Understanding California Eminent Domain Law

The Following Is Quoted Directly Out Of The California Constitution

CALIFORNIA CONSTITUTION
ARTICLE 1 DECLARATION OF RIGHTS

SEC. 19. Private property may be taken or damaged for public use only when just compensation, ascertained by a jury unless waived, has first been paid to, or into court for, the owner. The Legislature may provide for possession by the condemnor following commencement of eminent domain proceedings upon deposit in court and prompt release to the owner of money determined by the court to be the probable amount of just compensation.

The main difference between what is in the California Constitution now and the newer language was this one added sentence: "Private property may not be taken or damaged for private use."

In essence it was the same added language but specifically said no to private party takings and damages. Maybe the language in subsequent areas could have clarified that general zoning changes were not ruled as damages even though (my reading of it) was specifically addressing the zoning changes involved with eminent domain takeovers.

This just goes to show that the writing of laws need to be as tight as possible in order to leave out any ambiguities.

As our California Constitution is currently written in this area, there are a lot of ambiguities, because the argument could be made by a Lawyer that since the California Constitution already says, "Private property may be taken or damaged for public use only when just compensation," which infers that private property may not be taken or damaged for private use. However, I suspect that since it does not specifically say, "private property may not be taken or damaged for private use," that other Lawyers have interpreted this to mean that cities can use it for private property gain. This has opened the spigot for cities to have Eminent Domain on their books as a tool for Redevelopment Zones to use in a "last case resort"

However, as we have said before, having an eminent domain hammer over a redevelopment zone imposes a very aggressive stance against any owner of property in the redevelopment zones. Plus, redevelopment zones can be expanded or include other areas of the community. Intimidation is definitely a force, in which an aggressive developer comes in to the city and proposes a major change for the property. With visions of dollar signs in the head of City Council Members (an increased tax base for the city), is it any wonder why most property owners really have an aversion to having Eminent Domain on the books? Likewise, as the city tries to meet their low cost housing goals, the pressure is on for them to really forget the rights of the individual property owners and do what will Net them the most value. If that means having Eminent Domain on the books, then the city will take advantage of this by having it as Council Member David E. Hudson, stated, "Eminent Domain is just another tool in our quiver, we do not intend to use it." That was the reason that the City Council passed Eminent Domain for private gain to be a tool in their quiver.

Market forces are steered by laws, zoning, and other ordinances. Eminent Domain on the books of San Ramon steers market forces. Once again we have the case of the "law of unintended consequences."

8 States Vote To Restrict Eminent Domain

From CNNMoney.com

Voters on Tuesday responded by voting in favor of the restrictive measures in eight of those initiatives - call it Kelo's revenge.

Two other states rejected similar ballot measures, and results for one were not expected until later on Wednesday.

Arizona, Florida, Georgia, Michigan, Nevada, North Dakota, Oregon and South Carolina all passed initiatives to restrict the use of eminent domain, in most cases overwhelmingly.

In Florida, 69 percent voted yes on an amendment that prohibits using eminent domain to force the transfer of property from one private individual or entity to another.

In Georgia, 83 percent voted to approve an amendment to the state constitution that says eminent domain can be used only for public use. A school or park might be okay; the government taking land to give to a mall developer would not be.

The most one-sided vote in favor took place in South Carolina, where 86 percent voted yes to an amendment restricting eminent domain for public use only.

Read the entire story: Kelo's revenge: Voters restrict eminent domain

The vote in California was close. Opponents of Proposition 90 claimed that the proposition went too far and encompassed areas that had to do with zoning and other issues not related directly to eminent domain.

While some individuals read the initiative one way, others read it another. It is certainly apparent that the public is not very happy with the decision that the government could kick you out of your property and give it to another developer so the city can increase the tax base by building more expensive condo projects or other types of projects that would substantially increase a city's tax base.

It is likely that there will be another initiative on the ballot at some time in the future that clears up the language and wording for restricting eminent domain usage. The posting before this has an interesting conversation going on about this issue.

Here is also an interesting story from a ways back.

Eminent Domain: Being Abused?

Vote Yes On Proposition 90

GOVERNMENT ACQUISITION, REGULATION OF PRIVATE PROPERTY.
INITIATIVE CONSTITUTIONAL AMENDMENT.

• Bars state and local governments from condemning or damaging private property to promote other private projects or uses.
• Limits government's authority to adopt certain land use, housing, consumer, environmental and workplace laws and regulations, except when necessary to preserve public health or safety.
• Voids unpublished eminent domain court decisions.
• Defines "just compensation."
• Government must occupy condemned property or lease property for public use.
• Condemned private property must be offered for resale to prior owner or owner's heir at current fair market value if government abandons condemnation's objective.
• Exempts certain governmental actions.

In an effort to address some of the opponents misleading statements and scare tactics, it is wise to read the actual wording of the proposition. Proposition 90 takes us back to what the original, limited use, of eminent domain was all about.

