Showing posts with label eminent domain. Show all posts
Showing posts with label eminent domain. Show all posts
Monday, December 10, 2018
The Government Takings of Private Property coming to a community near you.
Government Takings of Private Property: Susette Kelo's Story from Mackinac Center on Vimeo.
The senate passed new laws allowing the government to yake property WITHOUT finding cause of blight. This means perfectly nice neighborhoods could be removed to build high density apartment building in transit corridors. We have heard that Steve Kinsey and other supervisors are eyeing Marinwood/Lucas Valley for their Smart Growth development BEYOND the affordable housing components. A series of bus shelters in reportedly being planned for Lucas Valley road.
If true, this will open a flood gate of new public and private development. Whenever I speak with pro growth people in Southern Marin about fairness, they reply, "You have room for growth in Marinwood/Lucas Valley. We are all built out in my neighborhood."
Our fore bearers wisely bought open space to PROTECT the land and community from excess development. We will Save Marin Again!
Sunday, December 9, 2018
The Kelo Debacle Turns 10
The Kelo Debacle Turns 10
Marking today’s 10th anniversary of the Supreme Court’s notorious decision in Kelo v. City of New London.
Ten years ago today, the U.S. Supreme Court issued one of the most destructive and appalling decisions of the modern era. In Kelo v. City of New London, a 5-4 majority allowed a local government to bulldoze a working-class neighborhood so that private developers would have a blank slate on which to build a luxury hotel, a conference center, and various other upscale amenities. The city’s goal was to erase that existing community and replace it with a new commercial district that would (hopefully) fill the local coffers with more abundant tax dollars. According to the Supreme Court, this unsavory land grab qualified as a legitimate use of the city’s eminent domain powers because the city “has carefully formulated an economic development plan that it believes will provide appreciable benefits to the community.”
Never mind the fact that the Fifth Amendment to the U.S. Constitution forbids the government from taking private property via eminent domain for anything less than a legitimate “public use.” Traditionally, the concept of public use has been understood to apply to things like roads, bridges, or tunnels—not to fancy hotels operated on a for-profit basis by private businesses. But that public-private distinction was lost in the eyes of the Court. “The disposition of this case,” declared the majority opinion of Justice John Paul Stevens, “turns on the question whether the City’s development plan serves a ‘public purpose.’ Without exception,” Stevens asserted, “our cases have defined that concept broadly, reflecting our longstanding policy of deference to legislative judgments in this field.”
According to Stevens, what really mattered was that city officials had a plan and that they firmly believed their plan was in the city’s best interests. The only task remaining for the Supreme Court, Stevens maintained, was to grant those government officials “broad latitude in determining what public needs justify the use of the takings power.” In other words, the city of New London was permitted to define—and to enlarge—the scope of its own eminent domain powers, unencumbered by any pesky interference from the courts.
Writing in dissent, Justice Sandra Day O’Connor observed that under the Court’s dangerous rationale, “the specter of condemnation hangs over all property. Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory.”
O’Connor was right to worry. In the aftermath of Kelo, New York officials took a page from New London and proceeded to tear down homes and businesses in order to make way for aprofessional basketball arena in Brooklyn, and then those same state officials snatched more homes and businesses in Harlem to provide extra campus space for Columbia University, an elite private institution that can surely afford to handle its own real estate deals on the open market.
To make matters worse, New York’s highest court followed the deferential Kelo standard and rubber-stamped the state’s misdeeds in both cases. “Any such limitation upon the sovereign power of eminent domain as it has come to be defined in the urban renewal context,” New York’s high court ruled in the Brooklyn arena case, “is a matter for the Legislature, not the courts.”
Unsurprisingly, Kelo has sparked outrage and disbelief across the political spectrum. Kelo is “the most un-American thing that can be done,” declared Democratic Rep. Maxine Waters of California, an outspoken liberal, a few days after the ruling was announced. Conservative talk radio host Rush Limbaugh, normally one of Waters’ ideological opponents, had a similar reaction. “Government can kick the little guy out of his or her homes and sell those [homes] to a big developer,” Limbaugh complained. “That’s not what the takings clause was about.... It’s just been bastardized.”
To be sure, the Supreme Court has issued plenty of controversial decisions in recent decades. But those controversies have tended to divide Americans along ideological or partisan lines. For example, conservatives tend to be the ones upset about Roe v. Wade, while liberals tend to be the ones upset about Citizens United. Kelo has the unique distinction of uniting all sorts of different people against the Court’s truly abysmal judgment.
Looking back over the past 10 years, it’s clear that Kelo was a disaster on virtually every level.
In the wake of the Court’s decision, the final holdouts in New London were given the boot and the bulldozers rolled in, leveling the neighborhood. But then nothing else happened. The redevelopment scheme fell apart and the project died. If you visit New London today, you’ll find that the razed neighborhood still stands empty, a depressing monument to the folly of “expert” government planning.
As for Justice John Paul Stevens, he remains unrepentant about his central role in the Kelodebacle. In fact, in a 2011 speech, Stevens lashed out at several of his critics (including me), arguing that Kelo remains perfectly justifiable because it “adhered to the doctrine of judicial restraint” and was rooted in “Justice Oliver Wendell Holmes’ broad reading of the text of the Constitution—which allows the states the same broad discretion in making takings decisions that they possess when engaging in other forms of economic regulation.”
