Eminent Domain, Duffy-Style

I noted a press release from City Hall (30 Church St.) from May 23, 2008 titled "Mayor Duffy Statement on Court's Approval of Midtown Condemnation Proceeding". The title implies Midtown was condemned, but the body of the release states, "we are thankful for Judge Van Strydonck's decision to grant our motion to take ownership of Midtown by eminent domain." My confusion was directly clarified in the Wikipedia article on eminent domain, explaining that "the term 'condemnation' is used to describe the formal act of the exercise of the power of eminent domain" and that it is "not to be confused with the same term that describes a declaration that real property, generally a building, has become so dilapidated as to be legally unfit for human habitation due to its physical defects."

While I'm no fan of the myriad of ways the government can take away one's earned property, I do give preference to those methods which are a simple if-then algorithm. What I mean by that is things like property tax: I at least know that if I do not pay my property tax, the government will take that property away. As such, I can choose my course of action and understand the reaction.

Exercising the power of eminent domain — condemnation — can happen at any time and without any cause on the part of the property owner. Because of that, I would hope that the government uses it with great care. Let's say you've got a $50,000 house — at least that's what it would sell for on the open market. If the government wants to run a highway through it, I would hope that is done gingerly and fairly — so for instance, one might request $150,000 to find a suitable replacement home in short order and to cover personal losses and such, but it would typically be unreasonable to request $1,500,000 unless there's some unusual circumstances.

One has to remember, of course, that the will of the government will persevere. Realizing that, it should be as cordial a disruption as possible — the government providing the "scooped-up in the hands of God" kind of move, and the property owners agreeing to reasonable discomfort. In theory, the governmental need for the property is so great that paying more than the current market value is a bargain.

Admittedly I'm talking about someone's home. In the case of Midtown, it's commercial property. Regardless of who owned it — [and with great reluctance *sigh*] even if it's a property holding company — as long as they met the requirements for keeping the property, as far as I'm concerned, they have the right to continue to keep it.

So let me go back to eminent domain once more. My recollection is that it's for things like a highway or a railroad where one property owner blocks completion of a much larger project — for instance, a farmer refusing to sell a mile of access across a 1,000 acre farm, preventing the completion of a 500 mile highway, or at least dramatically increasing the cost and complexity. I gather that historical precedent has changed this view, and indeed a project can target only one property.

In the case of Midtown, the whole project has me thinking of the City government with cartoon dollar-signs in their eyes: it's the City gambling with their revenues as if they were a business. I would much rather have had them support PAETEC's efforts to purchase the property themselves — welcome PAETEC to the table and open up the zoning and permit processes, for instance. As I see it, PAETEC has no risk — the City now owns Midtown and PAETEC can set up their world headquarters wherever they please. This is the same perfect-storm situation as the Fast Ferry: the City removed risks to encourage economic development, and caused irreconcilable bad business decision to be made in the artificial safe-harbor.

But I would also like assurance that the property owners have been justly compensated — by definition of the property owners. I guess this will come to be known in the coming months, as the press release says, "the parties affected by the condemnation will have six months to file claims for additional compensation that they believe are not resolved by the condemnation and relocation payments". We shall see.

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