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Public Use/Kelo Round Up

Several items today with a common theme of eminent domain and public use -

• PropertyProf Blog posts a link to Professor Richard Epstein's latest article, "Public Use in a Post-Kelo World."  I agree with Professor Barros' recommendation: "Given the author, obviously a must-read for anyone interested in public use issues."

• The Honolulu Advertiser's Sean Hao details the issues when takings for Honolulu's proposed +$4B rail transit project runs into a unique "old Hawaii" neighborhood in "Pearl City's Banana Patch at risk."  A neighborhood without city water, street lights, or sidewalks (but a community nonetheless) is slated for removal for a "park and ride."

• From the St. Louis Post-Dispatch comes "Owner of land in redevelopment path anxious, some suing to be paid" about how a group of owners have been waiting more than a year to be paid for their properties which were taken for redevelopment.

• Thanks to Castle Watch Daily for cheekily pointing out that the web site of the New London Development Corporation, the entity at the heart of the infamous Kelo case, is "Under Construction."  The web site might be, but the project sure isn't.

Honolulu Rail Takings

In "189 Hawaii properties in transit's path," the Honolulu Advertiser's Sean Hao writes about the potential use of eminent domain to take private property along the path of Honolulu's proposed $4B rail transit project:

Some landowners in the path of the new rail line, who may have little choice but to sell to the city, are not pleased with the potential eviction and complain that the process so far has left them in the dark.

The city, which has budgeted $70 million to purchase land needed to build the rail system, will offer property owners fair market value for their land based on an appraisal. That could prove controversial as some owners challenge the appraised value.

The article notes that the City's web site has listed these properties for more than a year, but the information is difficult to locate, so many of the owners were not aware their properties may be acquired.  The amount the City has budgeted -- $70 million -- may be an unrealistic estimate:

Fighting the city on property condemnation is not easy. Because mass transit serves a public purpose, there's little preventing the city from acquiring property needed to build it, said Robert Thomas, managing attorney for the Pacific Legal Foundation's Hawaii Center, which lobbies for property owner rights. The U.S. Constitution allows local government to take private property if there is a compelling public interest in doing so.

"Right now, it looks like the chances of a fight on whether they can take this land is pretty remote," Thomas said. "There's very little standing in the way."

Once the acquisition process starts, the city will determine the fair market value for properties and offer to pay owners that amount, the city said. If landowners refuse to sell, the city may condemn the property.

The key battles between property owners and the city will be over what constitutes fair value for the lands being acquired, Thomas said. That decision will hinge on when the property assessments are made.

"The critical piece in the puzzle is, when are we valuing this?" he said. "The owner could claim a higher valuation, if it's an earlier date, especially if it's a slightly declining market." However, "If our economy is going the way people think it's going, then property values are going down, which could benefit the city's acquisition prices," Thomas added.

Read the complete Advertiser article (plus reader comments) here.

In a similar vein, last year, UH Law professor David Callies, Honolulu attorney Vernon Woo, and I were guests on Jay Fidell's KHPR program on the topic of Honolulu rail, and the development and land use issues sure to surround the project.  Audio of the show is available here.

Hawaii Public Radio on Transit, Land Use, and Growth (mp3)

Hawaii Public Radio has posted a five-part series of reports on "Transit and Growth in Hawaii," the third of which is the most interesting since it focuses on Honolulu's proposed $4 billion+ rail system.  Each of the segments, however, is worth a listen:

• Part I - did 1970's projections match up to reality?
• Part II - gas prices and growth
• Part III - the cost of rail, and who will pay
• Part IV - the EIS
• Part V - which technology will be employed?

In a similar vein, last year, UH Law professor David Callies, Honolulu attorney Vernon Woo, and I were guests on Jay Fidell's KHPR program on the topic of Honolulu rail, and the development and land use issues sure to surround the project.  Audio of the show is available here.

eminentdomainsucks.com

Here's a property owner from Denver, Colorado not afraid to tell us what he really thinks about eminent domain: the URL for his blog is eminentdomainsucks.com. 

No surprise that someone who grabbed that domain name is a property owner on the business end of a condemnation action. 

▪ Court Strikes Delegation of Eminent Domain and Reimbursement to Private Party

You can read the court's Findings of Fact, Conclusions of Law, and Order here.

I won't be commenting on this decision since my colleagues Ken Kupchak, Mark Murakami and I are the attorneys for the property owner, but the statement of the family that owns the land is below.