But why should the Supreme Court adhere to Justice Holmes’ toxic interpretation? Why not just follow the actual text of the Constitution? After all, Holmes is the same justice who once wrote, “a law should be called good if it reflects the will of the dominant forces of the community, even if it will take us to hell.”
In other words, under Holmes’ “broad reading,” it is acceptable for the majority to run roughshod over the minority—and the judiciary has no business standing in the way. So much for protecting the rights of unpopular groups.
In short, Kelo was wrong the day it was decided 10 years ago today and it has only gotten more rancid with age. If any modern case deserves to be overruled by a future Court, Kelo is it.
[EDITOR'S NOTE: Look for eminent domain abuse to start again in Marin after two new senate bills were passed to help "Transit Priority Projects"]
The Golden State’s New Eminent-Domain Temptation
The Golden State’s New Eminent-Domain Temptation
A California bill would make it easier for local governments to seize homes and small businesses.
When the U.S. Supreme Court ruled that Susette Kelo’s little pink house in New London, Conn., could be seized with eminent domain, its decision ignited a political firestorm. Practically everyone in the nation was outraged, with Kelo v. City of New London uniting figures as diverse as Bernie Sanders and Rush Limbaugh in opposition. In the years since, 44 states have reformed their eminent-domain laws.
But as time went by and memories began to fade, lawmakers pounced to undo those reforms. In California, a bill is now on Governor Jerry Brown’s desk that could unleash a new wave of eminent-domain abuse across the state.After years of abuse, California dissolved its infamous redevelopment agencies (RDAs) in 2012. This reprieve for property rights, however, was short-lived. Last year, lawmakers decided to revive redevelopment under a new program, allowing municipalities to establish “community revitalization and investment authorities,” or CRIAs. Like the redevelopment agencies from before, CRIAs can siphon property-tax revenue away from infrastructure projects and instead funnel those funds to their own schemes. Appallingly, California law also grants these authorities the power of eminent domain to seize private property.
In August, state lawmakers approved a bill, AB 2492, that would make it even easier to create a CRIA. The consequences could be absolutely dire. One analysis by Andrew Chang and Company estimates that if the bill is enacted, a staggering 78 percent of California’s landmass could be threatened with condemnation, including 23 entire counties and 188 cities in whole. To put that figure into perspective, if that combined area were a state, it would constitute the seventh largest state in the U.S.
Sponsored by Assemblyman Luis Alejo, AB 2492 would further expand redevelopment in multiple ways. Existing law requires that 80 percent of the land affected by a CRIA must have a median household income of less than 80 percent of the statewide median household income. But AB 2492 would change that threshold to either 80 percent of the countywide or citywide annual median income. In other words, otherwise affluent communities could plead poverty, placing even more private properties at risk of being bulldozed.
Bizarrely, many California icons could be affected by this seemingly minor tweak. The Ritz-Carlton in San Francisco, Rodeo Drive in Beverly Hills, and the Boardwalk in Santa Cruz would all be “vulnerable to redevelopment,” Andrew Chang and Company reported.
Even if municipal governments decide against condemning homes and businesses in more prosperous neighborhoods, those high-value properties could be included in a CRIA. That would allow municipalities to fund bond increments, which in turn, “could amount to potentially billions of dollars statewide.”
Another change by AB 2492 would let municipalities juke the stats. Currently, to create a CRIA, an affected area must have a crime rate higher than the statewide median crime rate. But under the bill, local governments could use either the average crime rate for violentor property crimes, as opposed to one fixed number.
Tellingly, no other state in the nation uses the methodology in AB 2492, according to the California Alliance to Protect Private Property Rights. By further loosening the ability to create CRIAs, California lawmakers are poised to return the state to the bad old days of redevelopment. Initially limited to combating urban blight, redevelopment ultimately ballooned to a boondoggle that wasted billions of dollars in taxpayer money. In 2011, their final year before dissolution, hundreds of redevelopment agencies received $5 billion in revenue, or 12 percent of the state’s property taxes.
By comparison, RDAs received more property taxes than “all of the state’s fire, parks, and other special districts combined” and cost “the state’s General Fund about as much as the University of California or California State University systems,” according to one report by the Legislative Analyst’s Office (LAO), the nonpartisan California agency that provides fiscal advice to the state legislature. In some counties, redevelopment agencies even collected more than 25 percent of all property-tax revenue.
Despite this largess, redevelopment did precious little for Californians who weren’t politically-connected real-estate developers. After scouring independent research, the LAO found “little evidence that redevelopment increases jobs.” The office further concluded that “there is no reliable evidence that redevelopment projects attract businesses to the state or increase overall economic development in California.”
Redevelopment also imperiled private property. Over a ten-year period, the Institute for Justice identified more than 200 redevelopment projects that authorized eminent domain for private gain.
When Justice Sandra Day O’Connor dissented in Kelo, she was remarkably prescient about its impact: “Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory.”
Those words were supposed to be a warning, not an instruction manual.
— Nick Sibilla works at the Institute for Justice, which litigated the Kelo case.
