Law protecting residents might hurt community: Hampton Roads VA Daily Press, 4/14/07

Tighter eminent domain rules could keep some people in a stinky neighborhood

By Veronica Gorley Chufo

Stricter eminent domain laws may threaten the relocation of about 200 Pinewood Heights [VA] residents, who endure foul odors and noise from a nearby meatpacking plant and other industries.

State lawmakers this month passed changes to the state's eminent domain law, which allows local governments to take private property if they pay for it.

The state housing department is evaluating the changes and what it will mean for projects such as Smithfield's, a spokeswoman said.

"We are anxiously waiting to find out what effect this is going to have on our project," Smithfield Town Manager Peter Stephenson said.

The changes might make it tougher for governments to take properties and carry out redevelopment projects across the state, including ones in Smithfield, Newport News and Suffolk.

"It's used very sparingly, but in cases of public necessity, it's a valuable tool," Stephenson said. "Nobody wants to see it abused. Unfortunately, the cases where it's abused have brought about this knee-jerk reaction."

It's a big victory for individuals' property rights for landowners, said Joseph T. Waldo, a Norfolk-based lawyer who represents landowners in eminent-domain cases.

"Virginia is a very harsh state when it comes to property rights," Waldo said. "The bill is a major step in the right direction."

In November, Smithfield agreed to accept a grant to improve the living conditions of Pinewood Heights residents by relocating about half of them. The rest would be moved in later years.

But the town didn't enter a contract with the state housing department until February. The new law affects plans adopted after Jan. 1. The town plans to ask the state attorney general whether the changes apply to the project.

The amendment narrows the definition of blight. Before, a property that wasn't blighted could be taken as part of a neighborhood redevelopment project if the surrounding properties are blighted, Waldo said.

Now, each property must be ruled blighted, which the new law defines as "any property that endangers the public health or safety in its condition at the time of the filing of the petition for condemnation and is (i) a public nuisance or (ii) an individual commercial, industrial or residential structure or improvement that is beyond repair or unfit for human occupancy or use."

In Pinewood Heights, not all of the houses are in disrepair. Some have recently been upgraded.

With eminent domain, the town would be able to buy those houses at fair-market value. But if they're not deemed blighted, then the landowner dictates how much he or she is willing to sell them for.

"It's just going to drive the cost of the project through the roof, and that comes back on the taxpayers," Stephenson said. "To me, that's the sad irony of it."

James Gurganus, executive director of the Williamsburg Redevelopment and Housing Authority, agreed.

"Small towns and old cities are going to become slums," Gurganus said. "The towns and cities cannot afford to rehabilitate the properties and neighborhoods on their own."

For Newport News, that new definition could put stumbling blocks before the expansion of Madison Heights, where the city has demolished blighted houses between 26th and 28th streets to make way for new affordable houses.

"It could really cripple the housing authority's ability to get rid of blight," said Derek Kahn, the housing agency's director of community development.

In Suffolk, the city is working on an affordable-housing project called The Fairgrounds. The changes might make it harder to put together a site to redevelop, said Clarissa McAdoo, executive director of the Suffolk Redevelopment and Housing Authority.

Pinewood Heights homeowner Phyllis Townsend said she was disturbed to learn that the changes might threaten relocation.

"They don't consider us as taxpayers, as a neighborhood," Townsend said. "They need to come out here and stay a week and see for themselves - the sounds we hear, the smells we put up with and now, this time of year, the bugs are bad."

If the town offers decent places to live, it shouldn't need to use eminent domain, Townsend said.

Cases where landlords are unwilling to part with the rent they make from houses might call for eminent domain, Stephenson said.

Eminent domain is a worthwhile tool for redevelopment or improving residents' lives, but it can be used unnecessarily, Waldo said.

"If you've got a blight situation and it would benefit the community and you would treat them fairly and compensate them, it would be a good thing," he said, "but we should never force people to leave their homes."

Stephenson said Pinewood Heights is a prime example of the benefit of eminent domain.

"Because of the industrial location of the neighborhood, it needs to be relocated," Stephenson said, "but this may preclude that from happening."

Hampton Roads VA Daily Press: http://www.dailypress.com

Jury hears eminent domain case: Argus Observer, Ontario OR, 4/13/07

By Andy Gates

A jury will decide today how much money the state of Oregon should pay to Poole Real Estate Corporation for four acres of land that was taken through eminent domain to be used for a key road project in Ontario.

Eminent domain is the constitutional power of government to seize private property for public use, and the Oregon Department of Transportation used that authority to take four acres of land Jan. 10, 2006, owned by Poole Real Estate Corporation (PREC), according to a jury synopsis of the case filed by the Oregon Department of Justice in Malheur County Circuit Court.

Jurors will determine how much compensation PREC should receive from the state for the land because amounts proposed by the two entities vary by around $1.4 million, according to the state’s jury synopsis.

The Oregon Department of Transportation asserts it should pay $238,400 for four acres of PREC land.

However, PREC claims the land is worth a lot more, or $1.6 million according to the state’s jury synopsis.

