Requires the preparation of a comprehensive economic development plan for the use of eminent domain when the primary purpose is economic development and certain residential premises are to be acquired; requires municipal approval of the exercise of eminent domain power in such cases; enacts the "eminent domain reform act".
TITLE OF BILL: An act to amend the public authorities law, the not-for-profit corporation law, the general municipal law and the eminent domain procedure law, in relation to eminent domain reform
PURPOSE OR GENERAL IDEA: To reform the eminent domain process in relation to economic development projects by expanding judicial reform, providing more local control over eminent domain decisions, requiring a comprehensive economic development plan, and requiring a homeowner impact statement.
SUMMARY OF SPECIFIC PROVISIONS: Section 1. Short Title. The act shall be referred to as the "Eminent Domain Reform Act".
Section 2. Add a new § 1831-b to the public authorities law to give local governments the power to approve or disapprove any public authority's use of eminent domain.
Section 3. Amends § 1411 of the not-for-profit corporation law to give local governments the power to approve or disapprove local development corporation's use of eminent domain.
Section 4. Adds a new § 858-c to the general municipal law to give local governments the power to approve or disapprove industrial development agency's use of eminent domain.
Section 5. Amends § 103 of the EDPL to include new Definitions.
Section 6. Amends the § 204 of the EDPL to include a new section (4) to the determinations and findings requirements by including a new section on economic development.
Section 7. Adds a new § 204-a to the EDPL. A. Requires a comprehensive economic development plan in cases where eminent domain is used for economic development. Economic development plans must be approved by the local government.
B. Requires that a homeowner impact assessment statement be completed to assess the actual harm to affected condemnees, how the project would benefit the community and justification for the condemnation.
C. Increases compensation to condemnees whose home or dwelling is acquired for an economic development project. The compensation, in addition to the compensation already required by law, would be 150% of total fair market value.
Section 8. Amends § 207 of the EDPL to expand judicial review in cases where a condemnor substantially alters the scope of the project, or the determinations and findings, to allow citizens a fair process.
Section 9. Is the effective date.
JUSTIFICATION: The use of eminent domain is an important power for government to move forward on important public projects. However, the recent United States Supreme Court decision, KELO et al., v. CITY OF NEW LONDON et al., underscores the need for further eminent domain reform.
Several issues emerge from the Committee's investigations and the Supreme Court decision. First, is the meaning of public use under the 5th Amendment of the United States Constitution (New York has a similar constitutional provision. See: Article I, section 7 of the State Constitution). The New London decision centers on condemnation where one private interest is favored over another for the public purpose of economic development. The Court held that the economic development plan of the city did constitute a public use. Specifically, however, the decision focused on the appropriate legal standard of review. The Supreme Court gives wide latitude to governments to determine public use.
The second issue that emerges is who is using the power of eminent domain. In New York, like the New London case, these decisions are often done through quasi-public development agencies or authorities. In New York quasi-public entities such as industrial development agencies, local development corporations and public authorities have the power of eminent domain to fulfill their public mission. Often these quasi-public entities can condemn homes for economic development projects. Authorities and other development agencies are shielded from traditional public scrutiny.
This legislation specifically focuses on condemnation in which private property is taken for economic development purposes and transferred to other private entities. In these cases, government must be extremely cautious in using its power of eminent domain and must do everything in its power to protect citizens. The Eminent Domain Reform Act will include three major provisions: increasing the timeframe citizens can appeal decisions to condemn, enacting significant protections for homeowners and other displaced residents where their property was condemned for economic development, and empowering local governments to have decision making power of the use of eminent domain by public authorities and IDAs.
This bill would strike the right balance between the needs of society and individual liberties.
PRIOR LEGISLATIVE HISTORY: 2009-10: S.1669 Commerce, Economic Development & Small Business Cmte. 2006: Senate Finance Cmte./Assembly Judiciary Cmte.
FISCAL IMPLICATION FOR STATE AND LOCAL GOVERNMENTS: Not known.
This act shall take effect on the one hundred twentieth day after it shall have become law.
