Monthly Archives: February 2014

Eminent Domain In Russia

Don’t miss the front page story in yesterday’s Los Angeles Times, Sergei L. Loiko, In the Wrong Place for the Games, Feb. 7, 2014, at p. A1, reporting the usual stories of hardship and bureaucratic callousness that usually accompanies large-scale exercise of eminent domain. Except that this one is, well, the Russian version where there is also much corruption. We recommend you read the whole thing to get the flavor of it all which was captured in the quote of the “head of Sochi’s non-governmental anti-corruption coalition,” as follows: “It was a very Soviet way of doing things: anything for a noble purpose.” . . . “Given the ample corruption around this theme, the project became a disaster for many families.”

The piece de resistance of this caper involved the taking of land for a new Sochi-Adler highway, which sounds reasonable — clearly a public use, except it turns out that the highway in question had already been built, “passing a good two miles from the [subject] house.”

Unsurprisingly, complaints of undercompensation have also surfaced. Some of the displaced folks are complaining that the money they received as compensation is inadequate to buy replacement housing. But then again, you don’t have to go to Russia to see that.

Scalia the Prophet?

We just came across the following quotation of Justice Antonin Scalia, from a speech he just gave in Hawai’i.  Click on

“U.S. Supreme Court Justice Antonin Scalia delivered a mixed forecast to University of Hawaii law students yesterday.”

“[In pertinent part, Scalia] said he has ‘no doubt’ the court will eventually overturn a 2005 ruling that let the City of New London take Susette Kelo’s property using eminent domain and transfer it to a private corporation because the promised economic development constituted a public use.

“As it turned out, the development never happened and the jobs never came, which Scalia called ‘poetic justice.’ ”

“ ‘Kelo will not survive,’ he said of the court’s 5-4 decision on the case in which he dissented. ‘I think the court was surprised by the reaction nationwide.’ ”

Nice going, Your Honor! Now, if you can only persuade some of your colleagues to embrace that sentiment and act on it, the state of the law, the health of the Constitution, and of the country will be enhanced.

On the other hand, we are mindful that in the wretched San Remo Hotel case, four Justices expressed the view that the equally wretched Williamson County case (that created a class of American legal pariahs who ostensibly for reasons of “ripeness”  are barred from ever having the constitutional violation of their property rights reviewed in federal court, or even under federal law in state court), should be overruled or at least reconsidered. But nothing of the sort happened, showing once again that talk is cheap.

On a related subject, about the time when the Hawai’i Housing Authority v. Midkiff case came down, Justice Blackmun who was then visiting Hawai’i, was so concerned about the public’s reaction to the court endorsing a mass condemnation of private titles to land from their owner in order to convey them to other, better politically connected private individuals, that he wrote a letter to Justice Sandra Day O’Connor (the author of the Midkiff opinion), asking her to hold its filing for a few days, so he could get back to the Mainland safely. She agreed. You can see both their letters in Justice Blackmun’s papers at the Library of Congress. Of course, as you may recall if you’re old enough, there was no great public reaction to Midkiff (caused in large part by press misrepresentations conveying, the false idea that the Midkiff case approved mass condemnation of land titles  for the benefit of nonexistent “sharecropper farmers,” whereas the beneficiaries of those mass takings were wealthy Kahala suburbanites and eventually, Japanese land speculators). Thus was the merit of the words of the Good Book demonstrated again, that the wicked flee when no man pursueth.

And oh, yes. Instead bringing about a lowering of Hawai’i’s cost of housing prophesied by the Midkiff legislation and Justice O’Connor’s opinion, housing prices in Hawai’i skyrocketed, doubling within a few years, and making Japanese home buyers and speculators wealthy in the process.* So much for using eminent domain to rectify a “malfunctioning” real estate market.


*     If you don’t believe us, go to Nexis and check out press reports of these events (from around 1986) using the phrase “Genshiro Kawamoto” as your search term. Good luck!

Kelo Revisited

Charlotte Allen, our favorite writer and commentator on current events has written a piece on the wretched Kelo case and its aftermath. Well worth reading. Here it is:


Tuesday, February 4, 2014

Eminent domain abuse revisited

‘Kelo’ Revisited

Properties were seized and a neighborhood razed in the name of ‘economic development’ that never came

Charlotte Allen

New London, Conn.

“See that pole with the transformer hanging from it?” Michael Cristofaro asked me. “That was where my family’s home was.”

