5/31/2005

A reservoir of hope: San Bernadino County (CA) Sun, 5/28/05

Lake plan also stirs upheaval

By David Schwartz

It started as a pipe dream a series of lakes and streams to transform the old downtown and solve a host of water woes.

Nine years later, it may become one of the largest redevelopment projects in San Bernardino Valley history.

Called variously Vision 20/20, Downtown Revitalization and most famously, Lakes and Streams, today it carries a more modest moniker: North Lake Project Area.

Despite the name changes, the project still represents a glimmer of hope for many who have watched downtown age and crumble.

As designed, the project would clear a square stretching three-quarters of a mile long on each side. It would demolish 437 houses, six churches and about 30 businesses north of downtown and east of Interstate 215.

In the neighborhood's place, the San Bernardino Valley Municipal Water District would build a 44.5-acre reservoir. The rest of the land would be turned into parkland and developed with 72 houses and 12 acres of shops.

The lake, proponents say, would help ease the problem of high groundwater and speed up decontamination of a water supply for nearly 1million people. By selling the water, officials expect to recoup some of the lake's cost.

Critics doubt it will meet grandiose expectations. And for all its promises, the North Lake Project Area would cost taxpayers more than $150 million and force nearly 1,500 residents from their homes.

"We've been under the ax for seven or eight years,' said Ghassan Abdullah, a 46-year-old physician who lives in the area and takes care of his disabled mother.

Steve Veloz, who lives on G street, has been through relocation before. It was in his sophomore year in high school in the mid-1960s, and the school district cleared out his family's Westside home to make way for Ramona Alessandro Elementary School.

"When you grew up with people you've known since you were a kid, then they bust everyone out of there,' he said. "Then you're living for over 26 years in the area, you establish roots. There are a lot of things here. Sentimental things. I don't want to be moved. To tell you the truth, I don't want to be moved.'

The burly 54-year-old had taken a wood-shingle house built on G Street in the 1930s and stuccoed it, dry-walled it and redesigned it himself.

It's not about the money.

"I'm not going to ever find a house the way my house is,' Veloz said.

Critics argue the project doesn't have to be so large. A proposal in 2003 would have demolished 111 fewer homes than the current plan.

The consultant said the lake needed to be larger and more shallow to address environmental concerns. The final report, though, made no mention of those concerns.

"Did we change the project in an honest and open fashion?' Councilwoman Susan Lien Longville asked. "We didn't. We used a ploy. We used technical issues to eliminate the entire neighborhood.'

Abdullah said, "Displacing 430 households when there are other viable options that haven't been looked at is not the way to get citizens who've been loyal to this city to jump on board.'

The water district says it needs the larger lake to efficiently deliver water.

Water board President C. Patrick Milligan, first elected to the panel in 1964, points to San Bernardino's high groundwater problem. During an earthquake, high groundwater and the sandy soil beneath downtown could create a quicksand-like effect called liquefaction.

An estimated 5.5million acre-feet of water lies beneath San Bernardino, enough to meet the needs of 100,000 families for 55 years without replenishment. The lake, Milligan said, will serve as a hub to sell water to Redlands, Rialto, Colton and Loma Linda. A major step

On April 25, the City Council and the water board agreed to the project's design and certified that it met state environmental laws. Lawsuits filed Friday by residents in the area challenge that assertion.

Approval of the project even with lawsuits looming at the time was a milestone that prompted Milligan to pump his fist and proclaim, "San Bernardino is going to get its lake.'

It didn't come without a fight, though. Protesters packed in, wearing T-shirts that showed Mayor Judith Valles pointing the way out of the neighborhood for broken-looking residents. Yet they were outnumbered by a group of chief executive officers and community leaders who came out to support the project.

An attempt by Lien Longville to get the smaller lake approved failed by one vote.

The project has received its approval and now needs to be built, Milligan said.

"Any people around that think after all these years, all these votes, we're going to resurrect any of these issues, it's never going to happen,' he said. "The time for argument is gone. It has passed. Arguments now are only a matter of history. We're going forward and going to do this project.'

Even longtime opponents are beginning to give up hope.

"I've been fighting this for five years,' said Lucy Romero, whose home that would be demolished is decorated with anti-lakes signs. "But I was at the last meeting. I saw they were for it.'

She has begun to look for a new house.

The water district plans to buy out and compensate residents, renters and business owners in the area. It will pay them enough to find a similar home or apartment nearby, Project Manager John Hoeger said. A downward spin

San Bernardino shares many of the same problems found in urban America.

To understand why bulldozing more than 82.4 acres of houses, businesses and churches appeals to so many is to understand how far the city has fallen.

In the first part of the 20th century, San Bernardino was not just the county seat in name. Route 66 ran through part of the town. Families in dusty desert towns trekked down to Harris' department store to shop in the big city. The railroads from the Pacific Ocean ports carried goods inland, and San Bernardino was a hub.

Perhaps the first blow to the city's future came in 1979, when southbound Interstate 15 split off from Interstate 215 in Devore. The future of retail and housing growth then funneled to Ontario and Rancho Cucamonga, said Nick Cataldo, a local historian.

In 1984, the Kaiser Steel Corp. mill near Fontana closed and 8,800 jobs were lost. Santa Fe Railway's repair shop was moved from San Bernardino to Kansas in 1988, erasing 6,300 jobs. Finally, the city received word in December 1988 that Norton Air Force Base was going to close.

The workers who lived in their small but tidy homes had to look for jobs elsewhere. Investors came in, thinking they were buying low. They rented out the houses, hoping for a quick rebound and a neighborhood on the mend.

Others had the same idea. Entire blocks became rentals. When landlords turned up absent, the area began to deteriorate, said Redlands-based economist John Husing, who studies the Inland Empire.

As jobs and homeowners fled, blight spread. By the mid-1990s, the area north of downtown San Bernardino, on the east side of I-215, had the highest rate of foreclosures in the city.

Like many of the old guard of the city, Edward G. "Duke' Hill was sick of seeing the city deteriorate. A land appraiser, he was active in the community, serving as the president of the San Bernardino Symphony and the Chamber of Commerce.

"It became obvious to me the city had no overall direction, no plan,' Hill said recently.

In 1996, he was headed back from appraising a planned development south of Hesperia, Rancho Las Flores. Nestled in a secluded valley, it is only accessible by a winding road.

He pulled over on his way home and looked out over the valley. He asked himself why people would move to such an inaccessible location and started thinking about solutions for San Bernardino.

Tear up the street grid system. Pump water under the city above ground, flooding the creeks that feed the Santa Ana River. Build some houses and businesses along the banks.

Not long after, he vacationed in Maui. While walking the beach, he spoke into a dictation machine, laying out his vision. That turned into a bound pamphlet titled "San Bernardino: The Future Runs Through It.'

At the same time, Milligan saw that Louis Fletcher, then general manager of the San Bernardino Valley Municipal Water District, was exploring using San Bernardino's high groundwater for a reservoir in Redlands, Milligan said.

"I said Louis, 'I like that idea,'' Milligan recalled.

But he wanted the reservoir to be in San Bernardino.

"We have high groundwater, we're shipping it down to Orange County for free, why don't we use some of it to improve quality of life?' Fletcher remembers thinking.

So Hill, Fletcher and Milligan began talking to Rotary and Kiwanis clubs, at local chamber of commerce events, to everyone who would listen.

"I think we had a very positive response from everybody,' Fletcher said. "It makes sense. If we have all this water, let's use it, not lose it.'

He had thought everything would go smoothly.

"Everybody would love to have the lake, Warm Creek flowing again, pathways, bikeways,' Fletcher said.

That was nine years ago.

Larger lake in
To move the project forward, the City Council and water board hired RBF Consulting in Ontario to prepare the environmental impact report for the project.

The smaller version of the lake, the one that integrated the old housing with the new housing and met the water district's needs, was supposed to be the project's scope.

On June 18, 2003, about six months after being hired, Kevin Thomas, the environmental services manager for RBF, said the lake needed to be more shallow, according to minutes of the San Bernardino Regional Water Resources Authority, which was formed by the City Council and the water board. In order to store enough water, it also had to be wider.

Thomas said RBF's research found problems with the high groundwater level, water fluctuation and clay importation, making the larger option a necessary project, according to the minutes .

The lake expanded from 34 acres to 44.5 acres. Now, 437 homes would be demolished.

When the final environmental report was released, the technical concerns raised by RBF Consulting nine months before were gone. Instead, the smaller project was discounted because it wouldn't provide enough redevelopment opportunities.

At the April 25 joint meeting of the City Council and the water board t o certify the environmental document, Lien Longville made a fiery but ultimately unsuccessful speech advocating a smaller lake.

Valles said she was grandstanding. Milligan accused Lien Longville of bringing up her concerns at the last minute.

Residents, though, said they felt like they had a new ally.

"Getting 83 acres, when the whole project is for a 40-acre lake, and you're going to sell the land back to private developers?' asked Abdullah. "It's cheating the citizens of the city. I would think if you're going to do a project of this size, you'd impact the least amount of people.'

Valles said the decision to go with the larger lake was to meet the needs of the water district.

"This is a better choice of the two,' Milligan said. "I do not believe it was an effective reservoir. I never, ever had much enthusiasm for the smaller lake.'

Sherrie Gundlach, business development coordinator for RBF Consulting, referred questions to the water district.

Water woes
To Milligan, it's not a lake. It's a reservoir. He has always maintained that the redevelopment opportunities are only a side benefit to the water issues that the project would solve.

Rain and melted snow rush down the slopes from the mountain peaks and into San Bernardino. Water sinks beneath the city into what is called the Bunker Hill Basin.

Dammed off by the San Jacinto Fault, 5.5 million acre-feet of water about the size of Lake Shasta when it's full builds up underneath downtown.

The resulting high groundwater, combined with silty and sandy soil, puts much of downtown San Bernardino at risk during an earthquake.

