.

“I’m sure happy to see some kind of notice,” Ken Miller said this week in an interview. “The period they’re talking about for giving notice – 15 days – isn’t much, but anything is helpful.”

The bill would require that certified letters go out to affected property owners at least 15 days before a meeting on taking their property.

The bill also requires the notice to give a description of the land under consideration, such as an address or lot number. The Web site posting in the Miller case only said the board would discuss acquiring “certain real property interests” necessary for the construction of the Lakewood and South Tacoma commuter rail stations.

The agency wanted the Millers’ land for a Park & Ride lot as part of its effort to extend commuter rail service from Tacoma to Lakewood. Miller said he had two contacts with Sound Transit prior to the meeting that targeted his land. But he said he knew only that it was being considered along with other sites.

Sound Transit spokesman Geoff Patrick said the agency did not start the condemnation proceedings on Miller’s land until more than a year later, when negotiations with him over purchase price failed. Miller said Sound Transit came in with a lowball offer and there was no negotiation.

A trial is set for May to sort out how much Sound Transit will now have to pay him for the land.

Patrick said Sound Transit supports the Legislature’s move to require that letters go out to affected property owners. Sound Transit already has started providing such notifications, he said.

This wasn’t the first time the Millers have battled a government agency over their property. The state Department of Transportation in 2004 backed down from an effort to condemn 20 acres of the Millers’ property in University Place. The state wanted to use the land as mitigation for wetlands that will be damaged as part of a project to widen Highway 16, located more than a mile away

Tacoma WA News Tribune: http://www.thenewstribune.com

NYRI to sue NY over eminent domain law: Business Week, 2/1/07

By Mark Johnson

The company that wants to build a high-voltage transmission line from central New York to the New York City suburbs said Thursday it will ask a federal court to throw out a state law that would restrict its use of eminent domain to secure land for the project.

Albany-based New York Regional Interconnect Inc. says the proposed 200-mile, $1.6 billion line from the Utica area to the lower Hudson Valley would deliver electricity to an area where power demand is expected to outstrip supply in a few years.

In October, Gov. George Pataki created a major obstacle to the project by signing a law restricting NYRI's use of eminent domain. Without the ability to force property sales, the company would have little chance of securing all the necessary land to complete the line, project manager Bill May said.

In a suit to be filed in federal court in Albany Thursday, NYRI contends the law discriminates against the company and violates its rights under the U.S. Constitution. NYRI also argues that the new law infringes its rights to equal protection and due process.

"The law seeks to individually punish NYRI for a project intended for a public need," May said.

A number of upstate New York public officials have opposed the project. They argue the proposed route through many small upstate communities would affect scenic areas and harm both the environment and local economic development. They also contend upstate residents would see their electric bills rise as more power is directed to the New York City area.

"From a public policy standpoint, a for-profit company should not have the right of eminent domain where they raise the rates of constituents upstate and lower the rates of constituents downstate," said state Sen. John Bonacic, an Orange County Republican.

Bonacic said lawyers for the Legislature and Pataki reviewed the statute and determined it was constitutional.

NYRI, a closely held company, said this week it is looking at some alternative routes to comply with an order from the state Public Service Commission, which oversees utilities. The alternatives include a route that follows the state Thruway, May said.

In just two years, the lower Hudson Valley and metropolitan New York will need an extra 500 megawatts of capacity, either from new transmission, new power plants, or energy conservation, according to the New York Independent System Operator, which controls the state's power grid.

In less than five years, the Hudson Valley, New York City and Long Island will need 1,250 megawatts of new capacity and by 2015 that need will grow to 2,250 megawatts. One megawatt is enough power for about 1,000 homes.

Business Week: http://www.businessweek.com

Rell makes pitch for eminent domain reform: Stamford CT Advocate, 2/1/07

By Brian Lockhart

Aiming to reignite efforts to reform eminent domain laws, Gov. M. Jodi Rell yesterday released the outline of a bill requiring that cities and towns take additional precautions before seizing private properties for redevelopment.

The plan also would require authorization from two-thirds of a municipal legislative body, and private owners would receive 125 percent of their property's fair-market value.

"I think both Democrats and Republicans would agree that the issue of property seizures has been put off for far too long and talked to death," Rell said in a statement. "It is time to stop dancing around this issue and get something done for taxpayers and property owners."

But a Rell spokesman said she was not calling on cities and towns to implement voluntary moratoriums on property seizures, as the General Assembly did in 2005.

"We wouldn't go there," spokesman Adam Liegeot said.

Rell will flesh out the proposal in a bill she will submit to the legislature, he said. Although she has expressed concern about eminent domain and called for legislative action, this is the first proposal on the matter submitted by the governor.

The goal is to apply the new legislation to any seizures after July 1, Liegeot said.

