Originally posted on Quora February 16, 2022
Unlike the original urban renewal of the 50s, 60s and 70s, which was federally subsidized through the Housing Acts of 1949 and 1954 to revitalize inner cities gutted by New Deal suburban sprawl, that excluded minorities through redlining and restrictive covenants, and railroaded in through the SCOTUS decision in Parker v. Berman, Urban Renewal 2.0 is confined to local “revitalization” schemes that while not receiving direct federal assistance most of the time, have the same objective of demolishing historic working class neighborhoods with lower income residents and replacing them with housing and accommodations suitable for more affluent residents (or multinational corporations). This was made much easier by the Supreme Court’s extremely liberal interpretation of the 5th amendment takings clause in Kelo v. City of New London (a high profile case litigated by IJ). The new expanded scope of “public benefit” eminent domain puts everyone’s home or business up for grabs but those of fewer means are much more likely to find themselves in the crosshairs. As I noted in How Progressive Urban Planners Created the Black Community these revitalization schemes tend to dispossess poorer, often minority residents of their homes and businesses to attract more affluent, often whiter residents.
The Institute for Justice conducted a demographic survey of 184 communities where eminent domain was used to take property for private development and found that 58% of the residents in these communities are minorities (non-white), half of the residents earn less than $19,000 annually, 25% of the residents live at or below the federal poverty line and typically have less than a high school education. In comparison, only 45% of the residents in surrounding communities not targeted for condemnation are minorities, half of residents make more than $23,000 annually, only 16% live below the federal poverty line, and a greater percentage of residents have a high school diploma and some college education.
Of course, race is not necessarily a motivating factor but will seem significant because of the adverse impact of these schemes on lower income demographics. Sometimes these working-class neighborhoods are majority white as is the case in Charlestown, IN where then mayor Bob Hall and city inspector Tony Jackson criminally conspired with an outside developer to condemn homes in Pleasant Ridge, a working class neighborhood built before the great depression, and sell them for pennies on the dollar to the developer violating municipal, state and federal law in the process.
Source: Institute for Justice
The mayor of Charleston, Indiana cooked up a scheme to circumvent an Indiana Law that prohibits the use of eminent domain for 'economic development' by shaking down the homeowners of Pleasant Ridge, a low income neighborhood that has fallen victim to this racket, with thousands of dollars in fines for such trivial bullshit as chipped paint and torn screens. The end game is to force Pleasant Ridge residents out of their own homes so the neighborhood can be bulldozed and turned over to Neace Ventures. The mayor has left Pleasant Ridge homeowners with only two options to avoid burdensome fines for trivial code violations: either sell their homes at a loss to Neace Ventures or raze their homes to the ground. As IJ points out, the municipal government has violated several laws in the process of trying to force Pleasant Ridge residents off their own property. They have violated the city's own property maintenance code by not giving residents any time to correct code violations before they are fined. They have violated Indiana's Unsafe Building Law, which prohibits immediate accumulating fines. They have violated the 5th amendment by taking property without just compensation and for the exclusive use of a private corporation. They have used fines to take property without a criminal or civil proceeding or even giving homeowners a chance to appeal the fines.
At the end of August (2017), the Institute for Justice leaked a series of documents which contained the correspondence among Charlestown mayor Bob Hall, city inspector Tony Jackson, city attorney Michael Gillenwater, and Neace Ventures project manager John Hampton, from last year. The documents showed that the aforementioned city officials had colluded with Neace Ventures in lowering home appraisals in their endeavor to make using eminent domain against any 'holdouts' as cheap as possible for the developer. Their scheme was to use the city's property maintenance codes to stack fines against Pleasant Ridge homeowners and allow Neace Ventures subsidiary, Pleasant Ridge Redevelopment LLC, to buy up vacant lots from the city, further driving down home values in the neighborhood. Once the accumulated fines became burdensome for the homeowners, the city would swoop in and offer to buy their house for $10,000, well below market value, in return for voiding the fines imposed on their property. The only other option offered was to raze their houses. The leaked documents reveal that mayor Bob Hall, attorney Michael Gillenwater and project manager John Hampton planned to railroad the project through as early as July 6th of 2017 even though Bob Hall claimed ignorance of the project to the press the next day and told WAVE3 TV, at the end of September (2017), that eminent domain wouldn't necessarily be used. Even before the July 6th meeting between Bob Hall and John Hampton, the mayor reached an indemnification agreement with Pleasant Ridge Redevelopment LLC, promising to compensate them for any lawsuits. What's more, the city inspector, Tony Jackson, profited from the project by doing contract work on the side removing asbestos from condemned houses. Ultimately, the criminal conspiracy was thwarted and Bob Hall was voted out of office in 2019 after the project was killed by litigation.
Not all of these municipal revitalization schemes involve criminal conspiracies but sometimes they are done under the false pretext of building affordable housing, as was the case in Emerson, NJ.