The mantra by various City Council members and even the San Ramon Legal Council stating that they would only use Eminent Domain in Redevelopment zones "as a last resort," is an error in logical and critical thinking. While cities seldom use the Eminent Domain clauses in their arsenal of so called "Redevelopment Tools," the very threat of having it on the books to be used "in a last case resort," is like having the government, holding a hammer over the head of individual property owners, and makes it much more likely that an aggressive developer could come in with the idea of making a ton of money using the Redevelopment Agency as a party to "market forces" and selling a proposal to the Redevelopment Agency / City Council to substantially increase a city's tax base with new private development projects.

The Trivalley Mayor's all came out against Proposition 90 because it places a substantial roadblock to new private redevelopment projects, where the possibility exists of having to use eminent domain on a individual property owner holdout for private developments.

Tom McClintock running for Lt. Governor, has recommended voting Yes on Proposition 90

Prop. 90 Protect Our Homes: YES! Restores the Fifth Amendment property rights protections in the Bill of Rights that the U.S. Supreme Court shredded with its infamous Kelo decision. Prop. 90 prohibits local officials from seizing homes and businesses for the profit of politically well-connected private interests, and requires government to pay you for any damage it does to your property.

In an article from: The Voice of San Diego
Pro: Prop 90 Reaffirms the Fifth Amendment

Proposition 90 is in response to that. When enacted, it will prevent churches and tire stores from being condemned for Costco, plumbing stores from being condemned for Home Depot, restaurants from being condemned for Lowe's, health care agencies and Toyota dealerships from being condemned for BMW, cigar stores from being condemned for hotels and a small developer's property from being condemned for a larger developer.

The bottom line is, with the passage of Proposition 90, it will completely change the way cities operate in their attitude toward the individual landowners. Cities will not be allowed to simply declare an area blighted because they want to place a new private Redevelopment project on the books. Government will have to go back to operating under the US Constitution instead of circumventing it.

The actual text of proposition 90 is as follows:

PROPOSITION 90
This initiative measure is submitted to the people in accordance with the provisions of Article II, Section 8 of the California Constitution. This initiative measure expressly amends the California Constitution by amending a section thereof; therefore, new provisions proposed to be added are printed in italic type to indicate that they are new.

PROPOSED LAW

SECTION 1. STATEMENT OF FINDINGS
(a) The California Constitution provides that no person shall be deprived of property without due process of law and allows government to take or damage private property only for a public use and only after payment to the property owner of just compensation.
(b) Despite these constitutional protections, state and local governments have undermined private property rights through an excessive use of eminent domain power and the regulation of private property for purposes unrelated to public health and safety.
(c) Neither the federal nor the California courts have protected the full scope of private property rights found in the state constitution. The courts have allowed local governments to exercise eminent domain powers to advance private economic interests in the face of protests from affected homeowners and neighborhood groups. The courts have not required government to pay compensation to property owners when enacting statutes, charter provisions, ordinances, resolutions, laws, rules or regulations not related to public health and safety that reduce the value of private property.
(d) As currently structured, the judicial process in California available to property owners to pursue property rights claims is cumbersome and costly.

SEC. 2. STATEMENT OF PURPOSE
(a) The power of eminent domain available to government in California shall be limited to projects of public use. Examples of public use projects include, but are not limited to, road construction, the creation of public parks, the creation of public facilities, land-use planning, property zoning, and actions to preserve the public health and safety.
(b) Public use projects that the government assigns, contracts or otherwise arranges for private entities to perform shall retain the power of eminent domain. Examples of public use projects that private entities perform include, but are not limited to, the construction and operation of private toll roads and privately-owned prison facilities.
(c) Whenever government takes or damages private property for a public use, the owner of any affected property shall receive just compensation for the property taken or damaged. Just compensation shall be set at fair market value for property taken and diminution of fair market value for property damaged. Whenever a property owner and the government cannot agree on fair compensation, the California courts shall provide through a jury trial a fair and timely process for the settlement of disputes.
(d) This constitutional amendment shall apply prospectively. Its terms shall apply to any eminent domain proceeding brought by a public agency not yet subject to a final adjudication. No statute, charter provision, ordinance, resolution, law, rule or regulation in effect on the date of enactment that results or has resulted in a substantial loss to the value of private property shall be subject to the new provisions of Section 19 of Article 1.
(e) Therefore, the people of the state of California hereby enact "The Protect Our Homes Act."