# # # #

Circuit Judge Ronald Ibarra has decided in favor of a local Kona family, ruling that the County of Hawaii illegally sold its power of eminent domain to Scottsdale, Arizona-based luxury developer Hokulia.  In the County-Hokulia Development Agreement, the County allowed Hokulia to control what property would be seized, permitted Hokulia's lawyers to threaten the Richards Family and its neighbors, and forced the County to bring lawsuits against its own citizens to take their property. 

The court ruled that the County-Hokulia Development Agreement violated state law because it illegally transferred the County's power to take the property by eminent domain to Hokulia.  The Richards Family's property was targeted by the developer for its "Hokulia Bypass," a road connecting the "luxury golf course real estate development project" to Mamalahoa Highway. 

 

The court struck down the first of the County's multiple attempts to take a portion of the Richards Family's property for the Bypass because the County "did not have a proper public purpose."  The court found "[i]f the government attempts to delegate its power of eminent domain to a private party in an agreement whereby the developer controls what property is taken and pays for all expenses, and the private party is able to demand the government institute eminent domain proceedings against other private property owners, then the attempted delegation is illegal and void." 

 

The court also invalided the portion of the County-Hokulia agreement that would have required the Richards Family and their Onouli neighbors to reimburse Hokulia for the cost of the road. 

 

Under the judge's ruling, however, the County will be able to build the Bypass since a second attempt to take the property did not suffer the same legal defects as the first.  The court awarded the Richards Family over $200,000 in compensation for the taking of their land.

 

"These cases were never about whether another road is needed in Kona," said Richards Family spokesman Charles Coupe.  "Our family fought for our rights and the rights of our neighbors because we couldn't believe that the County could sell governmental powers to the highest bidder.  It didn't seem right that the County could agree to allow Hokulia to take our property for Hokulia's road, and then pass back the cost of the road to us." 

 

After Hokulia directed the County to start eminent domain process in October 2000, the Richards Family called upon Kenneth Kupchak, Robert Thomas, and Mark Murakami, the legal team at Honolulu-based Damon Key Leong Kupchak Hastert (www.hawaiilawyer.com), to protect their rights in court. 

 

"It has been a long fight, but it has been worth it," said Coupe, "Our family knew this wasn't right, and we would stand up for our rights and our neighbors' rights again, if necessary."

 

▪ Land Use Round-Up

• In case you hadn't heard: from West Hawaii Today, a story about a lawsuit over whether a seller of land adequately disclosed the existence of the Big Island's infamous noise-making coqui frogs.

• Maui's affordable housing exaction working...or not? From the Maui News, a report on a proposed development that might not make the grade. 

• Is the valuation claimed in property tax appeal relevant to valuation in eminent domain?  Gideon's Trumpet reports on an Arizona case, Salt River Project v. Miller Park, LLC, 164 P.3d 667 (Ariz. Ct. App. 2007), regarding the relevance of an owner's testimony on valuation in a property tax appeal to the question of valuation in eminent domain.  Professor Kanner details why valuation in a property tax appeal is not all that relevant to just compensation.  Hawaii law provides:

The valuation claimed by the taxpayer in any appeal regarding the assessment of real property tax shall be admissible in evidence as an admission of the fair market value of the real property as of the date of assessment irrespective of the fact that the assessed value from which the taxpayer appealed is adjusted to one hundred per cent fair market value

Haw. Rev. Stat. § 101-12.

• Honolulu's rail project: a story from the Honolulu Advertiser about the ripple effects of planning for the transit stations on the proposed $4B+ fixed rail system.  More on the proposed transit project here.

▪ Designing "Transit Villages" in Honolulu's Rail Project

"Sustainability," "smart growth" and "transit-oriented development" are the catchwords du jour these days in Honolulu, as we anticipate the $4B+ fixed guideway mass transit project.  But from the San Francisco Chronicle comes this "cautionary tale" of a Bay Area Rapid Transit (BART) transit village gone. . .not quite right:

The basic moves are great: Three and four-story buildings filled with apartments and retail space are on busy El Camino Real instead of somewhere on the region's outskirts. There's a BART station next door, and 70 of the 361 apartments are reserved for lower-income residents. There's even a Trader Joe's, a grocery chain of cultlike status.

But this showcase of so-called smart growth comes packaged in the most generic structures imaginable, an inept cross between Stanford University and Orange County. The best thing about Solaire is that, with luck, it will be a wake-up call to other cities  --  reminding them that the quality of what gets built is every bit as important as the planning theories involved.