The PREC land will be used in a road project involving a newly constructed Yturri Beltline around Ontario that will connect to a new North Ontario Interchange at Interstate 84, according to the jury synopsis.

The purpose of the project is to reduce truck traffic through downtown Ontario — that traffic was a problem for city government and roadway maintenance, according to a trial memorandum from the Oregon Department of Justice on behalf of ODOT.

PREC property includes a lot near the I-84 interchange purchased in 1970 where a Shell station was built; an adjacent 10 acres was later purchased in the mid-1980s where a cardlock facility was erected; and then during the next several years PREC acquired additional land, according to a trial brief from PREC attorney John McCulloch Jr., Salem. The state argues the road project adds value to the four acres of land in question, but attorneys for PREC assert the land had an intended use before the project.

“The state’s experts contend that there are special benefits to the land after the project is completed and the owner’s experts deny that there are any,” according to the state’s trial memorandum.

However, PREC contends that before the project, the property would have been used to build a truck stop, along with additional land owned by PREC.

“The owner believes that before this project he had an integrated 15.19-acre parcel perfectly situated for development of a truck stop-travel center, and with a highest and best use therefore. Plaintiff’s (state) appraisers argue that the property had no such highest and best use; and that any very significant value of the property is only as a result of this state project,” according to McCulloch’s trial brief.

Jurors should determine the value of the four acres on the date of Jan. 10, 2006, according to the state’s jury synopsis. PREC contends the state took 2.67 acres in May 2002 for the Yturri Beltline construction, but during the next several years PREC acquired more land so it had a 15.19 acre “larger parcel,” from which the state is taking four acres, according to McCulloch’s trial brief. The state, however, claims PREC has around 12 acres of property remaining after the four acres is taken out, and the land is not all directly touching or utilized for the same uses, according to the state’s jury synopsis. The jury trial was held all week and is scheduled through today, according to the Malheur County Circuit Court Clerk’s Office.

Argus Observer, Ontario OR: http://www.argusobserver.com

Eminent Domain Seizures Loom Over West Maspeth: Queens Chronicle, Rego Park NY, 4/12/07

By Colin Gustafson

The government’s proposal to renovate or replace the Kosciuszko Bridge could bring innumerable benefits to motorists who traverse the dilapidated 1.1-mile stretch of the Brooklyn-Queens Expressway each day. But for a handful of residents and industry workers in West Maspeth, the impact could be devastating.

In a draft of the Kosciuszko Bridge Project’s Environmental Impact Statement, the Department of Transportation considered five different building alternatives. They include plans to refurbish the 68-year-old bridge and build either one or two parallel spans; demolish the existing bridge and replace it with two new bridges; or build a temporary bridge while construction on another permanent bridge is ongoing. Construction could cost between $515 million to $712 million and take up to six years.

The project could displace as many as nine Maspeth businesses and between 260 and 368 employees, state officials said. “This is going to be difficult, even under the best of circumstances,” said George Kosser, vice president of operations for Karp Associates, a door manufacturer that has operated out of the same plant on 43rd Street for more than five decades.

With over 100 employees, Karp is the largest business in the neighborhood facing seizure under eminent domain. All five of the state Department of Transportation’s building proposals would force the company to relocate, while a sixth “No-Build” option would leave it unscathed.

Already this month, Karp executives have entered talks with state officials on a potential time frame for relocating — a process that would be especially hard for the manufacturer, since its interlinked assembly lines and delicately calibrated machinery cannot be moved without major interruptions to the operation. To stay afloat, Karp would have to open a whole new plant before leaving the old. “We’re not a distributor who can just pack up and move,” he said. “If we don’t get a few years to rebuild, we won’t survive.”

In the meantime, state officials have instructed the company to continue its daily operations as if there were no prospect of being displaced. Under federal statute, the government is not required to reimburse a business for decisions made on the assumption that its assets will be seized under eminent domain. Such rules allow federal and state officials to minimize future liability — for instance, if a business owner buys up expensive new properties in hopes of being handsomely compensated for them later.

That same rule, however, has left Karp in financial limbo, with a recently purchased lot that can no longer be developed. “It does not pay to put the effort and agony into expanding it,” Kosser said. “We’re realists: We know it’s going to be taken along with everything else, and we don’t want to further jeopardize our company or employees.”

Karp’s northern neighbor, the Choudri family, may also lose their properties to the Kosciuszko project. One of the state’s proposals, which calls for the rehabilitation of the bridge and construction of a second bridge on its eastbound side, would result in the right-of-way acquisition of the three adjacent houses owned by Akhtar Choudri, who has lived in the area for 28 years.

Now, Choudri’s 42-year-old son, Tes — who occupies one of the homes on 43rd Street with his wife and child — is hoping to simply cut his losses. State officials have promised him a new home in or near Middle Village, if they decide to seize his father’s properties, he said. But if the government does not take the homes, the noise of construction and other disruptions will likely drive the family out anyway, he said.

“I’d prefer to leave. If the state adopts another plan, and we end up staying, all that (construction) is going to be happening right over my child’s head,” Tes Choudri said. “I’d never give up my home voluntarily, but every other option is just going to kill us. It won’t be worth the aggravation.”

