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CALIFORNIA EMINENT DOMAIN LAW BLOG

Lathrop to take over land: Recordnet.com, 1/17/08

By Anna Kaplan

 

LATHROP – Lathrop is planning to use eminent domain to take over a 4,500-square-foot parcel of land along McKinley Avenue in order to build a sewer pumping station that would service future industrial development.

City officials approved a resolution of necessity at a meeting Tuesday night, saying the city needs the land and will use legal powers to get it if need be.

McKinley Avenue, located on the east side of town, is populated by industrial storage pods fenced off from prying eyes. If city leaders have their way, the area will one day become a thriving part of Lathrop’s industrial district.

But first, the city will have to get past Rafael Sandoval, who owns more than 30 acres along McKinley and says he’s not getting a fair price for the 4,500-square-foot chunk Lathrop wants to use.

City staff have been contacting Sandoval for about two years in an attempt to buy the parcel because the plans for the pumping station have been on the books since 2001.

They are pursuing eminent domain as a last resort, according to Assistant City Manager Cary Keaten.

“We were not getting any response, and it’s imperative that the project move forward. It’s going to bring sewer service to all the property owners on McKinley Avenue. It’s going to open up the whole area to commercial and industrial development,” Keaten said.

Sandoval, who owns Lathrop Woodworks on part of his 30 acres and leases out the rest, is happy with his septic tank and says that the city’s offer of $26,000, based on official appraisals, is not enough.

“I’m ticked off about this. Their price is not even worth it for me to talk to them. I want $10 a square foot, especially since the pump is going to devalue the rest of the property,” he said.

The pump station and an attached half-mile worth of sewer pipe will cost the city $2.9 million to construct.

“Property rights are very important to us, but at the same time, you have to meet the public needs. Eminent domain is the absolute last option,” Vice Mayor Sonny Dhaliwal said.

Recordnet.com: http://www.recordnet.com

City council panel shoots down eminent domain proposal: The San Diego Union-Tribune, 1/23/08

By Helen Gao

SAN DIEGO – A proposal to amend the city charter to outlaw the use of eminent domain for economic development was shot down by a San Diego City Council committee Wednesday.

Representatives of the Grantville Action Group asked the Committee on Rules, Open Government and Intergovernmental Relations to limit eminent domain use to public projects. In other words, take private property only for parks, roads and other public facilities.

Under the group’s proposal, the city would be unable to condemn private property and transfer it to a private developer to build new projects, such as shopping malls or industrial parks that could generate a higher tax base.

The proposal is modeled after a June state ballot initiative called the California Property Owners and Farmland Protection Act. The measure seeks to rein in the government’s eminent domain power and its authority to enforce rent control.

A majority of the council committee declined to forward the proposed charter amendment (which has no references to rent control) to the full council for consideration. They said they wanted to see how the state initiative fares before taking action.

The Grantville Action Group is fighting the city’s designation of certain commercial areas in Grantville as a redevelopment zone, where eminent domain may be used. Grantville is east of Qualcomm Stadium and north of Interstate 8.

“I do not want the city to come in and seize my property and business in order to hand it over to a larger developer to turn it into something else,” said Brian T. Peterson, president of the group and owner of a veterinary clinic on Friars Road.

In 2004, San Diego’s Centre City Development Corp., the city’s downtown redevelopment agency, condemned a successful cigar shop to make room for a hotel project. That action became part of a national debate over whether government should oust a property owner for economic development.

The San Diego Union-Tribune: http://www.signonsandiego.com

Calaveras County will build new jail, court somewhere else: Recordnet.com, 1/23/08

By Dana M. Nichols

SAN ANDREAS – A new Calaveras County Jail and courts complex will likely be built on land the county government already owns, top county officials said Tuesday.

The pronouncement is a dramatic turnaround from a few weeks ago, when the county Board of Supervisors appeared poised to use eminent domain power to take 57 acres north of the existing government center along West Murray Creek Road.

An attorney for Greg Opinski, the owner of half the land, warned on Jan. 8 that he didn’t believe the county would be able to complete an eminent domain seizure in time to qualify for up to $30 million in state jail construction money.