When the groundwater rises too high, the loose sandy soil becomes saturated. In an earthquake, the grains of sand try to slip together but can't get any traction because they're surrounded by water, according to a report prepared by the U.S. Geological Survey.

The ground that buildings use for support becomes similar to quicksand.

"Essentially, everything underneath the buildings just becomes soft and soupy, almost like Jell-O,' said Katherine Kendrick, a research geologist at the USGS.

Scientists say buildings can sink or tilt over.

"It's most common when you have loose sediments, a high groundwater table and the possibility of an earthquake,' said Sally McGill, a professor of geology at Cal State San Bernardino. "We definitely have all three of those factors in downtown.'

Milligan said, "We need the reservoir-lake so we can pump all the water we need out of the basin to keep this city safe.'

McGill said the high groundwater problem could be solved without the lake project.

"It's important to try to lower the groundwater, but you don't have to link lakes and streams to groundwater,' she said.

McGill doesn't have a position on the project.

"That's a question more for people who know about urban planning,' she said.

Lien Longville, who is also associate director of the Water Resources Institute at Cal State San Bernardino, said the project would have little effect on liquefaction. She called that argument a "scare tactic.'

"It is preposterous,' she said. "It may be a good water project, but it sure as hell is not a public safety project.'

Milligan said the reservoir would allow the water district to sell the high groundwater beneath San Bernardino.

"You can't just forever pump water unless you have somebody to pay the bill,' Milligan said.

He maintains that the lake can only be at its proposed site because of the higher elevation and the location of existing pipes.

"It has to be where it is,' he said. "If moving a half- or quarter-mile would have worked, we would have done it.'

The alternative, he said, was to build a farm of steel tanks to help deliver the water, which would only add to the city's blight.

"The city needs to go to work to plan on how it's going to accept this gift and turn it into a diamond for the community,' he said. "It sure needs one.'

The 3 R's
Residents of the area are skeptical. They have heard the buzzwords before. Renaissance. Revitalization. Rejuvenation.

Projects like Carousel Mall and Seccombe Lake were pitched with the same prospect of saving downtown. Instead, they have come to symbolize the city's decline.

"The idea that they're going to put a lake in here and people are going to flock to San Bernardino is ridiculous,' said Deanna Adams, whose banquet hall, Victory Chapel, would be demolished.

When Valles was asked why the city should have faith that this project will be the forerunner of real change, she said with a laugh, "Because it's me. I don't want to be boastful, but I take a great deal of pride in my integrity.'

Valles said that a better comparison than Seccombe Lake would be The Hub project, where a residential community was uprooted. It is now a booming commercial area.

Some see this lake as just a test run for the future. If it succeeds, neighborhoods will clamor for their own lakes.

"This is just peanuts,' Hill said. "This is just the beginning.'

The decision-makers have wrestled with conflicting interests, some telling them to build bigger, others to build smaller or not at all.

What they've settled on is a gamble in financial, political and human costs. It's also something that will take years to complete, even under the most optimistic projections.

For all the unknowns, it's what many bank the city's future on.

"The area is lingering and dying,' Valles said. "We need the project to regain our rightful place as the county seat, culturally and economically."


San Bernadino County Sun: www.sbsun.com

2 suits target lakes plan: San Bernardino County (CA) Sun, 5/27/05

Action seeks court injunction against SB project

By David Schwartz

[San Bernadino] Residents filed two lawsuits Friday challenging the lakes project that would destroy their homes.

The first suit, filed by 10 homeowners, says the final environmental impact report approved April 25 fails to meet state environmental standards. Deanna Adams, who owns and operates Victory Chapel, filed the other lawsuit.

The lakes project would clear out 473 homes on 82.4 acres north of downtown and east of Interstate 215. In their place would be a 44.5-acre lake, with land left over for parks and the development of 72 homes and 12 acres of stores.

The lawsuits, filed in San Bernardino Superior Court on Friday, seek a permanent injunction against the project. They also ask for attorney fees.

"The mass of the demolition of affordable homes and growing businesses is sort of stunning,' said Lou Goebel, the San Diego-based lawyer who filed the lawsuits.

John Hoeger, the project manager, defended the document.

"The (environmental impact report) took years to prepare, hundreds of hours of study,' he said. "It's a well-thought-out document.'

Hoeger, City Attorney James F. Penman and Bruce Varner, the lawyer for the San Bernardino Valley Municipal Water District, had not seen the lawsuits and would not comment on them directly Friday.

"Challenges of (environmental impact reports) are not unusual. It's kind of an expected thing,' Hoeger said.

The lawsuits challenge the environmental document that the City Council and the water board separately certified on April 25.

The lawsuits claim the environmental impact report:

  • Gives inadequate details about relocation.
  • Doesn't deal with the effects on the neighborhood and where people will move.
  • Doesn't consider a smaller option that would have displaced fewer residents.

Even though the April 25 vote was hailed as a major step for the project, many obstacles and potential tripping points remain.

The water district has hired a firm to create a relocation plan, a necessary step required under state environmental law before the water district buys land and relocates residents.

The water district has almost $60 million, but the project is expected to cost at least $150 million. Hoeger said homes might not start to be acquired and residents relocated until more is known about the funding.

The water district "could choose to do this with their own funds, but they'd do it at some risk until they have enough money to complete the project,' Hoeger said. The board of directors, who are elected, have not made that decision yet.

Residents questioned where they'd move to.

"Do you know where 400 affordable homes are for sale in the area? I don't,' said Ghassan Abdullah, one of those suing the city and water district.

"This project is not for the people,' said Steve Veloz, who also lives in the area and is involved in the lawsuit.

The lawsuits question why some of the data in the area is based on old numbers, including the 2000 census.

Veloz was skeptical that residents would be fairly compensated, given the increased home prices and lack of affordable housing.

Veloz said, "There's a house shortage here for regular people.'

It remained unclear how this would affect the project.

Although the residents who are suing can seek a temporary restraining order, Goebel said it was unlikely they would do it immediately.

"Since they're not bulldozing right now, we're going to wait to see what happens next,' he said.

A hearing is set for July 28. Judge John Wade will hear the case.


San Bernardino County Sun: www.sbsun.com

5/30/2005

Landowners cry foul in eminent domain push: The (Palm Springs CA) Desert Sun, 5/28/05

By Nelsy Rodriguez

When Cathedral City City Council voted in March to exercise eminent domain over one of the largest undeveloped pieces of property left in the city, it was seeking to put about 60 acres of land together for possible development.

The 12 small business owners in the area - ranging from the Villa Bakery to Jaguars Only - and the landowners of the area near Sarah Street and Ramon Road were told the city did not have a development plan on the table.

But with the approval on Wednesday of a possible 40-acre RV dealership north of Ramon Road. that has changed - and some of the landowners say they have been taken by surprise.

The City Council approved this week a memorandum of understanding with Merritt RV to negotiate the possibility of building an RV sales and service station on 40 of 63 vacant acres north of Ramon Road.

The business fits part of the profile that city planners had mentioned in calling for the power of eminent domain: A big business that will generate much-needed sales tax for the cash-strapped city's general fund.

The plan is moving fast and some of the landowners are stunned.

A portion of the 40 acres is owned by Dr. Kurt Bochner of Palm Springs and his son Clifford Bochner of Murrieta. The elder Bochner did not return calls for comment, Friday, but said at the council meeting Wednesday that he had planned to develop the land and leave it to his kin as his legacy.

"I'm kind of emotionally shook," Bochner told the City Council before it voted to approve the memorandum of understanding.. "(The city had) assured us that there weren't any (other bidders for the land)."

But as Bochner realized, he doesn't have the final say over what happens to his legacy.

The city's Redevelopment Agency, following the March vote, has the power of eminent domain over the land in question. The City Council in March agreed with the RDA that it was important to secure the right to acquire the land, whether the property owners wanted to sell or not, to assure its further development.

The city then told the owners of Katsu's Laundry, Villa Bakery, Jaguars Only, Cathedral City Car Pros, 7-Eleven and all the others on Sarah Street and Ramon Road consideration would be given to keep them included in whatever large project would come.

"It was like a child and you can't give up a child," Mayor Kathy DeRosa told the group in March, assuring them that as a small business owner herself, she would suggest using eminent domain only if it became absolutely necessary.

The memorandum of understanding allows the owner of Merritt RV 120 days to negotiate with the city about developing an RV sales and service complex and related amenities in that area, according to city staff reports.

The memorandum does not guarantee that an agreement will come, but it does restrict the city from negotiating with any other developers for the time period.

The only exception is with property owners.

Redevelopment Projects Manager Keith Scott said the property owners at this point still could influence what happens with the land, "some of which is occupied, some vacant and some of which the property owner may have a project," Scott said.

Scott said Bochner and all other property owners have a right to compete to develop the land.

Mayor Kathy DeRosa did not return telephone calls requesting comment on Friday.

Bochner, who told the City Council he had invested money in forming plans to build low-income housing on his land, said the city wasn't acting fairly by first telling them that no one had expressed interest in the land and suddenly having an interested party.

"I'm 74 years old," Bochner said, "Now we are asked to compete with an outside (developer) in order to develop our own property?

"I don't think the presentation is fair."


The Desert Sun: www.thedesertsun.com

5/27/2005

Shop owner gets to stay put: St Louis (MO) Post-Dispatch, 5/26/05

By Jake Wagman

A St. Louis auto mechanic whose repair shop was targeted for acquisition to make way for a "Media Box" will get to keep his land after all.

The board of directors for Grand Center, the development agency that presides over the cultural district of the same name, voted Thursday to drop its eminent domain suit against Gentle "Jim" Day, owner of Royal Auto Repair.

"It's a very, very happy day in my life," Day, 58, said from his shop.

For 20 years, Day made his $1,222 monthly mortgage payment. He took title to the land last year. By then, however, he was mired in a court dispute with Grand Center over whether he should be forced to sell so the agency could add an artistic attraction to the area around Grand Boulevard in midtown.