STATE OF NEW YORK ________________________________________________________________________ 4685 2011-2012 Regular Sessions IN SENATE April 14, 2011 ___________Introduced by Sen. FLANAGAN -- read twice and ordered printed, and when printed to be committed to the Committee on Commerce, Economic Devel- opment and Small Business AN ACT to amend the public authorities law, the not-for-profit corpo- ration law, the general municipal law and the eminent domain procedure law, in relation to eminent domain reform THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Short title. This act shall be known and may be cited as the "eminent domain reform act". S 2. The public authorities law is amended by adding a new section 1831-b to read as follows: S 1831-B. EXERCISE OF POWER OF EMINENT DOMAIN; LIMITATIONS. THE LOCAL LEGISLATIVE BODY OF EACH CITY, TOWN, OR VILLAGE IN WHICH THE AUTHORITY SEEKS TO EXERCISE THE POWER OF EMINENT DOMAIN SHALL HAVE THE AUTHORITY TO APPROVE OR DISAPPROVE ANY EXERCISE OF SUCH POWER BY THE AUTHORITY. EVERY SUCH LOCAL LEGISLATIVE BODY SHALL APPROVE OR DISAPPROVE ANY EXER- CISE OF SUCH POWER BY MAJORITY VOTE. WHERE APPLICABLE IN THE ENACTMENT OF LOCAL LAWS, THE CHIEF EXECUTIVE OFFICER OF SUCH LOCALITY IF THE OFFICE OF SUCH CHIEF EXECUTIVE OFFICER IS ELECTIVE SHALL APPROVE OR DISAPPROVE SUCH LOCAL LEGISLATIVE BODY'S DECISION, SUBJECT TO ANY APPLI- CABLE RIGHT TO OVERRIDE. S 3. Paragraph (i) of section 1411 of the not-for-profit corporation law is relettered paragraph (j) and a new paragraph (i) is added to read as follows: (I) MUNICIPAL INPUT. THE LOCAL LEGISLATIVE BODY OF EACH CITY, TOWN, OR VILLAGE IN WHICH ANY PART OF THE REAL PROPERTY TO BE ACQUIRED IS LOCATED SHALL HAVE THE AUTHORITY TO APPROVE OR DISAPPROVE ANY CORPO- RATION'S USE OF EMINENT DOMAIN. EACH SUCH LOCAL LEGISLATIVE BODY SHALL APPROVE OR DISAPPROVE ANY PROPOSED CORPORATE USE OF THE POWER OF EMINENT DOMAIN BY MAJORITY VOTE. WHERE APPLICABLE IN THE ENACTMENT OF LOCALEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD07507-01-1 S. 4685 2
LAWS, THE CHIEF EXECUTIVE OFFICER OF SUCH LOCALITY IF THE OFFICE OF SUCH CHIEF EXECUTIVE OFFICER IS ELECTIVE SHALL APPROVE OR DISAPPROVE SUCH GOVERNING BODY'S DECISION, SUBJECT TO ANY APPLICABLE RIGHT TO OVERRIDE. S 4. The general municipal law is amended by adding a new section 858-c to read as follows: S 858-C. MUNICIPAL INPUT. THE GOVERNING BODY OF EACH CITY, TOWN, OR VILLAGE FOR WHOSE BENEFIT, IN WHOLE OR IN PART, AN AGENCY IS ESTABLISHED SHALL HAVE THE AUTHORITY TO APPROVE OR DISAPPROVE ANY AGENCY USE OF EMINENT DOMAIN. EACH SUCH GOVERNING BODY SHALL APPROVE OR DISAPPROVE THE USE OF EMINENT DOMAIN BY MAJORITY VOTE. WHERE APPLICABLE IN THE ENACT- MENT OF LOCAL LAWS, THE CHIEF EXECUTIVE OFFICER OF SUCH LOCALITY IF THE OFFICE OF SUCH CHIEF EXECUTIVE OFFICER IS ELECTIVE SHALL APPROVE OR DISAPPROVE SUCH GOVERNING BODY'S DECISION, SUBJECT TO ANY APPLICABLE RIGHT TO OVERRIDE. S 5. Section 103 of the eminent domain procedure law is amended by adding two new subdivisions (H) and (I) to read as follows: (H) "ECONOMIC DEVELOPMENT PROJECT" MEANS ANY PROJECT FOR WHICH ACQUI- SITION OF REAL PROPERTY MAY BE REQUIRED FOR A PUBLIC USE, BENEFIT, OR PURPOSE WHERE SUCH PUBLIC USE, BENEFIT, OR