Calaveras County Counsel Jim Jones didn’t mention that prediction directly Tuesday, but he advised the Board of Supervisors to forget about eminent domain and instead see if it will be possible to negotiate a purchase.

Interim County Administrative Officer Brent Harrington went further, telling the board “we are not near on price.”

Harrington said he met with architects for both the jail and for the state body that oversees courts and said they are drawing up plans both for the West Murry Creek site and for land the county owns along Red Barn Road between the existing government center and the public library in San Andreas.

Calaveras County Sheriff Dennis Downum said he supported going ahead on the assumption the jail will be built on Red Barn Road.

“We have to walk in there on the 18th of March with a plan,” Downum said of the deadline for applying for $30 million in state jail construction money.

Calaveras County voters in November approved a facilities bond measure, $10 million of which would provide matching money needed to qualify for the state jail construction funding. The existing Calaveras County Jail is so small that hundreds of inmates are released each year before they complete their sentences.

Recordnet.com: http://www.recordnet.com

Voters may weigh in on land acquisitions: Contra Costa Times, 1/20/08

By Karen Holzmeister
Initiative would limit eminent domain, but Alameda County agencies say policy already excludes it for private development

Alameda County agencies approach eminent domain differently, but it’s unlikely that at least one of two measures proposed for the June ballot would have any effect on their method of land acquisition.

The eminent domain initiative, proposed by the League of California Cities, would prohibit a public agency from using eminent domain to acquire an owner-occupied residence with the intention of conveying the property to a private developer.

This change in the law, if approved by voters, generally would affect redevelopment agencies that assemble properties for redevelopment by private developers.

Eileen Dalton, who heads the county Redevelopment Agency, said the county’s redevelopment plans already exclude residential properties from eminent domain authority.

The agency deals with land and economic development issues in urbanized unincorporated areas such as Ashland, Castro Valley, Cherryland and San Lorenzo.

“We would never use or threaten eminent domain,” she said. “Our M.O. is to acquire land through the negotiation process.”

The agency has accumulated about $8 million in a land-assembly fund for housing in unincorporated areas.

Acquisition of commercial or industrial properties on major thoroughfares in Ashland, Castro Valley and San Lorenzo could be an eminent domain option if the negotiating process isn’t successful.

Rory MacNeil of the county Public Works Agency said eminent domain is used only for public projects, such as road widening and flood-control improvements.

He cited 2006 eminent domain filings on Vasco Road in Livermore as part of a joint road improvement project between Alameda and Contra Costa counties. Sale agreements with property owners were reached before the disputes went to court, he said.

During the summer, the public works agency filed 44 eminent domain suits for residential and commercial properties on Lewelling Boulevard in San Lorenzo. The county plans to widen and landscape the thoroughfare in the next few years.

Of the 44, all but 12 have settled. MacNeil said he expects six property owners to settle soon.

The Contra Costa Times: http://www.contracostatimes.com

Eminent Domain: Land grab or tool to rebuild?: Contra Costa Times, 1/20/08

By Harrison Sheppard

SACRAMENTO — Taxpayer groups are battling elected officials over the government’s right to seize property in a campaign that could impact thousands of homes and businesses in California.

Each side is pushing a measure for the June ballot that would reform eminent domain, — which allows local governments to seize privately owned homes and businesses and turn them over to developers for shopping malls and office parks.

The fight will come as demands from a growing population and a shortage of land in dense urban areas such as Los Angeles put increased pressure on governments to exert their legal authority to seize private property — whether it is for public purposes such as building new schools and roads, or private purposes such as new retail stores in depressed inner cities.

In a state where local governments are restricted from raising property taxes by Proposition 13, building the tax base through redevelopment has become an increasingly attractive option.

“I think the local and state chambers will fight this tooth and nail,” said Barbara O’Connor, director of the Institute for the Study of Politics and the Media at Sacramento State. “… This is one way that they can mine inner-city areas, which are often cheaper to develop, and have large developments where they couldn’t otherwise acquire property.”