Day's plight became public this year. And Day, the son of Arkansas sharecroppers, received an outpouring of support from opponents of eminent domain. On Thursday, a table near his cluttered office at the repair shop bore news clippings about his eminent domain fight and contact information for the local alderman.

Eminent domain is the power granted in the Fifth Amendment of the Constitution that allows local governments to acquire private property for public benefit.

The U.S. Supreme Court is expected to rule soon on a Connecticut case that could curtail that right, potentially affecting several projects in the St. Louis region and hundreds nationwide.

Day's situation has parallels to the circumstances surrounding Kelo v. New London, Conn., which questions whether eminent domain can be used as a tool for economic development.

In Day's case, that power went to Grand Center, a nonprofit organization run by former St. Louis Mayor Vincent Schoemehl.

The St. Louis Board of Aldermen three years ago named Grand Center as the "master developer" of a swatch of land near St. Louis University, roughly bordered by Forest Park Avenue and Delmar Boulevard. That gave the agency broad control over land use, including the ability to dispense tax incentives, approve or reject building designs and to acquire land.

Schoemehl wanted to see Day's triangle of land between Spring Avenue and Olive Street turned over to a private developer.

Envisioned was a building with a design studio and residential units that would have some sort of "multimedia component," thus dubbed a Media Box.

But on Thursday, Schoemehl said the Grand Center board unanimously followed his recommendation to drop the eminent domain suit against Day. Other Grand Center sites will be scouted for the proposed building, he said.

Schoemehl had been under political and public pressure to reach an amicable settlement with Day after the Post-Dispatch reported the dispute in February. Among those seeking a resolution was the alderman in the ward, Mike McMillan, and U.S. Rep. William Lacy Clay Jr.

Schoemehl would not say whether he would use eminent domain in future land deals.

"I don't have an opinion on that," Schoemehl said.


St Louis Post-Dispatch: www.stltoday.com

MBTA pays $200K in eminent domain case: Cohasset (MA) Mariner, 5/27/05

By Samantha Brown

The Massachusetts Bay Transportation Authority [MBTA] has paid a settlement 10 times that of their original offer to a Cohasset couple whose land was taken by eminent domain as part of the Greenbush line construction.

William and Huguette Stone were the owners of a vacant lot at 383 South Main St., of which the MBTA took a portion by eminent domain last November. The government has the right to take private land by eminent domain for public use, and there is usually compensation awarded to the owner in return.

Although the MBTA originally offered $20,000 for the property, the couple's attorney Peter E. Flynn of Saugus said a complaint was filed in Norfolk Superior Court and an agreement has been reached, paying compensation to the Stones in the amount of $200,000.

"We were thrilled to obtain ten times the MBTA's original offer and present the Stones with a check for an additional $200,000," said Flynn, adding it was especially important for his clients that they were able to come to a resolution quickly, "while also avoiding lengthy, costly, and uncertain litigation."

The land was taken from the Stones Nov. 1, 2004, and at that time the MBTA felt its offer of $20,000 was proper compensation. However, Flynn said the Stones were not happy with the settlement and filed a complaint in Norfolk Superior Court Dec. 7.

Although litigation was filed, Flynn said, "Negotiations with the MBTA continued, which allowed us to come to an agreement quickly and withdraw the complaint before further pursuing the litigation."

The complaint alleges the compensation was "inadequate and does not reflect the fair market value of the property taken, and/or damages to the plaintiff's remaining property." Flynn explained the land is reasonably suited for some limited development, but that "Any development would encounter issues relating to the presence of wetlands, access, and a right of way over a railroad line," once construction of the Greenbush line is complete.

Through much negotiation, the $200,000 settlement was reached, and the Stones filed a notice of voluntary dismissal in Norfolk Superior Court March 15. Flynn said he and his clients are very happy with the outcome, adding while construction of the Greenbush line is somewhat controversial, it is a "worthy project."

spokesman Joseph Pesaturo said in order to build the Greenbush line, the MBTA has taken roughly 90 pieces of property by eminent domain throughout the entire 17-mile Greenbush corridor. There have been 30 eminent domain cases negotiated with property owners and nine property owners, including the Stones, have challenged the MBTA's taking price and have filed lawsuits.

The Greenbush Line is the third leg of the Old Colony Railroad Restoration Project, and is being built as mitigation for the Central Artery/Tunnel Project in downtown Boston. The project will stretch for 17 miles and once complete, will restore train service from Scituate to South Station. The project is intended to reduce automobile traffic on the congested highways leading into the city. According to the MBTA, the project will cost roughly $479 million including planning, engineering, land and permitting costs, along with the cost of construction and new trains.


Cohasset Mariner: www2.townonline.com/cohasset

5/25/2005

"Super Slab" opponents making pitch to Owens: The Denver (CO) Post, 5/24/05

The governor has hinted at a veto for one of two bills intended to block a huge toll road on the plains

By Colleen Slevin, Associated Press

Eastern Plains residents who have fought plans to build a private toll road near their homes are trying to pressure Gov. Bill Owens to sign legislation that would make it more difficult to build such highways.

Opponents of the so-called "Super Slab" project plan to rally Saturday at the state Capitol and also have been e-mailing the White House and the Republican National Committee to draw attention to their cause.

Owens has hinted he could veto at least one of the two bills lawmakers rushed to pass before heading home - a measure that would bar private companies from forcing landowners to sell their land in order to build roads.

Ray Wells, the man behind the project, which is officially called the Front Range Toll Road, has said Senate Bill 230 would block such projects because a few landowners could refuse to sell.

Owens has said he fears it could prevent future private road projects at a time when the state doesn't have enough money to pay for transportation needs.

"No bulldozers are lining up in Elbert County this summer. There is plenty of time to study what should be done," Owens spokesman Dan Hopkins said Friday.

Sharon Croghan, a rally organizer from Adams County, said many people from eastern Colorado have supported Owens because they see him as an advocate of private-property rights. She said vetoing the bills would be inconsistent.

"We're trying to make the point to the governor that this is really important to us. We think a private corporation having that power unchecked is wrong," she said.

Owens, who supported the public-private partnership that built the E-470 toll road east of Denver, is less concerned about the second bill, Hopkins said. House Bill 1342 would require private road projects to follow the same environmental and other regulations required of public roads.

Croghan and rally organizer Patty Sward of Elbert County said they don't support Wells' current proposal but recognize that another road may be needed to help ease congestion partly caused by people who have moved to the country but commute to work in Denver.

They just don't want to see a private company making all the decisions about where and how it should be built.

"When you take that government oversight piece out of it, you're talking David versus Goliath and you're also taking David's slingshot away," Sward said during a telephone interview as she sat in stop-and-go traffic on Interstate 25.


Denver Post: www.DenverPost.com

5/23/2005

Agency may buy Monte del Lago: Monterey (CA) Herald, 5/21/05

The Housing Authority has researched seeking a court order to declare eminent domain

By Joe Livernois

Residents in a North County mobile home park heard encouraging news Friday night in their fight against the corporate owner of their park.

Officials from the Monterey County Housing Authority told tenants of the Monte del Lago park that declaring eminent domain on the property might be possible, depending on how it's appraised. The appraisal is expected to be completed within two months.

"The appraisal will be a huge factor," said Starla Warren, a Housing Authority official who has been investigating numerous scenarios that could help residents fend off steadily escalating rents.

Residents first came to county officials two years ago, after the owner of Monte del Lago started terminating leases and ratcheting up rents on the spaces. Tenants own and make mortgage payments on their mobile homes, but must lease the ground on which the homes sit at Monte del Lago.

The 310-home park is owned by Equity Lifestyle Properties of Chicago, a public company that specializes in buying up undervalued properties.

Resident Bill Hellam on Thursday received notice from Equity Lifestyle that his rent will increase soon to $875, an increase of $350. Hellam is 87 and has lived at Monte del Lago for 24 years.

After determining that it will not pursue a rent control ordinance that would stanch the rent increases, the Board of Supervisors asked the Housing Authority to investigate alternatives. The agency operates housing complexes for low-income and aging residents throughout Monterey County.

The Housing Authority has researched the possibility of seeking a court order to declare eminent domain on Monte del Lago and Warren presented various scenarios to the agency board Friday night. By acquiring the property, the Housing Authority could establish restrictions on rent.

With eminent domain, the agency would have to prove that its acquisition of the property is needed to advance the "public good." The agency would then pay the owner fair market value.

According to Housing Authority officials, it might be able to pull off such an acquisition if the property is not valued at more than about $30 million.

At the same time, the Housing Authority could be in for a legal battle with Equity Lifestyle Properties, which is well-known among mobile home owners as being furiously litigious.

During the past several months, Monte del Lago residents have expressed frustration with the Housing Authority because they sensed it was reticent about pursuing action on their behalf.

But residents said Friday they were impressed with Warren's presentation. And agency officials pleaded with the residents to be patient.

"The big issue for us is that we'll likely be fighting a legal battle with a huge conglomerate," said Alan Styles, chairman of the Housing Authority board. "I understand the emotion, but we need to be careful that what we do here is not going to jeopardize the clients we already have. We need to be absolutely sure what we're doing."

Residents are already starting to flee the park. Among those leaving is Joe Russo, a retired Catholic priest who led tenant efforts against Equity Lifestyle Properties. Russo said he can't afford the rent increases and is preparing to move to another park in Corning, above Chico. He said rents there are about $350 a month, about $600 less than he is paying at Monte del Lago.

But at 87, Hellam said he has no choice but to try to find a way to pay his $875 rent. He said he retains hope that the Housing Authority will find a way to ease the situation.

"I have a feeling after tonight that something is going on," he said. "There are so many people who are giving up hope, but I have a good feeling."