I looked up at a line of high telephone poles marching diagonally against a blanched winter sky across a vast, empty field?-?90 acres?-?that was entirely uninhabited and looked as though it had always been that way. New London, population 27,000, a rundown onetime whaling port on the Atlantic coast that never recovered after the whaling industry died at the end of the 19th century, is a desolate-looking city. Cristofaro, a 52-year-old New London-born computer network engineer, and I were in its most desolate neighborhood?-?actually, ex-neighborhood, for there was not a residential property left standing on the entire tract. Just below us lay the mouth of Connecticut’s Thames River (unlike in London, “Thames” rhymes with “James,” and the “th” is pronounced as in “thumb”) where it joins the northerly end of the Long Island Sound. An icy New England January wind?-?cold enough to freeze the ink in my ballpoint pen into a gray, spidery scrawl as I scribbled notes?-?ripped across the only signs of life, actually former life, on the deserted incline: waist-high dead weeds, probably the remains of the goldenrod, yarrow, pokeweed, and high grass that grow everywhere during warm months on the North Atlantic coast.
Cristofaro and I were walking through a section of New London called Fort Trumbull, a fist-shaped peninsula jutting out into the Thames. It is the battleground of what must be the most universally loathed Supreme Court ruling of the new millennium, Kelov. City of New London (2005). The case is named after its lead plaintiff, Susette Kelo, a nurse who had owned a home a few blocks away from the Cristofaro house. The Supreme Court voted 5-4 to uphold a Connecticut Supreme Court ruling that the city of New London and a nonprofit quasi-public entity that the city had set up, then called the New London Development Corporation (NLDC), were entitled to seize, in a process known as eminent domain, the homes and businesses of Kelo, the Cristofaros, and five other nearby property owners in the name of “economic development” that would generate “new jobs and increased revenue,” in the words of since-retired Justice John Paul Stevens, author of the majority opinion.
That is, the city and the NLDC were entitled to condemn and then bulldoze people’s homes solely in order to have something else built on the land that would produce higher property taxes?-?such as the office buildings, luxury condos, five-star hotel, spacious conference center, a “river walk” to a brand-new marina, and high-end retail stores that were part of an elaborate “economic development” plan for Fort Trumbull that the NLDC had launched in 1997. The Constitution’s Fifth Amendment bars governments from taking private property unless the taking is for a “public use.” Historically “public use,” as courts had interpreted it, meant a road, a bridge, a public school, or some other government structure. But in the Kelo decision, the High Court majority declared that “economic development” that would involve using eminent domain to transfer the property of one private owner to a different but more economically ambitious private owner?-?such as a hotel?-?qualified as a public use just as much as, say, a new city library.
The nationwide outrage that followed in the wake of the Kelo decision spanned from left to right and back again on the political spectrum. It didn’t help that one of the chief beneficiaries of the NLDC’s economic development plan would have been the pharmaceutical giant Pfizer, Inc., which New London had lured into the city via an 80-percent, 10-year property-tax abatement for a $300 million research facility?-?an expansion of the company’s research operations in Groton, Connecticut, across the Thames. The properties seized from Kelo, the Cristofaros, and others would be adjacent to Pfizer’s facility. It also didn’t help that Susette Kelo, a feisty working-class woman who had raised five sons and put herself through nursing school by working as an emergency medical technician, was an appealing lead plaintiff, and that her 900-square-foot Victorian house, lovingly refurbished by Kelo and painted a vintage shade of salmon pink with white trim, was a showplace of devoted homeownership.
Nor did it help that the Fort Trumbull tract where the razed homes once stood never did get built on, despite a $78 million incentive package from the state of Connecticut. In 2008, after the nationwide real-estate bubble burst, the construction company, Boston-based Corcoran Jennison, that the NLDC had engaged to develop the site announced that it couldn’t obtain enough financing for the ambitious enterprise and pulled out. In 2009 Pfizer itself left New London, abandoning its new digs only eight years after the building had been completed. In 2010 Pfizer sold the New London facility for a reported $55 million?-?a small fraction of what it had spent to build it?-?to General Dynamics’s Groton-based Electric Boat division, a submarine manufacturer. Few of the 1,400 or so Pfizer employees who worked there had chosen to live in New London, so its contribution to the city’s economic base had always been questionable.
After Kelo, more than 40 state legislatures passed laws that banned or restricted the use of eminent domain for the purpose of economic rejuvenation, especially when it meant displacing homeowners. At least seven states amended their constitutions to ban the use of eminent domain for economic development, and some state courts explicitly rejected the Kelo ruling as precedent for interpreting those states’ own taking laws.