Sunday, May 27, 2018
Apartments coming to a neighborhood near you in Marinwood/ Lucas Valley/Terra Linda
Editor's Note: The fight for sensible land use is being fought in Seattle too. Like Marin, zealous planners, politicians and housing advocates are rezoning neighborhoods for affordable housing, micro apartments and the conversion of single family neighborhoods into multifamily apartment blocks. This is the idea behind the Priority Development Area in Marinwood and the rest of the 101 corridor. This is the future of Marinwood if they get their way and pass SB-1. It will allow redevelopment ANYWHERE without a declaration of blight.
The Fight Against Small Apartments
Why Neighborhood Groups Are Uniting to Stop Developers from Building Tiny, Affordable Units
KELLY O
In May of 2009, a rumor was floating around City Hall. Homeowners on Capitol Hill were furious about a construction project. So one sunny afternoon, while workers hammered nails into a few unfinished buildings near 23rd Avenue and East John Street, I went knocking on doors to find out what the problem was.
One neighbor was Alan Gossett. Gossett was trying to sell his blue Craftsman house, which shared an alley with the new development. Standing on the corner of his rear deck, Gossett pointed through the trees to the half-built structure and said, "I think this is going to be a magnet for very sketchy people."
Why sketchy?
According to permitting paperwork, the building was a commonplace cluster of six town houses—the sort that would typically attract well-to-do buyers. But inside each town house, the developer was building up to eight tiny units (about 150 to 250 square feet each, roughly the size of a carport) to be rented out separately. The tenants would each have a private bathroom and kitchenette, with a sink and microwave, but they would share one full kitchen for every eight residents. The rent would be cheap—starting at $500 a month, including all utilities and Wi-Fi—making this essentially affordable housing in the heart of the city. And, remarkably, for affordable housing, it was built without any subsidies from the city's housing levy. But Gossett was bracing for 46 low-income renters in the space where he'd been expecting six new homeowners instead.
Gossett and other neighbors felt hoodwinked, they told me.
There was no public notification and no review process that allowed neighbors to pose objections. This was due to a loophole in the permits: The city and developers classified the building as six units (with up to eight bedrooms each), instead of as an apartment building with dozens of units, which would have required a more public process. Neighbors said they feared that the area wasn't ready for so many new residents and that the influx of newcomers would usurp on-street parking. But Gossett also seemed concerned by who his new neighbors might be.
"Anyone who can scrape up enough money to live month-to-month can live there," he said, worried that low-income interlopers would jeopardize his chances to sell his own house. "I don't think most people want to live next to a boarding house with itinerant people living in it."
Monday, December 11, 2017
Judge Halts Indiana Town's Cruel Attempt to Fine Residents Out of their Properties
Judge Halts Indiana Town's Cruel Attempt to Fine Residents Out of their Properties
Property owners were ordered to pay thousands for violations unless they agreed to sell to a redeveloper.
Institute for JusticeA judge in Indiana has stopped a city's nasty plot to make people sell their homes to a redeveloper or else face thousands of dollars of rapidly accumulating fines.
In Charlestown, Indiana, a community north of Louisville with a population of less than 8,000, the mayor and other city leaders have been trying to transfer ownership of private plots of land in the low-income neighborhood of Pleasant Ridge to a developer. This developer would then raze all the properties and build an entirely new neighborhood.
Charlestown did not take advantage of Kelo v. City of New London, the Supreme Court decision that allows the government to transfer property to a private developer via eminent domain. That would have required the city to pay the property's current owners.
Instead, the city targeted Pleasant Ridge with ruthless code enforcement. Property owners were cited and fined hundreds of dollars for every individual violation. Unlike the usual practice in code enforcement, the owners were not given any grace period to correct the problems before the fines were levied: They were levied immediately and compounded daily until the problems were fixed. And even when the violations were fixed, the owners had to pay the fines. The only relief offered to them came if they agreed to sell their properties to the developer.
Once the developer bought and boarded up the homes, by contrast, the city refrained from citing it for code violations. Neighbors complained that the company's properties were overgrown and full of garbage and weeds, creating a public health risk. But the law wasn't being used to target public health risks; it was being used to target people who wouldn't sell.
In February, the libertarian attorneys of the Institute for Justice stepped in, representing several landowners and a neighborhood association. Yesterday, a circuit judge in Scott County sided with the institute and its clients. Judge Jason Mount ruled that Charlestown had violated its own code enforcement regulations in order to target Pleasant Ridge. He has ordered the city to give property owners the opportunity to appeal citations and a grace period to actually fix problems before the city is permitted to start levying fines.
In a release, Institute for Justice Senior Attorney Anthony Sanders took note of the victory and the judge's acknowledgment of the unfair enforcement:
Today's ruling unmasks the City of Charlestown's and developer John Neace's actions for what they are: a naked land grab, taking from the poor to give to the rich. With this injunction in place, the city either must force Mr. Neace's company to pay several million dollars in fines or waive the fines it has illegally and unconstitutionally issued against the residents of Pleasant Ridge.
That's two wins in less than a week for the lawyers at the Institute for Justice. That's good news for private property rights.