Eminent domain reform became a priority after a controversial 2005 U.S. Supreme Court ruling.

The justices ruled that New London could take homes in the Fort Trumbull neighborhood to make way for a riverfront project slated to include condominiums, a hotel and office space.

But the 2006 session ended in May without an agreement, and neither the House Democrats or Republicans listed "eminent domain reform" when listing their priorities in 2007.

"Connecticut residents are just as concerned about losing their homes and businesses as they have always been," Rell wrote yesterday. "Once and for all, we must now focus our efforts on joining with the other 25 states in the nation that have passed eminent domain reform legislation."

The issue still has the attention of individual legislators, including some in lower Fairfield County.

According to the General Assembly's Web site, 19 bills have so far been submitted addressing various aspects of eminent domain. Five have been sponsored or co-sponsored by state Sen. Judith Freedman, R-Westport, and state Reps. Antonietta "Toni" Boucher, R-Wilton; Claudia "Dolly" Powers, R-Greenwich; and James Shapiro, D-Stamford.

State Sen. Andrew McDonald, D-Stamford, Judiciary Committee co-chairman, said he is working to revive a compromise bill he worked on last session with counterparts on the Planning and Development Committee.

He said he was "dumbfounded" to find that Rell had cribbed liberally from last year's compromise bill in her proposal.

"It's a one-page distillation," McDonald said. "Imitation is the greatest form of flattery and I'm certainly flattered the governor's agreeing with our work product."

He also questioned whether it was too little, too late.

"My fear is she may have squandered her window of opportunity to influence the process, which was in its height last session," McDonald said. "The reality is now we've got energy on the horizon, which clearly will be a massive fight. And health care is going to be a blowout of time and energy."

Rell yesterday said her legislation will ensure public benefits of economic development outweigh private benefits and go beyond increasing the tax base.

She wants municipalities to integrate private properties into their plans when feasible and prove the use of eminent domain is "reasonably necessary" to accomplish redevelopment goals.

Norwalk Redevelopment Agency Director Timothy Sheehan said requiring individuals be compensated 125 percent of fair-market value will only encourage property owners who cannot get that price through negotiations to use eminent domain.

"If you're negotiating and getting 110 percent of fair-market value and you know there's a law that says you can get 125 percent, you're going to get in that line," Sheehan said.

In Norwalk and many other municipalities, requiring a two-thirds or "super-majority" vote of the governing body to approve a property seizure would require changes to local charters, he said.

"(That is) no small undertaking," Sheehan said.

Shapiro said Rell's proposal "certainly provides more protection" but that his legislation would go even further, banning eminent domain solely for the purpose of economic development.

"While economic development is a public benefit, it's not the public use envisioned by framers of the Constitution," Shapiro said. "The Founding Fathers were talking about the roads, hospitals and schools necessary to build a nation. They were not talking about waterfront theme parks."

Stamford CT Advocate: http://www.stamfordadvocate.com

WA Supreme Court upholds eminent domain ruling for PUD: Seattle WA Post-Intelligencer, 2/1/07

By Rachel La Corte, Associated Press

As [Washington state] lawmakers consider a measure that would require property owners to be directly notified that their land is about to be condemned, a sharply divided state Supreme Court on Thursday upheld an eminent domain action against a real-estate investment and development company.

The court's 5-4 decision affirmed that Public Utility District No. 2 of Grant County gave proper notice for an eminent domain action against North American Foreign Trade Zone Industries, LLC.

The ruling comes as lawmakers are considering a measure that would require local governments and public agencies to send certified letters to the affected parties when they are about to take property through eminent domain. It would also require publication of a notice of the decision-making meeting in the largest area newspaper. The bill has already passed the Senate Judiciary Committee and could come up for a full Senate vote as early as Friday.

"Really what the case is, it's mirroring the public debate right now over the rights of property owners," said Frank Siderius, attorney for North American. "Our state Legislature is going to have to address this issue."

The utility's spokesman, Gary Garnant, said he could not comment on the ruling because of ongoing litigation.

The case before the high court was prompted by a lease agreement the utility had with North American in 2001 for 20 acres in Grant County. The land was to contain 20 diesel generators the PUD acquired because of concerns during an energy shortage about meeting the power needs of its customers.

There was no purchase option in the agreement, and after negotiations for purchase fell through, the utility moved forward with condemnation proceedings for 10 acres of the property. In setting up the meeting to discuss condemnation, the official notice sent to the public only referred to "Condemnation of Certain Real Property."

According to the ruling, the utility's executive secretary faxed the agenda for the meeting to local newspapers and radio stations, posted the agenda outside the commission's meeting room and sent copies to the commissioners and to district employees and people who requested it.