The Kelo decision inspired ideological mass confusion, as when then-Democratic National Committee chairman Howard Dean declared in 2005 that the Kelo ruling had been all the fault of President George W. Bush. “The president and his right-wing Supreme Court think it is ‘okay’ to have the government take your house if they feel like putting a hotel where your house is,” Dean announced at a college rally.
In fact, the Supreme Court’s conservative bloc?-?the late Chief Justice William Rehnquist, the now-retired Justice Sandra Day O’Connor, and Justices Antonin Scalia and Clarence Thomas (none of whom was a Bush appointee)?-?had dissented from Stevens’s majority opinion. It was the High Court’s liberal faction?-?Stephen Breyer, Ruth Bader Ginsburg, and the since-retired David Souter?-?along with swing-voter Anthony Kennedy?-?who had formed the narrow majority. O’Connor’s dissenting opinion was particularly scathing. “Today the Court abandons [the Fifth Amendment’s] long-held, basic limitation on government power,” she wrote. “Under the banner of economic development, all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded, i.e., given to an owner who will use it in a way that the legislature deems more beneficial to the public?-?in the process.”
Susette Kelo and the other plaintiffs had been represented by the Institute for Justice, a libertarian public-interest law firm headquartered in Arlington, Virginia. The city of New London and the NLDC were represented by Wesley W. Horton, a prominent civil-rights lawyer in Hartford, Connecticut, who had some years earlier won a landmark ruling from the Connecticut Supreme Court that de facto racial segregation in Hartford-area schools violated the state constitution.
The Kelo decision did not come out of the blue, constitutionally speaking. In a 1954 decision, Berman v. Parker, the High Court had ruled unanimously, in an opinion written by William O. Douglas, perhaps the most liberal justice ever to sit on the Supreme Court, to uphold the power of a redevelopment agency created by Congress to seize and demolish almost the entire Southwest quadrant of Washington, D.C., on the ground that it was a “blighted area” and “blighted areas .??.??. tend to produce slums.” Blight removal was a “public use,” according to Douglas?-?and from there it was only a short step to economic development as a public use. The Berman and Kelo rulings affirmed a particular kind of liberal vision: that large-scale and intricate government plans trump individuals’ property rights. The Berman case involved a thriving department store in Southwest that could not in any way have been said to be a slum property and whose owners wanted it to stay where it was?-?just as Susette Kelo and the Cristofaros wanted to stay where they were. The only thing to be said for the Berman decision is that Southwest did eventually get rebuilt?-?although in a blockish, Brutalist fashion that made many architectural critics nostalgic for the old days of “blight.”
Still, my visit to New London on two subfreezing days in January revealed that the story of the Kelo case was something more than the story of a particularly nasty and overbearing abuse of either eminent domain or government power in general. It was also a tragedy, with all the classical Greek elements: hubris, turn of fortune, cathartic downfall, and possibly the “learning through suffering” that Aristotle in his Poetics argued was the point of tragic drama. Possibly but perhaps not likely: During the five years since Pfizer left New London, the city has placed its hopes in two more grandiose plans for Fort Trumbull and its environs that never materialized, and it may be poised to embark on still another. The story of the Kelo case is in part the story of a city so desperate, so economically beleaguered, that it was willing to try anything to bring a few more residents, a few more revenue dollars into its boundaries.
“You have to understand that the case was seen in a very different way on the local level from the way it was seen on a nationwide level,” Daryl J. Finizio, 36, Democratic mayor of New London since 2011, told me in an interview in his office in New London’s City Hall. The Beaux-Arts City Hall, completed in 1912, was, like most of the other buildings along State Street, New London’s main commercial strip leading downhill to the Thames, opulent in conception and almost irredeemably decrepit after more than a century of straitened finances and daily wear. The four elegant Corinthian columns that rose to span most of its meticulously carved three-story granite façade contrasted with cracked tile floors, chipped wall-paint, and stained marble moldings inside.
“On the local level the case was about taxation and corporate development,” Finizio, a lawyer who taught at Boston’s Northeastern University, said. “Then, when it got to court, it became a matter of constitutional law, of limits on government power. There, it was not a debate about what was debated about here: economic development, lower taxes, and corporate growth. There were a lot of people on the south side of the city who were tired of paying high property taxes, and they felt that something had to be done. My response to that has always been: If your taxes are too high, you need a smaller house. You don’t have a right to bulldoze someone else’s house.”
