Amicus Curiae Brief — Kelo v. New London

No. 04-108

In The

Supreme Court of the Anited States

¢

SUSETTE KELO, THELMA BRELESKY,

PASQUALE CRISTOFARO, WILHELMINA AND

CHARLES DERY, JAMES AND LAURA GURETSKY,

PATAYA CONSTRUCTION LIMITED PARTNERSHIP

and WILLIAM VON WINKLE,

Petitioners,

v.

CITY OF NEW LONDON and

NEW LONDON DEVELOPMENT CORPORATION,

Respondents.

¢

On Writ Of Certiorari To The Supreme Court

Of The State Of Connecticut

«

~ BRIEF AMICUS CURIAE OF CALIFORNIA

REDEVELOPMENT ASSOCIATION

IN SUPPORT OF RESPONDENTS

¢

IRIs P. YANG*

T. BRENT HAWKINS

AMBER HYMAN

McDONOUGH HOLLAND & ALLEN PC

555 Capitol Mall 9th Floor

Sacramento, CA 95814-4692

(916) 444-3900

*Counsel of Record

COCKLE LAW BRIEF PRINTING CO (800) 225-6964

OR CALL COLLECT (402) 342-2831

QUESTION PRESENTED

Does the Takings Clause of the Fifth Amendment

forbid an economically distressed city from employing its

eminent domain power to condemn, and pay just compen-

sation for, private property in order to reverse decades of

economic decline, create thousands of jobs and signifi-

cantly increase property taxes and other sources of reve-

nue for the city, and to realize immediate structural and

environmental benefits for the city, as long as the proposed

condemnation is rationally related to the accomplishment

of those goals?

‘i

TABLE OF CONTENTS

in Page

INTEREST OF AMICUS CURIAE...............ccccseceeeeeeeees 1

SUMMARY OF ARGUMENT. ...............cccsccccsesssreeeeeeeees 2

ATRIBUTREIEIN cevececscecnscceseceseuseesesnsnnesneneiiainnninnnnnnnnnnnnn 3

I. The Condemnation of Non-Blighted Property

Within a Blighted Area Pursuant to an Adopted

Redevelopment Plan Is a Public Use ................. 3

A. Blight Is an Area Concept................:s0seeeeees 3

B. Requiring Parcel-By-Parcel Findings of

Blight Would Severely Undermine Cali-

fornia’s and Other States’ Urban Redevel-

En 5

II. As Demonstrated by California Community

Redevelopment Law, States Adopt Procedural

and Substantive Safeguards That Protect

Against Abuses of the Eminent Domain Power... 7

A. California’s Community Redevelopment

Law Contains Both Procedural and Sub-

stantive Provisions Designed to Protect

the Interests of Property Owners in Rede-

velopment Project Areas ..............ccsscseseeees 8

B. Courts Will Invalidate Takings That Vio-

late Legislatively Imposed Procedural and

Subotentire ee 11

CONC AIIIIN 000ccccrcsccccccesesescesenennsnnssieneniinsnininnnnnnnnnnn 15

ill

TABLE OF AUTHORITIES

Page

CASES

99 Cents Only Stores, Inc. v. Lancaster Redevelop-

ment Agency, 237 F.Supp. 2d 1123 (C.D. Cal.

2001), appeal dismissed and remanded, 60 Fed.

Ce 12

Aaron v. Target Corp., 357 F.3d 768 (8th Cir. 2004)......... 12

Barbara Beach-Courchesne v. City of Diamond Bar,

80 Cal. App. 4th 388, 95 Cal. Rptr. 2d 265 (Cal.

i csmasssssnnnnncs 12

Berman v. Parker, 348 U.S. 26 (1954) .0......ccccccceeeeeees passim

Charleston Urban Renewal Auth. v. Courtland Co.,

203 W. Va. 528, 509 S.E.2d 569 (1998) 00.0... ceeeeeeeeees 6

City of Las Vegas Downtown Redevelopment Agericy

v. Pappas, 76 P.3d 1 (2003), cert. denied, 124

sr rrssnnsmnnsonoconces 6

Cottonwood Christian Ctr. v. Cypress Redevelop-

ment Agency, 218 F. Supp. 2d 1203 (C.D. Cal.