Read more about the case here
Thursday, April 20, 2017
Eminent Domain in the Trump Era
Little Pink House, a new feature film written and directed by Courtney Balaker, looks at eminent domain abuse by recounting the true story behind of an epic 2005 Supreme Court case. Though President Trump is no longer directly managing his real estate business, the story depicted in the film is more relevant than ever given his authoritarian tendencies.
Marin residents have much to worry about with new laws recently enacted providing sweeping powers of redevelopment agencies in California to condemn properties. Among the targets are low density neighborhoods near a transit corridor. Virtually all land within 1/2 mile of the 101 Freeway in Marin is considered part of the "101 Priority Development Area" by Plan Bay Area. Many people in regional government demand that Marin urbanize with high density development to "take the pressure off" their own communities.
It is a rocky road ahead.
Monday, December 19, 2016
Steve Kinsey and friends threaten our neighbors, the Silveira family,
Marin to Silveira ranch: Settle or sue
The fate of one of the largest parcels of undeveloped land left in Marin County, which has been hotly contested for more than a decade, could be determined in coming months.
Marin County supervisors have decided not to renew a “tolling” agreement with the Silveira family that prevents the statute of limitations from expiring on its right to sue over the Marin Countywide Plan.
Adopted in 2007, this long-range general plan for the county establishes the development rights for Silveira’s 340-acre ranch, which is located east of Highway 101 in the unincorporated area of the county between San Rafael and Novato. The plan substantially reduced allowable development on the Silveira property and the adjacent 770-acre St. Vincent’s School for Boys property.
The county entered into the tolling agreement with the Silveira family soon after the Countywide Plan was adopted in 2007 to allow the family additional time to deliberate and had renewed the agreement on a yearly basis since, said Deputy County Counsel Renee Giacomini Brewer.
“Nine years is long enough to not to get some kind of resolution,” said Supervisor Steve Kinsey. “As a board, we believe that the countywide plan that was adopted is legally defensible.”
Kinsey said when the county renewed the agreement a year ago, it notified the Silveiras that it would not be doing so again.
“We created a board subcommittee consisting of Supervisor (Damon) Connolly and myself to explore with the family whether there was any way to amicably resolve the differences,” Kinsey said. “I don’t think we’re there.”
DEADLINE LOOMING
Under the law, the Silveira family has until Feb. 1 to file suit; otherwise it relinquishes its right to challenge the plan, Brewer said.
See article HERE
Thursday, October 6, 2016
Important Eminent Domain case in New London (again_)
Family Sues West Haven Over Eminent Domain Case
By Justin Schecker
A West Haven family has filed a lawsuit against the city saying the planned use of eminent domain on two of their properties for The Haven is unconstitutional.
Bob McGinnity, 63, has more than 50 years of memories living in his home on 1st Ave. in West Haven. His house and the property his family owns next door stand in the way of The Haven Group LLC's plans to build the upscale waterfront mall.
“You’re taking homes from people and you’re holding a club over their head,” McGinnity said following a press conference outside the Milford Superior Court on Wednesday morning.
McGinnity is represented by local attorneys and the Washington, D.C.-based Institute for Justice.
“Bob’s homes are not for sale,” Attorney Robert McNamara said. “The McGinnitys have offered to accommodate development as much as possible, they’ve offered to willingly sell their large backyard to the developer if they can stay in their longtime homes.”
“It’s not buildable without those pieces of property,” West Haven Mayor Ed O’Brien said. “This is not a strip mall. This is probably one of the first in the country of its kind.”
The mayor said the developer has made McGinnity a generous offer “in excess of maybe 200-percent of the assessed value and the market value.” Nearly all of the property owners have already settled, he added.
McGinnity’s attorneys say Connecticut has seen this situation play out before with the 2005 landmark Kelo v. New London Supreme Court case. The Institute for Justice argues the court got it all wrong by ruling in favor of eminent domain in exchange for the promise of economic growth and more tax revenue.
“What we have here is a private developer using the city," McNamara said. "This is a private entity abusing public power for its own private gain. That’s not just wrong, that’s unconstitutional.”
Mayor O’Brien said he hopes McGinnity’s refusal to settle doesn’t prevent the construction of the mall that will bring jobs, millions of dollars in tax revenue and a clean-up of the waterfront that’s already begun.
“I understand like it’s his family home, I wouldn’t want that to happen,” Mayor O’Brien said, “but then again, you have to look for the greater good of the city.”
McGinnity insists he’s not moving from where he cares for his nearly 80-year-old uncle.
“He’s had a heart attack and stroke a month after finding out that we were going to have eminent domain placed on us,” he said.
Published at 12:57 PM EDT on Sep 29, 2016 | Updated at 12:58 PM EDT on Sep 29, 2016
Tuesday, August 30, 2016
Rhymes with Snobbery
Mayor Gayle McLaughlin shows her support of the CARES, (Community Action to Restore Equity and Stability) program during a public meeting in Richmond, Calif. on Saturday June 15, 2013, at the Nevin Community Center. A radical new program is being proposed as a way to help struggling homeowners that could lead the city to use eminent domain to seize underwater mortgages and restructure them to keep families in their homes. Photo: Michael Macor, The Chronicle
"Richmond rhymes with enrichment," Mayor Gayle McLaughlin boasts on her city website. Actually, Richmond does not rhyme with enrichment. The slogan, however, is apt for the first American city poised to seize mortgages by eminent domain. City pols claim the scheme is legal because the city would pay "fair market value" for private property in the furtherance of public good. Call the scheme Richmond Hood, in honor of Robin of Sherwood Forest.