All of Connecticut’s larger cities?-?not just New London but New Haven, Bridgeport, and Hartford as well?-?have serious economic problems, but New London may well be the worst off of them all. Its very geography seems to have conspired against it. It is only 11 square miles in area, and almost half of that is water. Settled in 1646, it lost all its potential for suburban expansion in 1801, when the farmers on its outskirts voted to form their own 33-square-mile town, Waterford, which now, with a population of 19,000, surrounds New London on all landward sides. Thanks to its natural deepwater harbor, New London boomed during the 19th century, when it was America’s second-largest whaling port after New Bedford, Massachusetts. Whale-oil wealth shaped the city. Its Latin motto, blazoned in a vivid mosaic on the vestibule floor of City Hall, was Mare Liberum (“the free sea”), accompanied by an image of a proud Yankee clipper in full sail. The whaling captains and the merchants and manufacturers who prospered alongside them crammed New London with oversize, often magnificent Victorian houses. The cone-shaped Gothic Revival spires and finials of some 33 stone churches built during that sea-going century still pierce the sky. The imposing Episcopal church downtown, St. James, constructed in 1853 out of sienna-colored rusticated freestone, boasts glorious Tiffany-glass windows.
The last whaling ship sailed out of New London in 1909. After that, the city had a brief flourishing as a manufacturing center, but most of the mills closed down during the Depression. Following World War II serious decline set in. The postwar construction of the I-95 expressway along the East Coast split New London in two. In another postwar demographic trend, homeowners began moving out to the suburbs, which often meant Waterford. Retail shopping followed them, to newly constructed malls alongside I-95, mostly outside the city limits, eroding the downtown tax base and killing off downtown stores. Swaths of stately Victorian houses turned into peeling-paint rentals.
The city’s low-income minority population surged; the city is now 28 percent Hispanic and 17 percent black. The median household income in New London is $44,000, 38 percent lower than the state average of $70,000. The unemployment rate is a sky-high 12 percent, and the percentage of poverty-level households is more than double the state average. The public schools are regarded as some of the worst in Connecticut. As if that weren’t enough, New London’s prime location astride I-95 has made it a regional base for narcotics traffickers ferrying their wares to New York City some 120 miles south and to Rhode Island and Massachusetts up north. Police raids on heroin and cocaine rings run by Dominican immigrants are a staple of New London news. NeighborhoodScout, a housing-search firm, has listed New London as the 35th most dangerous city in America because of its high crime rate.
By 1990 the state of Connecticut had declared New London a “distressed municipality,” and the intervening 24 years have done little to change that image. State Street downtown is a long row of handsome and mostly empty storefronts. The once-luxurious Mohican Hotel, designed in 1898 by William H. Tuthill, the architect of New York’s Carnegie Hall, closed in 1971 and is now apartments for senior citizens. The main thriving businesses in downtown New London seem to be taverns, tattoo parlors, and, because a Connecticut Superior Court district is headquartered in New London, law offices. The city has no lack of prestigious institutions: historic churches, three colleges including the U.S. Coast Guard Academy, and the Lawrence+Memorial Hospital, affiliated with Yale. All are nonprofits, however, meaning that they pay no property taxes. Indeed, more than 50 percent of the land in New London isn’t on the tax rolls. That has tended to concentrate the city’s tax base into its single upscale residential neighborhood, the blocks of spacious and spiffily landscaped 19th-century houses clustered around Ocean Park Beach at New London’s far southern tip. As might be expected, many of those residents have long resented having to pay for the operations, including massive social services, of a city they believe has been poorly managed and runs perpetual budget deficits.
Since the 1970s New London has struggled, usually futilely, to bring in new business ventures?-?or failing that, federal and state subventions?-?to shore up its precarious balance sheet. Perhaps if they had everything in place like their business plan, employees hired, their registered office address say from somewhere like, they could have been raring to go and business would be evolving tremendously. Because there has always been a paucity of vacant land in this tiny, thoroughly built-up city, the new ventures have often involved using eminent domain to seize and -demolish existing Victorian-house neighborhoods. Several blocks’ worth of Victorians just east of downtown New London met the bulldozer during the early ’70s to make way for a large-scale federally subsidized housing project. The visually unattractive apartments quickly became a crime-infested no-man’s land whose violence spilled over into downtown streets. Another group of felled Victorians made way for a failed industrial park. Michael Cristofaro’s parents, Pasquale and Margherita Cristofaro, who had emigrated to New London from Italy just before their son’s birth in 1962, saw their first house and all its neighbors leveled via eminent domain in 1971 because the city of New London had plans to build a seawall on their properties. The land sat vacant for five years and now houses a nondescript office building. So desperate for revenue was New London in 2010 that the city council voted to sell half of the city’s attractively designed but indifferently maintained 18-acre Riverside Park on the banks of the Thames to the Coast Guard Academy next door in order to raise a badly needed $2.9 million. Only a citywide referendum in November 2011 managed to save the park by a hair’s-breadth 19 votes.