Source: Institute for Justice
Small business owners and residents of the Central Business District of Emerson, New Jersey have formed a coalition called Stop Emerson Eminent Domain to prevent the Borough council from condemning their properties and handing them over to private developer JMF Properties. 82 properties fall within block 419, which has been designated a condemnation redevelopment area, but in response to public backlash the borough council removed 24 properties from consideration. The Borough council claims that it has to demolish these properties to meet its affordable housing obligations, but the developer’s agreement does not require JMF Properties to build affordable housing in the Central Business District, but rather explicitly says they will explore alternative sites. Furthermore, New Jersey’s Local Redevelopment and Housing Law does not include affordable housing as one of the criteria for establishing an Area in Need of Redevelopment. The current study of block 419 relies on New Jersey's vague legal definitions of ‘obsolete’ and ‘underutilized’ conditions, which are often used to simply transfer property from one private owner to another private owner (i.e. legal robbery). A few business owners have spoken out against the pending condemnation of their property that would destroy their livelihoods; their comments are included below.
The borough wants development at any cost, and will violate my rights as a hard-working small-business owner to get it,” said Dan O’Brien, owner of Academy Electrical Contractors, Inc. “They’re using affordable housing as a smokescreen for this development, and they’re abusing the state’s redevelopment law in the process.” Dan moved his business to Emerson five years ago and poured $150,000 into his property with hopes of one day handing it over to his children after he retires. “I’ve helped countless people in this borough with their electrical needs. I have 14 employees, half of whom are residents of this borough—if I lose my business, these Emerson residents lose their jobs. Our properties clearly aren’t blighted, and they are not for sale,
Dan continued.
We invested heavily in Emerson at a time of economic downturn. Our property is essential for our small business, my livelihood and retirement. It’s a horror to watch eminent domain crush other small businesses, homes, and lives,” said Todd Bradbury, owner of Bradbury Landscape in Emerson. “No court ordered this—it was an elective move by the governing body. We are not going to sit back and watch the next block fall. Just imagine if this happened to you.
I came to Emerson in 1977, when I was 24 years old. Since then, I’ve built two buildings and renovated two on Chestnut Street, with no tax breaks, no special treatment, without a dime, nothing—I worked hard seven days a week, often until 1am,” said small-business owner Bob Petrow, who owns Star Properties. “I’ve contributed to many community causes. Now I depend on these buildings that I bought, built and maintained to sustain me. They’re my retirement. Now all that’s threatened.
Mayor Lamatina recently said in a media interview that ‘downtown sorely needs new blood,’” said Toni Plantamura-Rossi, who owns the Dairy Queen on Kinderkamack Road, which was built in 1952. “But they’re attempting to squeeze small-business owners out of the borough. We’re part of a small-business franchise and are proud to be blue-collar workers. We all need electricians and auto-mechanics…what’s wrong with these services if we’re helping everyone’s needs? When did building a successful local business that caters to the community become something to be looked down upon and not patted on the back?
Not all revitalization schemes are pushed through brute force eminent domain. Sometimes existing businesses deemed undesirable are forced out through changes in zoning ordinances. This is the case for the partners of Sark’s Automotive and U-Haul rental business in Mauldin, SC. When the city council decided to pursue private development of a downtown area, they set their crossheirs on Sark’s automotive as an eyesore that would not fit in with their vision of a downtown area. Instead of resorting to eminent domain, the city simply changed the zoning ordinances to prohibit U-Haul rentals everywhere and refused to grandfather in Sark’s Automotive despite grandfathering in every other business engaged in a now prohibited land use.
Yorktown, IN concocted similar plans to destroy a historic working class neighborhood, built as early as 1837, and replace them with a “downtown” area that included a park, commercial/retail space, parking lots and luxury apartments (the same shit included in every urban renewal plan) evicting elderly homeowners who have lived in the town for several decades. Unfortunately, using eminent domain for naked land speculation like this is legal under the expanded scope of Parker v. Berman and Kelo v. The City of New London and the judges who authorize it do not care about the circumstances of their victims, even if they are blind, handicap and elderly as was the case for the couples on W Canal St in Yorktown.
Of course the most infamous case is Kelo vs. City of New London wherein the city of New London, CT vested eminent domain authority in New London Development Corporation to condemn and raze the historic working-class Fort Trumbull neighborhood on behalf of Pfizer. After the neighborhood was demolished, Pfizer reneged on their proposed drug research facility and left town, leaving the city with empty lots, 1400 fewer jobs and $80 million in sunk costs demonstrating that real estate speculation doesn’t always pay off even when you do it at gunpoint. The so-called economic development seizure was a complete catastrophe for the neighborhood and city but the aberration of constitutional law SCOTUS handed down in 2005 is still being used as a bludgeon for Urban Renewal 2.0 today. There are many more cases like these that had lower profiles and were not taken on by public interest law firms like the Institute for Justice or Pacific Legal Foundation because it is fiscally impossible to litigate every case like this across the country.
