Gary Markenson: Proposed amendments are unclear about impact on cities.
Ozark: Eminent domain not used
In the city of Ozark, eminent domain - or condemnation, as City Administrator Steve Childers prefers to call it - is not an issue - or is it?
"In my opinion and City Hall's opinion, there is no eminent domain or condemnation situation, and there never has been," Childers said.
The designation of a 47-acre area for redevelopment, including Ozark's central business district, and the subsequent acquisition of properties in that area, created a public controversy over the role of local government in property acquisition and private development. Formerly known as the Finley River Neighborhood Development, that area is now the Ozark River District.
"There is question whether (eminent domain) should be used for acquiring property for commercial development," Childers said. "The good thing is, we never did and we never had to."
No one went to court over condemnation in Ozark, but it was threatened, said Ron Calzone, chairman of Missouri Citizens for Property Rights. And for Calzone, threat is enough.
"Developers and some city officials will claim that unless you've been to court and a judge has said 'No, you lose,' eminent domain hasn't been used," Calzone said. "But eminent domain is used when it's threatened."
Meanwhile, don't look for condemnation for private development to come up in Ozark again anytime soon. "The City of Ozark has no intention of ever needing to utilize condemnation to acquire any property for the purpose of commercial development only and not a public works project," Childers said.
The redevelopment controversy behind it, Ozark has signed an agreement with a new developer - Ozark Acquisitions LLC - and is moving forward on revitalizing its central business district.
On March 11, Ozark city officials announced that Liberty-based B&B Theatres will soon begin construction on an eight-screen theater to be located in the Ozark River District. Completion is scheduled for December.
The battle over private property rights versus eminent domain rages on as one Missouri group works to garner support for two amendments to Missouri's constitution.
On one side is Missouri Citizens for Property Rights and its chairman, Ron Calzone. On the other is the Missouri Municipal League, representing 656 cities, towns and villages comprising 95 percent of Missouri's urban population.
Two initiative petitions from Mo-CPR have been certified by the Missouri Secretary of State's office to place constitutional amendments regarding eminent domain on the state's November 2010 ballot, but Calzone said his group is holding off on gathering signatures because of lawsuits filed in January challenging the ballot titles.
Missouri Citizens for Property Rights does not oppose eminent domain - through which the government can take private property for public use - for legitimate public purposes, such as roads, bridges and schools, Calzone said. Mo-CPR, however, strongly opposes what it calls "abuse": using the people's power of eminent domain to obtain property for private development.
The Missouri Municipal League states that it "supports changes in the law to further ensure fair treatment and just compensation of property owners," but it opposes restrictions on nuisance abatement and the elimination of eminent domain for economic development purposes where necessary.
Proposed changes
The amendments proposed by Mo-CPR would allow only government entities to use eminent domain; prohibit use of eminent domain for private purposes, with specific exceptions for utilities; require that any taking of property be for public use and that the landowners receive just compensation; require that the intended public use be stated at the time of taking; and permit the original property owner to repurchase the property if it is not used for the stated public use within five years, or if the property is offered to a private entity within 20 years.
Before petitions can be circulated, state law requires that proponents first have the approval of the secretary of state and the attorney general. The secretary of state then prepares a summary statement of no more than 100 words per petition, and the state auditor prepares a fiscal impact statement, and both are subject to the approval of the attorney general, before becoming the official ballot language.
Gary Markenson, executive director of the Missouri Municipal League, said the fiscal note attached to the eminent domain amendments is vague.
"Whereas some of the major cities say it would cost them $10 million to $15 million, the fiscal note basically says the cost is unknown," he said.
MML argues in lawsuits filed in January that Mo-CPR's proposed amendments would impose additional costs on cities, make it harder to abate public nuisances and prevent cities from carrying out activities designed to subsidize and/or implement redevelopment projects.
"We challenge the ballot language and the fiscal note," said Markenson, noting that both proposed changes fail to communicate the actual impact of the amendments on MML members.
For example, the state constitution currently allows municipalities to handle nuisances such as weeds, abandoned vehicles and rotting porches.
"If the weeds and grass are 12 inches and the person doesn't cut them after he gets notice, the city goes in and cuts them and prepares a tax bill," Markenson said.
Under the proposed amendments, nuisance abatement would revert to common law. "You'd have to go to court to abate a nuisance, and you can't do anything until all the appeals are expired, which could be a year," he added.
The result would be higher costs to cities and, potentially, individuals.
"In Springfield, you have full-time city attorneys, but in all the cities around you, the attorneys are contract attorneys that get paid an hourly fee," Markenson said. "So it's going to drive up the cost, and what some cities are going to do is say, 'We're not going to do it; if the neighbor wants to go to court, the neighbor can hire an attorney.'"
The second proposed amendment would prohibit the use of eminent domain to redevelop blighted areas, but MML maintains that the change could hamper redevelopment efforts.
"Without the use or the threat of eminent domain, we will never redevelop blighted areas because there's always one property where you can't determine who owns it, or you've got a speculator who just wants to hold it," Markenson said.
Use or abuse
"Nobody likes to use eminent domain, but sometimes you have to do it to create jobs, tax base and to rebuild areas," Markenson said.
MML notes that were the proposed amendments in place, projects that would not have happened include University Plaza, Jordan Valley Park and College Station in Springfield, Busch Stadium and North Park in St. Louis and the New York Life Building and the South Loop Entertainment and Office District in Kansas City.
Calzone, however, in arguing that eminent domain is too often abused, points to the experience of Dr. Homer Tourkakis, a dentist in Arnold.
The Circuit Court determined that Arnold, which is not a chartered city, did not have the authority to take Tourkakis' property for a major retail development. On appeal to the Missouri Supreme Court, the high court overturned the decision, requiring Tourkakis to relinquish the site of his 23-year-old dental practice.
"They didn't need his property," Calzone said. "In fact, that's not arguable, because that whole shopping center is functional right now and he's still in his office until June or July. But his office is what you see when you go up and down the highway, and they wanted to put some kind of restaurant in there instead of his dental practice. That's abuse."
Also, Calzone said, the government's ability to take all properties in a blighted area - even if some of the properties themselves are not blighted - provides an incentive for government officials to neglect their responsibilities. By ignoring potholes, damaged sidewalks and code violations - all indicators of blight - government officials can essentially manufacture a justification to take property for redevelopment.
In order for the proposed amendments to come up for a vote, signatures must be obtained from registered voters equal to 8 percent of the total votes cast in the 2008 governor's election from six of the state's nine congressional districts.
To appear on the November 2010 ballot, those signatures must be submitted to the secretary of state's office by May 2, 2010.
Calzone noted, however, that his group won't actively begin gathering the signatures until the issues related to the ballot titles are resolved.
"The ballot titles have been certified ... and we can collect signatures, but it's a risky thing, because if the court changes anything ... in the ballot title, then any signatures we collected on the old ballot title would not be valid," Calzone said. "We're not real sure how long the court challenge will take."