It was in this context?-?this mix of fiscal and economic destitution, hopes of somehow turning New London around at last, and a tradition of trigger-happiness when it came to eminent domain?-?that the city latched upon Fort Trumbull during the late 1990s as the site that could produce its salvation. When I called Wesley Horton, the Hartford lawyer who represented both the city and the NLDC before the Supreme Court, he directed me to a concurring opinion in the Kelo case by Justice Kennedy, which described “a comprehensive development plan meant to address a serious city-wide depression.” Horton said, “This was a poor city. It was desperately poor. The plan wasn’t developer-driven. The city didn’t even have a developer until it came up with the plan. New London was trapped in a problem that’s peculiar to New England. There aren’t any suburbs in New England.”
Fort Trumbull is physically separated from the rest of New London not just by geography but by a railroad line, part of the Amtrak and freight routes from New York to Boston, that marks its western boundary. The “Fort” of Fort Trumbull, on the southern end of the peninsula, had been a Revolutionary War site, sacked by British troops led by Benedict Arnold in a bloody battle in 1781 that burnt down most of the city. A headquarters for Union troops during the Civil War, the fort was ideally positioned with a stereoscopic view of the Thames mouth and the city of Groton right across the river. Much later, after World War II, Fort Trumbull served as the site of the Naval Undersea Warfare Center until that base was closed in 1996.
Even during its heyday?-?probably the 1920s, when more than 150 families lived there, and it was a close-knit Italian neighborhood?-?the Fort Trumbull area was never much to look at. “Working-class” was the delicate way that Cristofaro phrased it to me. The fort itself had been a tumbledown ruin for decades, and much of the rest of the peninsula was marred by defunct manufacturing operations that had despoiled their grounds with rubble and pollutants. The 24 waterfront acres where Pfizer built its research facility in 2001 had been a demolished linoleum plant. Nearby was the Calamari Brothers Co., an equally unaesthetic scrap-metal junkyard. The city of New London had placed its sewage-treatment plant on the peninsula, a cesspool-level facility that smelled like .??.??. raw sewage.
Still, even though the Fort Trumbull neighborhood had dwindled to about 75 families by the late 1990s, they were poor but proud, and their properties could scarcely be called “blighted.” Many of the houses had been in the families that owned them for generations, and their elderly owners kept tidy lawns and gardens. Pasquale Cristofaro had lovingly landscaped his yard with rhododendrons and other ornamental shrubs and plantings. The elder Cristofaros eventually moved while retaining title to the house, but “my oldest brother raised his three kids in that house,” said Michael Cristofaro. “And then my second-oldest brother lived there with his two kids. It was a kind of starter house for my family.” Susette Kelo bought and fixed up her pink house directly across the street from the fort in 1997 because she was enthralled by its majestic view of the Thames. There were solid neighborhood businesses: a bakery, a market, a deli, a grinder shop and restaurant (owned by another of the Kelo plaintiffs, Billy Von Winkle), a body shop. There was also a church.
The plan to convert this unprepossessing patchwork into an upmarket venue for tourists and condo-dwellers was a three-way operation involving the city of New London, the NLDC, created by the city in 1978 but mostly dormant until the late 1990s, and the state of Connecticut. The governor at the time, John Rowland, was a Chris Christie type: a Republican with the common touch who had succeeded politically in an overwhelmingly Democratic state. (Rowland’s political career came abruptly to an end when he went to federal prison in 2005 for having state contractors do free work on his home.) Rowland was an enthusiast for redevelopment, and it was he who pushed through the state’s $78 million worth of support for the Fort Trumbull project. Veteran investigative reporter Jeff Benedict, in a thoroughly researched 2009 book about the Kelo case,… “>Little Pink House: A True Story of Defiance and Courage, argues that there was a fourth shadow player: Pfizer, which implicitly exacted the total transformation of Fort Trumbull as a condition for moving into New London. The idea was that Pfizer executives and the scientists who would be visiting the research facility would be the primary beneficiaries of the hotel, the conference center, the condos, and the generally upgraded neighborhood.
