Critics Accuse Local, State Governments of Distorting Eminent Domain Laws

Local and state governments are increasingly using eminent domain laws meant to allow them to confiscate property for public works projects to instead grab land to make way for private developments and the fat tax revenues they bring, according to a Washington legal firm.

Lawyer Scott Bullock, of the pro-property rights Institute for Justice, claims that the governments have been taking advantage of changes in eminent domain laws that allow them to condemn what they call blighted property to make way for urban renewal projects.

"It's a huge weapon that the government has against people," Bullock said. "We now have localities saying, 'Isn't it a public purpose creating jobs and increasing our tax base?'"

In a recent report, the institute cited several examples of what it considers "abuse" of the laws:

— the city of New London, Conn., sought to condemn an entire neighborhood for a privately owned office park that would complement a nearby facility owned by drug maker Pfizer Inc.;

— land condemned in East St. Louis to make way for a racetrack parking lot;

— attempts to take a building owned by an elderly widow in Las Vegas to make way for casino parking;

— and forcing two families to move and make way for a private mall extension in Hurst, Texas, while their spouses were dying of cancer.

Some municipal government officials make no apologies for their efforts. It is their duty, they say, to increase jobs and lower taxes by taking unusable or dilapidated areas and turning them into profitable ones.

"They are misrepresenting the city," Robert Herron, city manager for Wheeling, W.Va., says of the Institute for Justice's criticism. His historic town was noted on the institute's Web site as an abuser of eminent domain. The institute claims the city plans to oust several businesses downtown to make way for more upscale buildings.

"Our downtown is really struggling," Herron said. The once-bustling retail area, he says, has been largely abandoned since outlet malls moved into the area. "We've been doing a lot of planning to revitalize," he said.

A developer is interested in replacing several businesses and vacant storefronts downtown with a mall fashioned in the image of Wheeling's Victorian past. "We would only use eminent domain as a last resort," Herron said. "The goal is what's best for all the citizens."

Jim Phelps, deputy mayor for economic development in Akron, Ohio (another city accused by the institute of abusing eminent domain laws), said local opponents of the city's development efforts "are not rational people."

Akron is being criticized for plans to condemn three homes, including that of a couple who have lived there for 30 years, and several businesses in order to transfer ownership of the land to a nearby Mercedes dealership. Like other city officials, Phelps said the condemning of blighted areas is fully legal and used only to spur urban renewal.

In Ohio, an eminent domain request must go before a jury, which decides whether taking the land is necessary and how much money the property owner will ultimately receive, he said.

"Those people are sitting in a very nice situation because they're going to walk away with money to buy a house in the nicest neighborhood in town," Phelps said. Under Ohio law, landowners receive the appraised value of the property, a bonus based on what the property would be worth located in a wealthier neighborhood, as well as relocation costs, he said.

Stephanie Parker Weaver, executive secretary of the Mississippi Southern Christian Leadership Conference, is part of a broad coalition of groups fighting efforts to move three black families off their land to make way for a Nissan trucking facility.

Weaver insists that eminent domain laws there refer specifically to confiscation for "public use."

"The public use law is just that — not greater good, not public purpose — public use. Not for one economic developer or a person who promised another to bring jobs in," she said.

The three families have been living on the rural property since as early as 1941. Weaver said not only were they not informed that their land was included as needed for the Nissan project, but that they were not offered the same right to negotiate a price for the property that white landowners in the area were.

"They treated them like sharecroppers, not shareowners," said Weaver.

In the New London case, a handful of property owners, with the aid of the institute, won a lawsuit against the city last week. Ed O'Connell, who represented the New London Development Corp., said the city wasn't seeking to accommodate Pfizer but instead to market land that has been underused in recent times.

"It depends on what you call a neighborhood," he said, when asked about the institute's allegations that an entire neighborhood was being pushed out. He described the neighborhood in question as a combination of 80 homes, a wastewater treatment facility, an historic fort, and an old railroad depot.

"It wasn't being done for the behest of Pfizer," he said of the eminent domain efforts. "New London was doing what most cities are trying to do in the U.S — economic development."