▪ Honolulu's Rail Project: Podcast of Hawaii Public Radio Program (mp3)

ThinkTech Hawaii, Jay Fidell's Hawaii Public Radio program on FM89.3 KIPO, has posted both the show (20mb mp3) and the aftershow podcast (13mb mp3) of  yesterday's "Honolulu's Fixed Guideways - How Will The Surrounding Areas be Developed."  I was a guest along with UH Law Professor David Callies, and Honolulu attorney and developer Vernon Woo.

Jay led a wide-ranging discussion on legal, land use, and political issues related to Honolulu's $4B "fixed guideway" mass transit system.  We talked about public-private development partnerships, eminent domain, transit-oriented development and other related subjects.  Jay's final question: "if you were King, what would you do about the rail?"  Food for thought.

Honolulu City Councilperson Charles Djou and transit expert Cliff Slater also called in with their thoughts.

▪ Tune In, Turn On: KIPO FM89.3 Wed., May 23 @ 5pm HST

A heads up: from 5 - 6 pm on Wednesday, May 23, I will be a guest on Jay Fidell's ThinkTech Hawaii program on Hawaii Public Radio, KIPO. 

The topic? "Oahu's Light Rail - How Will the Surrounding Areas be Developed."   KIPO can be tuned in at FM89.3, or streaming audio is available here.  ThinkTech also posts a podcast of the show a couple of days afterwards, and I will post a link when it becomes available.

Joining me as guests will be Professor David Callies of the UH Law School, and Honolulu City Councilperson Charles Djou.  Hope you can listen in.

▪ 2006 Land Use in Review

As a way of saying "aloha" to 2006, I've summarized the land use law highlights (or lowlights, depending on your point of view) from the Hawaii Supreme Court, the Ninth Circuit, and the U.S. Supreme Court, roughly in chronological order.  Topics include shorelines, eminent domain, environmental impact statements, RLUIPA, vested rights, and land use litigation procedures.

• Depends What the Meaning of "Shall" Is:  Leslie v. Bd. of Appeals, County of Hawaii (HAWSCT) (nondiscretionary actions, shoreline area boundaries)
  
• Environmental Assessments, Early and Probably Often:  Sierra Club v. Office of Planning, State of Hawaii (HAWSCT) (environmental assessments, boundary amendments)
• Eminent Domain and Land Reform Revisited:  City & County of Honolulu v. Sherman (HAWSCT) (eminent domain, RLUIPA)
• What to do if the Government Changes its Mind:  Arrow of Time: Vested Rights, Zoning Estoppel, and Development Agreements in Hawaii, 27 U. Haw. L. Rev. 17 (Feb. 2006) (vested rights)
• Hawaii Water Law is Not a Federal Case:  Maui Tomorrow v. State of Hawaii (HAWSCT) (attorneys fees, water rights)
• No Leg to Stand On: Keahole Defense Coalition, Inc. v. Bd. of Land and Nat. Res.  (HAWSCT) (standing, what is a "property" interest)
• The Supreme Court Muddies the Clean Water Act: Rapanos v. United States (SCOTUS) (Clean Water Act jurisdiction)
• Return to Sender - Elvis and Notice: Jones v. Flowers (SCOTUS) (due process notice to property owners)
• What is a "Contested Case?" - Aha Hui Malama O Kaniakapupu v. Land Use Comm'n (HAWSCT) (administrative appeals, contested cases)
• Who Protects the Public Trust? - Kelly v. 1250 Oceanside Partners (HAWSCT) (water pollution, public trust)
• Contesting Contested Cases:  Hui Kako Aina Hoopulapula v. Bd. of Land and Nat. Res. (HAWSCT) (administrative appeals, contested cases)
• RLUIPA and Local Land Use: Guru Nanak Sikh Society of Yuba City v. County of Sutter (9th Cir.) (RLUIPA and local land use)
• Hawaii Eminent Domain Compendium (eminent domain)
• Shoreline Tales: Diamond v. Bd. of Land and Nat. Res. (HAWSCT) (CZMA shoreline certifications)
• Voters Nationwide (But Not Hawaii) Enact Eminent Domain Reform (property rights, eminent domain)
• New Appellate Track: In re Water Use Permit Applications [Waiahole] (HAWSCT) (appellate jurisdiction, water rights)
• Honolulu "Fixed Guideway" Mass Transit Approved (eminent domain)

If you think I missed any key cases or events, please email me.