ES LAG 12

Emmington v. Solano County, 195 Cal. App. 3d 491,

237 Cal. Rptr. 636 (Cal. App. 1st Dist. 1987)................ 12

Fellom v. Redevelopment Agency of San Francisco,

157 Cal. App. 2d 243, 320 P.2d 884 (Cal. App. Ist

a cererercrrccneenccensscscssneneseoocooees 5

Friends of Mammoth, et al. v. Town of Mammoth

Lakes Redevelopment Agency, 82 Cal. App. 4th

511, 98 Cal. Rptr. 2d 334 (Cal. App. 3d Dist.

TTD 13

Gonzales v. City of Santa Ana, 12 Cal. App. 4th

1335, 16 Cal. Rptr. 2d 132 (Cal. App. 4th

AE 10

iv

TABLE OF AUTHORITIES - Continued

Page

Graber v. City of Upland, 99 Cal. App. 4th 424, 121

Cal. Rptr. 2d 649 (Cal. App. 4th Dist. 2002)................. 13

In re Redevelopment Plan for Bunker Hill, 61 Cal.

8 GE, Sa ee Ce cnterteniemnsnentaniommninns 4

Redevelopment Agency v. Herrold, 86 Cal. App. 3d

1024, 150 Cal. Rptr. 621 (Cal. App. 5th Dist. 1978)....... 14

Redevelopment Agency v. Hayes, 122 Cal. App. 2d

777, 266 P.2d 105 (Cal. App. 1954).............:ccseceeeees 4,5,6

Redevelopment Agency v. Norm’s Slauson, 173 Cal.

App. 3d 1121, 219 Cal. Rptr. 365 (Cal. App. 2d

SI TE cccsrensecsntniniennittaneenininaninhennnidiaiiiianineiniiiuiaeiiiia 13, 14

Redevelopment Agency v. Rados Bros., 95 Cal. App.

4th 309, 115 Cal. Rptr. 2d 234 (Cal. App. 4th

Ee cncccseennstnenennaseneneoenensenssetcaninniassisinnindamineaiaiin 5, 8

Regus v. City of Baldwin Park, 70 Cal. App. 3d 968,

139 Cal. Rptr. 196 (Cal. App. 2d Dist. 1977)................. 12

Sigma Tau Gamma Fraternity House Corp. v.

Menomonie, 93 Wis. 2d 392, 288 N.W.2d 85 (Wis.

ITIP cccrenenninsunctusioenennnsiiiiiiuniinaiamamaniabibeiatiamimntaasiatiiamesiiatail 6

State v. Miami Beach Redevelopment Agency, 392

en; SG ls: Sete cccnciccnciennamnasenitsnensenintecaenmmmeniatninis 6

Sweetwater Valley Civic Assn. v. National City, 18

Cal. 3d 270, 133 Cal. Rptr. 859 (1976). .................0.. 9,11

Wilson v. Long Branch, 27 N.J. 360, 142 A.2d 837

GET ccnncveceninsmnnsianiansunnninnemneansameumensanimeneicsnddesimiminaiasiesiiieal 6

STATUTES, REGULATIONS AND RULES:

a, Gaee, B, G ae Be acrrrrnccnenatcrninnencniiiiiiiaiinntens 11

By | RS erenrore 13

TABLE OF AUTHORITIES -— Continued

Page

Cal. Civ. Proc. Code § 1246.236..............ccccccocosccscocccessessesees 11

Cal. Civ. Proc. Code § 1246.240.............ccccccccccccsccscsccesceseees 11

Ee 11

a re ee Pe eeniiinitnttennnnntntinennininnnitntis — >

Cal. Health & Safety Code § 33000-34160 ..................... 1,8

Cal. Health & Safety Code § 33031 ...000...........cccccccecceceeeeee 8

Cal. Health & Safety Code § 33036 ...............ccccceeeceeeeeeeeeees 4

Cal. Health & Safety Code § 33037(b) .0...........cceceeeeeeeeeeee 1

Cal. Health & Safety Code § 33321 .20............cccccecceceeeeeeeeees 5

Cal. Health & Safety Code § 33339 2000.00.00... ....ccccceeceeeeeeeees 10

Cal. Health & Safety Code § 33339.5..00..0.........ccccceeeeeeeeeee 10

Cal. Health & Safety Code § 33347.5..0..............cccccccceeeeeeees 9

Cal. Health & Safety Code § 33348 .000.........ccccccccecceeeeeeeeeees 9

Cal. Health & Safety Code § 33349 200.........cccccceeeeeeeeeeeeees 9

Cal. Health & Safety Code § 33350 oc eceeeeeeeeee 9

Cal. Health & Safety Code § 33360 2.000.000... eeeeeeeeee ee 9

Cal. Health & Safety Code § 33363 .00............cccccccceeseeeeeeees )