Siderius said he wasn't aware of any newspaper publishing the agenda, and said his clients were not aware of the meeting.

After the resolution passed, the utility filed a condemnation petition, at which point North American was served with a copy. The company moved to dismiss the petition, arguing adequate public notice was not provided.

But at a second hearing in December 2003, the first resolution was ratified.

"The constitutionally limited eminent domain power and important due process safeguards of our constitution are again disregarded," Justice Jim Johnson wrote in dissent. "The constitutional right to own property and the public right to notice of governmental action loses again."

But the majority, led by Justice Mary Fairhurst, said the dissenters "misstate the law and the facts when they claim that due process entitles the landowner to notice of the agenda of a public meeting to authorize a condemnation."

"The notice at issue here is to the public, not the individual landowner," Fairhurst wrote.

"Notice for a public meeting to discuss a resolution authorizing condemnation is no different from notice for any other resolution," she wrote. "A resolution does not result in a taking of property and does not deprive a property owner of any rights."

The majority wrote that even if the resolution for condemnation is approved, "the actual condemnation action does not occur until the judicial hearing."

But "the problem with that, once you get into court, there's great deference paid to what the commissioners already resolved," Siderius said.

The ruling follows a controversial ruling the high court made last year in the case of Barbara and Ken Miller, who had some of their property in south Tacoma condemned by Sound Transit to make way for a parking lot for a train station.

Sound Transit posted a notice on its Web site of the meeting where the condemnation action would be taken. The Millers never saw the Web site notice, and appealed. But the Supreme Court ruled 5-4 that the Web site posting satisfied the notice requirement.

Some lawmakers said Thursday's ruling showed that the court would continue to rule against landowners.

"This is the sort of thing that builds distrust of government," said Sen. Mike Carrell, R-Lakewood and sponsor of the eminent domain measure in the Senate. "It's just simply wrong and it will not stand."

House Majority Leader Lynn Kessler, D-Hoquiam and sponsor of a companion bill in the House, agreed.

"It goes against at least the spirit of how we ought to go about eminent domain," she said. "It's more important now than ever to get this bill passed."

The companion House bill is scheduled for a public hearing in that chamber's Judiciary Committee on Friday.
The case is Pub. Util. Dist. No. 2 of Grant County v. N. Am. Foreign Trade Zone Indus., L.L.C. Docket number 76755-6.

The eminent domain notification measure is Senate Bill 5444. The companion measure is House Bill 1458.

Seattle WA Post-Intelligencer: http://seattlepi.nwsource.com

Cloverleaf Undone: Is Eminent Domain an Option? Richmond VA Style Weekly, 1/31/07

by Scott Bass

On the surface, the deal seems a bit absurd: The developer of Cloverleaf Mall agrees to purchase the mall buildings for $9.25 million and then demolish them, even though the developer doesn’t own the land where the buildings sit.

The Chesterfield County Board of Supervisors agreed to just such a deal last week, selling the mall to Crosland Inc., the developer, and agreeing to begin negotiations to purchase the land in question, about 46 acres.

Hailed as essentially a done deal last week, Cloverleaf Mall’s redevelopment raises new questions: How many millions in financial incentives is the county willing to kick in? If pushed to the wall, is Chesterfield willing to use eminent domain to gain control of the remaining land?

The county owns the mall and all but 46 acres of the 83-acre site at the intersection of Chippenham Parkway and Midlothian Turnpike. But those 46 acres are critical — it’s the dirt on which the mall buildings actually sit.

And the landowner, Millmar Properties, has been in discussions with a potential buyer — but it’s not the county. As of Monday, a Millmar spokesman says the county hasn’t contacted the company about purchasing the property.

But the Rev. Steve Parson, head pastor of the Richmond Christian Center, has. In recent weeks, the church offered to purchase the land for at least $7 million.

“The church is willing to pay top dollar for that property,” says Parson, adding that his church wants only 15 acres to build its new sanctuary and is willing to allow the county to develop the remainder however it sees fit.

Chesterfield plans to negotiate a bit differently. The lease agreement allows the county to make a minimum offer of $4.25 million. If that offer is rejected, a third-party appraiser will help determine an “objective” price for the property, says Tom Jacobson, Chesterfield’s director of community revitalization and point man for the project.

If the price winds up higher than $4.25 million, a complex formula will determine how much the county will kick in to make the project financially feasible. Crosland plans to build more than 500 residential apartments and condos and a retail shopping center anchored by a Kroger grocery store in the next four years.

Parson wonders why the county would pay anything.

“Why spend that money? Is it just because it’s taxpayers’ money?” asks Parson.

Legally, the county may be able to take control of the property via eminent domain, something that Jacobson doesn’t want to discuss. When asked if the county would rule out using eminent domain, Jacobson declined to answer.