At an April 4, 2023 public hearing, the board of Alderman and mayor of Ocean Springs, MS voted for a resolution to create 6 urban renewal areas that in their words would reduce blight and be key to sustainable development of the small Gulf Coast city. Unbeknown to the affected residents, they had only 10 days, until April 14, 2023, to file a notice of appeal to challenge the inclusion of their property within an urban renewal zone yet none of them received individualized notice of the April 4th hearing, their properties inclusion in a designated urban renewal area, or the April 14th deadline to appeal their inclusion. The city also failed to publish any notice of the upcoming hearing prior to it and did not publish any list of properties included within the six urban renewal areas. In their negligence to notify residents of their inclusion and provide ample time to appeal it the city violated the substantial due process rights of the residents included in the six urban renewal areas. One of those six areas included homes in the historically black working-class Railroad District neighborhood, a few properties of the historically black Macedonia Missionary Baptist Church and an Auto Mechanic Shop a few miles away; all have become plaintiffs in federal suit against the City of Ocean Springs. Although urban renewal, “revitalization” or “redevelopment” is often marketed as a means to eliminated ambiguously defined “blighted” properties and create “sustainable” development it has historically been used to dispossess poor working class and often minority residents and local businesses in favor of wealthier residents and chain stores that generate higher property tax revenue for their municipality. Ocean Spring’s designation of urban renewal areas is the first step towards condemning and razing homes and businesses it deems “blighted” under Berman v. Parker and Kelo v. City of New London.
While Urban renewal is no longer congressionally funded its scourge continues to afflict renters, homeowners and small businesses across the country. The first step municipalities take towards razing their homes and livelihoods is designating their communities as blighted, opening them up to condemnation proceedings under Berman v. Parker. The St. Louis Suburb of Brentwood took this first step this year against several small businesses and a commercial landlord in three different locations in two July meetings among the board of Alderman. On July 5th the board deliberated on a new redevelopment plan for the Manchester Corridor, the designated Highway Commercial district in which the businesses are located. At the next meeting, about two weeks later, they adopted their 2023 redevelopment plan for the Manchester Corridor based on the concurrent blight study. In the prior month, the board had adopted an ordinance that changed the definition of blight and lengthened the period for considering redevelopment plans from 90 days to 5 years. The definition of blighted area was changed to mean:
(a) an area which, by reason of the predominance of insanitary or unsafe conditions, deterioration of site improvements, or the existence of conditions which endanger life or property by fire and other causes, or any combination of such factors, retards the provision of housing accommodations or constitutes an economic or social liability or a menace to the public health, safety, or welfare in its present condition and use, or (b) such other definition as may be required by Missouri law in connection with the approval of a Development Plan.f
The extension for considering redevelopment request for proposal allowed the board to keep the one for the Manchester Corridor, that had been presented by the Brentwood Redevelopment Corporation in April of 2022, alive and the open ended “blighted area” definition allowed them target properties that are up to code but don't maximize tax revenue for their coffers. This motive for designating these properties as blighted was readily apparent before the July 17th meeting because private developer Green Street had responded to the Brentwood Redevelopment Corporation’s request for proposal in June of 2022, which considered “the use of eminent domain if needed for any non-single-family homes, real estate tax abatement, an area-wide Community Improvement District (CID), a Transportation Development District (TDD), the use of New Market Tax Credits (NMTC), and Chapter 100 Bonds to abate sales tax on construction materials.” The businesses within this Manchester corridor were so far out of the loop on the decisions the board of aldermen were making for them that they were not even notified that their road was designated the Manchester Corridor Commercial Zoning District back in April of 2019 much less any of the more monumental decisions and deals made afterward violating their due process rights.
The 2023 blight study in question concludes “the Area shows a predominance of insanitary or unsafe conditions” from 5 unnamed properties, out of 75 total properties, exhibiting unsanitary and unsafe conditions. The study assumes “the presence of hazardous chemicals and materials is likely to exist in many of these properties” without evidence but only on the basis that twenty properties were built before 1960 and 29 before 1970 with only three properties less than 35 years old. The study even uses minor cosmetic defects such as “the need for paint, window repair, damaged trash holding facilities, deteriorating signage, rotting or missing facias or soffits, damaged or deteriorated loading areas or doors, and cracking and/or pot-holed parking lots” as well as “dilapidation of outbuildings or other accessory structures'' as justification for a blight designation. The study also used the risk of a 500 year flood as part of their flimsy basis for a blight designation. However, the biased study reveals its true motive when it notes that “the structures have little attractiveness for uses other than their current ones” and “the age of the buildings makes most of them economically and functionally obsolete.” This makes it apparent that the threat of eminent domain hangs over these properties not because of neglect but because the city wants to give them to businesses that will use them in a manner that brings in higher tax revenues. After the Kelo decision, Missouri was one of 44 states that reformed their condemnation laws to make forced property transfers from private homeowners and businesses to private developers working on behalf of private companies (like Pfizer) extremely difficult if not impossible. Thus, a blight designation from a biased pseudo scientific study would allow them to condemn the existing properties under the Berman precedent.