In The News › Voters consider lists on government taking of land

Sep 28, 2006

Source: Associated Press

Voters consider lists on government taking of land

Thursday, September 28, 2006
Louisiana voters consider limits on government taking of land
By ALAN SAYRE
Associated Press Writer
NEW ORLEANS

After a U.S. Supreme Court ruling in 2005 that cleared the way for governments to take land for private economic development
projects, Louisiana voters will decide Saturday on a state constitutional amendment that would prohibit the practice.

The vote comes amid concerns that homeowners – especially in hurricane-hit areas such as New Orleans – could lose their
property to developers who convince cash-strapped public officials that their project would create jobs and tax dollars. However,
critics say the amendment could make hurricane reconstruction more difficult and add to the cost of expropriating land for public
projects.

The issue is a hot button in New Orleans as plans are drawn to rebuild after Hurricane Katrina. Some areas, including middle-class
eastern New Orleans and poorer neighborhoods remain largely uninhabited with houses gutted or awaiting demolition.

Neighborhood groups in areas such as the Lower Ninth Ward, where floodwaters created massive devastation, have been vocal in
demanding that the neighborhood be rebuilt. But to date, the city has no comprehensive plan for rebuilding.

Expropriation for “public purposes” has long been used to take private land, with payment, for such public-interest projects as
roads, schools, canals and airports, along with providing routes for public utilities and common carriers such as railroads.

But the term “public purposes” is not defined in federal or state constitutions and has been left up to the courts to decide. The issue
has ended up in the courts, and some have allowed property expropriation for economic development.

In the first case involving the concept to come before the U.S. Supreme Court, the justices – on a 5-4 vote – said in June 2005 that
the Connecticut city of New London could force buyouts of seven homeowners so a private developer could build condominiums, a
hotel and office space. The court ruled that the broader community would gain economic benefit from the action.

But in allowing the New London project to go forward, the Supreme Court said states had the power to change their eminent
domain laws, effectively freeing Louisiana and other states to be more stringent or lenient with the terms by which eminent domain
can be used.

The Louisiana Legislature, joining five other states, chose the constitutional route, while 30 states changed existing laws, said Jim
Brandt, head of the Public Affairs Research Council, a Baton Rouge-based private government watchdog group that analyzed the
amendment.

In a broadside aimed at the New London decision, Amendment 5 would ban state and local governments from taking property in
which substantial control or ownership would be turned over to private parties. It also would outlaw the use of economic
development and tax enhancement as factors in determining whether a taking is for “a public purpose.”

The amendment also addresses how much a landowner should be paid for expropriated property.

Currently, the state Constitution says an owner may be compensated to the “full extent of the loss,” a figure that can be determined
by a jury and include such items as attorney fees, moving costs and the cost of re-establishing a business or the loss of future
rental income.

The amendment would put those factors into the definition of “full extent of the loss” – possibly driving up the cost of expropriating
land, critics say.

The Bureau of Government Research, a New Orleans-area watchdog group, opposes the amendment, saying the restrictions
could affect hurricane-hit areas “by seriously impeding the ability of the state and local governments to deal with blight.” BGR
called the amendment “clumsily drafted” and “likely to create an array of difficulties in an arena in which Louisiana has no history of
problems.”

Sen. Joe McPherson, D-Woodworth, who sponsored the amendment, said the constitutional definition is needed because
Louisiana has 128 different laws dealing with expropriation, including some that allow numerous economic districts to take land for
“public purposes,” he said.

At the time the laws were passed, McPherson said legislators did not believe land taken by development districts would eventually
wind up under private ownership.

“With this (Supreme Court) decision, that is now all in a different light,” he said.

The amendment also allows the taking of property that poses a health or safety hazard. “That’s what blight is,” McPherson said.
McPherson said that although the Louisiana Supreme Court has never decided the question, there are two state appellate court
rulings that would allow the taking of land for private economic development projects.

“It’s a balancing act,” McPherson said. “It’s a question of whether you believe in individual property rights or a developer being able
to come in and trump that in the name of economic development.”

But BGR head Janet Howard said the amendment over-defines “public purpose.” For example, she said, under a strict judicial
reading of the list of acceptable purposes, land could be expropriated by government for a museum – but not a performance hall.
She also said the amendment raises the standard of “blight,” eliminating the current definition of “health, safety or general welfare.”

“What you usually do with blighted property is to put it back into commerce,” Howard said. “That’s huge, given the problem of
blighted property we’re fixing to have” in the New Orleans area.

However, June Sanchez, a member of the Lower Ninth Neighborhood Council, said residents who want to rebuild should not face
the threat of having their property expropriated for commercial developments.

“Unless it’s approved by the citizens in that area, we should not have to give up our land for developers,” Sanchez said.
There are also two related propositions on the ballot.

Amendment 4 deals directly with hurricane-hit areas. For billions of dollars in projected hurricane protection projects, including
coastal restoration could be expropriated with the landowner getting “fair market value” for the property, a lower price tag than the
“full extent of the loss” contained in state expropriation law.

The federal government and most states use the “fair market value” standard in expropriations. Backers say it will cut the cost of
such projects, much of which will be funded by Congress. Opponents said landowners should be entitled to the same payment as
all other expropriation targets.

Amendment 6 spells out how governments can dispose of expropriated land that is no longer needed for public projects. If the
property has been held for 30 years or less, it would have to be first offered to the original owner or heirs. After that, it could be
sold by competitive bid to the public. After 30 years, the property could be disposed of under numerous existing state laws that
allow exchanges, sales or donations by government agencies.

The fate of the amendments is expected to be decided by only a fraction of Louisiana voters. Secretary of State Al Ater has
projected that between 25 and 30 percent of the state’s 2.9 million voters will cast ballots.

Sep 28, 2006

Source: Associated Press

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