SEC 3. Section. 19 of Article I of the California Constitution is amended to read: SEC. 19. (a)(1) Private property may be taken or damaged only for a stated public use and only when just compensation, ascertained by a jury unless waived, has first been paid to, or into court for, the owner. Private property may not be taken or damaged for private use.
(2) Property taken by eminent domain shall be owned and occupied by the condemnor, or another governmental agency utilizing the property for the stated public use by agreement with the condemnor, or may be leased to entities that are regulated by the Public Utilities Commission or any other entity that the government assigns, contracts or arranges with to perform a public use project. All property that is taken by eminent domain shall be used only for the stated public use.
(3) If any property taken through eminent domain after the effective date of this subdivision ceases to be used for the stated public use, the former owner of the property or a beneficiary or an heir, if a beneficiary or heir has been designated for this purpose, shall have the right to reacquire the property for the fair market value of the property before the property may be otherwise sold or transferred. Notwithstanding subdivision (a) of Section 2 of Article XIII A, upon reacquisition the property shall be appraised by the assessor for purposes of property taxation at its base year value, with any authorized adjustments, as had been last determined in accordance with Article XIII A at the time the property was acquired by the condemnor.
(4) The Legislature may provide for possession by the condemnor following commencement of eminent domain proceedings upon deposit in court and prompt release to the owner of money determined by the court to be the probable amount of just compensation.
(b) For purposes of applying this section:
(1) “Public use” shall have a distinct and more narrow meaning than the term “public purpose”; its limiting effect prohibits takings expected to result in transfers to nongovernmental owners on economic development or tax revenue enhancement grounds, or for any other actual uses that are not public in fact, even though these uses may serve otherwise legitimate public purposes.
(2) Public use shall not include the direct or indirect transfer of any possessory interest in property taken in an eminent domain proceeding from one private party to another private party unless that transfer proceeds pursuant to a government assignment, contract or arrangement with a private entity whereby the private entity performs a public use project. In all eminent domain actions, the government shall have the burden to prove public use.
(3) Unpublished eminent domain judicial opinions or orders shall be null and void.
(4) In all eminent domain actions, prior to the government’s occupancy, a property owner shall be given copies of all appraisals by the government and shall be entitled, at the property owner’s election, to a separate and distinct determination by a superior court jury, as to whether the taking is actually for a public use.
(5) If a public use is determined, the taken or damaged property shall be valued at its highest and best use without considering any future dedication requirements imposed by the government. If private property is taken for any proprietary governmental purpose, then the property shall be valued at the use to which the government intends to put the property, if such use results in a higher value for the land taken.
(6) In all eminent domain actions, "just compensation" shall be defined as that sum of money necessary to place the property owner in the same position monetarily, without any governmental offsets, as if the property had never been taken. "Just compensation" shall include, but is not limited to, compounded interest and all reasonable costs and expenses actually incurred.
(7) In all eminent domain actions, "fair market" value shall be defined as the highest price the property would bring on the open market.
(8) Except when taken to protect public health and safety, "damage" to private property includes government actions that result in substantial economic loss to private property. Examples of substantial economic loss include, but are not limited to, the downzoning of private property, the elimination of any access to private property, and limitations on the use of private air space. "Government action" shall mean any statute, charter provision, ordinance, resolution, law, rule or regulation.
(9) A property owner shall not be liable to the government for attorney fees or costs in any eminent domain action.
(10) For all provisions contained in this section, "government" shall be defined as the State of California, its political subdivisions, agencies, any public or private agent acting on their behalf, and any public or private entity that has the power of eminent domain.
(c) Nothing in this section shall prohibit the California Public Utilities Commission from regulating public utility rates.
(d) Nothing in this section shall restrict administrative powers to take or damage private property under a declared state of emergency.
(e) Nothing in this section shall prohibit the use of condemnation powers to abate nuisances such as blight, obscenity, pornography, hazardous substances or environmental conditions, provided those condemnations are limited to abatement of specific conditions on specific parcels.
SEC. 4. IMPLEMENTATION AND AMENDMENT
This section shall be self-executing. The Legislature may adopt laws to further the purposes of this section and aid in its implementation. No amendment to this section may be made except by a vote of the people pursuant to Article II or Article XVIII of the California Constitution.
SEC. 5. SEVERABILITY
The provisions of this section are severable. If any provision of this section or its application is held invalid, that finding shall not affect other provisions or applications that can be given effect without the invalid provision or application.
SEC. 6. EFFECTIVE DATE
This section shall become effective on the day following the election pursuant to subdivision (a) of Section 10 of Article II of the California Constitution.
The provisions of this section shall apply immediately to any eminent domain proceeding by a public agency in which there has been no final adjudication.
Other than eminent domain powers, the provisions added to this section shall not apply to any statute, charter provision, ordinance, resolution, law, rule or regulation in effect on the date of enactment that results in substantial economic loss to private property. Any statute, charter provision, ordinance, resolution, law, rule or regulation in effect on the date of enactment that is amended after the date of enactment shall continue to be exempt from the provisions added to this section provided that the amendment both serves to promote the original policy of the statute, charter provision, ordinance, resolution, law, rule or regulation and does not significantly broaden the scope of application of the statute, charter provision, ordinance, resolution, law, rule or regulation being amended. The governmental entity making the amendment shall make a declaration contemporaneously with enactment of the amendment that the amendment promotes the original policy of the statute, charter provision, ordinance, resolution, law, rule or regulation and does not significantly broaden its scope of application. The question of whether an amendment significantly broadens the scope of application is subject to judicial review.