Eminent Domain and the Greyhound Bus Terminal

[DaveKCMO]

this is an instance when eminent domain is a good thing, IMO. that property has been stagnating for years and is a complete eyesore. i just love the sight of razorwire in my city's government district.

KCMax Edit: For reference, see here and the East Village thread here

[kard]

this is an instance when eminent domain is a good thing, IMO. that property has been stagnating for years and is a complete eyesore. i just love the sight of razorwire in my city's government district.

Eminent domain here?  While I think the building is crappy, I still don't like the idea of taking it to build something other than infrastructure.  The city should slap him to death with codes violations, etc for awhile first.

In fact, why is the city even involved?  Shouldn't the developer be paying for the building?

[knucklehead]

This is an example of a property owner trying to extort a price based on the value of a larger project that needs their property to proceed.

Without the east village project, that property is worth maybe $1.5 million tops.

But because it is a relatively small piece of a large project, the owner thinks he can extort part of the value of that larger project by holding out for a price he would never be able to get without the project.

the example I use is a project like Kansas Speedway. Lets say there are 20 residential properties that need to be bought. The market value of the properties, before the proposed speedway is readily determinable from comparable sales. Lets say 100,000 per property to simplfy.

After the first 18 property owners sell for a reasonable price, there are two properties sitting right in the middle of the site. The property owners demand $1 million each, because if they don't sell, a $1 billion project goes down the tubes.

Relocating to another site isn't cost effective, as there were reasons why you chose that site to start with and you already own most of the land.

The hold out owners figure they can exact a high toll that far exceeds the "pre project value" of their land. They know work around alternatives will be cost prohibitive. So they figure without emminent domain they can sucessfuly extort $900,000 K in windfall profits.

Its not hard to understand. Some people seem to believe all major projects should have to pay an excessive toll to the last few holdout land owners. I just don't get why they think this way.

Personally, I kind of like the new approach in Missouri. The emmient domain price should be 20 percent higher than market value. That gives the owner some compensation for being forced to sell letting them get away with gross extortion.

[DaveKCMO]

Eminent domain here?  While I think the building is crappy, I still don't like the idea of taking it to build something other than infrastructure.  The city should slap him to death with codes violations, etc for awhile first.

In fact, why is the city even involved?  Shouldn't the developer be paying for the building?

i assume the deal is structured just like P+L... the city assembled all of the properties first and then handed them over to the developer. does anyone know if that's normal for large projects like this in other cities? or are we just being someone's bitch here?

[kard]

This is an example of a property owner trying to extort a price based on the value of a larger project that needs their property to proceed.

Without the east village project, that property is worth maybe $1.5 million tops.

I agree, but that's his right.  We're not talking about building a road or utilities there.  We're talking about building apartments / condos.

I get the "anger" when it comes to a hold out, but I don't like the idea of one person's business or home or whatever being put above someone else's just because they've got more money.  The Speedway is a good example--it's a private business.  It should be sorted out between the two parties involved.

Its not hard to understand. Some people seem to believe all major projects should have to pay an excessive toll to the last few holdout land owners. I just don't get why they think this way.

I understand it fine, thanks.  I just don't like it when someone says I have to sell my farm so someone can put in a Wally World.  I also think more density is needed on the east loop, but it doesn't have to be done in a large project.

Personally, I kind of like the new approach in Missouri. The emmient domain price should be 20 percent higher than market value. That gives the owner some compensation for being forced to sell letting them get away with gross extortion.

Big fan of that.  I wouldn't mind it being higher in some cases.  There are times when one can't replace what they have by getting market value.  I'm reminded of the neighborhood in Sunset Hills (in southwest St Louis) where some were given 180k but couldn't find a place that low in the same school district.

[mean]

The practice of government taking away property from private owners to give it to other private owners is tyrannical and should be stopped.

[Maitre D]

The practice of government taking away property from private owners to give it to other private owners is tyrannical and should be stopped.

Yes.

It is obnoxious that these property holders do attempt "extortion", but that doesn't really affect me.  Government power and intrustion into my life, surely does.

This argument boils down to the same one used on most aspects of thought:  either you support the power of the individual, or the power of the state.  I think the state owes us explanations and justifications - not the other way around.

[KC-wildcat]

The practice of government taking away property from private owners to give it to other private owners is tyrannical and should be stopped.

I agree.  As former Justice O'Connor stated in her Kelo dissent:
"The public use requirement, in turn, imposes a more basic limitation, circumscribing the very scope of the eminent domain power: Government may compel an individual to forfeit her property for the public'suse, but not for the benefit of another private person. This requirement promotes fairness as well as security."