Monterey Herald: www.montereyherald.com

Revitalization Projects Hinge On Eminent-Domain Lawsuit: Washingon (DC) Post, 5/21/05

By Kirstin Downey

Seven years after a real estate agent came knocking at her door [in New London CT] to tell her that her house was being condemned by the city to make way for a luxury hotel and office complex, Susette Kelo, a 48-year-old nurse, is still seething with rage.

Perched stiffly at the kitchen table of the cozy Victorian cottage she refurbished "from the concrete in the basement to the shingles on the roof," Kelo pours out the story of how she has fought the city and state, taking her case all the way to the Supreme Court. "I don't like to be pushed around," she said.

Now one woman's anger and determination may affect urban revitalization projects all over the country. She and her backers say the government has overstepped; those on the other side say such actions are needed for the public good.

Kelo's lawsuit, filed with eight neighbors and financed by the libertarian advocacy group Institute for Justice, alleges that New London's plan to redevelop the waterfront area where Kelo lives is unconstitutional because the government wants to take her land for private redevelopment, not public use as the Fifth Amendment permits.

While the Constitution grants governments the power to take land for public use, it specifies only that owners be given "just compensation" for their loss. Through the years, the people on the losing end of the arrangement have disliked it; the people deciding what needs to be taken have defended it.

There is little dispute over many kinds of public land use, such as that for schools, roads and water-treatment plants. In the past five decades, however, municipalities have expanded the interpretation of "public use" to include revitalizing dilapidated downtowns, removing urban blight and boosting tourism and tax revenue.

In the Washington area, the power of eminent domain, or the threat of it, was used to spiff up Pennsylvania Avenue and to build the Metro system and the development parcels around its stations. The District hopes to redevelop a down-at-the-heels cluster of stores in Southeast Washington known as the Skyland Shopping Center into a more upscale shopping complex, and if the 16 property owners there don't agree to sell their land to the city voluntarily, city officials say they will take the land through eminent domain. That plan could die if the Supreme Court rules in favor of Kelo.

City officials around the nation are watching uneasily as the Supreme Court deliberates. D.C. Mayor Anthony A. Williams (D), who is president of the National League of Cities, said he is worried that the case could interfere with "the critical need of cities to use this tool — reluctantly — for public purpose and benefits."

Williams said the success of the Kelo lawsuit represents the growing political strength of what he views as radical property-rights activists.

"Some of these people wouldn't use eminent domain to build a highway or a railroad," Williams said.

The Institute for Justice says it accepts the use of eminent domain for roads, schools and parks and opposes it for privately owned, for-profit operations. Lawyers there say they have taken Kelo's case because they think it represents a classic case of excessive use of government power. "It's an unholy marriage between land-hungry developers and tax-hungry local governments," said John E. Kramer, an institute spokesman. Institute officials say they found 10,282 incidents of filed or threatened condemnation procedures in which land was given to private, for-profit parties, such as Target or Costco stores or casino parking lots, between Jan. 1, 1998, and Dec. 31, 2002.

The Kelo case arose when New London, an old and scruffy city seeking to jump-start its economy, turned to urban redevelopment. Once a whaling center second only to New Bedford, Mass., and then a shipping and manufacturing hub, New London has slowly lost its industrial and commercial base.

In 1997, Pfizer Inc., the giant pharmaceutical firm that makes such drugs as Zoloft, Viagra and Celebrex, began discussions with state and local officials about a $300 million research plant in New London that would bring 2,000 jobs. It was the first time a major manufacturer had expressed interest in moving to New London in more than 100 years.

In a March 1999 letter, George M. Milne Jr., president of Pfizer's Central Research Division, wrote that the company's New London expansion "requires the world class redevelopment planned for the adjacent 90 acres," which included Kelo's neighborhood, encompassing about 115 properties. Milne said Pfizer needed a 200-room waterfront hotel, a conference center, a physical fitness area, extended-stay residential units and 80 units of housing.

Kelo learned about the government's plan for her property when a real estate agent showed up on her doorstep in early 1998, telling her that her home was scheduled for demolition and that she had better sell quickly. Kelo bought the two-bedroom, one-bathroom house for $53,000 in 1997. The real estate agent offered her $68,000. Kelo told the agent to get off her property. Other area residents were easier to persuade.

The issue of compensation was a sticking point. When Kelo bought her house, the Fort Trumbull area was run down, wedged between a decommissioned military installation and a ramshackle marina, near a malodorous sewage-treatment plant. But by the time demolition of the neighborhood began, there was a blue-chip corporate research center and an attractive waterfront park with bike trails and green lawns. The sewage smell had abated. And when Pfizer decided to build a state-of-the-art day care center for the children of its employees, the corporation bought homes near its compound, paying prices considerably higher than the previous going rates. One house reportedly sold for $400,000. Kelo said the final government offer she received was $125,000.

In a statement, Pfizer said it is not a party to the suit and has no stake in its outcome. It said it had been a "good citizen" in New London and is now the city's largest taxpayer.

Kelo decided to fight the condemnation and got support from area activists who also opposed the project. With the backing of the Institute for Justice, Kelo and eight other property owners sued and won at the Connecticut Superior Court, but the city appealed to the state Supreme Court, which sided with the city. In February, the U.S. Supreme Court held oral arguments on the case, and a ruling is expected sometime this spring.

No construction has occurred at the site because prospective developers were frightened away by the lawsuits and controversy, said New London city manager Richard M. Brown.

In the meantime, the city's financial plight has worsened. In a recent budget statement, Brown reported that the city lost $1 million in expected tax revenue, partially because the Fort Trumbull neighborhood that had once paid taxes has been destroyed. The city's budget had relied on projected building permit fees that never materialized. Homeowners will likely face higher taxes, city officials said. The city took another blow last week, when the Pentagon announced plans to close the U.S. Naval Submarine Base, one of the city's largest employers, eliminating 7,096 military jobs and 952 civilian jobs.

For Kelo, not much of a victory is possible. Her house faces a gated state park with the modernist, six-story Pfizer research headquarters looming overhead. The blocks where her neighbors lived are a flattened expanse of dusty, rock-strewn soil with a handful of remaining structures poking out desolately. A nearby vacant lot is a dumping ground for smashed and abandoned buses and burned-out cars.

"It was always a quiet neighborhood," Kelo said. "Now it's just quieter. I don't like the fact they're all gone, but what can you do?"


Washington Post: www.washingtonpost.com

Eminent domain taking is upheld: The Cincinnati (OH) Enquirer, 5/21/05

Appeals court finds Norwood acted properly

By Sharon Coolidge

The city of Norwood [OH] properly used eminent domain when it seized five properties off Interstate 71, saying the homes and businesses on the land were deteriorating and posed a danger to the community, the 1st District Court of Appeals ruled Friday.

Norwood handed over the land to Anderson Real Estate and Miller-Valentine Group after seizing the properties, citing a study that found the property was deteriorating. They are building a $175-million complex of offices, shops, residences and restaurants. The developers have bought 65 other properties in the area bounded by I-71 and Edmondson and Edwards roads, most of which have already been razed.

The ruling upheld a June 2004 decision by Hamilton County Common Pleas Court Judge Beth Myers.

"The Ohio Supreme Court requires that we give the definition of 'blighted area' a liberal interpretation," wrote 1st District Court of Appeals Judge Mark Painter.

"Once a legislative determination of blight has been made, courts are required to and should be zealous in giving such determination by the city great weight.

"We will not substitute our judgment for that of the legislative body of the city," Painter added.

The decision addressed two properties specifically - a rental home on Delmar Avenue owned by Joe Horney and a home on Atlantic Avenue owned by Joy and Carl Gamble.

But the same argument applies to a third property, the Kumon Math and Reading Center on Edmondson Road.

The owners of Wilker Design on Edwards Road are appealing the city's use of eminent domain separately and the owner of Hyde Park Holistic Center on Edmondson Road has since dropped his appeal.

The Washington, D.C.-based Institute for Justice, a public-interest law firm which represents Horney and the Gambles, said it will ask the Ohio Supreme Court to take the case. Ohio's high court has already said the properties in question cannot be destroyed until the issue is resolved.

Horney and the Gambles have vowed to continue to fight against the taking of their property.

"The appeals court's decision opens the floodgates to further abuse of eminent domain," said Bert Gall, an attorney at the Institute for Justice. "Under its decision, developers are free to buy out a city's power of eminent domain for private development projects. The United States and Ohio constitutions forbid that result, and we are confident that we will prevail at the Ohio Supreme Court."

Norwood's attorney, Tim Burke, said he doesn't expect the Ohio Supreme Court to take up the case.

"Given four judges have all looked at the case and all have decided in favor of the city of Norwood, I think it reduces the likelihood that the Ohio Supreme Court will take jurisdiction over the case," Burke said. "Frankly, I really hope people recognize the fight is just about over and maybe it's time for everyone to move on and allow this project to go forward."

Attorney Richard Tranter, who represents Anderson Real Estate and Miller-Valentine Group, added, "This decision confirms that Norwood's urban renewal process was open, deliberative and served the community interest."

Although the developers cannot touch three properties involved in the appeal, they are close to completing the demolition of the other 68 structures on the 10-acre site, which is the first step of Rookwood Exchange.

Tranter would not comment on when building will begin.

Friday's unanimous appellate decision by Painter, Lee H. Hildebrandt Jr. and Robert Gorman said the city did not abuse its discretion in finding that the area was in danger of deteriorating into a blighted area.

"In our system of government, we require judicial deference to be given to a city council's decisions," Painter wrote. "...legislatures are better able to assess what public purpose should be advanced by the exercise of eminent domain."

The appellate court pointed out that the Norwood council considered several factors, including traffic congestion, noise, diversity of ownership, safety issues because of dead-end streets and the quality of residential living in the area at night because of lights from nearby developments.

After hearing what Norwood considered, Myers found the city had sound reasoning in taking the property. The appellate court agreed.

The Institute of Justice also argued that Norwood's urban renewal plan didn't comply with city code, that eminent domain can't be used to eliminate deteriorating conditions and that the city was using the deteriorating designation to mask the real reason for wanting the property.

