Posted by: Patricia Salkin | November 28, 2009

Use of Eminent Domain Approved for Atlantic Yards Project – State High Court Finds Project Has Public Purpose as Area Meets Blight Definition

This week the proposed redevelopment of an area in Brooklyn, NY known as Atlantic Yards, cleared another hurdle in what is turning out to be protracted litigation.  Basing its holding on State constitutional authority that accords government “broad power to take and clear substandard and insanitary areas for redevelopment,” The New York Court of Appeals upheld the use of eminent domain by the New York State Empire State Development Corporation to acquire parcels that the project developer was unable to secure through voluntary negotiation with property owners.  It seems as though the Court may have been frustrated in reaching its conclusion, commenting that it is possible that the bar has been set too low on what will now pass as blight, but that this a matter for the Legislature and not for the courts.

The proposed project, which consists of a sports arena to house a major league basketball franchise as well as various infrastructure improvements in phase one, would include numerous high rise buildings along with approximately eight acres of open, publically accessible landscaped space planned for phase two.  The project sponsor asserts that the high rise buildings will serve both commercial and residential purposes, containing between 5,325 and 6,430 dwelling units, of which more than one third are to be affordable for either low and or moderate income families. The Empire State Development Corporation has sponsored the project, proposed by private developer Forest City Ratner, as a “land use improvement project” under the New York State Urban Development Corporation Act, finding that the area in which the project is to be situated is “substandard and insanitary.”  Although part of the footprint had been previously designated as blighted, areas that the developer had not been successful in acquiring were the subject of recent commissioned blight studies which found “sufficient indicia of actual or impending blight to warrant their condemnation for clearance and redevelopment” and that such blight removal would allow for the above-described mixed-use development that would serve a “public use, benefit or purpose.”  

Following an unsuccessful effort to halt the eminent domain in federal court (see, Goldstein v. Pataki, 488 F Supp 2d 254 (EDNY 2007), aff’d 516 F3d 50 (2008), cert. den. 128 S.Ct. 2964 (2008)), the remaining property owners challenged the use of eminent domain under two provisions in the New York State Constitution.  After finding that the appellants did timely file their appeal in State Court despite the fact that the State Court action was not filed until after federal court remedies were exhausted, the Court turned to the merits.  Examining first the question of whether the condemnation is constitutional under the State constitution’s requirement that, “[p]rivate property shall not be taken for public use without just compensation,” (the same language as found in the U.S. Constitution), the Court found that it clearly is constitutional since “the removal of urban blight is a proper, and, indeed, constitutionally sanctioned, predicate for the exercise of the power of eminent domain.” Further, the Court noted that Art. XVIII, sec. 1 of the Constitution grants to the Legislature the power to provide specificity with respect to defining blight and blight conditions, and that sec. 2 of that Article authorizes the Legislature to grant the power of eminent domain to any public corporation. Here, the Court said, the Empire State Development Corporation exercised the power for the constitutionally recognized public purpose or “use” of rehabilitating a blighted area.

With respect to the finding of blight, the Court noted that while the conditions that supported the blight finding may not “approach in severity the dire circumstances of urban slum dwelling…” which had prompted the adoption of Art. XVIII, the Court has “never required that a finding of blight by a legislatively designated public benefit corporation be based upon conditions” replicating blight during the Great Depression. The court also acknowledged that the precise definition of “blight” is not for the judicial branch to articulate, but rather something left to the Legislature. And here, the Legislature has left the actual specification to quasi-legislative administrative agencies whose decisions will be upheld where, as here, “those bodies have made their finding, not corruptly or irrationally or baselessly.” So, although the Court said it is possible to make a finding otherwise with respect to blight, it is not for the Court to overturn the decision under the circumstances.  

Lastly, the Court turned to Section 6 of Article XVIII of the Constitution and concluded, based on constitutional history, that the section was meant to apply where housing is created in connection with an urban renewal slum clearance project and where such is aided by state loans or subsidies, the new housing must replace the low rent housing lost during the clearance. The present situation, explained the Court, is different since the current project is not aimed at the wholesale eradication of slums, but rather at alleviating “minor conditions of urban blight” attributable not to housing but rather to an uninhabitable subgrade rail cut. Further, the Court noted that at the time of the environmental impact statement only 146 people still resided in the project footprint and not all of those people were low-income. The Court said, “While the creation of low income housing is a generally worthy objective, it is not constitutionally required under Article XVIII, sec. 6 as an element of a land use improvement project that does not entail substantial slum clearance.”

Goldstein v. New York State Urban Development Corp., 2009 WL 4030939 (NY 11/24/2009).

The opinion can be accessed at: http://www.nycourts.gov/ctapps/decisions/2009/nov09/178opn09.pdf

For earlier blog postings on this case click here and here

Read what journalist Norman Oder has to say about the decision here

This is not the final chapter on the Atlantic Yard litigation, only the eminent domain issue.  See, http://atlanticyardsreport.blogspot.com/2009/11/new-lawsuit-challenging-ay-approval-to.html

See also, http://dddb.net/MTAsuit/index.php; http://dddb.net/MGPPsuit/index.php; and http://dddb.net/FEIS/index.php


Responses

  1. Private property owners facing the threat of eminent domain quickly learn that they are not standing on a level playing field legally, economically or politically.

    Among other lessons, there is a lot of play in the “just” of “just compensation.” The power of eminent domain brings with it a sense of entitlement. At that point, property owners become merely an obstacle to be swept aside — when, in fact, they possess the key asset coveted by government and the corporation.

    But property owners can fight back. Our two-year battle against Houston-based Spectra Energy which seized our property rights for an underground gas storage field led to the development of a website which has begun to attract whistle blowers inside the energy industry. We are collaborating and helping property owners in many states. For info, visit the site: http://www.spectraenergywatch.com/blog/

    By the way, our new neighbor, Spectra Energy, has received two Notice of Violations for “unlawful conduct” over the past 2-3 months related to emergency shutdowns and emissions at its storage field in Bedford County, PA. Reports of contaminated water supplies are on the rise since they began operations.

    Like Kelo and Atlantic Yards, the ripple effects of eminent domain are never over.

  2. the court was schizo, it said article XVIII applies for condemnation and blight purposes, but doesn’t apply for low-income housing purposes. slum clearance=modern day blight for eminent domain, but slum clearance doesn’t exist any longer, they say, as far as Section 6 goes. schizo is the nice way of calling that argument untenable. which is the nice way of calling it BS.

  3. I wasn’t surprised by the courts decision. Based on the ‘broad’ eminent domain power in the state constitution and the US Supreme Court’s holding in Kelo, the taking seemed to be proper under current law.

    I also applaud the court for interpreting current law rather creating a new/ more restrictive eminent domain standard. That should be left to the state legislature, so this was a good showing of judicial restraint by the Court of Appeals.


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