Eminent Domain on the Retreat
A funny thing has been happening on the way to redevelopment here in New Jersey. In just a few months this summer, government's use of eminent domain to seize property and hand it over to private developers in the name of "redevelopment" and higher ratables has sustained one defeat after another in rapid succession.
First, of course, there was the June ruling by the State Supreme Court that "underutilization" or "not being fully productive" may not be used a sole criterion to declare a property blighted and therefore potentially subject to eminent domain, in response to the case Gallenthin Realty vs. Paulsboro.
On July 19, Essex County Superior Court Judge Marie P. Simonelli threw out Newark's attempt to declare its Mulberry Street area as "blighted" or, more euphemistically, "in need of redevelopment." The 14-acres area has been improved with a mix of residential and commercial buildings and several parking lots. There are 166 lots, and all but seven are owned by private businesses or individuals. The area is located approximately one block east of the Newark Arena project presently under construction on Broad Street. The Court concluded that the city had not presented substantial credible evidence of blight as required under the state Local Housing and Redevelopment Law. In this case, the Court also noted the existence of "allegations of impermissible favoritism given to politically connected developers" (eminent domain attorney Bill Ward).
In Lodi, a trial court rejected the city's designation of a residential trailer park as blighted. New Jersey Appellate Judges Kestin, Payne, and Lihotz affirmed the decision of Superior Court Judge Richard Donohue throwing out the resolutions of the Lodi Planning Board, Mayor and Council that blighted approximately 20 acres in the Route 46 area. As a result of this decision, Lodi's Governing Body unanimously decided to drop any appeal of the case. Had the properties of Brown's Trailer Park and Costa Trailer Court been subject to eminent domain, more than 40 residents would have been displaced from their homes.
On July 11, another three-judge appellate panel reversed a decision of Judge Lawrence Lawson, A.J.S.C., Monmouth County, which had affirmed the Borough of Belmar's blighting of waterfront property belonging to Freedman's Bakery in HJB v. Borough of Belmar.
In Maplewood, Essex County Superior Court Judge Donald Goldman vacated a blight designation for two properties, one owned by Carolyn Evans and the other owned by Richard Rio of the Rivco Group LLC. In this case, "the court rejected Maplewood’s argument that the suit was premature because no plan for redevelopment has been adopted and no condemnation was imminent. Maplewood’s argument is typical of the disingenuous blather presented to property owners who oppose a blight designation under the 45-day time constraints" (eminent domain attorney Bill Ward).
The bottom line, according to attorney Michael Kates, Esq., is "Now we know that you can't simply say that you can redevelop on the basis that you're not getting the highest return on your land." - Michael Kates, Esq., as reported in the Star-Ledger (July 25, 2007).
In Camden, a lawsuit brought by the residents of the Cramer Hill Neighborhood as a result of the city's attempt via eminent domain to acquire several parcels of land containing residential homes resulted in the Appellate Court Division's reversal of an earlier trial court decision in favor of the takings. It is noteworthy that Camden sought to use the Fair Housing Act rather than the Local Redevelopment Housing Law (LRHL) after the trial court threw out Camden’s redevelopment plan. The Cramer Hill Neighborhood encompasses more than 162 city blocks containing more than 4,000 homes, most of which are well maintained, historic, and attractively landscaped.
In Perth Amboy, a blight designation was reversed by the New Jersey Superior Court because the city did not provide enough evidence to justify the designation. According to the court decision, "You can’t just say by reason of dilapidation you’re in an area of redevelopment. You have to indicate how that’s detrimental to the safety, health, morals, or welfare of a community. And in order to demonstrate that … that’s where the evidence comes into play. That could have been demonstrated or possibly demonstrated through zoning violations, building code violations, fire reports, something of that nature. Again, that wasn’t present in the report. (381 N.J. Super at 275)."