The appellate court found no merit in those arguments.

Norwood Mayor Tom Williams said he's pleased with the appeals court's decision. "A Common Pleas Court judge and three appellate court judges have said that Norwood followed the law in the action we took," he said. "It's time for this project to move forward."



TIMELINE

Fall 2002: Anderson Real Estate and Miller-Valentine Group begin talking about Rookwood Exchange, a $175 million shopping and office complex off Interstate 71.

August 2003: Norwood City Council accepts an urban renewal plan that finds property in the area is deteriorating, thus can be seized through eminent domain.

November 2003: Norwood files to take the five properties through eminent domain. Owners of the other 65 properties needed for the project agreed to sell.

September 2003: The property owners file a lawsuit in Hamilton County Common Pleas Court challenging the eminent domain action.

June 2004: Hamilton County Common Pleas Judge Beth Myers ruled the city properly used eminent domain power.

February 2005: The Ohio Supreme Court says three of the properties in question cannot be destroyed until the appeals process is finished.


The Cincinnati Enquirer: http://news.enquirer.com

Debate Pits Private Property Against Powers of the State: Online Wall Street Journal, 5/19/05

Later this spring, the Supreme Court is expected to issue an opinion on the power of governments to seize private property.

The closely watched case centers on a New London, Conn., economic development plan. The city wants to use eminent domain to build offices, a hotel, condominiums and parking where houses now stand, arguing that its plan has economic benefits in new jobs and property-tax revenue. But opponents maintain that the project isn't a legitimate public use, saying it unjustly takes private property for a project that will benefit other private interests.

As a warm-up to the court's decision, which is expected sometime before the end of term June 30, economist blogger Don Boudreaux and Harvard Law professor David Barron debate the theories underlying eminent domain and public use of private property.



Don Boudreaux writes: Secure private property rights are the foundation of liberty and commerce — the chief pillars of our civilization. Such rights give each of us the elbow room necessary to develop our unique talents and to think and act in whatever peaceful ways we like, even if others find our thoughts and actions to be disagreeable. Security of these rights also encourages the mutually beneficial exchanges upon which economic prosperity depends, in large part by preventing property transfers that aren't mutually beneficial.

Suppose I think that I value my neighbor's car more than he values it. The only way for me (or anyone else) to be sure is for the law to require me to secure my neighbor's consent to sell his car to me. If I could simply take his car without his consent as long as I agreed to pay the car's blue-book value, there's no guarantee that this property transfer is mutually beneficial. My taking my neighbor's car without his consent is thievery, pure and simple. No economy rises above subsistence without a widespread, hard and fast requirement of mutual consent for property transfers.

Contrary to much modern mythology, nothing about government renders its violations of property rights less objectionable than those of common thieves and vandals. If the city of New London, Conn., is permitted to confiscate property belonging to others, even if it is required to pay fair market value to the former owners, ordinary people will be less secure in their persons and possessions.

And the general populace, if not the local government, will be poorer than otherwise. How could it not be so? If government is permitted to confiscate property rather than purchase it, the presumption must be that government values the property less highly than it is valued by the private owners from whom it is taken. Even if in a particular case this presumption doesn't hold (although we can never know when such a particular case arises), the policy of permitting government to take property without the consent of its owners inevitably encourages thievery by the state.

David Barron writes: Thanks, Don, for getting us going — and in such sweeping terms. It's hard to know what to make of grand claims about the importance of the right to property necessarily conflicting with the government's power to take it — given that the right to property grew up along with the government's authority to exercise the power of eminent domain. The very same Constitution that precludes the government from depriving people of their property without due process of law makes it perfectly clear that the government can take that property for a public use so long as it pays just compensation. The founders were no slouches when it came to property rights. The American historian Charles Beard made a career making that point. But you make them sound like the outspoken leftist John Reed (played by Warren Beatty in the movie "Reds") and his fellow travelers.

So, is it the case that we can't have secure property and permit eminent domain? If so, what's the evidence for that? Seems like we are doing pretty well economically without the constraint. And, in fact, as the Supreme Court has set forth an ever more deferential approach to the government's assertions of authority to engage in eminent domain — in cases such as Hawaii Housing Authority v. Midkiff and Berman v. Parker — economic growth hasn't seemed to falter. Nor, from what I can tell, has a general sense of being secure in one's property taken much of a hit. If anything, market fetishization is on the upswing.

That doesn't mean there are no hard questions when it comes to eminent domain. The Supreme Court is presented with a potentially difficult one at the present moment. The case concerns whether the city of New London can take private property (while compensating) and then make it available for private development. That action at least raises an issue about whether the government is conforming to the Constitution, which requires takings to be for a public use. I think the court should uphold the exercise of eminent domain in that case. I am quite confident you don't. But from your first post, it seems like you think that the government couldn't take the property even if it was going to build a public road or an airport or any number of clearly public uses.

Does our tradition of respect for private property really mean that the government can be held hostage to any holdout who wants to preclude the development of a government highway? Perhaps you think the Constitution should be amended to preclude the government from exercising eminent domain in all cases. If so, I think the "empirical burden" ball to show that would do more harm than good is in your court.

Don writes: Fortunately, while the security of property rights is reduced by decisions such as Midkiff — which gives enormous deference to legislative maneuvers that forcibly transfer property from Private Citizen A to Private Citizen B — property rights remain, by and large, secure in the United States. Indeed, I'm sure that even a Supreme Court victory for the city of New London won't cast us into the dark ages.

As Adam Smith wisely observed upon learning some bad news, "There is a great deal of ruin in a nation." A society as civil and as dynamic as the U.S. can endure and even prosper despite instances of corruption, malfeasance, and petty tyranny.

But the fact that government confiscations of private property aren't so widespread in the U.S. to prevent economic growth doesn't justify such confiscations. To the extent that these seizures occur, they make us less free and less prosperous than we would otherwise be.

David's right that the framers of the U.S. Constitution were "no slouches when it comes to property rights." By and large, I admire their handiwork. But I do wish that they would have rejected eminent domain. As David correctly notes, government asserts that it needs this power in order to prevent its projects from being hamstrung by private owners "holding out" strategically for unjustly high payments.

While such problems are imaginable — and, no doubt, would occasionally occur — I doubt that they are significant enough to entrust politicians with the power to take private property (even if such takings require payment of fair market value). America is planted thick, for example, with private housing developments on large contiguous plots of land that developers manage to assemble without confiscating others' properties. If private developers can achieve such outcomes, there's no reason government officials can't do so.

For those who fancy that government's projects are uniquely important, or for those who imagine that holding government office makes someone unusually saintly or trustworthy, entrusting government with power that we would never entrust to our neighbors or other private citizens might seem sensible. To me, it's dangerous, unjustified, and unjustifiable.

David writes: Looks like our disagreement remains at the threshold — whether any exercises of eminent domain are ever justifiable.

Don suggests that they always result in social loss, and he points to the fact that developers manage to assemble master-planned communities with some regularity without resorting to the exercise of eminent domain. So, he suggests, why should the government be privileged to get land for less than it's worth? After all, it could always buy it at a price the seller would accept. Doesn't that mean that every exercise of eminent domain makes the world poorer?

Sounds plausible, but a few points in that regard:

The first is that these master-planned communities share a common feature — they are located near public roads, which exist only because the power of eminent domain exists. So it's actually not the case that these private developers acted without the aid of the government confiscating someone's property. Could we really have these developments if the private developers themselves had to assemble all of the necessary transportation infrastructure to get people from home to work as well? Indeed, even property that is taken is often property that itself benefited along the way from prior exercises of eminent domain — be they exercises of eminent domain that helped make it possible for the railroad to deliver the construction materials for the building of the home in the first place, etc.

The basic conceptual problem, in other words, seems to me to remain for those who oppose the eminent domain power simpliciter: Eminent domain and private property are more co-dependent than you'd think. So, in permitting eminent domain, we aren't just tolerating a drag on the system. We are upholding a practice that makes the system work as well as it does.

The second point concerns the fact that these master-planned developments are sprouting up further and further out into exurbia. One reason that places like New London occasionally resort to eminent domain is to revitalize a close-in city. It by no means clear that restricting eminent domain — insofar as it precludes cities from revitalizing themselves — makes us all better off if it just ensures that sprawling growth results. The literature on the costs of sprawl is itself sprawling, of course, and it is surely open to differing interpretations. But given the room for debate, why wouldn't we think that democratic processes are a good mechanism for making judgments about how to proceed when the best way of achieving social welfare is by no means clear? Seems to me we have a pretty deep tradition of looking to democratic processes to make such judgments all the time — even when they impose costs on private property owners. I don't think Don means to be calling all forms of property regulation into question, but I'm not sure I see how he isn't.

One final point. As a lawyer, now in dialogue with an economist, I am interested in your view as to whether there is anything to the distinction between takings for "public use" in the classic sense (say, for a public road) and takings in which the government gives the property over for private development (as in New London). Justice Kennedy at oral argument in the New London case kept suggesting the economists would think there is nothing to that distinction. Each kind of exercise of eminent domain is either equally good or bad. But is that right? Do you see a difference between the two — a difference that would make you even more hostile to what the city of New London is doing in particular than to what the framers of our Constitution authorized governments to do more generally?

Don writes: It's true that privately built housing communities depend upon road and sewer systems, which typically are built by government. But this observation doesn't address my argument that eminent domain is unnecessary. The fact that housing developers routinely acquire large contiguous plots of land without eminent domain — that is, by buying individual plots from private owners — suggests that government doesn't need eminent domain to build roads and to do whatever else it does.

Unlike David, I trust democratic mechanisms much less than I trust the rules of private property. If the city of New London, for example, can confiscate private property without the owners' consent, government officials have too little incentive to bargain in good faith with property owners to find out if mutually advantageous deals are possible. Government will confiscate property rather than pay market prices for it. And politicians will pander to special-interest groups eager to gain at the public expense.

