Eminent Domain Report

Proposed changes to California's redevelopment law have been quietly making their way through the California legislature.  With little publicity, AB 2531, authored by Assemblyman Felipe Fuentes, made its way through the process this summer.  After a series of amendments, AB 2531 was passed by California's Senate on August 12 by a vote of 22-13.  On August 27, it passed California's Assembly, 50-26.

On September 10, the bill was presented to Governor Arnold Schwarzenegger for signature.  Under the California legislative process, the Governor has until September 30 to sign or veto the bill.  If he signs (or takes no action at all), AB 2531 becomes law.  If he vetoes, the bill goes back to the legislature for a possible vote to override the veto.  (Overriding the veto would require a 2/3 vote, meaning AB 2531 would fall just short in both houses unless the votes change.)   

I'll get into more details about AB 2531 if it passes, but the basic premise is that it would:

1. Expand the ability of the Los Angeles Community Redevelopment Association to acquire property through eminent domain by removing the restriction that the CRA can only exercise its eminent domain authority within designated redevelopment areas.  In other words, if AB 2531 becomes law, the CRA could condemn property anywhere within the City of Los Angeles. 
2. Expand the CRA's bases for asserting eminent domain to include eminent domain motivated by pure economic motives (essentially, the very conduct that created all the controversy when the Kelo opinion came down in 2005). 

If you think this sounds like a significant change in the law, you're not alone.  Several commentators have reacted negatively to AB 2531, including:

• In a September 28 post on citywatchla.com, "Dangerous New Bill About to Become LA Law," Ziggy Kruse summarizes AB 2531 as follows:  "AB 2531 expressly unleashes CRA/LA to roam city wide and take any piece of property and give it to one of its developer cronies." 
• Timothy Sandefur, writing for the PLF Liberty Blog, titled his September 28 post, "Gov. Schwarzenegger ponders expanding the abuse of eminent domain in California."

On the other hand, the California Redevelopment Association (not surprisingly) urges support for the bill:  "AB 2531 will give redevelopment agencies clear authority to use their resources for economic development–activities that will create and support jobs, assist industrial and manufacturing businesses, and investments to grow California’s green economy."

One of the interesting things about AB 2531 is that as initially proposed, it would have applied throughout California.  But during the course of the legislative process, the bill was amended and narrowed.  As passed, AB 2531 expressly applies only to the CRA in Los Angeles. 

More tomorrow once we know what happens.