That said,
If a neighborhood has become so “injurious to the public health, safety, morals, and welfare” it may be necessary to “eliminat[e] all such injurious conditions by employing all means necessary and appropriate for the purpose,” including eminent domain. 

Thus, in the case of East Village, where the propery is so blighted that the general public is being harmed, eminent domain may be necessary. 

[ShowMeKC]

The only rightful use of eminent domain, is taking it from criminals or absentee landowners.

[aknowledgeableperson]

What one person may see is blight, the property owner may see an investment just waiting for the right opportunity and time to develop.  Don't know Barber, don't know why he purchased this property, but why should one entity take it away from him so that another entity can reap a big profit?  If that land is so valuable to a developer then the current property owner should also benefit in that stepped up valuation.

Right now both sides are just posturing to see where the other side stands.  As I said before I don't know why Barber purchased this tract of land but I do believe it was to sell to make a profit and not to develop it himself.  It may be an eyesore however I do not see Codes coming down on him for violations.  And if he had violations in the past they would have been remedied.

So sit tight.  Barber will sell when he sees the money he wants to see.  That amount might be more than the developer wants to pay.  I don't think neither side wants this to go to the condemnation court so expect an agreement close to that court date.

[Highlander]

The only rightful use of eminent domain, is taking it from criminals or absentee landowners.

I do not agree but I would like to know what you consider an absentee landowner?  How is Barber any different from an absentee landowner....he does not live on the property, as far as I know there is no extant business on the property nor are there any apparent plans for the property to be improved.  Seems to qualify as an absentee landowner to me.   

I tend to agree more with KC Wildcat and Justice O'conner on this one. 

[BVC]

The practice of government taking away property from private owners to give it to other private owners is tyrannical and should be stopped.

It's good old fashion fascism...

[tat2kc]

Well, if the owner is putting the value of his property at $17 million, then the city should oblige him by assessing his property at 17 million for tax purposes.

[mean]

Well, if the owner is putting the value of his property at $17 million, then the city should oblige him by assessing his property at 17 million for tax purposes.

I would much rather see that than the government forcibly taking his property. And there are probably other creative ways to try and get the guy to not be an idiot about the sell price. But in the end, if the guy doesn't want to play ball he shouldn't be forced to. Build around him or pay what he's asking.

[Maitre D]

Well, if the owner is putting the value of his property at $17 million, then the city should oblige him by assessing his property at 17 million for tax purposes.

Good point.  They should do that, just to see his reaction.

[chrizow]

this is clearly the old-school negotiation tactic of asking a ridiculously high sum in the hopes of somehow inflating the final sum...much research has revealed this just wastes time and doesn't end up with a higher result than good faith bargaining, but whatever...my guess is that this guy will get $4M for his $200,000 property and EV will move forward.

[KC-wildcat]

I would much rather see that than the government forcibly taking his property. And there are probably other creative ways to try and get the guy to not be an idiot about the sell price. But in the end, if the guy doesn't want to play ball he shouldn't be forced to. Build around him or pay what he's asking.

While I do like the tax idea, I don't see the city as having any problem taking his property through the use of eminent domain.  Of course, they'll have to pay him the market rate for his property.  No way he's getting anywhere near $17 mil. 

I do not like eminent domain.  Our country was founded on the basic principle of private ownership of property.  This is what seperated America from England; the prospect of owning your own land.  Of course, there are exceptions to this. 

Unfortunately, in DT Kansas City, I don't think you can make the argument that this property owner is operating to the detriment of society.  In Kelo, the unemployment rate was stunning, the city was deteriorating, population was dwindling, etc.  For that reason, the city approved the taking of a nice waterfront property to build a big pharmaceutical plant that would employ hundreds of people and would add unmatched economic stimulus to the City of New London.  The Court held that this fell within the "public use" exception to the Takings Clause.
Here, in KC, the East Village will be a nice (in my biased opinion, essential) addition to DT, it is not harming society as a whole. 

[tat2kc]

If he doesn't pay the tax bill, then the city can seize his property for unpaid taxes. Then, not only does the city make some cash, they get the property.

[Highlander]

If he doesn't pay the tax bill, then the city can seize his property for unpaid taxes. Then, not only does the city make some cash, they get the property.

I agree, I think you have found a universal way to deal with such opportunistic hold outs in lieu of eminent domain. 

[tat2kc]

no doubt. Then when he appeals, and says the property is only worth a million or so, then the city can pounce!