It turns out Richmond does spell enrichment - for Mortgage Resolution Partners, a San Francisco startup in which Chronicle columnist Willie Brown was an initial investor.
The plan originally was billed as a means to help Richmond by "preserving home ownership, restoring homeowner equity and stabilizing the communities' housing market and economy by allowing many homeowners to remain in their homes." Folks figured that meant fixing up homes and eliminating blight in depressed neighborhoods, Councilman Nat Bates recalled. "Lo and behold," he added, "we find out that we have folks with million-dollar homes" that can be helped.
As The Chronicle's Carolyn Said reported, with MRP's help, Richmond threatened the seizure of 624 underwater mortgages. The vast majority of the loans, 444, are current on their payments; 180 are delinquent. The three most expensive mortgages are for $1.22 million, $962,307 and $888,000 for homes in Richmond's priciest hood, Point Richmond on the waterfront.
The city offered $679,834, $543,608 and $510,727 to purchase those three mortgages. For a $4,500 fee, MRP helps homeowners get lower loans, and the city pockets profits in the process. (MRP would not talk to me on the record.)
So far, no surprise, no bank has taken up Richmond on its "fair market value" proffers. Still, the purveyors of Richmond Hood contend that the deal benefits the public.
Enter the cold embrace of reality. In August, Richmond tried to refinance $34 million in A-minus-rated bonds. No one bought them.
Richmond homeowners who have kept up their mortgages should be asking themselves: If I want to sell my house in three years, will potential buyers be able to secure a mortgage in a town known for robbing banks by fiat?
"It sounds good, the eminent domain, and I'm not in love with the lending institutions, because I do feel they've taken advantage of a huge number of our citizens," said Councilman Bates, who plans to introduce a motion on Tuesday to withdraw the city's purchase-or-go-to-court offers. "They're a hard-nosed group of people. But at the same time, I can't in good conscience go out and take these people on when they do have certain rights."
Also it would be a financial disaster to get in a fighting match with Wall Street and financial institutions, as City Hall is about to sell tax-revenue anticipation bonds needed to keep the city running.
McLaughlin tells me that she's not worried about finding buyers for Richmond bonds. "We think that it's a lot of blustering, and they're acting out of emotion," quoth the mayor.
And if banks won't lend to would-be Richmond home buyers?
"We believe that's totally against the law," she answered. Surely there are many civil rights lawyers who would be happy to "right any wrongs brought against the city of Richmond."
The next slogan: Richmond rhymes with legal pitchman.
She's not asking: Who wants to buy a home in a city where officials believe they have a right to seize property from one taxpayer - not for the public good of a school or a road but to feed a money-making enterprise run by political cronies? No one is safe in such a city. There is no alarm system powerful enough to protect a humble homeowner from the giant maw of such a revenue-raking machine.
"Suppose a homeowner owes $300,000 on a home now worth $200,000. The city seizes the loan (by eminent domain) and pays the current mortgage holders $170,000. This price assumes a large number of severely underwater homeowners will ultimately default.
"The city, which now owns the loan, writes down the balance to $190,000. Now instead of being underwater, the borrower has $10,000 in equity. He gets a new loan for $190,000, which pays off the $170,000, with $20,000 left over for the city to share with its investors and pay expenses."
It turns out Richmond does spell enrichment - for Mortgage Resolution Partners, a San Francisco startup in which Chronicle columnist Willie Brown was an initial investor.
The plan originally was billed as a means to help Richmond by "preserving home ownership, restoring homeowner equity and stabilizing the communities' housing market and economy by allowing many homeowners to remain in their homes." Folks figured that meant fixing up homes and eliminating blight in depressed neighborhoods, Councilman Nat Bates recalled. "Lo and behold," he added, "we find out that we have folks with million-dollar homes" that can be helped.
As The Chronicle's Carolyn Said reported, with MRP's help, Richmond threatened the seizure of 624 underwater mortgages. The vast majority of the loans, 444, are current on their payments; 180 are delinquent. The three most expensive mortgages are for $1.22 million, $962,307 and $888,000 for homes in Richmond's priciest hood, Point Richmond on the waterfront.
The city offered $679,834, $543,608 and $510,727 to purchase those three mortgages. For a $4,500 fee, MRP helps homeowners get lower loans, and the city pockets profits in the process. (MRP would not talk to me on the record.)
So far, no surprise, no bank has taken up Richmond on its "fair market value" proffers. Still, the purveyors of Richmond Hood contend that the deal benefits the public.
Enter the cold embrace of reality. In August, Richmond tried to refinance $34 million in A-minus-rated bonds. No one bought them.
Richmond homeowners who have kept up their mortgages should be asking themselves: If I want to sell my house in three years, will potential buyers be able to secure a mortgage in a town known for robbing banks by fiat?
