JLF Memo
Dec. 14th, 2010: - johnlocke.org

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The Fayetteville Observer Fails to Understand Blight Abuse, Among Other Things
By Daren Bakst

On December 8, 2010, The Fayetteville Observer ran an unfortunate editorial that, in defending a possible attempt by Fayetteville to seize private property for a business park, used the blight excuse as justification for taking the property.

As written in the article:

Acquiring the site may be problematic, and with $1 million already committed for land acquisition, the problem isn't money.

Eighty percent of the parcels are vacant, but on the others are residences and a small business. The City Council was right to defer action, buying itself a little time for a look at both the relocation of residents and the sensitive issue of eminent domain.

Here are some quick points:

1.    Cities don't just come out and admit that they are seizing private property for economic development (as in Kelo). Instead, cities use overbroad definitions of "blight" to seize private property. In many states, properties don't even have to be considered blighted so long as they are located within a blighted area.

2.    A recent Institute for Justice study states: "Under that act [Federal Housing Act of 1949], which was in force between 1949 and 1973, cities were authorized to use the power of eminent domain to clear 'blighted neighborhoods' for 'higher uses.' In 24 years, 2,532 projects were carried out in 992 cities that displaced 1 million people, two-thirds of them African American."

3.    In 2006, the North Carolina legislature amended the state's blight law to address two critical issues. First, the law tightened up the definition of "blight." Second, it required each individual property to be blighted.

Prior to that, North Carolina cities could seize private property that hurt sound economic growth (i.e., the same thing as taking property for economic development). They also could seize property in pristine condition if it was in a "blighted area."

While the North Carolina blight law still is too broad, it almost certainly would prohibit Fayetteville from seizing the properties constituting twenty percent of the potential business park site, and it also would likely prohibit the seizures of the vacant properties (depending on the nature of the properties and the reasons for their vacancies).

The newspaper also makes the following very strange/amusing argument in defending the use of eminent domain: "[M]ost or all of these residents appear to be renters, not landowners."

Huh? This may come as news, but renters tend to rent property from landowners.

If there's going to be real eminent domain reform in North Carolina, any proposed constitutional amendment will need to address blight. Seizing property based on blight is usually just a pretext for Kelo-type takings.


More Dam Editorials

The Winston-Salem Journal published a recent editorial arguing that the state should seize the Alcoa hydropower dam. As I have written before, North Carolina is trying to nationalize industries, not unlike Hugo Chavez.

In all fairness, North Carolina isn't alone in trying to nationalize hydroelectric dams. Socialist Bolivia recently acted to nationalize its hydroelectric dams as well.

Here's a key quote from the
Journal's editorial:

Alcoa, which plans to appeal the state revocation and is pushing for a renewal of its license, has painted the state's attempt to control the dams as a government takeover of private business. That's a vast exaggeration. Alcoa has held a 50-year license to operate the dams, and the renewal of that license is now being considered by the commission. The river belongs to the people of North Carolina, and is protected by the state and federal governments. If the state does prevail over Alcoa in what's sure to be a hard-fought battle, it should give the company a fair-market value for the dams and related infrastructure.

A couple of points:

  1. How is Alcoa incorrect in stating that this is a takeover of a private business? North Carolina would be seizing the dam (a private business) because it feels it can run the dam better. Don't be surprised, however, if the dam and other infrastructure are eventually transferred to a developer or a utility company.

  2. Yes, the river belongs to North Carolina, but Alcoa isn't claiming to own the river. A property owner also can make reasonable use of the river. If the state leaders dislike how Alcoa is using the river, then they can address that use -- it doesn't logically follow that they should seize private property,including property that has nothing to do with the use of the river.

  3. That's nice of the paper to be willing to give fair-market value for the dams and related infrastructure. By law, of course, any seizure of private property already requires fair-market value.


Quick Takes

Quick Takes

Homeowners protest town's plan to annex property involuntarily (Town of Franklin)

A public hearing on the imminent involuntary annexation of properties was held last Monday at Town Hall...

William Roten, of Walnut Street, contended that at least some of the properties on the annexation map were incorrectly placed within city limits. "This map is not right. Your attempt to annex these properties is null and void, according to these statutes right here," he said, referring to the state annexation statutes in his possession. Roten said that according to the legislation, a map depicting a city must be completely accurate concerning where properties are designated to be, before further annexation can occur.

Towns given power over county property owners

While opponents of forced annexation are hopeful the new Republican majority in the General Assembly will enact meaningful annexation reform, Republicans on the Wake County Commission recently extended the power of two municipalities to control private property in areas near the towns.



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