Overriding Broad Public Use in the Face of Bad Faith Blight: In re Parminder Kaur and Redeveloping Eminent Domain in New York State

Robert Barrows, Albany Government Law Review Editor-in-Chief

Introduction

            In 2005, the United States Supreme Court held in a controversial decision that the clearing and transfer of private property to a private developer for the purpose of economic redevelopment was a “public use” under the Takings Clause of the Fifth Amendment.[1]  The holding in Kelo v. City of New London not only outraged certain members of the Court[2], it also prompted forty-three states to pass legislation restricting the use of eminent domain.[3]  Although efforts were made to reform the state’s condemnation procedures, New York is not one of the forty-three.[4]  In the last eight months, however, New York courts have issued two decisions with strong implications for the state’s eminent domain powers.  In Matter of Goldstein v. N.Y.S. Urban Development Corp., the New York Court of Appeals endorsed the use of eminent domain to remove blighted properties in the Atlantic Yards neighborhood of Brooklyn for the development of a new arena for the New Jersey Nets as well as luxury apartments and office space.[5]  Decided within two weeks of Goldstein was In re Parminder Kaur v. N.Y.S. Urban Development Corp., where the First Department, in a complete turnaround from the Court of Appeals, sided with private property owners in the Manhattanville section of West Harlem who were fighting the City’s decision to use eminent domain for the purpose of expanding Columbia University’s campus.[6]  The court held that the taking was unconstitutional and failed to meet the state constitution’s “public use” requirement.[7]  The Court of Appeals will hear arguments for In re Parminder Kaur, in the beginning of June, and many land-use experts believe it will be overturned based on the logic employed in Goldstein.[8]  In re Parminder Kaur, however, could be the long invoked hypothetical case by the Court of Appeals that would justify a judicial halt to the condemnation proceedings even if the taking meets constitutional mandates.

The Law and The Kaskel Hypothetical 

          Reminiscent of the Fifth Amendment, the New York Constitution provides that “private property [shall not] be taken for public use, without just compensation.”[9]  Consistent with the Supreme Court’s decision in Berman v. Parker, the state has deemed blight removal, slum clearance, and redevelopment as public uses that would trigger eminent domain.[10]  The general test for whether private property is blighted is if the area is “substandard or insanitary”[11] and is determined by an objective study statutorily performed by the Empire State Development Corporation (ESDC), a state entity that liaises between the government and developers.[12]

          Due to the state’s historic broad interpretation of public use, New York has the dubious distinction as being one of the most hostile places to property rights.[13]  The Court of Appeals, however, has stated, although not employed, a public policy exception to constitutional takings involving blight removal.  Announced in Kaskel v. Impellitteri, and more importantly re-iterated in Goldstein, the court would halt blight-based condemnation proceedings where “the physical conditions of an area might be such that it would be irrational and baseless to call it substandard or insanitary.”[14]  In evaluating some of the eye-brow raising tactics used by the ESDC and Columbia in designating Manhattanville as blighted, In re Parminder Kaur just may be the Court of Appeals’ hypothetical scenario.

“Irrational and Baseless” Blight

            It is certainly understandable as to why so many land-use practitioners rationalize that In re Parminder Kaur will be overturned in the wake of Goldstein.  Surely, from a logical stance, the Court of Appeals will deem the removal of urban blight for the expansion of a university, albeit a very elite one, a public use if they did so already for the construction of a new basketball arena.  In re Parminder Kaur, however, is categorically different because it is a case that involves timing and procedure in eminent domain and appears to be filled with improper motives, collusion, and questionable claims that should justify the use of the Kaskel exception.  In Goldstein, more than 2/3rds of the proposed site had been designated as blighted by the ESDC since 1968.[15]  The only area of contention was a mere two blocks that had not been previously blighted.[16]  In In re Parminder Kaur, however, the finding of blight by the ESDC was made after Columbia’s plan became well-known and had purchased over fifty-one percent of the properties in the neighborhood.[17] 

            In 2001, Columbia University approached the New York City Economic Development Corporation (EDC) about redeveloping Manhattanville.[18]  In response to the University’s plans, the EDC issued a report about the neighborhood’s status and noted that the site was once a “waterfront gateway [to] Manhattan” with a possible “renewed future” and that fifty-four of the sixty-seven affected lots were in “good,” “very good,” or “fair” condition.[19]  Yet despite such a positive outlook, in 2004, after Columbia had made its plans well known to the state, the ESDC and the EDC deemed the proposed site as unsanitary and unsafe and designated Manhattanville as “blighted” and worthy of eminent domain.[20]

            The circumstances surrounding the blight determination process in Manhattanville suggests that this was simply manufactured.  In light of the EDC’s report in 2001 and Columbia’s purchase of a majority of the properties, the University let it be well known that eminent domain would be needed to complete the project and even entered into an agreement with ESDC to pay the costs of the agency in connection with the project.[21]  The first study by the ESDC that stated Manhattanville was blighted was performed by a consulting firm that Columbia had previously hired for their own report.[22]  In order to deflect an appearance of impropriety, the ESDC issued a second blight study that the First Department later summarized as a clear replication.[23]  More determinative that an improper motive was present in the blight determinations is the fact that Columbia owned many of the inspected properties by 2004 and failed to make repairs, fix building code violations, and adhere to city-wide regulations.[24]  The First Department pointedly noted that that there was no record before the ESDC “whatsoever that Manhattanville was blighted prior to Columbia gaining control” of a majority of the affected properties.[25]  Furthermore, the defects that ESDC considered to make in its determinations appeared to be minor and included unpainted block walls and loose awning supports.  The First Department reduced these findings to sheer “idiocy” and further commented that “[v]irtually every neighborhood in the five boroughs will yield similar instances of disrepair that can be captured in close-up technicolor.”[26]  Once Columbia’s intentions were known, the ESDC placed few constraints on the university and failed to consider other developers and community plans.[27]      

