Beware Eminent Domain Measures Masquerading in Sheep’s Clothing
Prepare for another hot button issue. With the issue on 12 state ballots, eminent domain, called “takings” by opponents, will rank with gay marriage, school prayer and teaching evolution for this election season’s fear mongering award.
States with measures that would limit eminent domain include, Nevada, North Dakota, Michigan, New Hampshire, South Carolina, Georgia, and Florida. California, Arizona and Idaho would make governments pay for zoning regulations that restrict the value of private property.
Eminent domain arose as an issue in June when the Supreme Court voted 5 to 4 to allow local governments to confiscate property for private economic development when officials determine it will benefit the public. Local governments are increasingly using the tactic for an economic jolt in decaying city centers where large developers propose shopping malls and other commercial developments, which would increase tax revenues for local areas.
In a minority opinion, Justice Sandra Day O’Connor claimed the decision hurt small property owners and gave a “disproportionate influence” in the political process to large corporations and developers. The Fifth Amendment requires that “just compensation” be paid when local and state governments use eminent domain and that the property must be for “public use.” In the past, eminent domain has been used to build bridges and highways, and for slum clearance and redevelopment, but the conservative Court’s decision widened the concept of “public use” to include “public purpose” to create jobs or increase economic activity.
The decision created a storm of protests and prompted a backlash of anti-government libertarians, who seek to frame the debate as a governmental “abuse of power.” While 30 states passed reforms restricting eminent domain, the California legislature couldn’t reach agreement. In response, New York real estate mogul Howie Rich funded the collection of one million signatures to put Proposition 90 on the ballot and financed 92 percent of the money to support the measure. Along with Idaho and Arizona, where eminent domain ballot measures are also funded by Rich, California has the most egregious measure.
A billionaire, Rich is the sole proprietor and funding source behind a plethora of radical libertarian front groups, which promote state spending caps, social security privatization, so-called property rights issues, tax cuts and school vouchers. Although his measures were tossed off the ballot for fraudulent gathering of signatures in Montana, Nevada and Michigan, Rich spent over $14 million to support constitutional changes in Wisconsin, Oregon, Arizona, Ohio, Arizona and Maine.
Like Rich’s other proposals, California’s Proposition 90 is a doozy. Under the cover of protecting individuals from being unfairly forced to hand over their property to private developers, the proposition would reimburse owners for losses when regulations restrict owners from developing their land in any way they see fit. Although the proposal makes exceptions for existing regulations on health and safety issues, local governments, citizens and homeowner associations would not be able to control private developments in their communities.
According to Al Meyerhoff, an environmental attorney in LA, Proposition 90 is “an anti-environmental stealth measure” designed to strip the public of the ability to pass environmental, land use, zoning and planning laws. “If enacted,” he writes in the Los Angeles Times, “any regulation (other than health and safety) said to have any impact on any property – real, personal or intellectual – could trigger claims for compensation to be paid by taxpayers.”
Oregon passed a Proposition 90-like “property rights” law in 2004, allowing claims when zoning restrictions hurt property values. Oregon courts ruled that 2,200 claims, totaling over $5.6 billion, would have to be paid by taxpayers. Cash poor local governments waived the zoning rules rather than pay off private property owners.
Proposition 90 would mean that a plot of private property overlooking the ocean could be bought for its asking price of $229,000 and a $10 million house planned for the site. Regardless of the “parks and recreation” use imposed by the coastal commission, a house could be built, or the owner would be eligible for $10 million compensation for what the house would have fetched on the open market. Similarly, other restrictions on development would be equally costly. Development of beaches and marine reserves, gravel pits in downtown areas, and oil wells on beaches would be allowed, or the state would have to pay property owners for the loss of the wildest imagined uses of their land.
Part of the backlash against eminent domain is being driven by cities across the country that force people to sell their property to developers of expensive homes, offices and shopping complexes. Ironically, measures like Proposition 90 would be a “bonanza” for national big-box stores, which would be allowed to muscle their way into unwilling communities to build gigantic Wal-Mart or Home Depot stores, shopping complexes and fast food strips.
The confiscation of land by government to assist rich conglomerates or developers is a bad idea, but passing a law to limit public regulation of unwanted development or to protect the environment is an even worse idea. Rejecting deceptive eminent domain measures and pressuring the state legislatures to deal with the problem would better serve the public.
Don Monkerud is a California-based writer who follows cultural,
social and political issues. He can be reached at email@example.com.