As of mid-August, there have been a total of seven court decisions in New Jersey that focused on the determination of blight and the use of eminent domain. According to eminent domain attorney Bill Ward, "decisions in Lodi, Bloomfield, Newark, Belmar, Camden and Maplewood demonstrate that the courts will not accept or give deference to municipal blight declarations which are not supported by substantial, credible evidence. The message is clear: the New Jersey courts are looking at these prerogative writs actions and expert testimonies through the lens of Gallenthin. As a consequence, municipalities that present evidence less than required by Gallenthin are subject to losing their blight designations and redevelopment projects" (eminent domain attorney Bill Ward).
The implications of these decisions for Highland Park are clear. Properties that are not vacant or abandoned, that house residents or businesses who have no violations of building codes, fire codes, or zoning laws, may not be declared "in need of redevelopment" and subsequently taken by eminent domain because government officials believe they have a better use for those properties that would produce more tax ratables. This reasoning was exactly that stated by the Highland Park Planning Board in its 2005 declaration of a patchwork of properties on Raritan Avenue as being in need of redevelopment. It is exactly the reasoning used by the mayor's designee on the Planning Board, former Councilman Steve Buzbee, in arguments he has made dating back to 2001. And now it is clear it will not hold up in court.
Neither will the argument that the town has no specific redevelopment plans and/or intentions of imminent condemnation of these areas hold up in a court of law. Mayor Frank often makes a point of noting that eminent domain has not been used, that no declarations of taking have been issued, and that Highland Park will "do" redevelopment differently than other towns. Whether or not a declaration of taking has been issued, a designation of blight makes a property permanently vulnerable to being seized at some point in the future.
As for "doing redevelopment differently," those very words have been pronounced by mayors and council members across the state and country. They could be coming from the same script, written by firms such as Jaffe Communications who specialize in "selling" redevelopment to the public. Every town purports to be different, yet in the end, the results are the same. An oral promise stating the borough hopes to never use eminent domain yet refusing to rule it out by statute means about as much as an oral contract between buyers and sellers or between employers and employees.
Equally encouraging, various state agencies are now investigating over 70 improper blight designations in New Jersey.
For local businesses and residents who want to stay in Highland Park, things are definitely looking up.
First, of course, there was the June ruling by the State Supreme Court that "underutilization" or "not being fully productive" may not be used a sole criterion to declare a property blighted and therefore potentially subject to eminent domain, in response to the case Gallenthin Realty vs. Paulsboro.
On July 19, Essex County Superior Court Judge Marie P. Simonelli threw out Newark's attempt to declare its Mulberry Street area as "blighted" or, more euphemistically, "in need of redevelopment." The 14-acres area has been improved with a mix of residential and commercial buildings and several parking lots. There are 166 lots, and all but seven are owned by private businesses or individuals. The area is located approximately one block east of the Newark Arena project presently under construction on Broad Street. The Court concluded that the city had not presented substantial credible evidence of blight as required under the state Local Housing and Redevelopment Law. In this case, the Court also noted the existence of "allegations of impermissible favoritism given to politically connected developers" (eminent domain attorney Bill Ward).
In Lodi, a trial court rejected the city's designation of a residential trailer park as blighted. New Jersey Appellate Judges Kestin, Payne, and Lihotz affirmed the decision of Superior Court Judge Richard Donohue throwing out the resolutions of the Lodi Planning Board, Mayor and Council that blighted approximately 20 acres in the Route 46 area. As a result of this decision, Lodi's Governing Body unanimously decided to drop any appeal of the case. Had the properties of Brown's Trailer Park and Costa Trailer Court been subject to eminent domain, more than 40 residents would have been displaced from their homes.
On July 11, another three-judge appellate panel reversed a decision of Judge Lawrence Lawson, A.J.S.C., Monmouth County, which had affirmed the Borough of Belmar's blighting of waterfront property belonging to Freedman's Bakery in HJB v. Borough of Belmar.