Cal. Health & Safety Code § 33365 ...0000........ceceeeeeeeeees 10

Cal. Health & Safety Code § 33366 .....................0cccceeeeeee 10

Cal. Health & Safety Code § 33367 .00............:ccccccccseeeeeeeeees 8

Cal. Health & Safety Code § 33373 .0.00.........cccccececeeeeeeeeees 10

Cal. Health & Safety Code § 33385 ..00.........:..cccecceeeeeeeeeee 9

Cal. Health & Safety Code § 33391 oo... cccccceeeeeeeeeees 1

Cal. Health & Safety Code § 33394 .00.0.........ccccceceeeeee 11, 14

TABLE OF AUTHORITIES - Continued

Page

Cal. Health & Safety Code § 33501 ....................ccccceeeeeeeee 10

U. S. Supreme Court Rule 37.6...................ccccceseseseeseeeseeeees 1

OTHER AUTHORITIES

2A Nichols on Eminent Domain § 7.06/27] (2004).............. 5

1

INTEREST OF AMICUS CURIAE

Amicus curiae California Redevelopment Association

(“CRA”) is a California nonprofit corporation whose mem-

bers include redevelopment agencies and private sector

firms and individuals interested in redevelopment in

California.’ Currently, 324 redevelopment agencies and

264 private sector firms are members of CRA. CRA’s

members are involved in carrying out redevelopment plans

throughout the state. California’s Community Redevelop-

ment Law (California Health & Safety Code §§ 33000 -

34160) was adopted in 1945. Since that time, approxi-

mately 414 cities and counties have established redevel-

opment agencies and have adopted approximately 772

redevelopment plans. All but a few of those redevelopment

plans authorize the use of eminent domain to acquire some

or all of the property within the redevelopment project

area in order to eliminate conditions of blight.’

e

’ All parties have given written consent to the filing of this brief and

copies of the consent letters are on file with the Clerk. Pursuant to

Supreme Court Rule 37.6, counsel for amicus curiae state that counsel for

the parties did not author this brief in whole or in part and no person or

entity, other than amicus curiae, its members, or its counsel, made a

monetary contribution to the preparation or submission of this brief.

* California redevelopment agencies are authorized to exercise the

power of eminent domain by California Health and Safety Code section

33391. The California legislature has declared it to be the policy of the

state: “That whenever the redevelopment of blighted areas cannot be

accomplished by private enterprise alone, without public participation

and assistance in the acquisition of land, in planning and in the

financing of land assembly, in the work of clearance, and in the making

of improvements necessary therefor, it is in the public interest to

employ the power of eminent domain, to advance or expend public

funds for these purposes, and to provide a means by which blighted

areas may be redeveloped or rehabilitated.” Cal. Health & Safety Code

§ 33037(b).

2

SUMMARY OF ARGUMENT

For the reasons set forth in Respondents’ Brie, CRA

firmly supports Respondents’ contentions that: (1) eco-

nomic development is a public use for which the power of

eminent domain may be constitutionally exercised, and (2)

there is no basis in the Constitution for applying a more

stringent standard of judicial review to takings for eco-

nomic development purposes.