In a footnote to his majority opinion in Kelo, Justice Stevens rejected this contention, reiterating that the “development plan was not intended to serve the interests of Pfizer, Inc., or any other private entity, but rather to revitalize the local economy by creating temporary and permanent jobs, encouraging spin-off economic activities and maximizing public access to the waterfront.” Still, it couldn’t help but be noticed that a Pfizer executive, George Milne Jr., head of the company’s research operations, was a board member of the NLDC. Or that David Burnett, husband of the NLDC’s chairman, Claire Gaudiani, then the president of Connecticut College, one of New London’s three institutions of higher learning, worked under Milne at Pfizer. In a 2001 interview with the Hartford Courant that he undoubtedly later regretted, Burnett said, “Pfizer wants a nice place to operate. We don’t want to be surrounded by tenements.”
Using the state funding supplied at Rowland’s behest, the city of New London modernized its sewage-treatment plant to remove the stench and did a thorough cleanup of the linoleum-plant site. The fort got restored and its site turned into an attractive state park. The Calamari junkyard sold out in 1998 and moved to Essex, Connecticut. “It’s a gorgeous piece of property,” Tony Sheridan, president of the Chamber of Commerce of Eastern Connecticut, pointed out during an interview in his office in Waterford. Sheridan believes that New London made the right decision in accommodating Pfizer “despite all the mistakes that were made in the past?-?the public wasn’t given sufficient time to raise a lot of issues. New London is the biggest winner of all. That property was highly polluted, with the scrapyard and the old linoleum plant. Between Pfizer and the state government, they made it clean and usable.”
New London’s City Council had voted to grant to the NLDC the power of eminent domain, and the NLDC began to wield it as a reserve club for Fort Trumbull property owners who did not wish to sell at the prices it was offering for their homes and businesses. (The Fifth Amendment requires that owners be paid “just compensation” for government-seized property, but that can be at the low end of the market.)
The NLDC might have won its case in the courts of law, but it did everything to lose it in the court of public opinion, its critics alleged: having real estate agents harass elderly Fort Trumbull owners on the telephone; showing up on their front porches waving contracts as they were sitting down to their Italian Sunday lunches; in the case of Billy Von Winkle, locking the tenants out of a Fort Trumbull apartment house he owned; trying to extract “rent” from those who resisted on the theory that the NLDC already had title to their properties; and immediately bulldozing the homes of everyone who sold, so as to isolate the seven holdouts psychologically and physically. All these tactics were reported gleefully in the Courant and the Day, New London’s daily newspaper. Cars reportedly started sporting bumper stickers reading “The City of New London took my house, and all I got was this lousy bumper sticker.”
Most galling of all, in Cristofaro’s opinion, the city and the NLDC, while insisting that nearly all of the 90 acres be clear-cut, agreed to spare one property from the wrecking ball: a worn 1922 magenta structure perched on one edge of the tract that hosts the Italian Dramatic Club, a private social club for eastern Connecticut’s political elite. “How about that?” Cristofaro said bitterly as we drove past it. “I call it the ugly pink Quonset hut.”
“The Italian Dramatic Club got to stay, but all the Italians had to go,” Scott Bullock, the lead lawyer from the Institute for Justice in the Kelo case, said in a telephone interview. “These people weren’t NIMBY people. They said: We need redevelopment, but we just want to be part of it. It would have been easy just to incorporate what was already there. They could have built around them. Those properties were on tiny lots?-?one and a half acres in total in two small sections of 90 acres. That’s the trend these days: infill. In the old days you tore down everything, but then planners recognized: Let’s not destroy history. Let’s blend the old with the new. Why did New London stick to the old model? The answer is: They wanted something big and grand.”
After the Supreme Court ruling and the cyclone of negative publicity that whirled about all things New London in its aftermath, a rift grew between the city council and the NLDC and also between the city and Connecticut’s new Republican governor, Jodi Rell, who had succeeded Rowland and didn’t approve of the way eminent domain had been used in Fort Trumbull. At Rell’s prodding and with $4.1 million in state funds, the city paid settlements to the Kelo plaintiffs to get them off their properties without having to undergo another round of nationwide embarrassment by having marshals drag them from their homes. Susette Kelo and the Cristofaros, who held out the longest, got nearly half a million dollars apiece. Kelo was allowed to have her pink house disassembled and then reassembled on a lot in downtown New London as a monument to her struggle. She moved to Groton. The Cristofaro house was bulldozed in 2007, but New London, at Michael Cristofaro’s insistence, placed a plaque on a bluff overlooking the Thames in memory of his mother, Margherita, who had died in 2003, while the lawsuit was pending (Pasquale Cristofaro died in 2009). Michael Cristofaro, who had lived in New London all his life, moved to Waterford.