"It sounds good, the eminent domain, and I'm not in love with the lending institutions, because I do feel they've taken advantage of a huge number of our citizens," said Councilman Bates, who plans to introduce a motion on Tuesday to withdraw the city's purchase-or-go-to-court offers. "They're a hard-nosed group of people. But at the same time, I can't in good conscience go out and take these people on when they do have certain rights."
Also it would be a financial disaster to get in a fighting match with Wall Street and financial institutions, as City Hall is about to sell tax-revenue anticipation bonds needed to keep the city running.
McLaughlin tells me that she's not worried about finding buyers for Richmond bonds. "We think that it's a lot of blustering, and they're acting out of emotion," quoth the mayor.
And if banks won't lend to would-be Richmond home buyers?
"We believe that's totally against the law," she answered. Surely there are many civil rights lawyers who would be happy to "right any wrongs brought against the city of Richmond."
The next slogan: Richmond rhymes with legal pitchman.
She's not asking: Who wants to buy a home in a city where officials believe they have a right to seize property from one taxpayer - not for the public good of a school or a road but to feed a money-making enterprise run by political cronies? No one is safe in such a city. There is no alarm system powerful enough to protect a humble homeowner from the giant maw of such a revenue-raking machine.
Eminent domain and mortgages
The Chronicle's Kathleen Pender wrote this description of the Mortgage Resolution Partners model in her Net Worth column:"Suppose a homeowner owes $300,000 on a home now worth $200,000. The city seizes the loan (by eminent domain) and pays the current mortgage holders $170,000. This price assumes a large number of severely underwater homeowners will ultimately default.
"The city, which now owns the loan, writes down the balance to $190,000. Now instead of being underwater, the borrower has $10,000 in equity. He gets a new loan for $190,000, which pays off the $170,000, with $20,000 left over for the city to share with its investors and pay expenses."
Debra J. Saunders is a San Francisco Chronicle columnist. E-mail: dsaunders@sfchronicle.com Twitter: @DebraJSaunders
"Sometimes I wonder whether the world is being run by smart people who are putting us on, or by imbeciles who really mean it." - Mark Twain
Monday, August 22, 2016
Eminent domain means your home can be their castle
 |
| John Revelli snapped this photograph of his tire shop in ruins on the day it was demolished. Revelli returned to the site of his former tire business in downtown Oakland, Calif. on Friday, June 23, 2006. The Oakland Redevelopment Agency took his business, which his family had owned since 1949, through eminent domain proceedings so a developer could construct a huge apartment complex. PHOTO: COURTESY OF JOHN REVELLI **John Revelli |
As mayor of Oakland in the 2000s, Jerry Brown supported redevelopment. Then he returned to the governor’s office in 2011 and inherited a $25 billion budget shortfall. Feeling the squeeze, Brown saw an opportunity to make $1.7 billion by eliminating redevelopment agencies and shifted. He liked redevelopment as mayor, he explained to the League of California Cities, but also: “I didn’t quite understand it. It seemed kind of magical. It was the money that you could spend on stuff that they wouldn’t otherwise let you spend.”
In Sacramento, fiscal restraint can only last so long. The urge to “spend on stuff” is back. Last year, the Legislature passed a measure with bipartisan support to restore redevelopment. The governor signed the bill, which took effect this year. Already the Legislature is working to expand rules to allow local officials to green-light pet projects more likely to enrich powerful interests than benefit the communities the policy is supposed to serve.
Small businesses, beware. In 2005, the U.S. Supreme Court ruled that “economic development” constituted “public use” in its infamous Kelo decision, which allowed governments to seize private property for private development. (The state or local government derives its power to take private property for public use in return for just compensation from the right of eminent domain.) The Kelo ruling emboldened cities like Oakland to seize private property at bargain prices to accommodate tony private development. The targeted property didn’t even have to be blighted — the traditional rationale for urban renewal projects. It just had to be in the way.
In her blistering dissent of Kelo, Justice Sandra Day O’Connor warned, “The specter of condemnation hangs over all property. Nothing is to prevent the state from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory.” Oakland proved O’Connor right by seizing two properties — Revelli Tires and Autohouse — to make way for private development. “There is a greater good here,” Brown told me at the time, even as he admitted the businesses were not blighted.
Ravelli Tires and Autohouse had a form of blight — their owners didn’t have the political clout to fight back. They were like the tire and brake repair shop owned by the parents of Pacific Legal Foundation attorney Larry Salzman. Two decades ago, the City of La Mesa (San Diego County) took his parents’ shop to make way for a Costco. “The ‘just compensation’ offered to them by the city was laughably inadequate,” Salzman wrote in the San Diego Union-Tribune, and years of litigation drove them into bankruptcy. That’s your “greater good.”
AB2492 seeks to expand redevelopment in the worst way. A legislative analysis explains that the bill’s purpose is to address “unanswered questions about the data sources” that can be used to determine blight. In effect, AB2492 would allow officials to find that an area is blighted if, for example, the median income there is less than 80 percent of the median income either “statewide, countywide or citywide.” Take your pick.
The “or” part, says Marko Mlikotin of the California Alliance to Protect Private Property Rights, would allow local officials to “cherry-pick the data,” and let affluent communities parade as needy.