PURPOSE IS PRIMARILY FOR ECONOMIC DEVELOPMENT AND WHERE THE CONDEMNEE'S REAL PROPERTY IS A HOME OR DWELLING. (I) FOR THE PURPOSES OF ARTICLE TWO OF THIS CHAPTER: (1) "HOME" MEANS OWNER-OCCUPIED RESIDENTIAL PREMISES CONSISTING OF NOT MORE THAN SIX DWELLING UNITS. (2) "DWELLING" MEANS RESIDENTIAL PREMISES CONSISTING OF NOT MORE THAN THIRTY DWELLING UNITS, NONE OF WHICH IS OCCUPIED BY AN OWNER OF SUCH PREMISES. (3) IN THE CASE OF COOPERATIVE APARTMENT CORPORATIONS, TITLE TO THAT PORTION OF REAL PROPERTY OWNED BY A COOPERATIVE APARTMENT CORPORATION IN WHICH A TENANT-STOCKHOLDER OF SUCH CORPORATION RESIDES, AND WHICH IS REPRESENTED BY HIS OR HER SHARE OR SHARES OF STOCK IN SUCH CORPORATION AS DETERMINED BY ITS OR THEIR PROPORTIONAL RELATIONSHIP TO THE TOTAL OUTSTANDING STOCK OF THE CORPORATION, INCLUDING THAT OWNED BY THE CORPO- RATION, SHALL BE DEEMED TO BE VESTED IN SUCH TENANT-STOCKHOLDER NOTWITH- STANDING THE NUMBER OF DWELLING UNITS IN SUCH RESIDENTIAL PREMISES, THUS QUALIFYING A COOPERATIVE APARTMENT AS A HOME. S 6. Subdivision (B) of section 204 of the eminent domain procedure law is amended to read as follows: (B) The condemnor, in its determination and findings, shall specify, but shall not be limited to the following: (1) the public use, benefit or purpose to be served by the proposed public project; (2) the approximate location for the proposed public project and the reasons for the selection of that location; (3) the general effect of the proposed project on the environment and residents of the locality; (4) A DECLARATION TO SUCH EFFECT IF THE PRIMARY PUBLIC PURPOSE IS DETERMINED TO BE FOR ECONOMIC DEVELOPMENT WHERE ONE OR MORE CONDEMNEES' HOMES OR DWELLINGS ARE TO BE AFFECTED; AND (5) such other factors as it considers relevant. S 7. The eminent domain procedure law is amended by adding a new section 204-a to read as follows: S 204-A. ECONOMIC DEVELOPMENT CONDEMNATION FINDINGS AND HOMEOWNER PROTECTION. (A) IF THE CONDEMNOR DETERMINES PURSUANT TO PARAGRAPH FOUR OF SUBDIVISION (B) OF SECTION TWO HUNDRED FOUR OF THIS ARTICLE THAT THE PRIMARY PUBLIC PURPOSE OR BENEFIT IS FOR ECONOMIC DEVELOPMENT, THES. 4685 3
CONDEMNOR, IN COOPERATION WITH THE GOVERNMENT OF THE LOCALITY IN WHICH THE REAL PROPERTY TO BE ACQUIRED IS LOCATED SHALL PREPARE A COMPREHEN- SIVE ECONOMIC DEVELOPMENT PLAN FOR THE AFFECTED AREA. THE COMPREHENSIVE ECONOMIC DEVELOPMENT PLAN SHALL INCLUDE, BUT NOT BE LIMITED TO, THE ACTUAL OR EXPECTED BENEFITS OF THE PROJECT, INCLUDING THE EXPECTED INCREASED TAX REVENUE OR EXPECTED CREATION OF JOBS, THE TYPES OF BUSI- NESSES OR INDUSTRY THAT WILL USE THE CONDEMNED PROPERTY, AND ALTERNA- TIVES TO THE PLAN. WHEN A DRAFT COMPREHENSIVE ECONOMIC DEVELOPMENT PLAN IS CREATED, THE CONDEMNOR, IN COOPERATION WITH THE GOVERNMENT OF THE LOCALITY IN WHICH THE REAL PROPERTY TO BE ACQUIRED IS LOCATED SHALL HOLD AT LEAST ONE PUBLIC HEARING TO COMPILE AND ANALYZE PUBLIC INPUT. THE PUBLIC HEARING SHALL BE HELD IN ACCORDANCE WITH THE PROVISIONS OF THIS ARTICLE AT A LOCATION REASONABLY PROXIMATE TO THE REAL PROPERTY WHICH MAY BE ACQUIRED FOR SUCH PROJECT. THEREAFTER, THE CONDEMNOR SHALL COMPLETE A FINAL COMPREHENSIVE ECONOMIC DEVELOPMENT PLAN TO BE SUBMITTED TO THE LOCAL LEGISLATIVE BODY, SUBJECT TO ANY