The fact that government is democratically elected might put some restraint on use of this power — or it might not. If a majority of voters in New London perceive that they can gain by directing the city fathers to confiscate private property owned by voters in the minority, why should we trust that the city will seize private property only if doing so yields significant benefits to the public at large?

By obliging all persons — including government officials — to pay voluntarily agreed upon prices for any properties acquired, we best ensure that worthwhile transfers of property rights occur and that transfers that aren't worthwhile are avoided.

David writes: The government could build a statewide highway by just bargaining with landowners along the route? What about the owner of the last parcel in the road's path? Is the market value of that parcel whatever that property owner wants to charge? Suppose the owner wants whatever the fair market value of the parcel was before construction on the roadway began plus the entire budget for the roadway's cost now that the owner knows the road is being built? Why is it socially efficient to make society pay that premium?

But even if a flat ban on eminent domain is inefficient, there are hard cases. Can a city take a $200,000 house to permit a developer to build one for a $1 million, claiming the move would be good for the local tax base? Once we dispense with a flat ban on eminent domain, though, our choice is either to have judges do the sorting between good and bad takings or to have the people themselves do it through their elected representatives. Our nation's past experience with judges second-guessing the legislature's economic policies has been pretty dim. So, on balance, I'd cast my lot with the people.

Don writes: You raise an interesting point — usually called the "hold-up problem" — in which a single property owner can hold a project hostage and extract maximum gain. But in reality, because there is almost always more than one way to build a road or to site a large development, there usually isn't any one property owner who can hold the project hostage. This is one reason why private developers commonly succeed in assembling large parcels without using eminent domain.

Moreover, ingenious strategies exist to avoid the hold-up problem. For example, a buyer can negotiate sales contracts contingent upon the buyer acquiring all necessary parcels of land. With such contracts, no one landowner is ever in a position to hold-out strategically for the full value of the project.

You ask, David, whether a legislature should be able to take a $200,000 house to build a $1 million dollar project that increases the tax base. My answer to that (and I hope the Supreme Court reaches the same conclusion in Kelo) is an emphatic no.

One reason is practical: If there really is such a discrepancy in value, the project will take place anyway, as I've argued above. But the second reason is my skepticism about of legislators' ability to dispassionately represent "the people." Which people, after all, are represented? Conflicts exist between those who would benefit from higher tax revenues (for example, developers who would be awarded lucrative contracts funded with these higher tax revenues) and those who lose — namely, property owners whose properties are seized. Politicians are simply too likely to pander to special-interest groups. The more unrestrained is government's power to use eminent domain, the more likely will our country be one marked by too many shopping malls and too few desirable, if not necessarily highly taxable, alternative uses of land.

David writes: Even the contingency contract you describe permits the landowner to extract a premium. If the contract price isn't more than the amount the government would owe as just compensation, then the government could just take and pay without complaint from the property owner. So the question for me is why society should bear the extra cost.

Absent evidence that net social welfare declines unless the government bears the extra cost, efficiency analysis simply can't prove that eminent domain is bad rather than good. And the necessary evidence just doesn't exist.

Our debate ultimately turns on differing views of government regulation. After all, there's no reason to trust government when it engages in zoning but not when it engages in eminent domain. Certainly zoning can "take" plenty of value from property owners. But we've generally recognized that regulation also can create value in property, and for many decades constitutional law has proceeded from that premise. That's partly why zoning generally raises no constitutional problem. And why eminent domain shouldn't either.

But to close on a point of (near) agreement, I grant that taking the $200,000 home causes real concern. Even John Reed might have a problem with that one, and the Supreme Court has long said that you can't take from A to give to B even if you can take for a public use. So I won't be at all surprised if the court makes some noises to that effect, even as it upholds New London's right to redevelop.



David Barron is a professor at Harvard Law School. His writings focus on the legal powers of local governments, federalism and the separation of powers, and he also researches property law and urban sprawl. Barron was a law clerk for Judge Stephen Reinhardt of the U.S. Court of Appeals for the Ninth Circuit and Justice John Paul Stevens of the U.S. Supreme Court. Prior to teaching, he was an attorney-adviser during the Clinton administration in the Office of Legal Counsel in the U.S. Department of Justice. Barron received his bachelor's in history and his law degree from Harvard.

Don Boudreaux is chairman of the economics department at George Mason University and has held the position since 2001. He previously was president of the Foundation for Economic Education and taught at George Mason and Clemson University. His research centers on the nature of law, antitrust law and economics, and international trade. Boudreaux blogs regularly (with fellow Econoblogger Russ Roberts) at Café Hayek. He received his doctorate in economics from Auburn University and his law degree from the University of Virginia.



Online Wall Street Journal: http://online.wsj.com

5/20/2005

Supervisors take major fire during forum: The (Woodland CA) Daily Democrat, 5/20/05

City lawsuit contentious point of debate

By Eve Hightower

Yolo County supervisors' decisions took major fire Wednesday at a public forum.
Supervisors Duane Chamberlain and Frank Sieferman Jr., city councilmen Dave Flory and Matt Rexroad and about 60 other people attended the discussion hosted by Woodlanders for Responsible Government, a nonpartisan group that seeks to inform Woodlanders of issues pertinent to the city.

The county's lawsuit against the city was among the most contentious points of debate.

Last March, Yolo County filed suit against Woodland to block development of a shopping center near Interstate 5. The county wants to halt the City Council's approval of the Woodland Gateway and Auto Mall, which would blanket 77 acres of prime farmland with retail stores, auto center and parking lot.

Mayor Rexroad said the county is just trying to win a share of sales-tax revenues from the project.

Supervisors Chamberlain and Sieferman disagreed, saying the project's environmental impact review is faulty and the city needs to mitigate for the loss of agricultural land and impacts to nearby agricultural operations.

Sieferman said the county repeatedly objected to the review, and concerns were not fully addressed. The county's concerns include a proposed interstate on-ramp, effects on other retail centers in Woodland, and wastewater treatment systems and water supply.

Rexroad said the county's statements about the need for agricultural land mitigation is just a front for their pursuit of money.

"It's about money. Be honest," he said.

The Gateway project is expected to provide at least $1.5 million to city coffers annually. Under a 1989 revenue-sharing agreement, Yolo County could gain more than $600,000 in property taxes from the project. The county would not partake of sales-tax revenue.

Chamberlain said the project would impact several county services, like roads, jails and waste.

"Once it's in the city, your not free of the county," he said. "There's no landfill in the city."

Rexroad said the board's suing the city is a sketchy policy decision. Sieferman and Chamberlain said their decision was based on information provided to them by county staff.

"You can choose not to take council's advise," Rexroad said.

The subject of debate shifted from the lawsuit to this week's announcement of the county-Wintun Indian alliance in purchasing Conaway Ranch to flood control protection to a city urban limit line and Assemblywoman Lois Wolk's proposed legislation to designate more than 30 miles of Cache Creek a wild, scenic and recreational area.

Several attendees pressed the supervisors on the county's use of eminent domain to acquire Conaway Ranch and agreement with the Rumsey Band of Wintun Indians. The tribe has pledged to "fully assist" Yolo County in buying the 17,300-acre ranch.

Jim Nielsen asked if there is a connection between the funding agreement and the board's approval of a golf course at the tribe's Cache Creek Casino Resort.

"No," Sieferman said.

Others asked why the agreement hadn't been discussed openly before Tuesday's press conference, where the alliance was announced.

"Nothing has been signed and there are no terms of agreement," Sieferman said.

He added the county and tribe have yet to create an agreement and there has been no board action.

Others questioned the county's determination to acquire the ranch.

"If we'd never gotten involved, anyone could own it by now - and they wouldn't be farmers," Chamberlain said.

Chamberlain reminded the audience that he ran for office last fall on a platform in opposition to the county's use of eminent domain to acquire the property. Now that he is in office, he has to deal with the board's choice to fight for the ranch.

Chamberlain said he'd like to see the ranch owned by those who farm it. He said the county could put easements on the land to take down its value and make it affordable to farmers.

Rexroad also suggested the county place easements on the property.

"And I think Gidaro's group would be willing to do that," he said in reference to ranch owners Conaway Preservation Group of which Steve Gidaro is a member.

"The county has to decide they can't fight every fight," Rexroad said earlier Thursday evening.

Rexroad said he thought the county was right to use eminent domain when dealing with an unwilling seller, but the ranch has since changed hands and the county should reconsider it's strategy.


The Daily Democrat: www.dailydemocrat.com

Swampscott Town Meeting backs land taking for rec trail: (Lynn MA) Daily Item, 5/19/05

By Debra Glidden

[The Swampscott MA] Town Meeting on Tuesday approved taking land by eminent domain to create a 1.3-mile recreational trail.

A motion to take property belonging to National Grid, formerly Massachusetts Electric Company, for a recreational trail, passed by only one vote, which sparked some controversy.

Opponents of the trail immediately filed for reconsideration, which opened the subject up for debate again Wednesday night.

Abutter Richard Polisson moved for reconsideration Wednesday because he said people were not allowed to speak on Tuesday, and the presentation by proponents of the trail did not make it clear that some of the land that would be taken belonged to private homeowners, not National Grid.

Marc Caron also spoke against the eminent domain proceedings, because he said it would allow the town to take property for a project that might not be feasible.

"We have no information whatsoever on this. All we know is they are telling us it is free," Caron said.

Swampscott Partnership Initiative Rails Into Trails (SPIRIT) member Marc Barden spoke against reconsideration, and the motion to reconsider was voted down.

Barden said Town Meeting approval of the eminent domain proceeding allows the Board of Selectmen to file for the land taking, but that several conditions would need to take place before that could be done.

The RTIC would have to obtain two valuations of the property, which Barden said could range from no value to as much as $200,000.The RTIC would have to have enough money to pay National Grid for the highest valuation before the town could initiate eminent domain proceedings.