In Maplewood, Essex County Superior Court Judge Donald Goldman vacated a blight designation for two properties, one owned by Carolyn Evans and the other owned by Richard Rio of the Rivco Group LLC. In this case, "the court rejected Maplewood’s argument that the suit was premature because no plan for redevelopment has been adopted and no condemnation was imminent. Maplewood’s argument is typical of the disingenuous blather presented to property owners who oppose a blight designation under the 45-day time constraints" (eminent domain attorney Bill Ward).
The bottom line, according to attorney Michael Kates, Esq., is "Now we know that you can't simply say that you can redevelop on the basis that you're not getting the highest return on your land." - Michael Kates, Esq., as reported in the Star-Ledger (July 25, 2007).
In Camden, a lawsuit brought by the residents of the Cramer Hill Neighborhood as a result of the city's attempt via eminent domain to acquire several parcels of land containing residential homes resulted in the Appellate Court Division's reversal of an earlier trial court decision in favor of the takings. It is noteworthy that Camden sought to use the Fair Housing Act rather than the Local Redevelopment Housing Law (LRHL) after the trial court threw out Camden’s redevelopment plan. The Cramer Hill Neighborhood encompasses more than 162 city blocks containing more than 4,000 homes, most of which are well maintained, historic, and attractively landscaped.
In Perth Amboy, a blight designation was reversed by the New Jersey Superior Court because the city did not provide enough evidence to justify the designation. According to the court decision, "You can’t just say by reason of dilapidation you’re in an area of redevelopment. You have to indicate how that’s detrimental to the safety, health, morals, or welfare of a community. And in order to demonstrate that … that’s where the evidence comes into play. That could have been demonstrated or possibly demonstrated through zoning violations, building code violations, fire reports, something of that nature. Again, that wasn’t present in the report. (381 N.J. Super at 275)."
As of mid-August, there have been a total of seven court decisions in New Jersey that focused on the determination of blight and the use of eminent domain. According to eminent domain attorney Bill Ward, "decisions in Lodi, Bloomfield, Newark, Belmar, Camden and Maplewood demonstrate that the courts will not accept or give deference to municipal blight declarations which are not supported by substantial, credible evidence. The message is clear: the New Jersey courts are looking at these prerogative writs actions and expert testimonies through the lens of Gallenthin. As a consequence, municipalities that present evidence less than required by Gallenthin are subject to losing their blight designations and redevelopment projects" (eminent domain attorney Bill Ward).
The implications of these decisions for Highland Park are clear. Properties that are not vacant or abandoned, that house residents or businesses who have no violations of building codes, fire codes, or zoning laws, may not be declared "in need of redevelopment" and subsequently taken by eminent domain because government officials believe they have a better use for those properties that would produce more tax ratables. This reasoning was exactly that stated by the Highland Park Planning Board in its 2005 declaration of a patchwork of properties on Raritan Avenue as being in need of redevelopment. It is exactly the reasoning used by the mayor's designee on the Planning Board, former Councilman Steve Buzbee, in arguments he has made dating back to 2001. And now it is clear it will not hold up in court.
Neither will the argument that the town has no specific redevelopment plans and/or intentions of imminent condemnation of these areas hold up in a court of law. Mayor Frank often makes a point of noting that eminent domain has not been used, that no declarations of taking have been issued, and that Highland Park will "do" redevelopment differently than other towns. Whether or not a declaration of taking has been issued, a designation of blight makes a property permanently vulnerable to being seized at some point in the future.
As for "doing redevelopment differently," those very words have been pronounced by mayors and council members across the state and country. They could be coming from the same script, written by firms such as Jaffe Communications who specialize in "selling" redevelopment to the public. Every town purports to be different, yet in the end, the results are the same. An oral promise stating the borough hopes to never use eminent domain yet refusing to rule it out by statute means about as much as an oral contract between buyers and sellers or between employers and employees.
Equally encouraging, various state agencies are now investigating over 70 improper blight designations in New Jersey.
For local businesses and residents who want to stay in Highland Park, things are definitely looking up.
posted by Laurel Kornfeld | 2:15 PM
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