The proposed ballot measures focus only on that private development aspect of eminent domain.

The ballot measures are a reaction to a ruling issued three years ago by the U.S. Supreme Court, which confirmed the government’s right to seize private property and hand it over to private developers for “public use.” Critics say that decision opened the floodgates for a rash of property seizures nationwide.

National property rights groups say California has one of the worst records in the country protecting private property rights.

The Castle Coalition, a property rights group, ranked California in the bottom 20 percent, with a D- grade, in a state-by-state report card on eminent domain reform.

“California is one of the most notorious eminent domain abusers in the country,” said Jeff Rowes, an attorney with the Arlington, Va.-based Institute for Justice, a nonprofit group which sponsors the coalition.

“There are massive cases of abuse. The two places you find eminent domain abuse are scenic areas and the intersection of major transportation conduits. California has lots of interstates and lots of scenery. It has traditionally been a big abuser.”

And because the areas that are most often targeted for redevelopment are those experiencing blight and economic hardships, “eminent domain abuse falls overwhelmingly on the poor and minorities, and California has lots of those,” he said.

However, what groups like the coalition call “abuse” are instead seen by government agencies and developers as necessary tools that provide for the economic rebirth of depressed areas. In such cases, they say, some individuals will have to sacrifice for the greater good.

For example, the loss of a pawnshop or a convenience store in favor of a mall or condo tower that increases the economic activity in a neighborhood — and boosts city tax revenue — is usually worth overriding the concerns about property rights, they say.

In Los Angeles, simply the threat of eminent domain has been used to acquire properties in the redevelopment of Hollywood, the building of the Staples Center and retail projects in South Los Angeles.

Those who owned the properties that were taken often felt abused by the city, and many fought in court to obtain better prices than the city offered — but in the end, many city officials would argue a greater public good was achieved.

“You have the ability to go into areas that are terribly downtrodden with high poverty and high crime and assemble enough property to make a block deal happen,” said Bruce Ackerman, vice chairman of the Los Angeles city Community Redevelopment Agency and chairman of the California Association for Local Economic Development. “I’ve always seen it as a very positive tool.”

However, most agencies prefer to negotiate a voluntary deal with the property owner, Ackerman said, making eminent domain a “tool of last resort.”

The Castle Coalition claims that the number of eminent domain cases for the benefit of private redevelopment has skyrocketed since the Supreme Court decision in June 2005.

From 1998 to 2002, the group tracked 10,282 properties nationwide threatened or taken by eminent domain for the benefit of private parties. However, the year after the court decision in June 2005, the group tracked 5,783 properties which were threatened or taken. On an annual basis, that’s almost three times as many properties at risk after the decision.

In California, the group tracked 858 properties in the five years before the court decision; after the decision, 346 properties were at risk or about double the annual rate.

California authorities say state law was clear long before the 2005 decision. Local redevelopment agencies have always had the power to seize private property for private development, but only if they were able first to designate an area as blighted.

There is often a strong economic incentive to do so. A city redevelopment agency can declare an area as blighted and then use eminent domain to redevelop it. Through a tool known as “tax-increment financing,” the city can then keep the additional tax revenue generated by the higher property values the project creates, rather than turning over that revenue to the county.

The extra funds are supposed to be used in the project area for public improvements. But the process often generates friction with counties that resent the loss of tax revenue and suspect the cities of abusing the tool, using it in areas where the private sector may have chosen to develop anyway without public subsidies. Los Angeles County and the city of Los Angeles have a long history of legal battles over the issue of redevelopment revenue.

California voters in June will have the ability to restrict the government’s power in some of those cases. They are being offered a choice between two competing ballot measures to redraw the rules under which local governments can seize private property.

One measure, sponsored by the League of California Cities, would prohibit government from seizing residential property and giving it to a private developer for commercial purposes.

The second measure, sponsored by the Howard Jarvis Taxpayers Association, takes a much broader approach.

First, it would prevent the seizure of both homes and businesses. It would also essentially end rent control in California. This would be achieved through vacancy decontrol — rent limits would remain in place for current tenants, but once an apartment is vacated, it could no longer be controlled.