Although the constitutional question presented by this

case does not appear to impact takings by redevelopment

agencies for the purpose of eliminating blight, CRA feels

impelled to call to the Court’s attention the serious impli-

cations that Petitioners’ arguments may have for takings

of non-blighted properties within blighted areas. Petition-

ers’ assertion that “there is nothing in the act of condemn-

ing non-blighted properties that constitutes a public

purpose” (Petitioners’ Brief at 26) overlooks this Court’s

holding in Berman v. Parker, 348 U.S. 26 (1954). Berman

clearly held that blight is determined on an area basis —

not a parcel-by-parcel basis — and that a blighted area may

include non-blighted properties which are necessary to

effectively redevelop the area as a whole. Moreover,

Berman held that the power of eminent domain may be

used to acquire non-blighted property within a blighted

area. This holding of Berman is critical to the ability of

redevelopment agencies to continue to deal effectively with

eliminating conditions of blight which threaten the physi-

cal, social and economic health of California’s communi-

ties.

3

ARGUMENT

I. The Condemnation of Non-Blighted Property

Within a Blighted Area Pursuant to an Adopted

Redevelopment Plan Is a Public Use

A. Blight Is an Area Concept

While Petitioners do not controvert that the removal

of blight is a public use, their assertion that “there is

nothing in the act of condemning non-blighted properties

that constitutes a public purpose” (Petitioners’ Brief at 26)

overlooks this Court’s holding in Berman that the concept

of blight applies to a redevelopment project area as a

whole and not to individual properties. Under Berman,

individual, parcel-specific determinations of blight are

unnecessary. Regardless of the character of the specific

parcel condemned, when the purpose of the agency's

conde \nation is blight removal in a designated redevel-

opment project area, the taking is for a public use. As this

Court explained:

Property may of course be taken for this re-

development which, standing by itself, is in-

nocuous and unoffending. But we have said

enough to indicate it is the need of the area as a

whole which Congress and its agencies are

evaluating. If owner after owner were permitted

to resist these redevelopment programs on the

ground that his particular property was not be-

ing used against the public interest, integrated

plans for redevelopment would suffer greatly.

The argument pressed on us is, indeed, a plea

to substitute the landowner’s standard of the

public need for the standard prescribed by Con-

gress. But as we have already stated, commu-

nity redevelopment programs need not, by force

of the Constitution, be on a piecemeal basis — lot

4

by lot, building by building. Berman, supra, at

35-36.

The public policy reasons for dealing with blight on an

area-wide basis have been explained in the legislative

findings accompanying the California Community Rede-

velopment Law. The California legislature has found that

“conditions of blight are chiefly found in areas subdivided

into small parcels, held in divided and widely scattered

ownerships, frequently under defective titles, and in many

such instances the private assembly of the land in blighted

areas for redevelopment is so difficult and costly that it is

uneconomic and as a practical matter impossible for

owners to undertake because of lack of the legal power and

excessive costs.” Cal. Health & Safety Code § 33036(c).

The conditions found in most urban centers make it

virtually impossible for a private developer acting without

the assistance of a redevelopment agency possessing the

power of eminent domain to assemble a site large enough

for modern development. Descriptions of these conditions

are found throughout California case law dealing with the

redevelopment of blighted areas. See, e.g., Redevelopment

Agency v. Hayes, 122 Cal. App. 2d 777, 782-84, 266 P.2d

105, 109-12 (Cal. App. 1954) (“Hayes”); and In re Redevel-

opment Plan for Bunker Hill, 61 Cal. 2d 21, 33-35, 45, 389

P.2d 538, 545-48, 553-54, (1964). Dealing effectively with

these conditions would be impossible if the owners of a few

non-blighted parcels within a redevelopment project area

could refuse to sell their property or hold a project hostage

by demanding an inflated price. (For a more detailed

discussion of the “hold-out problem” see Respondents’ Brief

at section II B.) For this reason, using the power of emi-

nent domain to acquire non-blighted property within a

5

redevelopment project area is critical to the success of

redevelopment efforts.

B. Requiring Parcel-By-Parcel Findings of

Blight Would Severely Undermine Cali-

fornia’s and Other States’ Urban Redevel-

opment Efforts

California’s Community Redevelopment Law permits

the condemnation of non-blighted parcels in a predomi-

nantly blighted area for the purpose of redevelopment.’

The authorizing statute provides that a project area may

include property which is not detrimental to the public

health, safety or welfare, but whose inclusion is necessary

for the effective redevelopment of the area. Cal. Health &

Safety Code § 33321. California courts have consistently

applied both this statute and the holding in Berman to

sustain the taking of non-blighted parcels in a designated

redevelopment project area. See Redevelopment Agency v.

