What can Newhall area business owners and homeowners do to fight the eminent domain process?

Business owners in the Downtown Newhall area received threatening letters from the City of Santa Clarita this week stating that the City would be invoking its right to eminent domain to evict them from their properties, and that the City would start legal action against the business owners if they did not readily comply.

The recent U.S. Supreme Court ruling in the case Kelo v. City of New London opened new doors for the government to seize properties at will throughout the United States using the power of eminent domain. In this ruling, the Court held that anyone’s home or business can be taken if the government thinks someone else can make more money with the land. The only loophole in this ruling is that it states, "Nothing in our opinion precludes any State from placing further restrictions on its exercise of the takings power."

Unfortunately, California uses eminent domain to condemn properties more often than most states. And quite often these condemnations are for private use, as in taking the properties and then subsequently turning them over to a private developer to build for profit. Even with the premise that an area must be considered "blighted" before eminent domain can be used, the broader definition of this allows any property in a defined "redevelopment zone" to be classified as blighted since it won’t meet the proposed standards of the new development.

On the positive side, eminent domain actions to take land to build Costco stores have been blocked by the Federal court in two cases since there was failure to prove that the condemnation would provide a public use. However, in San Jose the courts allowed an area to be condemned for the "shocking symptoms of blight" defined as having wet leaves on a private tennis court!

Several initiatives have been on the table to alter the eminent domain rules in California, but so far none have succeeded in making a significant change to the eminent domain practices in California. Although California does lead in the amount of legislation intiated regarding eminent domain, most of the intiatives that have passed have too many loopholes to have made a significant impact.

Here are a few of the bills recently introduced in California to help fight rampant use of eminent domain:

2005 CA S.C.A. 20, sponsored by State Senator Tom McClintock, states in part that "private property may be taken or damaged only for a stated public use and not without the consent of the owner for purposes of economic development, increasing tax revenue, or any other private use, nor for maintaining the present use by a different owner… if the property ceases to be used for the stated public use, the former owner would have the right to reacquire the property for its fair market value." Although this bill failed to pass Senate Committee on the Judiciary on April 25, 2006, the Committee subsequently agreed to reconsider the bill.

2005 CA S.B. 1210, sponsored by State Senator Tom Torlakson, provides that "public use does not include the taking of property in order to transfer it to a nongovernmental entity for purposes of economic development or increasing tax revenues, except as specifically provided under the Community Redevelopment Law." Passed as amended to Committee on Appropriations on June 29, 2006.

2005 CA A.B. 1990, sponsored by Assemblywoman Mimi Walters, "prohibits a city, county, special district, school district, community redevelopment agency, or community development commission or joint powers agency from exercising the power of eminent domain to acquire any real property if ownership of the property will be transferred to a private party or private entity." Although this action failed to pass the Assembly Committee on Housing and Community Development, it was granted reconsideration on June 8, 2006.

So what do the businesses and homeowners in the Downtown Newhall Redevelopment Area do to fight this eminent domain process? Do they have any hope?

Historically, the success rate for fighting eminent domain is abysmal, with only about 1% actually succeeding in holding off eminent domain with legal actions. However, there are resources available that should be explored. The Castle Coalition has an abundance of resources on their website, including a Survival Guide that is designed to be a comprehensive roadmap for any grassroots battle against eminent domain for private development.

With the current eminent domain notices being sent to properties owners in the area slated for a "public library" instead of commercial development, the businesses in that quadrant of Downtown Newhall may be facing an uphill battle. Even if it is determined that the library plan cannot work, and thus is replaced by commercial development, the initial plan for placing a public library on that location is the only data currently available. That is, of course, unless someone gets written documentation from Los Angeles County that states that they have no intent to staff the new library or stock it with books. If this can be obtained, then the argument for using eminent domain to use the property for "public use" would be flushed down the toilet.

The next targeted areas for removal are apparently the two planned parking garages, which again are "public use" properties. Seems the City wants to get the "public use" areas under their belt before moving forward with acquiring the areas that will be turned over for profitable commercial development.

With legal action against eminent domain proceedings having a poor success record, many areas are resorting to a more grassroots effort to stop eminent domain from happening. Public outcry can often change the attitude of local governments, and there are plenty of resources available online to get this started. The challenge here is that we have a situation where the eminent domain process has already begun for the Downtown Newhall area, so the clock is ticking!

Interested in starting a grassroots campaign to fight eminent domain? Here are some resources to help you get started:

• Castle Coalition website, with an abundance of eminent domain resources.
• Castle Coalition’s downloadable Survival Guide.
• Freedom Market has products for starting a grassroots campaign, including t-shirts and brochures.
• Institute for Justice website, which "helps individuals subject to wacky government regulations".
• Legislative Action Since Kelo, a downloadable report showing state-by-state activities since this Federal decision was passed down. Sadly, California’s actions have been mostly too limited to have any real effect.

While the Downtown Newhall Revitalization Project may have its merits overall (although I’m certainly not endorsing it here!), the City of Santa Clarita does have choices to make in how it handles obtaining the land (and removing existing property owners) that is needed for this plan to be successful. Hopefully the City will see fit to be more responsive to the needs of property owners who are slated for the wrecking ball than they have shown thus far.

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