In addition, it would restrict the ability to seize private property for water projects. It would also grant new compensations to owners when their property is taken, such as offering them first right of repurchase if the government abandons the proposed project.

An earlier effort to pass strong eminent domain controls, Proposition 90, was rejected by California voters in 2006 by a 52-47 margin. That campaign attracted nearly $19 million in spending, and some experts think this year’s effort could exceed that level.

Backers of the league measure said they purposely tailored their effort to protect homeowners and believe the Jarvis measure is too broad and includes items which have little to do with eminent domain, such as rent control.

In fact, they are calling the Jarvis plan a rent control measure, not an eminent domain measure.

“From our perspective, this measure is an attack on tenants and affordable housing and an assault on the environment,” said Tom Adams, president of the California League of Conservation Voters.

Jon Coupal, president of the Jarvis association, said he believes the league’s competing measure was placed on the ballot to “obfuscate” the issue in the minds of voters. With two similar competing measures on the ballot, they may vote against both simply out of confusion.

The Jarvis measure was ultimately designed to give the strongest protections to property owners, including landlords, he said.

“The initiative first and foremost reflects the policy that government should not take property away from one private interest to give to another,” Coupal said. “We do not impact the ability of government to take property for public use — the traditional roads and highways and schools and dams.”

And according to the Jarvis association, imposing rent controls is just another form of the government taking away value from property. “These rent regulations are as close to a physical taking as you can possibly get,” Coupal said.

Experts say the number of special interest groups that are affected by the two measures is likely to escalate public attention and campaign fundraising. Among the groups directly affected by the measure are landlords, property owners, developers, environmentalists, tenants and local governments.

Tim Hodson, executive director of the Center for California Studies at California State University Sacramento, said these two measures are expected to draw greater attention because of the relatively thin ballot in June. There are no statewide or presidential races on the ballot, and so far, there appear to be few other ballot measures.

“I would anticipate that there will be no lack of funds spent on these measures,” Hodson said.

The Contra Costa Times: http://www.contracostatimes.com

City moves to assume control of strip mall: Whittier Daily News, 1/11/08

By Tania Chatila

LA PUENTE – The city is moving forward in using eminent domain to obtain a nearly three-acre parcel of land along Hacienda Boulevard.

In the coming weeks, La Puente expects to approve several guarantees to ensure financial security for Victor Gudzunas, who owns the land at 1313-1335 N. Hacienda Boulevard.

City attorneys first filed paperwork with the courts in July to seize the property. It is home to a small strip mall with 13 tenants, some of whom have operated their businesses there for more than two decades.

The city wants to build a commercial retail center on that site, as well as on two adjacent sites.

Officials say that since the summer, the city has been taking necessary measures to ensure the process moves along.

They have also been in negotiations with Gudzunas. He has yet to accept a deal from the city for his land – which in July, was appraised at $3.8 million.

Gudzunas could not be reached for comment Friday.

“From what I understand, (Gudzunas) has been very cooperative,” Mayor Louie Lujan said. “He has taken the approach that any responsible property owner would and should take at this point.”

Officials say they hope to resolve negotiations before a May hearing set by the courts. At that time, if a resolution is not reached, legal proceedings will begin to seize the land, Lujan said.

The city will have the opportunity to request an extension, he said, but there is no guarantee it would be granted.

Assistant City Manager Gregg Yamachika said he is hopeful a resolution can be reached, as several obstacles in the negotiations have already been addressed.

Among them are three guarantees that the Community Development Commission and the City Council are expected to approve within their next few meetings, Yamachika said. The city is going to guarantee that if the commission somehow dismantles before the proceedings are complete, the city will take over responsibility, Yamachika said.

Officials are also guaranteeing that they will not abandon eminent domain, he said.

“In other words, we are not going to move all his tenants out and then not move forward, leaving him with an empty shopping center,” Yamachika said.

Finally, the city will be assuming lease obligations for those tenants which they relocate as part of the eminent domain process, Yamachika said.