According to the Assessors Office, National Grid pays the town $65,000 a year in property taxes, and the taxes on the utility easement behind the High School, where the proposed trail would go, are $6,407 a year and opponents of the trail said that is revenue the town cannot afford to lose.

Opponents also said National Grid, which currently owns the land, assumes all maintenance and liability for the corridor.In addition to the loss of tax revenue, opponents expressed concern that the project would not be funded privately, and the town would be stuck footing the bill for the project.


Saily Item: www.thedailyitemoflynn.com

L.B. residents rally to save their homes: Atlanticville (Long Branch NJ), 5/18/05

By Christine varno

Long Branch homeowners facing the prospect of losing their homes to redevelopment made a statement last weekend at a rally against the use of eminent domain.

The rally organized by the Beachfront South Coalition of property owners in the Beachfront South redevelopment zone was the second of its kind to be held in Long Branch this year.

One resident vowed he is not going to give up the fight.

“Like Yogi Berra said, ‘It ain’t over till it’s over’” Harold Bobrow, Ocean Boulevard, said at the rally he organized on May 15 in the parking lot of the condominium unit he owns on Ocean Boulevard.

“I do not think anyone in this group would have a problem if a hospital was going to be built, but to make a redeveloper richer is wrong.

“It may be legal, but it is certainly immoral,” he said.

Bobrow and his wife, Michelle, founded the Beachfront South Coalition in March with two goals in mind: to stop eminent domain proceedings that would take his beachfront home and, if that failed, to obtain equitable compensation for the property taken.

The rally, Bobrow said, gave residents in the Beachfront South redevelopment zone a way to join voices.

Beachfront South is a 12-acre tract of land that extends from Bath Avenue to Morris Avenue between Ocean Boulevard and Ocean Avenue. Properties in the area are slated to be taken by the city using its power of eminent domain.

In August, K. Hovnanian Shore Acquisitions, Middletown, was designated as the redeveloper of the zone. Plans call for the approximately 30 properties in the zone to be razed and replaced with a $300 million project comprising five buildings with 350 residential units that will range in cost from $400,000 up to more than $2.2 million.

Residents of the Beachfront North phase II redevelopment zone, known as MTOTSA — Marine and Ocean Terraces and Seaview Avenue — in February hosted the first rally against what they say is the city’s abuse of eminent domain.

Many residents at the Beachfront South rally on Sunday said they did not agree with the city’s vision for redevelopment.

“I do not understand why the city would take nice modern condominium developments to put up more of the cookie-cutter-style apartments and condominiums,” Alice Kessler, Long Branch, said.

Bill McLaughlin, Ocean Avenue, agreed.

“I am against eminent domain,” he said. “Taking people’s homes away for a developer to make a profit is wrong.

Other residents came out because they said they could be next.

“I am here to support the homeowners,” Donna Peterson, Rockwell Avenue, said. “This could affect us next.”

A Neptune women who lost her home through eminent domain proceedings participated in the rally.

“It is hard for me to stand here today and hold an American flag and know this can be going on in America,” Dorothy Argyros said.

“[Eminent domain] takes away what America stands for. This is going on all over.”


Atlanticville: http://atlanticville.gmnews.com

Fontana to consider eminent domain: San Bernardino County (CA) Sun, 5/18/05

By Kelly Rayburn

The [Fontana CA] City Council likely will decide June 7 whether to give the redevelopment agency authority to use eminent domain in large parts of the town's north end.

A public hearing drew minimal public protest Tuesday evening.

At issue is a proposed amendment to the North Fontana Redevelopment Plan that would give the agency the right to take private land in the name of a greater public good in three areas of north Fontana areas the city leaders say have been slow to develop compared to the rest of Fontana's fast-growing north end.

At the meeting Tuesday, Ray Bragg, Fontana's redevelopment and special projects director, sought to make clear that the agency has no plans as of yet to actually use eminent domain.

"It's just a matter of getting it on the books so as a last-resort negotiating tool it's there if necessary,' he said.

The roughly 8,960-acre North Fontana Redevelopment Project Area was created in 1982 and the agency had the authority to use eminent domain within it through 1994, when it expired under state law.

Property owners both within and near the three areas have expressed uneasiness about the amendment, but Tuesday only one showed up to air his concerns.

Larry Bonanno, who owns land in one of the three areas and on which the city would like to build an auto mall, reiterated his protest of including his property in the proposal. He said his property already has all the infrastructure needed for development.

Though mostly quiet at the meeting, some elected officials, including Mayor Mark Nuaimi, have indicated their support for the amendment.


San Bernardino County Sun: www.sbsun.com

BOF Delays Eminent Domain Action: Shore Publishing Co (Madison CT), 5/19/05

By Ben Rayner

More questions were raised than answered about Branford's [CT] attempt to enforce eminent domain acquisition of the Queach property at the Board of Finance [BOF] last week. The BOF did not take any action in regards to the enforcement, instead deciding to put off a vote until its June meeting.

Through his lawyer Al Ippolito, developer Alex Vigliotti has maintained that if offered a fair price for the Queach land he would gladly sell it to the people of Branford. The town counters that it has already offered a reasonable price for the land and that a decision to enforce eminent domain is only a last resort. The actual value of the property is now at the heart of the issue.

A report prepared by the Select Committee on Open Space Acquisition (SCOSA) was given to the Board of Finance. The report attempts to resolve many of the questions regarding the parcel but most of those can't be determined without further analysis and appraisal. Town officials feel that the $1 million offer for the property is in line with previous appraisals and is commensurate with what Vigliotti paid for the land in December, 2004. Vigliotti through his lawyer contends that the actual value of the parcel is well over $4 million and possibly closer to $5 million. "The number [$1 million] is supported by past appraisals," Opie said. "The $5 million figure was based on the entire 205-acre parcel, including the 43.4 acre piece owned by Mr. Vigliotti that is not part of this matter. That price is also with the proviso of 115 building lots on the property. But that number of lots has never been approved by zoning and it is not realistic. "A lot of things point to the $1 million price," First Selectman John Opie continued.

Looking at Other Options
According to Ippolito (a Branford resident and former member of the Board of Assessment Appeals), Branford officials haven't been negotiating in true good faith with his client. He stated that he has a number of different proposals that would satisfy the town's need for open space and balance his client's development prospects but have not been considered.

"The assessment price of large parcels has very little to do with the actual property value. I personally don't know the value and they [the town] don't know the value. We believe there is still room for negotiations. At a minimum we need an appraisal," said Ippolito.

When asked directly by BOF Chair Joseph Mooney if enforcement of the statute was the only option for the town, Opie responded, "As much as I dislike the words eminent domain, it may be the only vehicle left for an amicable agreement. No one wants to talk about eminent domain. It has a bad connotation but I'm not sure how much further we can move the process without this leverage."

Ippolito countered that negotiations should still be taking place and that there was room for a mutually agreeable solution, "This could be a win-win situation for the town and a win-win situation for my client. I feel it is premature to be here [before the BOF]. There are more options — they ended negotiations, we didn't end negotiations."

Cheryl Morris, Democratic candidate for first selectman, raised financial concerns about the enforcement. "Is the $1 million a realistic figure or a pipe dream? Eminent domain sounds like an easy way to go but appeals could potentially costs the town millions," Morris stated. "Are there any other alternatives?" Mooney stated, "We don't take lightly the use of eminent domain. We need to study the information [the SCOSA report] we have here."

he BOF has postponed any action on the matter until its June meeting. The next step, whether the BOF approves the measure in June or not, will be an objective third party appraisal of the property.


Shore Publishing Co: www.shorepublishing.com

5/18/2005

Yolo smooths out parks master plan: Yolo (County CA) Enterprise, 5/17/05

By Elisabeth Sherwin

The Yolo County Board of Supervisors was scheduled this morning to review the process that has been used to update the initially controversial draft Parks and Open Space Master Plan.

The draft plan met with considerable unhappiness when it was first made public earlier this spring. The main opposition came from landowners who feared the county was going to build public trails across private ranches, possibly by invoking eminent domain.

However, county staff held many public meetings, at least two specifically with rural landowners, and further explained the county's position, according to an advance staff report.

Staff made clear that possible sites of future parks and open space areas will not identify specific private land. The revised plan will emphasize willing participation and mutually beneficial partnerships. It also will present possible future park components as suggested ways to expand recreational and open space opportunities; these may not necessarily involve land acquisition.

Further, staff emphasized that the draft plan did not mention, nor was it intended to support, the use of eminent domain. The revised plan will clearly state that it is not the county's intent to use eminent domain for projects outlined in the master plan, nor is implementation of the plan dependent on eminent domain.

Staff also will remove all reference to Conaway Ranch as potential county-owned open space. The status of the 17,300-acre Conaway Ranch property is the subject of ongoing legal actions involving the county and other parties, and references to it will be removed from the revised plan. The county has initiated an eminent domain action to buy the land.

(On Monday afternoon, a news conference was called for 11 a.m. today at the County Administration Building in Woodland to announce news regarding the Rumsey Branch of Wintun Indians, the county and Conaway Ranch. The tribe's public relations spokesman, Doug Elmets, would not describe in advance what the announcement concerned but the county has been seeking more than $50 million to buy the ranch property.)

At the board meeting today, staff was going to hear from supervisors and members of the public in preparing revisions to the master plan in the hopes that most of the contentious issues had been addressed.

Staff says the need for recreational areas and open space continues to be a demand in Yolo County.

As a steward of public lands, the county is faced with the challenge of balancing often-competing user needs. This process for managing evolving demands within county parks is often difficult because a clear vision for the management of these lands is not defined.

Through the development of a park and open space master plan, a management directive would be available to staff and the public to provide a clear direction for the planning, development, and management of county parks.

Earlier this year, the board determined that a countywide plan was needed and selected a consulting firm to assist the county. The Dangermond Group, in association with Roberts, Kemp and Associates, was selected based on a recommendation of a subcommittee of the Parks, Recreation and Wildlife Advisory Committee that included chairman Andrew Fulks, Sally Barrett and Jerry Hartwig.