In the end, though, it is hard to say exactly what the universal denunciation of the Kelo ruling accomplished over the long run. Eminent domain in the name of economic development ought to be dead letter, but it is in fact alive and well. In 2006, a year after Kelo, New York City mayor Michael Bloomberg unveiled the Atlantic Yards Project, a massive mixed commercial/residential/recreational use project, including 16 high-rise buildings, for 22 acres in Brooklyn’s Prospect Heights, an already gentrifying neighborhood that needs no public boost?-?all to be financed in part with some $2 billion in taxpayer aid. The city used eminent domain to demolish well-maintained condominiums over the protests of their residents. Thanks to the real estate collapse, ground was not broken until 2012, and large portions of the project may never be built. In California two measures?-?a ballot initiative and a pending bill in the state senate?-?would, among other things, broaden the definition of “blight” for eminent domain purposes and revive in altered form the state’s local redevelopment agencies, which used to receive up to 12 percent of state tax revenues until California governor Jerry Brown abolished them in 2011. The redevelopment agencies were notorious for their failure to generate actual economic improvement.
As for New London itself, it seems to be back to something big and grand. The NLDC changed its name at Mayor Finizio’s instigation to the more upbeat Renaissance City Development Association (RCDA), and some members from the Kelo era resigned. In July 2010 the Yale Design Workshop, at the city’s request, unveiled an elaborate schema for Fort Trumbull that included restaurants, offices, art galleries, artists’ studios, a resort hotel, a visitors’ center, a heritage trail, a seafood market, an “entertainment zone,” an indoor athletic facility, and an unnamed “cultural institution,” plus bicycle lanes, water taxis, and a pedestrian bridge to downtown New London. The money for all this was to come from “Private, Local, State, and Federal funds,” according to the Yale team. In July 2012 a development firm, River Bank, selected for Fort Trumbull in 2009, unveiled its proposed “Village on the Thames,” a $24 million, 103-unit townhouse development. As with Pfizer, the city council granted River Bank a substantial tax abatement. In May 2013 Mayor Finizio’s office announced that a scheduled groundbreaking for the Village on the Thames would be postponed, because River Bank had failed to obtain adequate financing. A few days later the RCDA declared that River Bank was in default on its development contract. No more has been heard about the Village on the Thames.
Meanwhile New London’s financial problems have continued unabated. Finizio swept into office in 2011 in a nearly 2-1 victory over his Republican opponent, on the promise of bringing a fresh start to the beleaguered city (he apologized to all the Keloplaintiffs, calling the decision a “black stain”). But in 2012 voters soundly defeated his first major measure: a 20 percent property tax increase. Recently the Day reported that New London faces a $1.4 million deficit in its current $40.8 million general budget, coupled with further dilapidation in City Hall: a broken steam pipe on the first floor, a five-foot hole in the ceiling of a second-floor office where a sewer pipe ruptured, and lack of hot water in some of the bathrooms, moisture in the basement, and mold growing over some interior walls.
Finizio’s plans for saving New London seem to be lifted from the pages of Richard Florida’s 2002 “New Urbanism” classic, The Rise of the Creative Class. One of Florida’s theories is that decaying urban cores can turn themselves around by rebranding themselves as magnets for “the creative core”: the hip, the artistic, the poetic, the tech-savvy, and the gay, on the theory that those types generate prosperity by making urban centers fun to live in. A few months ago Finizio endorsed New London’s first-ever gay pride festival, scheduled for sometime later this year, telling the –Courant that it would be an “economic boon” to the city. Finizio doesn’t fit into a stereotype of a gay rights supporters but I guess that is a lesson to us all in its own right. I also noticed that downtown New London’s Bank Street, running along the Thames waterfront, seemed to be defining itself as a Florida-inspired arts district, with puffy installations filling the windows of the aging storefronts.
For Fort Trumbull, Finizio also has creative-class visions: “tiny houses”?-?those grass-hut-size dwellings on micro-lots that are currently the rage among green types and simplicity buffs. “There are a lot of people concerned with environmental self-sufficiency,” he told me when I interviewed him. “You’re looking at a neighborhood that’s been destroyed in order to satisfy someone’s expensive vision?-?condos, hotels. What hasn’t been tried is a real neighborhood. This would be an opportunity to redo Fort Trumbull as a national first?-?a green, integrated mid-rise community. There would be green tech, LEED-certified buildings, solar power. It would be a green, self-sustaining neighborhood.” Finizio also expressed the hope that the city of New London could ultimately take over title to Fort Trumbull from the RCDA, with its quasi-private status. “There should be direct public ownership of that property,” he said.
More big and grand, I thought. Another New London adventure in eminent domain. Mare liberum. The sea is free. But not Fort Trumbull.
Follow up: This article also appears in the current issue of the Weekly Standard.
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Lowball Watch — Colorado