“I just don’t want to comment on eminent domain,” Jacobson says. “We have the right to buy the land.”

The potential cost raises a bigger question: How much will the county spend to redevelop Cloverleaf into a residential neighborhood with minimal retail?

“It’s going to be around a Kroger. It will be your neighborhood center kind of retail,” says Brian Glass, senior vice president of retail brokerage at Grubb & Ellis/Harrison & Bates, who envisions shoe stores, maybe an H&R Block. “A nail salon, hair salon, a couple of small restaurants — those kind of uses.”

Richmond VA Style Weekly: http://www.styleweekly.com

Optimistic at hearing on Lodi trailer parks: Hackensack NJ Herald News, 1/31/07

By Suzanne Travers

Residents of two Lodi trailer parks left a Bergen County courtroom Tuesday optimistic that a three-judge panel will uphold a lower court ruling that the borough cannot seize their homes for redevelopment.

"I think we won," said Kendall Kardt, president of Save Our Homes, a residents group that has led the fight against the borough's attempt to condemn the trailer parks and take over the land using eminent domain. "My sense is this court will affirm the trial court, just on the merits."

Among the indicators the court could rule in favor of the residents were comments from state Appeals Court Judge Howard Kestin, who told Brown's Trailer Park attorney Jan Brody that his argument was "very well done" and referred to legal briefs submitted by the trailer parks' attorneys as "excellent."

More than 40 people who call trailers in Brown's Trailer Park and Costa Trailer Court home packed the small courtroom to hear borough and trailer park attorneys argue a key issue in the case: How much evidence a municipality must amass to prove that an area is blighted and in a condition that justifies the government's takeover of private property.

In October 2005, Superior Court Judge Richard Donahue ruled that the borough had not provided sufficient evidence that the trailer parks were in a condition meeting the definition of blight.

Borough officials appealed that decision, saying the use of eminent domain was in the community's best interest because if the land, some 20 acres along Route 46, is developed into a strip mall and upscale senior housing, it would bring increased tax revenues, allowing the borough to lower property taxes for its 25,000 residents.

Meanwhile, Brown's Trailer Park owner Robert Bonanno, 80, said Monday that he has his own plans to redevelop the site, but slowly and in a way that allows current residents to remain in their homes. Bonanno has leased two acres of the property for a QuickChek convenience store, and plans to develop another parcel of land. The entire site would be passed on to his family, he said, adding that he remains in full support of Save Our Homes.

In court Tuesday, John Baldino, attorney for the borough, said the court should overturn any municipality's decision to take property through eminent domain only if opponents can establish that the borough's decision was "completely arbitrary, capricious, and unreasonable."

"No question, it is a hardship when government takes homes," said Baldino. "Everybody pays the price when there is some kind of progress."

Planning board attorney Gerald Salerno said Lodi's planning board held eight hearings over nearly a year before voting to condemn the properties, a process that met the "substantial evidence" requirement for a blight determination, he said.

Attorneys for the trailer parks' owners and residents rejected that claim, noting that the borough did not systematically inspect the trailers, provide evidence of health or fire code violations, or otherwise substantiate its view that the parks deserved condemnation.

"There was not one iota of credible evidence, let alone substantial credible evidence, to support" a blight designation, said Brody.

Eminent domain cases, including those in Lodi and Long Branch, have garnered national attention, especially after the U.S. Supreme Court ruled in 2005 that local governments can seize property for private economic development if it would benefit the public.

Two outside groups, Northeast New Jersey Legal Services and the New Jersey Public Advocate's Office, joined the Lodi case in "friend of the court" briefs that argued municipalities should be required to meet tougher standards when using eminent domain to take property that provides affordable housing where few comparable alternatives exist. Rents for most of the 200 or so Lodi trailers range from $425 to $600 a month, making the parks a scarce source of affordable housing in the borough. Many residents of the two parks are older or disabled.

But the judges appeared reluctant to expand the scope of their decision.

"We try not to make cases into more than they are when they come before us," said Judge Kestin, who was joined by Judges Edith Payne and Marie Lihotz. "Our sense of this case is that Judge Donohue made a judgment call on whether the proof satisfied the three statutory elements, and that's what we're going to decide on. We are not a policy-making court."

The judges gave no indication as to when they would issue their ruling.

Lodi Mayor Gary Paparozzi said the borough will not take the case to a higher court if it loses this appeal.

"We did what we did only because there are other people in Lodi we were trying to help as well," Paparozzi said. "If it doesn't work out, it doesn't work out."

But despite their optimism, residents such as Judy Kuchenmeister, 64, who lives in Brown's Trailer Park, said until the court rules, insecurity will dog them.

"You're living on eggshells," she said.

Hackensack NJ Herald News: http://www.northjersey.com