If the bill makes it to the governor’s desk as expected, will Brown sign it? When redevelopment shuttered in 2011, I liked to think that Brown realized that redevelopment represented a corrupt bargain, even though he never said as much. Now I suspect Mlikotin is right when he posits Brown’s move on redevelopment “really was about money, not some new found religion in private property rights.”
“Follow the money,” Salzman wrote in an email. “There was little money to be made by people who would abuse eminent domain during the economic (downturn) that followed Kelo and the financial crisis, but in the past few years there is again economic incentive for government and politically favored developers to collude to grab land they can’t get in a free market.” It’s “the worst kind of cronyism.”
The older guy who built up his tire shop and the immigrant who started a car repair business don’t stand a chance.
Debra J. Saunders is a San Francisco Chronicle staff writer. Email: dsaunders@sfchronicle.com. Twitter: @DebraJSaunders
See Story HERE
------------------------------------
Kelo was here
The Fifth Amendment states, “Nor shall private property be taken for public use, without just compensation.” That’s known as the “Takings Clause.” In 2005, the U.S. Supreme Court issued a 5-4 ruling written by Justice John Paul Stevens in the Kelo vs. New London, Conn., case that interpreted the phrase “public use” to include private “economic development.” As a result, the New London Development Corp. was able to seize the waterfront home of Susette Kelo to accommodate a project meant to serve the employees of Pfizer Corp.
After developers took the land under Kelo’s little pink cottage, the redevelopment project fell through. The cottage was moved, however, and now serves as a monument to all those who fight eminent domain abuses. As the Institute of Justice, which represented Kelo pro bono, wrote, “Although Kelo and her neighbors endured a tragic loss of their neighborhood, they can take comfort in the fact that they have left a legacy of real change and inspiration for millions of other property owners throughout the nation.”
Thursday, April 14, 2016
Monday, October 19, 2015
Lesson for Marin: Citizen Fight in Colorado.
Arvada Citizens Also Engaged in Urban Renewal Gone Bad
Posted on January 6, 2015 by Carol B
Urban Renewal: Everything That Can Be Wrong With Local Government
Cronyism, corruption, corporate welfare, corporate socialism, elitism, insider deals, political payoffs, central planning, social engineering … the worst of what can happen when politicians, government bureaucrats and business fat cats get together under the auspices of your local ‘urban renewal authority’.
In recent years we have seen the Arvada Urban Renewal Authority (AURA) go on a tax give-away binge and engage in heavy-handed regulation for the benefit of favored developers; behavior that has gone far beyond what the ‘urban renewal’ concept was ever meant to accomplish.
Perhaps most egregious is the strong-arm power of urban renewal authority that distorts and manipulates the functioning of the free market. Local established businesses and historic neighborhoods are thus artificially impacted in ways from which they may never recover. In just the past couple of years in Arvada we have witnessed the city council and AURA applying elitist “we always know what is best for you” decisions in the central region of the city especially.
The whole urban renewal process often descends into what amounts to sanctioned bribery and graft when developers get rebated millions and millions of tax dollars to build projects desired by government — where otherwise the free market would render its own organic resolution and judgement. Any such system is ripe for abuse: thus, not unexpectedly, we have seen in city council elections, proponents of city government largess tending to receive campaign contributions from their developer ‘friends’.
Once upon a time, government urban renewal was meant to reconstruct rundown or ‘blighted’ urban areas. These days it means
- attempts to use eminent domain to take productive property from one private owner for the benefit of another (Walmart);
- the term ‘blight’ has been expanded to include even open rural land, like AURA’s Northwest Arvada Urban Renewal area for the primary benefit of private residential developers;
- driving out a valuable neighborhood grocery store, Safeway, to advantage another Walmart project, then the government getting into the real estate business by actually buying the vacant property and then giving an exclusive sweetheart deal to yet another private developer;
- and it has come to mean government subsidies of tens of millions of dollars to private developers.
The Arvada Urban Renewal Authority has become a scandal … but, the concerns of city residents are belittled and ignored.
What are the typical responses of the elected elite, the establishment politicians and their cronies to this tax give-aways and favoritism towards wealthy developers?
- Why, we common folks just don’t understand the mechanics of city planning and how government and business have to ‘work’ together.
- We are naivé to think that this isn’t how big, important deals are made … and besides, what do you know about what is best for the future of Arvada?
- And then there is the slickest line of all: if government doesn’t give developers tax money, they wouldn’t be able to afford to build and ‘improve’ the city. Next time you need to repaint or re-roof your house, go to city council and try that reasoning on them — ask for three of four years of city sales tax rebate so you can afford to ‘improve’ your neighborhood.
Lately, however, citizens across the metro area are waking up to this abuse of government power that favors special interests over free markets and taxpaying residents.
- In Littleton, a grassroots effort of citizens has succeeded in putting on a city special election ballot a proposal to rein in the overreach of city hall and urban renewal: Gloves are off in urban renewal battle royale – Denver Post.
- In Westminster, an incumbent city council representative has authored a hard-hitting critique of how urban renewal is being utilized in that city: Westminster abusing ‘blight’ designation for TIF-funded urban renewal by Bruce Baker.
