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  • Property Rights Slippery Slope

    Posted by Jonathan on April 27th, 2004 (All posts by )

    Scott links to this informative article about a proposed Florida law that would allow local governments to condemn private land for the sole purpose of making it available to developers. This is a recent and very bad development in U.S. local politics. The proposed law would formalize the until-now casual predatory behavior of local governments which seize land for the benefit of developers and other well connected interest groups. Legislation should forbid this kind of behavior, not codify it.

    The article also makes clear that government employees would be one of the main, if not the main interest-group beneficiaries of the proposed law:

    Government support

    Government officials from counties and cities with thousands of small residential lots such as Cape Coral, Lehigh Acres and Charlotte County say the bill is needed to better plan for the future.

    Cape Coral City Manager Terry Stewart has been to Tallahassee to lobby for the legislation. He sees a city expanding to more than 400,000 people without enough land designated for the businesses needed to serve that population.

    “If we developed all the commercial and industrial land we have today we’d still fall way short of our needs,” he said.

    This is really scandalous. One interesting and little discussed fact about the U.S. is that, while national leaders usually pay at least lip service to constitutional rights, many local officials are central-planners with as much zeal as any Soviet commissar and not a lot of concern for individual rights. They tend, like the city manager quoted above, to see their communities as government property to be managed. The problem is becoming more serious because the power wielded by such officials has grown with rising populations and tax bases, and with spending shifts from federal to local government, and because many Americans don’t pay attention to local politics. There’s a lot of ugly stuff going on under the rocks.

    The article quotes some local officials who appear to fit into the “commissar” category:

    Lehigh Acres officials estimate that they’ll need to nearly double the amount of commercial and industrial land in their community.

    Lee County Lands Director Karen Forsyth said the bill gives government the flexibility to acquire and reassemble land into larger tracts for a commercial development that a community may need.

    “It’s difficult to plan an area when you have such small lots with so many owners,” she said.

    Wayne Daltry, director of Lee County’s Smart Growth initiative, said that Lehigh Acres is the “poster child” for the bill.

    Got that? They plan, the citizens just live there. (BTW, note the reference to “Smart Growth.” Where have we seen similar ideas recently?)

    The idea that big government can be benign as long as decent people are in charge is false and dangerous. There is always a high cost to be paid for government, though that cost may be hidden, or may not come due for a long time. Keep that in mind the next time someone tries to sell you on the benefits of “compassionate conservatism” or whatever today’s fashionable rationalization for government expansion is. The Founders created a limited government for good reason.

     

    10 Responses to “Property Rights Slippery Slope”

    1. Lex Says:

      This is routine in Illinois. Private property is condemned so other private enterprises which will generate more tax revenue, or otherwise comport with the local government’s vision of what belongs there, can be put in there instead.

      One problem Conservatives have is that they claim to like the idea of local government over centralized government. Unfortunately, state and local governments are at least as bad in terms of bad thinking, probably more corrupt, subject to far less scrutiny, and may in the aggregate do more damage.

    2. Joe Says:

      I bet it would slow them down if the owners dug 9′ deep holes and filled them with used motor oil. Petroleum – the nuclear weapons of land ownership.

    3. Jonathan Says:

      Joe, that’s an attractive fantasy. The flaw with the concept is that citizens who are sufficiently motivated and organized to pull off such stunts and win are probably going to vote the bums out of office, making the stunts unnecessary. As for going it alone, good luck. Sure, some people do it, and sometimes they prevail, but very few people are willing to dedicate themselves to fighting City Hall when it’s usually much easier to move and get on with their lives. And the political establishment knows this, which is part of the explanation for its brazenness in seizing property.

      The ray of light in this story is that the Internet and the Institute for Justice now exist and together help to make the struggle a bit less unbalanced in favor of local governments.

    4. In-Cog-Nito Says:

      Stupid government intervention…

      Just let the market sort it out. If the developers pay the owners enough money, 90% of the time they won’t have to resort to dirty tactics.

    5. MatyaNoBaka Says:

      The article cites “holdouts” as being the reason why the market won’t work. But In-Coq-Nito is particularly right in this case. You are holding out? Good, we build anyway, surround your property with a parking lot, and then watch your property price plummet.

      Of course you then get the other great local government hack, the zoning board hearing…

      Matya no baka

    6. J.Scott Barnard Says:

      Jonathan, thanks for helping get the word out. Neil Bortz picked it up and thankfully several co-sponsors have withdrawn their support and the bill is going to be amended…or killed.–scott

    7. Jonathan Says:

      “Holdouts” is code that means: the market price for the land is too high for the govt to pay it openly without generating significant political opposition to the expenditure. So instead the govt hacks invoke the magic term, “market failure” and steal the land, forcing the ex-owners to bear disproportionately the costs.

      If I am offering hot dogs at $2 each and you are only willing to pay $1, you do not have the right to take a hot dog from me by force, even if you subsequently give me $1 and declare it just compensation. Yet that is what govt does when it exercises eminent domain. If govt wants to purchase hot dogs or anything else (and ignoring the question of whether govt should be in the hot-dog purchasing businesses), the best way to do it is to tax everyone equally and then buy the hot dogs for $2 each at market rates.

      If the govt’s proposed use for the land doesn’t justify paying a market prices for it, why should the govt make the purchase? These forced puuchases only appear to be justified because the costs are never stated accurately. A true accounting would include the amount necessary to get all property owners to sell. Anything less is a ripoff of the property owners whose selling price is above the lowball levels that govt usually sets in these cases.

    8. Jonathan Says:

      Scott, that is great news. Thanks for passing it along.

    9. Jim English Says:

      I caught a re-run on PBS the other night about the building of the World Trade Center. They talked about how the city condemned hundreds of buildings in order to take the property and give it to the developers. Owners of the condemned properties were given “compensation” for their land and buildings. Three story brick apartment buildings w/ lot were “valued” at $9000.00. Can you imagine what those lots would be worth now? If you lived one block over you’re filthy rich. I realize that the WTC is part of the reason that the values skyrocketted but still is it right for the government to forcibly remove someone from their land for private development? No freakin way! I don’t feel good about it when it is for public use.

      Jim English
      Chicago

    10. AnotherScott Says:

      I actually wrote a paper about this practice two years ago in law school. One of the main cases I highlighted was a case in SW Illinois where a race track had worked with a local state development agency to condemn land used by their neighbor for use as a new parking area.

      In cases like this there has to be a public need and right now the standard is ‘blight,’ which can basically be defined by the local government as they wish. What was really crazy in this case was that the blight, bad and ‘dangerous’ traffic was caused by the race track, NOT the land being condemned. Fortunately the busisness owners who stood to lose their land fought hard, all the way to the IL Supreme Court (twice) and finally won.

      Nation wide, this trend has been going on for a while, including writing laws to fasttrack the authority to local concerns. However, in the last two years there has been some groing resistance from courts concerned about perversion of the 5th amendment (from whence the power to condemn springs).

      PS – The world trade center was 30 years ago, you don’t have to go back that far. The new building going up for the NY Times was a result of just that sort of deal. In fact, in New York, just about any new major construction is a monument to an immense lobbying and arm-twisting effort.