Rados Bros., 95 Cal. App. 4th 309, 315, 115 Cal. Rptr. 2d

234, 239 (Cal. App. 4th Dist. 2001) (holding that the trial

court improperly applied a blight concept to the property

owner’s individual parcel) (“Rados Bros.”); Fellom uv.

Redevelopment Agency of San Francisco, 157 Cal. App. 2d

243, 247, 320 P.2d 884, 887 (Cal. App. 1st Dist. 1958)

(holding that California Redevelopment Law as applied to

non-slum-type blighted areas is constitutional); Hayes,

* See also 2A NICHOLS ON EMINENT DOMAIN § 7.06[27] n. 25 and 26

(2004) (listing the following states as finding that non-blighted proper-

ties may be taken to prevent slums and clean up blighted areas:

California, Connecticut, Illinois, Kentucky, Maine, Maryland, Massa-

chusetts, Minnesota, Mississippi, Missouri, Nevada, New York, North

Dakota, Ohio, Oregon, aa, Rhode Island, Virginia, Washing-

ton, and Wisconsin).

6

supra, 122 Cal. App. 2d at 800, 266 P.2d at 120 (holding

that California Redevelopment Law is constitutional as

applied to non-slum-type blighted areas or to undeveloped,

vacant land areas).

Requiring parcel-by-parcel findings of blight or impos-

ing a higher level of scrutiny on the taking of non-blighted

property in a redevelopment project area would severely

undermine state redevelopment efforts throughout the

country. Numerous states have followed this Court’s

holding in Berman and found that redevelopment of

blighted areas need not occur on a piecemeal basis. See

State v. Miami Beach Redevelopment Agency, 392 So. 2d

875, 889 (Fla. 1980) (holding that the condemnation of

buildings that do not contribute to the slum or blight of an

area is constitutional for the purpose of community blight

removal); City of Las Vegas Downtown Redevelopment

Agency v. Pappas, 76 P.3d 1 (2003), cert. denied, 124 S. Ct.

1603 (2004) (holding that redevelopment encompasses an

entire area, not just individually blighted sections); Wilson

v. Long Branch, 27 N.J. 360, 381, 142 A.2d 837, 849 (1958)

(“Denial of the right of the municipality to draw within a

blighted area certain houses or buildings which are in

good condition, would be in some instances to defeat the

overall legislative purpose, namely, the redevelopment of

blighted areas.”); Charleston Urban Renewal Auth. v.

Courtland Co., 203 W. Va. 528, 532, 509 S.E.2d 569, 573

(1998) (“ ... the issue is not whether an individual prop-

erty is ‘slum’ or ‘blighted’ property. The issue is whether an

‘area,’ typically composed of many individual parcels of

property, is a slum or blighted area.”); Sigma Tau Gamma

Fraternity House Corp. v. Menomonie, 93 Wis. 2d 392, 409,

288 N.W.2d 85, 92-93 (Wis. 1980) (“If the area in which

plaintiff’s property is located is blighted, and if the

7

acquisition of plaintiff’s property is reasonably necessary

for the elimination of that blight, then the city may law-

fully condemn plaintiff’s property, despite the fact that

that property itself has been properly maintained and is

presently in satisfactory condition.”).

II. As Demonstrated by California Community

Redevelopment Law, States Adopt Procedural

and Substantive Safeguards That Protect Against

Abuses of the Eminent Domain Power

State and local officials adopt procedural and substan-

tive safeguards that protect against abuses of the eminent

domain power. As envisioned under the separation of

powers doctrine, courts diligently enforce these provisions

and assure that local agencies heed these legislative

protections. These procedural and substantive constraints

balance the legitimate interests of local agencies to pursue

projects that enhance the general health and welfare of

the community with the private individual interests of

those affected by such projects. Because amicus is most

familiar and qualified to discuss California Redevelopment

Law, this section focuses on the constraints found on the

use of eminent domain in the California Community

Redevelopment Act. However, substantive and procedural

limits in varying forms are imposed in urban renewal

statues throughout the country.‘

* More pointedly, procedural and substantive constraints also

exist in Connecticut’s General Statutes controlling the exercise of

eminent domain for economic development. See Respondents’ Brief at

Summary of Facts and Section II B. (City of New London held

numerous neighborhood meetings before adopting the Municipal

Development Plan, the plan required specific details regarding the

(Continued on following page)