APPLICABLE RIGHT TO OVER- RIDE FOR ITS APPROVAL. TO MOVE FORWARD WITH THE PROJECT, THE LOCAL LEGISLATIVE BODY MUST APPROVE THE PLAN BY A MAJORITY VOTE, AND IT MUST ALSO BE APPROVED BY THE CHIEF EXECUTIVE OFFICER OF SUCH LOCALITY IF THE OFFICE OF SUCH CHIEF EXECUTIVE OFFICER IS ELECTIVE. (B) THE CONDEMNOR SHALL ALSO CREATE A HOMEOWNER IMPACT ASSESSMENT STATEMENT. THE CONDEMNOR, IN THE HOMEOWNER IMPACT ASSESSMENT STATEMENT, SHALL ASSESS THE ACTUAL HARM TO AFFECTED CONDEMNEES' THAT WOULD LOSE THEIR HOMES OR DWELLINGS AND COMPARE SUCH HARM WITH THE REASONABLY EXPECTED COMMUNITY BENEFITS, INCLUDING BUT NOT LIMITED TO HOW THE CONDEMNOR JUSTIFIES THE TAKING OF THE CONDEMNEES' HOMES OR DWELLINGS. THE HOMEOWNER IMPACT ASSESSMENT STATEMENT SHALL BE COMPLETED SIMULTANE- OUSLY WITH THE COMPREHENSIVE ECONOMIC DEVELOPMENT PLAN UNDER SUBDIVISION (A) OF THIS SECTION. THE HOMEOWNER IMPACT ASSESSMENT STATEMENT SHALL BE MADE WIDELY AVAILABLE. (C) IN CASES WHERE A CONDEMNEE'S HOME OR DWELLING IS ACQUIRED FOR AN ECONOMIC DEVELOPMENT PROJECT, THE CONDEMNOR SHALL, IN ADDITION TO ANY OTHER COMPENSATION REQUIREMENTS UNDER THIS ARTICLE, COMPENSATE THE CONDEMNEE A MINIMUM OF ONE HUNDRED FIFTY PERCENT OF THE FAIR MARKET VALUE OF THE REAL PROPERTY. RESIDENTS WHO ARE DISPLACED BY THE ECONOMIC DEVELOPMENT PROJECT SHALL ALSO BE COMPENSATED AT LEAST ONE HUNDRED FIFTY PERCENT OF THE ANNUAL RENT OF SUCH DWELLING. S 8. Subdivision (A) of section 207 of the eminent domain procedure law, as amended by chapter 356 of the laws of 1982, is amended to read as follows: (A) Any person or persons jointly or severally, aggrieved by the condemnor's determination and findings made pursuant to section two hundred four of this article, may seek judicial review thereof by the appellate division of the supreme court, in the judicial department embracing the county wherein the proposed facility is located by the filing of a petition in such court within
[thirty]NINETY days after the condemnor's completion of its publication of its determination and find- ings pursuant to section two hundred four [herein]OF THIS ARTICLE. Such petition shall be accompanied by proof of service of a demand on the condemnor to file with said court a copy of a written transcript of the record of the proceeding before it, and a copy of its determination and findings. Upon receipt of such petition and demand, the condemnor shall forthwith deliver to the court a copy of the record and a copy of its determination and findings. The proceeding shall be heard on the record without requirement of reproduction. If such proposed public improvement is located in more than one judicial department, such proceeding may beS. 4685 4
brought in any one, but only one, of such departments, and all such proceedings with relation to any single public project shall be consol- idated with that first filed. IF THE CONDEMNOR SUBSTANTIALLY ALTERS THE SCOPE OF THE PROJECT OR THE DETERMINATION AND FINDINGS, THEN THE CONDEM- NEE SHALL HAVE AN ADDITIONAL NINETY DAYS FROM THE CONDEMNOR'S PUBLICA- TION OF SUCH ALTERATION, WHICH PUBLICATION IS HEREBY REQUIRED, TO SEEK JUDICIAL REVIEW UNDER THIS SECTION. S 9. This act shall take effect on the one hundred twentieth day after it shall have become a law.