RIVIERA BEACH, Fla. – The builders of a multibillion-dollar redevelopment project are considering legal action against the state and city after being told eminent domain powers will not be used to seize property to make way for the plan.
Viking Inlet Harbor Properties, a joint venture between Viking Yacht Co. and resort-development firm Portfolio Group, has already spent more than $50 million acquiring property in the redevelopment zone, said Mike Clark, president of Viking Associates, the real estate arm of the company.
"Now I'm stuck with these properties but can't develop them because I can't fill in the puzzle pieces," Clark said. "The city spent millions of dollars putting together its comprehensive plan, and we spent well over $1 million in engineering, architectural and planning fees. Our plan now becomes virtually worthless.
"We're certainly considering joining with other developers and perhaps a group of municipalities about the changing of the rules in midstream," Clark added.
The $2.4 billion project is planned for an area that encompasses about 1,700 homes and businesses in an effort to revamp the marina district with high-end condominiums, houses, shops, offices and yacht slips in one of Palm Beach County's poorest cities.
The city was moving ahead with the plans over the objections of some residents who refused to move out of their homes to make way for the project in potentially one of the nation's largest eminent domain seizures.
Mayor Michael Brown has said the city would use eminent domain to force home and business owners to sell their properties in an effort to bring a higher tax base and better paying jobs to the city. However, city officials contend that many residents would choose to sell, making forceable eviction unnecessary.
But after the U.S. Supreme Court ruled last year that local governments could use the power of eminent domain to obtain property for such private development, Florida and 30 other states passed laws restricting the seizures.
Brown still said the plan would move forward because it was already in the works when the law was enacted this year.
However, Floyd Johnson, executive director of Riviera Beach's redevelopment agency, said the city now has no choice but to follow the law. It cannot force residents out of their homes against their will, Johnson said.
Brown declined to comment.
The City Council was set to consider a resolution Wednesday night making it official that it does indeed intend to abide by the law.
Such a resolution would make moot several lawsuits that have been filed against the city by residents seeking to stop the project.
Traditionally, governments have used eminent domain to forcibly buy property so they can build public facilities like schools, parks, prisons, airports and roads. But after the Supreme Court ruling, cities across the country began eminent domain procedures for projects much like Riviera Beach's plan.
Florida voters have a chance to put the state law restrictions into the constitution if they pass Amendment 8 on the Nov. 7 ballot. It would ban the use of eminent domain to transfer property, such as homes or businesses, to private developers unless an exemption is approved by three-fifths of both houses of the Legislature.
The new law and the resolution being considered would effectively stop a large portion of the Riviera Beach project. The developers would then have to negotiate for much higher prices to buy residents' properties if the project were to move forward.