Posted by Ilya Somin:
New Jersey Appellate Court Invalidates "Blight" Condemnation:
http://volokh.com/archives/archive_2008_08_03-2008_08_09.shtml#1218227281
A New Jersey appellate court [1]recently invalidated a "blight"
condemnation in Long Branch, N.J. on the grounds that there wasn't
enough evidence of genuine blight to meet the standards required by
the New Jersey Constitution. The case is called City of Long Branch v.
Anzalone; I have not been able to find a copy of the opinion online.
But for readers with access to Westlaw, the cite is 2008 WL 3090052.
New Jersey is one of many states that has blight condemnation laws so
broad that almost any property can be defined as "blighted" and then
condemned. Last year, in Gallenthin Realty Development, Inc. v.
Borough of Paulsboro, [2]the New Jersey Supreme Court invalidated a
provision in New Jersey's blight law that allowed condemnation of any
property that is "underutilized" or not fully productive. The Court
ruled that New Jersey's state constitution (which [3]gives local
government the power to take "blighted areas") does not allow
condemnations under a definition of "blight" this broad. Jonathan
Adler and I discussed Gallenthin in [4]this series of posts last year.
Gallenthin requires that property not be condemned as "blighted"
unless there is proof of "deterioration or stagnation that has a
decadent effect on surrounding property." As I explained in [5]this
post , this is still a fairly lax standard; almost every neighborhood
goes through periods when it is "stagnant" or "deteriorating." But at
least it no longer simply gives local governments a blank check to
condemn any property they want. Anzalone is perhaps the first major
case applying Gallenthin. It ruled that Gallenthin and the New Jersey
Constitution require that any area can only be declared "blighted" if
there is "substantial evidence" of blight. And blight justifying
eminent domain is only present if the poor condition of the area to be
taken causes genuine harm to surrounding neighbhorhoods. A mere
insufficiency of economic growth and developmentis not enough for a
blight designation:
[The court's] reading of Gallenthin . . . requires a municipality
to find that the physical condition of the properties at issue was
contributing to social problems not only within the redevelopment
area, but also in nearby areas. Even though redevelopment would be
expected to result in higher property tax payments and more
spending for local businesses, the difference between the actual
level of economic activity in the redevelopment area and the level
that might be achieved after its transformation does not by itself
amount to blight. Eminent domain based solely on such a difference
would instead amount to condemnation due to the area's perceived
insufficiency of wealth, and it would exemplify the [NJ Supreme]
Court's fear that most property would be continuously subject to
forced redevelopment if the threshold requirement were nothing more
than the possibility of a more profitable use of the land.
In Anzalone itself, the court found that the city had presented little
evidence beyond "a a bland recitation of applicable statutory criteria
and a declaration that those criteria are met," along with a poorly
evidenced "expert" report. That was not considered enough to justify
condemnation.
Like Gallenthin, Anzalone still gives broad leeway to local
governments. It emphasizes that blight designations are considered
"presumptively valid" and that proof of blight requires only that
there be substantial evidence of "deterioration" or stagnation that
might harm surrounding areas. A local government with skilled lawyers
and staff can probably come up with such evidence for a wide range of
neighborhoods. That might still happen even in this case, since the
appellate court remanded the case to the trial judge to give the city
an opportunity to provide additional evidence that the area really is
blighted under the Gallenthin standard.
However, the two cases do tighten New Jersey's blight criteria
relative to previous practice. In New Jersey, there are now at least
some areas that cannot be declared blighted and condemned. So bad was
preexisting law that this actually constitutes significant progress.
Unfortunately, as I explained in [6]this article, most states still
allow almost any property to be declared "blighted" and condemned.
This is true even in the majority of those states that have passed new
eminent domain reform laws since Kelo v. City of New London was
decided in 2005 (see Part II of [7]this article for details).
CONFLICT OF INTEREST WATCH: I have done a variety of pro bono work
over the years for the Institute for Justice, the public interest law
firm that represented the property
References
1.
http://www.nj.com/news/ledger/topstories/index.ssf/2008/08/court_ruling_gives_life_to_lon.html
2. http://volokh.com/posts/chain_1181761894.shtml
3. http://volokh.com/archives/archive_2007_06_10-2007_06_16.shtml#1181761894
4. http://volokh.com/posts/chain_1181761894.shtml
5. http://volokh.com/archives/archive_2007_06_10-2007_06_16.shtml#1181761894
6. http://www.law.gmu.edu/assets/homepages/isomin/files/LegalTimes_Blight.pdf
7. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=976298
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