Businesses that do remain, along with residents of more than two dozen other homes on the Queens side of the project, can expect noise increases during construction, according to the impact study. The state will release its completed Environmental Impact Statement in either August or September, according to department spokesman Adam Levine. The approved proposal still has to be reviewed by federal transportation officials.

Before the completion of the impact statement, the state will host two public hearings; one in Brooklyn on April 19 and the second on April 26 at DeVry Institute of Technology, located at 30-20 Thomson Ave. in Long Island City

Queens Chronicle, Rego Park NY: http://www.zwire.com

Eminent domain issue in mall case: Bristol CT Press, 4/2/07

By Jackie Majerus

Attorneys for the city and for Ocean State Job Lot argued before the Connecticut Supreme Court Thursday over whether Bristol can evict the Rhode Island-based retailer from the downtown mall.

The case seems to rest on whether the city's purchase of the property amounted to the same thing as use of eminent domain.

In Ocean State Job Lot's lease, it says that if a certain amount of the mall property "shall be acquired or condemned by right of eminent domain for any public or quasi public use or purpose," the landlord may terminate the lease.

The city's position is that the lease allows it to terminate the lease because the city acquired the property for a public use.

But Ocean State Job Lot's argument is that the city did not use eminent domain to buy the mall property and so cannot simply terminate the store's lease.

"This is a contract interpretation case," said attorney Houston Putnam Lowry, who represents the city.

Bridget Gallagher, the lawyer representing Ocean State Job Lot, said the city never used its power of eminent domain when it bought the mall two years ago - and couldn't have at the time, because there was no redevelopment plan for the property.

She said no city board ever passed a resolution to use eminent domain and that no official ever testified that the city intended to use that power.

"No such evidence was ever introduced," Gallagher told the panel of five justices.

The city wouldn't have been able to continue to use Lowry, Gallagher said, if it intended to use eminent domain to take the property, because Lowry also worked for the former mall owners and would have had a conflict of interest.

"The city did not want to use eminent domain," Gallagher said.

At one point during Lowry's argument, Lowry had a somewhat contentious exchange with Senior Associate Justice David Borden.

"Of course the city has the power of eminent domain, once it goes through the formal statutory requirements," said Borden.

Lowry said the city was en route to using eminent domain, having taken the first step, which he said is negotiating for the property. According to Lowry, there isn't any difference between the city buying a piece of property and taking it by eminent domain.

"A vote to purchase is synonymous with a vote to condemn," said Lowry.

Ocean State officials have repeatedly said they want to keep their downtown Bristol location, and John Conforti, the company's chief financial officer, said that is still true.

The store's lease runs until 2014, Gallagher said.

Conforti, who attended the arguments before the Supreme Court, said he was impressed by the session.

"The justices came across as very astute," said Conforti. "This is such a higher level."

Conforti said that Lowry's argument was "fluff" to Gallagher's "fact."

City corporation counsel Edward Krawiecki Jr., who also attended the Supreme Court arguments, said the burden was on Ocean State Job Lot to show why the appellate court ruled in favor of the city.

"The city's case is very strong," said Krawiecki.

But Krawiecki acknowledged that it is "possible" that the Supreme Court will overturn the lower court's ruling.

"It's hard to predict what the Supreme Court will or will not do," said Krawiecki.
It may be many months before there's an answer.

Krawiecki said if the justices do not deliver their ruling by mid-June, it will be at least September before they do.

The city could condemn Ocean State Job Lot's lease instead of pursuing an eviction, Krawiecki said, but he said this route was chosen instead.

"The last administration did not want to condemn," said Krawiecki. When Mayor William Stortz took office, Krawiecki said, the case against Ocean State was already under way.

Bristol CT Press: http://www.bristolpress.com

The diner vs. City Hall: Fortune Small Business Magazine, 4/4/07

A small restaurant owner battles her local government over eminent-domain power - and wins

By Ian Mount

Maria Aposporos must never have heard the adage about fighting city hall. The 60-year-old owner of Curley's, a Stamford, Conn., diner, took on her local government when the city decided that her location, on gentrifying West Park Place, would be a perfect spot to build an apartment tower.

The city tried to use its eminent-domain powers to buy the property for $233,000, some $1 million less than Aposporos's appraiser thought it was worth. Aposporos fought Stamford in the Connecticut Supreme Court and won.

The city then erected a chainlink fence around three sides of Curley's (which has no Web site, but can be reached at 203-348-2020), cutting it off from a parking lot and dumpster.

Aposporos countered by winning a seat on Stamford's board of representatives.

But lately things haven't been looking good for Aposporos. As a member of the minority Republican Party, she says that her power on Stamford's board is nil.

And her attempts to sue for access to the parking lot - to which Stamford mayor Dannell Malloy says she sold the rights more than 20 years ago - have been unsuccessful. "I'm getting frustrated," Aposporos admits.

Fortune Small Business Magazine: http://money.cnn.com/magazines/fsb