Conclusion

            The taking of Manhattanville appears to be, on its face, manufactured and so ostentatious that the Kaskel exception could come into play.  Much of the ire of the First Department’s opinion was directed at the ESDC’s process for making its determination and the court placed strong importance on timing and procedure in the exercise of eminent domain – a theme that perhaps will continue on appeal.  More importantly, given the current public outrage and uncertainty surrounding the law of eminent domain, employing a long invoked exception that places a check against engineered pretenses to justify a taking would perhaps be a sensible solution.  With In re Parminder Kaur v. N.Y.S. Development Corp., the use of the hypothetical exception illustrated in Kaskel may be justified. 


[1] Kelo v. City of New London, 545 U.S. 469 (2005).

[2] See id. at 494 (O’Connor, J., dissenting).

[3] Terry Pristin, Columbia Setback Puts Eminent Domain in Spotlight, N.Y. Times, Jan. 10, 2010, at B6.

[4] Id.

[5] Matter of Goldstein v. N.Y.S. Urban Dev. Corp., 921 N.E.2d 164 (N.Y. 2009).

[6] In re Parminder Kaur v. N.Y.S. Urban Dev. Corp., 892 N.Y.S.2d 8 (1st Dep’t 2009) .

[7] Id. at 28–29.

[8] Pristin, supra note 3, at B6.

[9] N.Y. Const. art. I, § 7(a).

[10] See Berman v. Parker, 348 U.S. 26, 32–34 (1954); N.Y. Const. art. XVIII, § 1.

[11]See N.Y. Const. art. XVIII, § 1; N.Y. Unconsol. § 6260(b)(1) (McKinney 2010).

[12] N.Y. Unconsol. § 6263 (McKinney 2010).

[13] See generally Pristin, supra note 3, at B6; see also Charles V. Bagli, Court Bars New York’s Takeover of Land for Columbia Campus, N.Y. Times, Dec. 4, 2009, at A1.

[14] Kaskel v. Impellitteri, 115 N.E.2d 659, 662 (N.Y. 1953); see also Matter of Goldstein v. N.Y.S. Urban Development Corp., 921 N.E.2d 164, 174 (N.Y. 2009) (quoting Kaskel, 115 N.E.2d at 662).

[15] Goldstein, 921 N.E.2d at 166.

[16] Id. 

[17] In re Parminder Kaur v. N.Y.S. Urban Dev. Corp., 892 N.Y.S.2d 8, 12–14 (1st Dep’t 2009).

[18] Id. at 12.

[19] Id.

[20] Id. at 12–13.

[21] Id. at 12.

[22] Id.; see also Brief for New York State Senator Bill Perkins, as Amici Curiae Supporting Respondents at 9, Matter of Kaur v. New York State Urban Dev.Corp., No. 777778 (N.Y. Ct. App. April 23, 2010), available at http://www.nysenate.gov/files/pdfs/AMICUS.pdf.

[23] Brief for Perkins, supra note 22, at 9.

[24] In re Parminder Kaur, 892 N.Y.S.2d at 21.

[25] Id. at 20.

[26] Id. at 22.

[27] Brief for Perkins, supra note 22, at 10.

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3 Comments

Filed under Constitutional Law, Land Use

3 responses to “Overriding Broad Public Use in the Face of Bad Faith Blight: In re Parminder Kaur and Redeveloping Eminent Domain in New York State

  1. Mr. Barrows nails the larger issue with eminent domain in his conclusion when he speaks about “engineered pretenses to justify a taking.”

    Those of us who have faced the threat of eminent domain know two things: It is a sobering experience and much of it seems “manufactured,” to Mr. Borrows point.

    More “taking” is on its way in New York and Pennsylvania, thanks to the rising interest in natural gas drilling in the gas-rich Marcellus Shale. With more drilling comes more pipelines and more underground gas storage fields — and that (pipelines & storage fields) always means eminent domain.

    Alexandra Klass, Associate Professor of Law at the University of Minnesota Law School, wrote an article in 2008 titled, “The Frontier of Eminent Domain.” She raises the question: “Why aren’t Kelo activists also incensed over natural resource development takings?”

    Indeed. The excellent Institute for Justice of Kelo fame declines to intervene in energy/utility “takings” because, they told me, of the “public good” premise. The Institute should reconsider what support it can offer in this expanding “market” for eminent domain abuse.

    The stories are horrendous; energy companies and utilities are no better than Bruce Ratner.

    But property owners can fight back. Our two-year battle against Houston-based Spectra Energy which seized our property rights for an underground gas storage field led to the development of a website which has begun to attract whistle blowers inside the energy industry. If you want to understand the adverse effects of this type of eminent domain, read this post: http://www.spectraenergywatch.com/blog/?p=616

    Spectra Energy’s facility has had operational problems from the start, has received two Notice of Violations for “unlawful conduct” related to emergency shutdowns and emissions at its storage field in Bedford County, PA. Reports of contaminated water supplies are on the rise since they began operations.

    The ripple effects of eminent domain are never over.

  2. Margaret Litean

    Please put my name on your List and send me information on the NY Court of Appeals decision on Kaur v. ESDC.
    Also other topics are ok. Thank you.
    M. Litean, Manhattan, NYC.

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