In May 2004, county staff and the consultants (the planning team) began developing the public outreach process. First, a list of potentially interested agencies, advisory committees, citizen groups, individuals, and businesses was developed to be contacted about the plan and planning process.

In addition, a Web site with the sole purpose of educating the public on the park master planning process was developed.

In total, there were nine public meetings in 2004 and 12 public meetings to date, including four public workshops.

The background reports, public outreach and public meetings all led to the creation of the draft master plan, released in February. Several public workshops were held, including a March meeting with rural landowners at the Farm Bureau to gather additional input and provide clarification on the draft plan.

"These meetings were very helpful, as the staff heard a perspective that was missed during the initial public workshops," said John Bencomo, director of planning and public works, in his staff report.

Nearly 100 individuals submitted a total of 50 written comments about the proposed master plan. From these comments, several reoccurring themes and issues became apparent, including questions about plan implementation, the identification of private lands as future parks, the issues of eminent domain and Conaway Ranch and financing for future parks.

Once staff has provided the supervisors with an update on the planning process and heard their comments, the planning team will then revise the draft master plan and return it to the parks advisory commission for more public comment and a recommendation to the board.

The final plan must be approved by the Board of Supervisors.


Yolo Enterprise: www.davisenterprise.com

City agency seeks land: San Bernardino County (CA) Sun-News, 5/17/05

Eminent domain possible

By Kelly Rayburn

Amid concern from some [Fontana CA] property owners, the city's redevelopment agency is seeking authority to use eminent domain in a large portion of the fast-growing north end.

The three areas where eminent domain is proposed all fall within the approximately 8,960-acre North Fontana Redevelopment Project Area, created more than 20 years ago to help eliminate blight.

While north Fontana has experienced tremendous growth and commercial development since then, Fontana Redevelopment Director Ray Bragg said that growth has been mostly stagnant in the three areas in question and that eminent domain could be used as a last resort to help the areas develop.

"We need to increase the tools we have to deal with these problems," Bragg said.

If eminent-domain authority is granted, it would give the redevelopment agency the right to take private land in the name of a greater public good.

Though the use of this tactic often is controversial, Bragg said the redevelopment agency has no specific plans to use eminent domain and that if it ever did, property owners would receive a fair price for their land, as well as money for moving costs.

Land in the three areas is mostly undeveloped, but homeowners nearby wonder what's to stop the city from using eminent domain in their neighborhoods if it is used elsewhere in north Fontana. Letters from Bragg specifying that only people within the three sub-areas of the redevelopment zone would be affected did little to quell some people's uneasiness.

"We're kind of skeptical," said Tony Galindo, who has lived on Lytle Creek Road, near the intersection of Interstate 15 and the Interstate 210 extension, for 18 years.

Galindo said, "Development is happening all around us, but we're not getting the upgrades ... we still don't have sidewalks."

He said he had been approached by a representative from a real estate development company looking to buy his property. He demurred, but wonders whether his property could be targeted if the city wants new development.

Bragg said he does not foresee the need for eminent-domain authority in any other region of north Fontana.

One of the areas where eminent domain is an issue includes land where the city would like to create an auto mall.

Larry Bonanno, who said he owns 23.75 acres in the auto mall area, sent a letter to city leaders protesting the inclusion of some of his property in the eminent-domain area. He said his property is not blighted and that the infrastructure needed for development including curbs, gutters, utilities and traffic lights is already in place. He plans to air his concerns at the City Council meeting tonight. Eminent domain is scheduled to be considered tonight during a joint session of the council and the city's redevelopment agency, which is composed of council members. Bragg said officials likely would use the meeting to hear concerns and would vote at their June 7 meeting.

Some elected officials have indicated their support for the proposed amendment.

City Councilwoman Janice Rutherford describes herself as a supporter of individuals' property rights.

"I generally oppose the use of eminent domain," she said, "but I think it's a valuable tool for the city to have to negotiate with people."

She said the redevelopment agency's work has been critical in bringing commercial development, including a Target and a Stater Bros., to north Fontana.


Sun-News: www.sbsun.com

5/15/2005

Baby boomers driving redevelopment: (Camden NJ) Courier-Post, 5/15/05

By William Sokolic

Houses for aging baby boomers looking for a second home on the Jersey Shore. A marina, restaurants, upscale retail shops, water sports and fishing.

Coastal communities covet such developments, which are part of ambitious plans to boost tourism in Ventnor, Pleasantville, Wildwood and Somers Point.

And all four towns have turned to a popular tool: They hang their future on redevelopment, something usually associated with efforts to recycle blighted sections of urban centers or older suburban communities.

What has helped is that it has become easier to designate an area for redevelopment. Gone are the days when you required proof of distress to get such a designation.

"Now, all you need is a plan and a good reason to redevelop," said Dr. Richard Perniciaro, director of the Center for Regional and Business Research at Atlantic Cape Community College.

These four municipalities all seek to use redevelopment to capitalize on the growing demand for - and limited supply of - waterfront housing near the shore. "Baby boomers are getting ready to retire, and that's driving the market up and down the shore," Perniciaro said.

Declaring a redevelopment zone allows municipalities to offer tax incentives and abatements to developers.

Although redevelopment has drawn rave reviews for its ability to resuscitate a neighborhood, it can come with a price. To achieve their goals, municipalities must often acquire homes and businesses that do not fit with their plans. And such acquisitions could require the use of eminent domain - the government's right to acquire private land for public use - to force out unwilling owners.

Residents often question the need for revitalization.

Such is the case in Ventnor, the most controversial of the four projects. The city has targeted a 28-acre section of older homes, some mid-rise apartment buildings and a shopping district.

Too many of the buildings are overcrowded and don't meet today's building codes, the city claims.

But the Hispanic Alliance of Atlantic County calls it a form of racial discrimination.

It says the redevelopment effort seeks to eliminate rentals in favor of home ownership and with the higher-end housing proposed, Latinos couldn't afford to buy a new home in Ventnor.

"They'd have to leave town," said Bert Lopez, president of the alliance, which has filed suit to modify, if not stop, the redevelopment proposal. "There's a way of doing redevelopment and improve those buildings in need of repair, and still maintain this as a good working-class neighborhood."

City officials counter they will give financial assistance to displaced residents to help them find other housing in the city.

The redevelopment also affects businesses like the Nashville Market, a grocery bought by Jose Osoria in 2001. Given his druthers, he would stay put rather than be forced to sell and lose money on his investment.

News of the project is also driving away businesses.

A movie theater closed when the landlord pulled the plug in anticipation of having to sell his property. A clothing store folded. Jagielky's Homemade Candies is still around, but owner Mike Carr has opened up in Margate as a hedge.

"The city is still up in the air what to do with me," Carr said. "They talk about relocation, but it will cost a ton to get rid of me."

Mayor Tim Kreischer defends the possible use of eminent domain. "No one will invest in this area without controlling a large portion of the land," he said of developers.

Opposition to the other three redevelopment proposals is not as intense.

The redevelopment area in Pleasantville lies between the old high school and the new marina. It is a mostly vacant neighborhood with a few homes and a wholesale seafood distributor. The city has designated two heavyweights, Edgewood Properties and Toll Brothers, to build homes expected to sell at more than $260,000 each.

"Hopefully we would be able to bring something into the marina as an attraction, like a riverboat shuttle through the Lakes Bay area, some fishing and wind surfing," said Councilman Lincoln Green.

The city wants to keep existing owners as residents. But Michael Giordano of Collingswood worries Toll Brothers will muscle him out of the vacation home he bought on the same street where his grandmother lived for more than 40 years. He and his wife, Patricia, have a vista across the channel to the Atlantic City skyline. He's just steps from the Pleasantville Yacht Club and its new marina. And it's cheaper than Margate or Ocean City.

"I think Pleasantville will take us (through) eminent domain, and then sell to Toll Brothers," Giordano said.

The owner of Randall Seafood, while hoping to stay in the area it has occupied for decades, worries the new residents won't be thrilled by the arrival of trucks at 2 in the morning.

"They want a commercial waterfront, but I do not know if this is what they want," said Al Glenn, owner of the business, which started in 1949. "The city so far made it seem like we would end up staying in the area. But I heard rumors of using eminent domain."

Wildwood selected a top developer, K. Hovnanian, to build in an area of the city fast becoming popular for housing because it's one of the few locations where land is available. Townhouses surrounding the Hovnanian site are selling for as much as $500,000.

"It's consistent with our company philosophy to look for redevelopment opportunities in areas where we think the market is good," said Lew Kurland, legal counsel for the Red Bank-based company.

Realtors in the area praise the proposal. But at least one property owner believes Hovnanian is squashing his plans to build 22 townhouses, valued at $400,000 each. Robert Wood said if the city denies him a permit to build, he expects the developer to pay him for the land.

Somers Point is focusing as much on retail and restaurants as residential housing in the first phase of a four-pronged proposal revolving around Bay Avenue, once home to legendary rock clubs like Tony Marts and Bayshores.

"The overall vision is to have a resort-oriented development," Councilman Carmen Marotta said.

But phase one has run into opposition from Shore Memorial Hospital, which owns much of the land targeted. The hospital has its own ideas, some of which conform to the city's plans and some that don't. The impasse has led to legal action, which may lead to negotiations for a compromise.

To date, none of the projects has broken ground. Concerns about the environment and, to a lesser degree, acquisitions, have held up plans in Wildwood and Pleasantville.

Somers Point has to resolve its conflict with the hospital to move forward. Ventnor is faced with the outstanding lawsuit.

And all are watching for the U.S. Supreme Court's decision on the legality of eminent domain in New London, Conn., where residents of a working-class neighborhood have sued city officials who want their properties for a hotel, offices and luxury condominiums. A decision is expected before the court recesses in June.


Courier-Post: www.courierpostonline.com