8

A. California’s Community Redevelopment

Law Contains Both Procedural and Sub-

stantive Provisions Designed to Protect

the Interests of Property Owners in Re-

development Project Areas

In recognition of the authority vested in redevelopment

agencies and the potential for the abuse of that authority,

the California Community Redevelopment Law contains

provisions designed to protect the interests of property

owners. In connection with the adoption of the redevelop-

ment plan, the elected legislative body is required to make

findings that the redevelopment project area is a blighted

area based on the existence of specifically identified condi-

tions of both economic and physical blight. Cal. Health &

Safety Code § 33367. Blight is rigorously defined as a

combination of enumerated conditions,» which are so

prevalent and so substantial that it causes a reduction of, or

lack of proper utilization of the area to such an extent that

it constitutes a serious physical and economic burden on the

community which cannot be expected to be reversed or

alleviated by private enterprise or governmental action, or

both, without redevelopment. Jd. § 33030.° Land does not

qualify as being blighted merely because it is not being put

needs for development and the benefits of the proposed plan and also

imposed both city and state oversight on development.)

* Such conditions include unsafe or abandoned buildings, high crime

rates, incompatible uses of adjacent properties, depreciated or stagnant

property values or impaired investments, abnormally high business

vacancies and a lack of necessary commercial facilities. Jd. § 33031;

Rados Bros., supra, 95 Cal. App. 4th at 314, 115 Cal. Rptr. 2d at 239.

* Additional findings that must be made include the necessity

of condemnation, economic feasibility of the redevelopment plan,

adequacy of the relocation plan, and the fact that the project area is

predominately urbanized. Jd. § 33367.

9

to its optimum use or may be more valuable for other uses.

Sweetwater Valley Civic Assn. v. National City, 18 Cal.3d

270, 277-78, 133 Cal. Rptr. 859, 863 (1976).

Procedural safeguards guide the redevelopment

process in general and the exercise of eminent domain in

particular. California law provides that both the redevel-

opment agency and legislative body conduct public hear-

ings prior to approving the redevelopment plan. Cal.

Health & Safety Code §§ 33348, 33360. If the redevelop-

ment plan would subject any property in the project area

‘9 acquisition by purchase or condemnation, the agency

™ 3st send a statement explaining this to each property

owner with the notice of hearing. Jd. § 33350. The descrip-

tion of the goals and objectives of the redevelopment plan

and notice of authority to condemn property, if any, must

be in non-technical, easily understood language. Id.

§§ 33349, 33350. Specific procedures must be followed if

written objections to the plan are submitted. The legisla-

tive body must address objections in detail and give

reasons for not accepting specified objections and sugges-

tions, using a good faith reasoned analysis in its response,

supported by factual information. Jd. § 33363.

If the proposed redevelopment plan contains the

authority to acquire residential property, and substantial

numbers of low- or moderate-income persons reside within

the project area, or the project will displace a substantial

number of people, an independently elected “project area

committee” including representatives of property owners

must review the redevelopment plan prior to its adoption

and make a recommendation to the legislative body. Id.

§§ 33347.5, 33385. If the project area committee recom-

mends against adoption of the redevelopment plan, the

10

redevelopment plan may only be adopted by an extraordi-

nary majority vote of the legislative body. Id. § 33366.

The ordinance adopting the redevelopment plan and

the validity of the findings and conclusions of the legisla-

tive body must be supported by substantial evidence in the

record of proceedings and are subject to legal challenge

and referendum. Cal. Health & Safety Code §§ 33501,

33365; Gonzales v. City of Santa Ana, 12 Cal. App. 4th

1335, 1343-45, 16 Cal. Rptr. 2d 132, 137-38 (Cal. App. 4th

Dist. 1993).

After the redevelopment plan is adopted, the agency

must record in the land records of the county in which the

redevelopment project is situated, a description of the land

within the project area and a statement that proceedings

for the redevelopment of the project area have been

instituted. Jd. § 33373. Purchasers of property in the

redevelopment project area after the redevelopment plan

is adopted are thereby given constructive notice that the

property they are acquiring may be subject to acquisition

by eminent domain for redevelopment purposes.

