Ohio Trial To Examine Eminent Domain Abuse

Washington, D.C.— A trial to begin next week in Cincinnati, Ohio, will determine whether the government can take homes and businesses only to hand the property to a wealthy, politically connected developer for his private use. The Institute for Justice, which is defending the property owners for free, calls this one of the worst abuses of eminent domain it has ever encountered. IJ litigates nationwide against eminent domain abuse—when government takes land for private not public use.

Real estate developer Jeffrey R. Anderson—who has $500 million in real estate holdings and a private jet—asked the Cincinnati suburb of Norwood to condemn (for now) five homes and small businesses so he can expand his complex of private offices, condominiums and chain stores. He asked and paid for the “study” Norwood City Council used to declare “blighted” the 99 perfectly fine buildings bounded by Edwards and Edmondson Roads—a charade that enables the City to condemn any and all land in the neighborhood for Anderson and his partner in the project, Miller-Valentine Group.

The trial begins Monday, April 12, 2004, at 10 a.m. before Judge Beth A. Myers of the Hamilton County Court of Common Pleas, Hamilton County Courthouse, Room 375, 1000 Main St., Cincinnati, Ohio.

“The U.S. Constitution was written to protect private property, not to create government by the highest bidder,” said IJ Senior Attorney Scott Bullock. “If Anderson and the City of Norwood get away with this unconstitutional land grab, no one’s home or business is safe.”

Carl and Joy Gamble are among those fighting to save their properties from eminent domain abuse. They have lived for more than 34 years in their well-kept home with a huge backyard on Atlantic Avenue. “We are not interested in selling our home,” said Joy Gamble. “We just want to be left alone to enjoy our retirement in our home. The City shouldn’t try to take our home just so a developer can make money off of our land.” The Gambles raised two kids in Norwood. When they sold their family-owned grocery store in November 2001 and retired, they looked forward to quiet days of gardening and visiting with their now-grown children.

Unfortunately, the unholy marriage of convenience between politically powerful developers like Anderson and tax-hungry city governments like Norwood is not uncommon, as the Institute for Justice documented in its 2003 report, Public Power, Private Gain. The Institute found that over a five-year period, governments across America took or threatened to take more than 10,000 homes, businesses, churches and other private land for private economic development. That includes at least 400 properties in Ohio, one of the worst states for eminent domain abuse.

Developer Jeffery Anderson is a prime example of the trend. The Cleveland suburb of Lakewood declared “blighted” a neighborhood very similar to the targeted area in Norwood in order to transfer the land to Anderson and another developer. Lakewood residents revolted against Anderson’s efforts and voted down his plan, then voted overwhelmingly to repeal the bogus blight designation.

Bogus Blight

The U.S. Constitution and every state constitution limit eminent domain to projects for “public use,” once universally understood as property owned by and open to the public, like a road or a police station. But a 1954 U.S. Supreme Court decision kicked off 50 years of expanding government power as public use gradually came to mean “public benefit,” leaving eminent domain virtually unchecked. All too often, cities hope for “public benefit” in the form of (often empty) promises of higher taxes and more jobs.

A finding of “blight” is typically the first step toward eminent domain. Like public use, the definition of “blight” has morphed to meet the demands of developers and local officials. “Blight” once implied neighborhoods infested with disease and crime. And it used to mean a significant percentage—say, 80 percent—of buildings in the targeted area were actually in disrepair. Now “blight” means just about anything developers and the government want it to mean.

Case in point: the Norwood “blight study”—requested and paid for by Anderson—admitted that not one of the 99 homes or businesses in the area was dilapidated or delinquent on taxes. Not one.

Simply a brief walk or drive through the neighborhood shows that it is not blighted, so the “study” relied on factors outside property owners’ control—like noise from a nearby highway—and spurious accounting to find “blight.” The “study” also counts weeds and cars parked in front of houses toward the finding of “blight.”

In a move that may reveal shame on the part of City Council about declaring a perfectly fine neighborhood “blighted,” the Council used the term “deteriorated” when it accepted the findings of the study, rather than “blight.” Either way, the Council declared that the neighborhood meets the criteria of its urban renewal statute for “slum/blight/deteriorated” without a single property in disrepair.

“The bogus blighting of Norwood is a new all-time low for government abuse,” said Bullock.

Anderson Holds Homeowners Hostage

In a twist of language worthy of George Orwell, Anderson recently orchestrated yard signs and even a painted van parked in Norwood reading, “Held hostage by the Institute for (In)Justice.” But it is actually Anderson that is holding homeowners hostage. Anderson has not bought any property in the area outright, even from willing sellers. Instead, he has options to buy. If he does not get all the properties in the area, he refuses to buy any of them.

“If Anderson and homeowners who want to sell somehow feel they are being held hostage by IJ, why doesn’t Anderson just buy them out?” Bullock asked. “Nothing is stopping Anderson but his own greedy demand to get the entire neighborhood—on his terms—or none of it.”

Indeed, developers buy from willing sellers all the time. For instance, in New Rochelle, N.Y., IKEA bought properties from willing sellers even as its proposed project was contested. When the project fell through, IKEA simply sold the properties either back to their original owners or to other interested parties.

Bullock added, “With $500 million in holdings and a private jet, Anderson could easily buy the properties rather than leaving the owners in limbo. It’s outrageous that he would blame property owners who simply want to keep what is theirs.”

Divide and Conquer

Anderson’s underhanded tactics don’t stop there. He and the City portray the five home and business owners who are challenging his plan as lone “holdouts.” To do so Anderson employs a divide-and-conquer strategy against the neighborhood. Of the 99 buildings included in the “blight study” only about 65 have signed contracts to sell to Anderson. The remaining 34 or so buildings, yet to be condemned, are anything but safe.

When Anderson faced strong opposition from a group of property owners on and around Dacey Avenue, he decided to leave them out of the plans—for now. Those property owners still live in the “blighted” neighborhood and their properties have been included in an area labeled “Future Rookwood Expansion” in Anderson’s current plans. They face the prospect of eminent domain in the near future and many stand with the five property owners who face it now. But by conducting condemnations in stages, Anderson makes those facing condemnation first appear isolated and alone, even though they enjoy the support of citizens throughout Norwood.

Dana Berliner, a senior attorney with the Institute for Justice, said, “What Anderson and the City are doing is repulsive and simply un-American. In this country, government isn’t supposed to be a super real estate agent, throwing out rightful land owners to make way for the rich; it is supposed to be a means to protect the rights and freedoms of everyone.”

The Institute for Justice is the nation’s leading legal advocate against the abuse of eminent domain, currently fighting battles across the nation against the taking of private properties by governments for the benefit of private parties. These include cases in New London, Conn., and metropolitan New York. IJ has already scored victories against the abuse of eminent domain in court and in the court of public opinion in Lakewood, Ohio; Mesa, Ariz.; Canton, Miss.; Pittsburgh, Penn.; Baltimore, Md.; and Atlantic City, N.J.