“If we move a tenant out, we will guarantee the property owner continued rent payments,” he said. “So that potential loss of rents is no longer an issue for him.”

The city has successfully relocated two tenants out the strip mall – The Chop Shop, a barber shop, and JRCRealty and Financial Services.

A third tenant – an auto sales office – is in the middle of relocation, Yamachika said.

“We are required by law to assist them in moving,” he said. “That includes their moving expenses, helping them find an alternative location, paying for any fixtures or equipment they can’t take with them.”

A group of seven of the 13 tenants have hired an attorney.

Anthony Li, owner of Tony’s Hobbies and Toys, is not part of that group and is looking for another site to move his 2,000-square-foot storefront.

“I’m just waiting to find a place to get out too,” he said. “I’m struggling. I’m looking all over.”

Li said it is unlikely he or the city will ever find him a spot comparable to what he has now – in terms of size and rent.

“But what can I do?” he said. “It happened. The landlord is losing the land and we get all the hassle of having to move.”

Whittier Daily News: www.whittierdailynews.com

Eminent domain possible for jail – Two landowners shun Calaveras over facilities site: Recordnet.com, 1/4/08

By Dana M. Nichols

SAN ANDREAS – Calaveras County may resort to eminent domain to take 57 acres of land it wants for a new jail and county courthouse in San Andreas.

The owners of the two parcels just north of the existing government center have not responded to the county’s purchase offer, said Brent Harrington, the county’s interim administrative officer. The delay threatens as much as $30 million in state money needed to help build the jail.

County supervisors on Tuesday will consider approving the use of eminent domain to take the two parcels. The county needs control of the land by June so Calaveras County can qualify for the state money to help build the jail, which also will be funded in part with a local bond measure Calaveras voters approved in November.

“We reached conclusion in early December on a staff level that it would be in the best interests of the county to buy both of those parcels,” Harrington said.

The more northerly of the two lots belongs to Galt-based developer Ryan Voorhees. Dave Tanner, a land-use consultant representing Voorhees, said that his client has reached agreement with the county on the terms of a sale.

The southern lot belongs to construction company owner Greg Opinski of Merced. Mike Dell’Orto, a consultant who represents Opinski, said his client disagrees both with the price the county is offering and with the idea that the county needs the entire lot.

Dell’Orto said Opinski would be happy to sell part of the area the county needs but that Opinski would like to keep the rest for a commercial development.

Harrington said that other than informal verbal statements about the price, neither landowner has responded to the county’s offer. Neither Harrington nor the representatives of the landowners disclosed the amounts of the county’s offers.

The county already owns land between the library and some existing temporary county buildings that could be used as a jail site. But county staffers and court officials prefer a larger site to also accommodate courts and the future expansion of county offices.

“We have some very stringent timelines to deal with,” Harrington said. “Not only for the court but for the jail and to apply for what we think will be a successful effort to apply for funds from AB900.”

Assembly Bill 900 authorizes $750 million in state money to be distributed to local governments this year to build jails. San Joaquin and Calaveras counties are each expected to have strong applications for the money. The two counties are participating in an effort to open a re-entry state prison facility in Stockton. Opening such a facility, where inmates spend the final months of their prison terms, increases a local agency’s chances of winning the state funding.

Harrington said that starting eminent domain now would allow the county to take control of the land by June and in time to meet AB900 requirements. Under eminent domain, a judge sets the price the county would pay for the land.

If all goes well for the county, construction on the jail could begin in 2009 and be completed in 2010.

The current jail is so small that hundreds of inmates each year are released before completing their sentences.

Calaveras County officials historically have been reluctant to use eminent domain to take property. This time, however, it may be necessary, said county Supervisor Bill Claudino, who represents San Andreas on the board.

“I’m not a big fan of eminent domain myself. But it is not like we are taking somebody’s home from them. The people have owned that land for less than a year. It is an investment,” Claudino said. “It may be something we are forced to do for the public good.”

Recordnet.com: http://www.recordnet.com

COPYRIGHT © 2010 Arthur J. Hazarabedian, Esq.