Each redevelopment plan is required to “provide for

participation in the redevelopment of property in the

project area by the owners of all or part of such property if

the owners agree to participate in the redevelopment in

conformity with the redevelopment plan... .” Jd. § 33339.

Redevelopment agencies must also extend reasonable

preferences to persons engaged in business in the project

area to reenter in business within the redeveloped area if

they otherwise meet the requirements prescribed by the

redevelopment plan. Jd. § 33339.5.

Before a redevelopment agency may condemn prop-

erty, it must make every reasonable effort to acquire the

11

property voluntarily, including having the property ap-

praised and offering to purchase the property for not less

than the appraised fair market value. Cal. Gov't Code

§§ 7267.1, 7267.2. If the property owner refuses the

redevelopment agency’s offer, before proceeding to con-

demnation the agency must adopt a resolution declaring

the public use and necessity of the taking. Cal. Civ. Proc.

Code § 1245.220. The property owner must receive notice

of the adoption of this “resolution of necessity” and have

an opportunity to appear and refute the required findings.

Id. § 1245.235. The resolution of necessity may only be

adopted by a vote of two-thirds of all the members of the

governing body. Id. § 1245.240.

Finally, an agency is prohibited from acquiring prop-

erty to remain in its current condition merely to effect a

change in ownership. Cal. Health & Safety Code § 33394.

This detailed statutory scheme has built a substantive

and procedural fence around the use of eminent domain by

redevelopment agencies that provides an extraordinary

level of protection to property owners from the abuse of

that power.

B. Courts Will Invalidate Takings That Vio-

late Legislatively Imposed Procedural

and Substantive Safeguards

Courts enforce the legislative protections discussed

above. Courts have rejected redevelopment plans where

there is no substantial evidence in the record that the

project area is predominately blighted. See Sweetwater

Valley, supra, 18 Cal. 3d at 278-79, 133 Cal. Rptr. at 864

(finding that the property in a redevelopment project area,

which included a golf course and vacant land, was neither

12

an economic nor a social liability substantiating a finding

of blight); Regus v. City of Baldwin Park, 70 Cal. App. 3d

968, 139 Cal. Rptr. 196 (Cal. App. 2nd Dist. 1977) (record

failed to show project area was blighted); Emmington v.

Solano County, 195 Cal. App. 3d 491, 497-98, 237 Cal.

Rptr. 636, 640 (Cal. App. 1st Dist. 1987) (courts role is to

ensure that the factors to be considered in determining

whether an area is blighted are taken into account and not

just “rubber stamp” local government findings.)’

For example, in Barbara Beach-Courchesne v. City of

Diamond Bar, 80 Cal. App. 4th 388, 95 Cal. Rptr. 2d 265

(Cal. App. 2d Dist. 2000) the court concluded that the

proposed redevelopment project failed to establish blight

due to a lack of substantial supporting evidence in the

administrative record. The court held that in order to

establish blight, reports must discuss specific defects in

specific parcels and not just recite the statutory language.

” Two Federal District Court cases cited by Petitioners, 99 Cents

Only Stores, Inc. v. Lancaster Redevelopment Agency, 237 F. Supp. 2d

1123 (C.D. Cal. 2001), appeal dismissed and remanded, 60 Fed. Appx.

123 (9th Cir. 2003) and Cottonwood Christian Ctr. v. Cypress Redev.

Agency, 218 F.Supp. 2d 1203 (C.D. Cal. 2002) made an “end run”

around state condemnation procedures, probably based in part on a

perception that property owners would fare better in federal court on

challenging a right to take. (Petitioners’ Brief at 14, 16.) Both cases

involved redevelopment agencies’ condemnation of allegedly non-

blighted property within a redevelopment project area and rested in

part on allowing a challenge to the agencies’ determinations of blight.

In both cases, the district courts expressly declined to address the

blight findings made pursuant to California Redevelopment Law and

neither case cited nor acknowledged the holding in Berman permitting

the taking of non-blighted properties for the purpose of redevelopment.

Compare these cases with Aaron v. Target Corp., 357 F.3d 768 (8th Cir.

