Eminent domain law gets mixed reviews
A proposed eminent domain law that bars Westchester County from taking properties to benefit private developers is getting mixed ”“ and heated ”“ reviews.
The plan has drawn fire from proponents of public-private partnerships for economic development and support from professionals and residents who call the existing system unjust and point to vacant, wasted properties in communities where developers walked away from projects.
Given testimony from both sides at a Sept. 7 public hearing, the Westchester County Board of Legislators balked at referring the law to voters on the ballot in the Nov. 2 general election.
Instead, it was sent back to the board”™s legislation committee for further review and discussion.
A bipartisan measure introduced by board Majority Leader Thomas J. Abinanti and Minority Leader James Maisano, the law would prohibit the county from condemning private properties for developments that include retail shopping centers, commercial offices, industrial and residential facilities. The public benefit of solely economic development, such as increases in the tax base, tax revenues and employment from a private project, would not qualify as a permitted use of a property to justify its taking by eminent domain.
The law would not apply to fair and affordable housing development projects by a government agency or by a nonprofit company partnering with a government agency.
While the county law does not restrict other municipalities in their use of eminent domain, it would bar the county from appropriating funds for any project that takes private properties for private development. Funds from county agencies often are funneled into local development projects.
In Yonkers, that provision in the proposed law could jeopardize the River Park Center downtown redevelopment planned by the city”™s private development partner, Struever Fidelco Cappelli L.L.C., according to Mark W. Blanchard, Yonkers corporation counsel. The city is ready to use eminent domain to acquire several business and residential properties near Getty Square for the stalled SFC project. Blanchard said a special incremental tax program to pay off project bonds for needed public infrastructure improvements might not work if the county refuses to participate.
”˜Anti-taxpayer proposal”™
In a 10-page statement to county legislators detailing Yonkers”™ opposition to the proposed law, Blanchard also claimed the more restrictive county law is at odds with and preempted by the state”™s eminent domain procedure law and “would not withstand judicial scrutiny.”
Blanchard called the law “bad public policy” because it would “severely hamper if not preclude” the public-private partnerships that historically have spurred the nation”™s economic growth.
“In this time of tightening municipal budgets, the need for such partnerships, is, if anything, more pressing than ever,” the attorney wrote. “It is difficult to understand the rationale for legislation that would eliminate a key cog in the machinery of economic development during the worst recession since the Great Depression.”
“This is an anti-taxpayer proposal,” Robert Bernstein, an attorney from Greenburgh and president of the Edgemont Community Council Inc., told legislators at the hearing. The proposed law prevents the county from working with private developers to spur economic development and so raise commercial property values in municipalities where homeowners shoulder an increasingly larger share of property taxes, he said.
”˜Un-American and unfair”™
Supporting the proposed law, White Plains attorney Debra S. Cohen called it a “reasonable and balanced recalibration of the use of eminent domain in Westchester.” While it does not go as far as some recent legal reforms limiting the uses of eminent domain, Cohen said, it “seeks a balance between the rights of individual property owners and the ever challenging need to find better ways to revitalize our communities and economy.”
Another supporter of the county law, Bruce Kanner, a principal at Besselman & Kanner L.L.P., a Yorktown Heights accounting firm, in a phone interview called the current use of eminent domain in New York for the benefit of private developers “un-American and unfair.” Kanner cited his and his family”™s experience with their former waterfront property in the village of Haverstraw as evidence of the need for reform to protect property owners.
Haverstraw in 2008 took the Kanners”™ nearly 10-acre property by eminent domain, paying just under $1.2 million for the former site of the Empire State Chair Co., which had been owned and sold by the accountant”™s late father, Andrew Kanner.
Kanner in state Supreme Court is seeking additional compensation for the property, which the village priced at about 10 percent of its real value, he said.
Village ”˜out on a hook”™
Kanner said in 1998 he made an informal proposal to the then-mayor of Haverstraw to redevelop the industrial property, but was told no housing would be allowed on the waterfront. Several months later, Martin Ginsburg, founder and principal of Ginsburg Development Cos. in Valhalla, crossed the Hudson with a similar proposal for residential development on the Haverstraw waterfront that would include the Kanner property in its second construction phase.
In 2003, the village entered into an agreement with Ginsburg for a luxury condominium development, Harbors at Haverstraw. Kanner said his family property fell under “a cloud of condemnation” that left him unable to sell or develop the acreage and that he fought unsuccessfully to lift with costly legal challenges.
Kanner said Ginsburg halted the Harbors project when it was about half completed and before the razed chair-factory property was developed. The village has removed it from the tax rolls, he said.
The village also could be liable for additional compensation payments to Kanner and to the former owner of another waterfront parcel taken for the Harbors project.
“The village has kind of gone out on a hook,” he said. “They”™re in a very precarious position.”
“Municipalities should not be in the business of land speculation,” Kanner said in written comments to the county board. “This is not what eminent domain was intended for.”
Condemning properties to make way for luxury condos “is not what our founding fathers had in mind when they talked about eminent domain,” Kanner said by phone. “It”™s just despicable what happened. It”™s frightening.”