Nothing just about eminent domain compensation
Reasonable people can disagree about whether there is any justification - ever - for seizing private property for economic redevelopment. But it's hard to argue that the current law regarding compensation for those whose properties have been seized is fair. It's anything but.
The redevelopment areas of Long Branch offer many examples of why there is a need for change - assuming you accept the proposition that eminent domain for private redevelopment is acceptable in certain circumstances, which I don't. In today's ongoing Press series "The Battle Over Eminent Domain,'' it is pointed out that the value of the property being seized is frozen from the time the government moves to take it, regardless of how long it takes to settle. In determining a price, normal appreciation is taken into account, but the increased value of the property due to redevelopment is not.
As a practical matter, that almost guarantees that property owners will get a bad deal, particularly in a hot real estate market like New Jersey. The series cites the case of the Cangemi family, which bought a four-family home 500 yards from the ocean in Long Branch in 1988 for $240,000. Over the years, they made $80,000 in improvements. Long Branch took their home for the new Pier Village parking garage in 2001 and offered the Cangemis $182,000. Condemnation commissioners ultimately raised the offer to $220,000 - a figure the Cangemis are contesting in court. Several years ago, their appraiser valued their property at $360,000. Because state law only allows the Cangemis to argue what the property was worth when it was taken, $360,000 is the best they can do - minus the one-third cut their attorneys will take if they are successful in court. That would leave them without about $240,000 - about the same amount they paid for the property 18 years ago.
Anyone think that's fair? How would you feel if it happened to you?
The redevelopment areas of Long Branch offer many examples of why there is a need for change - assuming you accept the proposition that eminent domain for private redevelopment is acceptable in certain circumstances, which I don't. In today's ongoing Press series "The Battle Over Eminent Domain,'' it is pointed out that the value of the property being seized is frozen from the time the government moves to take it, regardless of how long it takes to settle. In determining a price, normal appreciation is taken into account, but the increased value of the property due to redevelopment is not.
As a practical matter, that almost guarantees that property owners will get a bad deal, particularly in a hot real estate market like New Jersey. The series cites the case of the Cangemi family, which bought a four-family home 500 yards from the ocean in Long Branch in 1988 for $240,000. Over the years, they made $80,000 in improvements. Long Branch took their home for the new Pier Village parking garage in 2001 and offered the Cangemis $182,000. Condemnation commissioners ultimately raised the offer to $220,000 - a figure the Cangemis are contesting in court. Several years ago, their appraiser valued their property at $360,000. Because state law only allows the Cangemis to argue what the property was worth when it was taken, $360,000 is the best they can do - minus the one-third cut their attorneys will take if they are successful in court. That would leave them without about $240,000 - about the same amount they paid for the property 18 years ago.
Anyone think that's fair? How would you feel if it happened to you?
posted by Randy Bergmann at 9:23 AM
1 Comments:
Randy, you are right on target. Agreeing that the taking is not justified in the first place, if one does allow for it, the value ought to be based upon the anticipated increased value after the redevelopment.
There are two cures to all of this. One is to only allow the replacement for blighted areas to be the equivilent of what is there now. If it is homes, then similar homes would be built. If apartments, then the same type of apartments. How many developers are going to jump at this "opportunity"?
But we all know the Adam Schneiders of this world are not interested so much in improving a blighted looking area of town as in an opportunity to increase tax revenue. That means property tax income.
And that is leads to the second disincentive that could be implemented to discourage outrageous tyranny of the state actions. ELIMINATE THE PROPERTY TAX. Without the carrot of more property tax income, the need to rob home and business OWNERS of their property in order to replace them with higher valued properites will be gone.
That will only leave the voter approved incentive so prevalent in NJ politics: Corrupt politicians need to pay off campaign contributors and other cronies. (voter approved because they keep re-electing these same creeps)
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