2004) holding that the district court abused its discretion when it

declined to abstain and permit a state eminent domain action to go

forward.

13

Recently, in Graber v. City of Upland, 99 Cal. App. 4th

424, 121 Cal. Rptr. 2d 649 (Cal. App. 4th Dist. 2002) the

court reinforced earlier precedent finding inadequate

evidence of blight and criticized the use of overbroad

definitions which prevented the city council from deter-

mining whether the project area could truly be character-

ized as having the blight conditions required by statute.*

Similarly, in Redevelopment Agency v. Norm’s Slauson,

173 Cal. App. 3d 1121, 219 Cal. Rptr. 365 (Cal. App. 2d

Dist. 1985), the court rejected a resolution of necessity

where the contents of the resolution were affected by a

gross abuse of discretion by the legislative body.’ In Norm’s

Slauson, the court found that the adoption of the resolu-

tion of necessity to acquire the property for a redevelop-

ment project was a “sham” because the city had already

irrevocably committed itself to condemnation of the parcel.

Id. at 1127, 219 Cal. Rptr. at 369. Prior to the hearing on

whether the city council should adopt’ the resolution of

necessity, the agency had contracted to sell the property

and issued bonds to finance development (without notify-

ing the property owner). Id. at 1127, 219 Cal. Rptr. at 369.

* See also Friends of Mammoth, et al. v. Town of Mammoth Lakes

Redevelopment Agency, 82 Cal. App. 4th 511, 98 Cal. Rptr. 2d 334 (Cal.

App. 3d Dist. 2002) (rejecting a redevelopment plan on the grounds that

the project did not meet the predominantly urbanized requirement).

* Aresolution of necessity to condemn a particular piece of property

must contain the following four findings: (1) the public interest and

necessity require the project; (2) the project is planned or located in the

manner that will be most compatible with the greatest public good and

the least private injury; (3) the property sought to be acquired is

necessary for the project; and (4) the agency has made the offer of just

compensation required by Government Code section 7267.2 or the offer

was not made because the owner could not be found with reasonable

diligence. Cal. Civ. Proc. Code § 1245.230.

14

The court explained that before a local legislative body

determines that it is necessary to take a particular parcel

of property, it must “conduct a fair hearing and make its

determinations on the basis of evidence presented in a

judicious and nonarbitrary fashion.” Jd. at 1129, 219 Cal.

Rptr. at 370.

In Redevelopment Agency v. Herrold, 86 Cal. App. 3d

1024, 150 Cal. Rptr. 621 (Cal. App. 5th Dist. 1978) the

court held that the 60-day statute of limitations to chal-

lenge a redevelopment plan did not bar a claim alleging

illegal implementation of the plan. At issue was whether

the agency violated section 33394 of the Health and Safety

Code which prohibits a redevelopment agency from taking

property that will remain in the same condition merely to

effect a change in ownership. The court overruled the trial

court’s determination that the claim was time-barred. The

court explained, “[the statute of limitations] cannot be

used to immunize an agency which adopts a redevelop-

ment plan legal on its face, then after the 60-day period

has elapsed deviates from its resolved purpose and seeks

to violate the public use requirement of [the] California

Constitution. .. .” Jd. at 1029, 150 Cal. Rptr. at 625.

As evidenced by the above, while courts give great

deference to legislative declarations of public use, they

enforce the procedural and substantive safeguards that

protect against abuses of the eminent domain power. This

separation of powers provides the proper balance between

legislative findings of public use that authorize the exer-

cise of eminent domain to implement comprehensive

redevelopment projects benefiting the general health and

welfare of the community, while at the same time ensuring

— -

15

judicial protection of individual property interests should

an agency misuse such authority.

¢

CONCLUSION

For the reasons set forth above, CRA urges this Court

to re-affirm its holding in Berman that non-blighted

property located within a blighted area may be taken by

eminent domain in order to alleviate conditions of blight

which exist in the area as a whole and reject any standard

of review that would impose the need for parcel-by-parcel

determinations of blight.

Respectfully submitted,

IrIs P. YANG*

T. BRENT HAWKINS

AMBER HYMAN

McDONOUGH HOLLAND & ALLEN PC

555 Capitol Mall 9th Floor

Sacramento, CA 95814-4692

*Counsel of Record