Word reaches us informally that the case in Boulder County, Colorado, involving the taking of the old Dillard’s department store in Longmont for redevelopment has been resolved. We lack any details — which we will supply when we get them. But the essentials are that the redevelopment agency offered some $3 million, but after a trial on the right to take (which went in favor of the redevelopment agency) the case settled for over $6 million.

Earlier, a local court ruled in favor of the redevelopment agency on the right to take, with the valuation trial to take place later. But it looks like there won’t be any valuation trial because the parties have agreed on compensation at a figure about twice what the redevelopment agency had originally offered.

The case is Boulder County District Court, Longmont Urban Renewal Agency v. DSS Uniter, LLC, Case No. 13 CV30828.

Stay tuned for the rest of the story.

The Queen of Hearts Comes to Santa Monica — Feds Argue the City’s Airport Action Is Too Early (Unripe) and Too Late (Barred by Limitations)

The Santa Monica Airport has been a fruitful source of litigation for years and years. To give you an idea, your faithful servant argued one of those airport cases before the California Supreme Court way back in 1972, in Nestle v. Santa Monica, 6 Cal.3d 568 — that’s right, 40 years ago. It was an inverse taking case, involving aircraft overflight over residential areas surrounding the airport. In spite of the fact that the city was caught cheating on discovery, it won the taking claim. But we won the nuisance claim, so the case was remanded and later settled after the California Supreme Court reversed a judgment adverse to our clients on a nuisance theory. Its holding established the rule that cities had no immunity in nuisance actions. Since then there must have been at least a half dozen cases involving that airport. Now, along comes another one, which we noted at .

In a nutshell, the city wants to terminate airport operations, but the Feds don’t like that idea. The legal issue is who owns what. It’s one of those controversies that gladdens the heart of title examiners but often tends to put everyone to sleep. Still, these controversies can be a big deal because they determine land ownership. Here, Santa Monica claims unencumbered ownership of the airport, and argues that the feds’ interest terminated when war (that’s WW II) ended. The Feds disagree. You can find a concise summary of that controversy on the January 28th post in the Nossaman blog ( so we don’t need to repeat it here. Suffice it to say that the city is suing the feds in federal courts, and the feds have moved to dismiss the action — the Nossaman blog has a link to the federal moving papers if you want to see them.

As noted, we aren’t going there in this blog. But we must share with our readers the fact that in their motion to dismiss the Feds argue (a) that the city’s action is too late (barred by limitations) and also that it’s too early (not yet ripe). Which brings to mind the deathless observation of the Queen of Hearts in “Alice in Wonderland,” where she explained to Alice, “You could have had jam on your toast yesterday, and you can have it tomorrow. But never today.”

Which provides us with yet another reason why eminent domain law is an intellectual and moral snake pit.