- In Arvada average citizens are seeing growing online and grassroots interest in local government reform that puts AURA abuses front-and-center. At issue are pending and proposed tax subsidies worth millions and millions of dollars — Walmart $5.8 million; Park Place Olde Town $3.3 million; Solana Olde Town (apartments) $7.2 million; Renascent/Hilton Hotel $8.6 million. See: Stop Arvada Walmart/Facebook; Save Arvada Now/Facebook; Arvada for ALL the People/Facebook.
Residents of Arvada, Westminster, Littleton — indeed, the entire Denver region — all want good quality economic prosperity for our communities. Undoubtedly, however, most regular folks also believe that free enterprise, fairness and the ‘old fashioned’ American way of doing business should not be subverted by government favors and preferences for a chosen few picked to be ‘winners’ by urban renewal authorities.
•••
To find out more about the Littleton urban renewal ballot issue, go to: http://yourlittletonyourvote.wordpress.com
Saturday, October 10, 2015
Donald Trump Trashes the Constitution, Endorses Eminent Domain Abuse
Donald Trump Trashes the Constitution, Endorses Eminent Domain Abuse
Trump's support for Kelo v. City of New London reveals his fundamentally unconstitutional support for eminent domain abuse.
Credit: Todd KraninEarlier this week Republican presidential candidate Donald Trump told Fox News that he totally supports the Supreme Court's shameful 2005 eminent domain decision in Kelo v. City of New London. "I think eminent domain is wonderful," Trump declared.
It was not a particularly surprising comment. After all, as Inoted here yesterday, Trump has a long record of seeking to personally profit from eminent domain abuse. One such incident occurred in 1994 when Trump joined forces with government officials in New Jersey in a legally unsuccessful attempt to kick an elderly widow out of her Atlantic City home in order to make room for a limousine parking for the nearby Trump Plaza hotel and casino.
Today the conservative site Breitbart published an article featuring Trump's response to his eminent domain critics (including me). "Trump and his critics have different views on what constitutes 'public use,'" Breitbart summarized.
No kidding. Trump's latest comments only provide further proof of his fundamentally unconstitutional support for eminent domain abuse. Here's why.
The Fifth Amendment to the U.S. Constitution forbids the government from taking private property unless the taking is "for public use." That concept has traditionally been understood to apply only to a very narrow category of undeniable public projects, such as the building of roads or bridges.
But Trump believes the government should get to wield far more power than that. Trump believes it should count as a legitimate public use to build a limousine parking lot (for Trump) or "to build a factory that's going to have 5,000 jobs."
To be clear, that is precisely the same untrammeled and unconstitutional rationale adopted by the liberal Supreme Court majority in Kelo v. City of New London, one of the most appalling decisions of the modern era. In that case, government officials sought to tear down a working-class neighborhood because they wanted to give the land to private developers (working in cahoots with the powerful Pfizer corporation) for the express purpose of (hopefully) generating higher tax revenues sometime in the future. During the February 2005 oral arguments, the city of New London openly acknowledged this outlandish scheme.
Under your theory of the case, Justice Antonin Scalia asked the lawyer representing the city, "you could take [private property] from A and give it to B if B is richer, and would pay higher municipal taxes, couldn't you?"
"Yes, Your Honor," the lawyer replied.
"For example," interjected Justice Sandra Day O'Connor, "Motel 6 and the city thinks, well, if we had a Ritz-Carlton, we would have higher taxes. Now, is that okay?"
"Yes, Your Honor, that would be okay," the city's lawyer promptly responded.
Three months later, the Court made the land grab official. As Justice O'Connor remarked in dissent, joined by Chief Justice William Rehnquist and Justices Antonin Scalia and Clarence Thomas, the result of Kelo "is to wash out any distinction between private and public use of property—and thereby effectively delete the words 'for public use' from the Takings Clause of the Fifth Amendment."
Furthermore, not only was the Kelo decision an unconstitutional disaster, the Kelo "redevelopment" was a disaster too. As I note in my recent book Overruled:
Despite prevailing at the Supreme Court, the development project that was supposed to entice Pfizer and provide "appreciable benefits to the community" (in the approving words of Justice Stevens's majority opinion) was never built, and in November 2009 Pfizer announced that it was closing shop and pulling out of New London entirely. As for Fort Trumbull, the razed neighborhood was never redeveloped and continues to stand empty today. In fact, in the aftermath of Hurricane Irene in 2011, New London officials encouraged city residents to use Fort Trumbull as a dump site for storm debris.
But that's not the worst of it. As Hartford Courant reporter Jeff Benedict revealed in September 2011, Connecticut Supreme Court Justice Richard N. Palmer, one of the four justices who voted against the property owners and thus directly precipitated their appeal to the U.S. Supreme Court, personally apologized to Susette Kelo at a May 2010 event at the New Haven Lawn Club. "Justice Palmer turned to Susette, took her hand and offered a heartfelt apology," Benedict reported. "Tears trickled down her red cheeks. It was the first time in the 12-year saga that anyone had uttered the words 'I'm sorry.'"
This is what Trump's destructive and unaccountable vision of government power looks like in practice.
Subscribe to:
Posts (Atom)