Eminent Domain Report

Today I want to focus on whether the plan to seize underwater mortgages through eminent domain is legal. Getting into this topic, in my view the debate should not focus on whether this plan passes constitutional muster at the federal level.  I've seen much written on this subject, but I really think this is a red herring, and that the answer is pretty easy.   While others disagree, I believe the plan passes constitutional muster at the federal level.

The U.S. Supreme Court has issued a long line of cases that all make pretty clear that the government could constitutionally condemn ...

Anyone who follows eminent domain issues no doubt by now has heard about the plan of some government agencies to condemn underwater mortgages -- essentially as a mechanism to refinance those loans to give borrowers loans that better reflect the current fair market value of their homes.

There has been much debate on the issue, and it has included a whole lot of rhetoric that has started to look a bit like an election campaign. I've heard extreme arguments both in favor and against the plan.

My intention here is not to advocate for or against the plan. Rather, I hope to help better -- and more ...

The parade of lawsuits involved in the redevelopment dissolution process continues to grow.   Here are a few quick updates:

• Five San Diego County cities have sued the state over AB 1484.  Chula Vista, National City, Oceanside, San Marcos and Vista have joined forces to attack the law.
• In Northern California, El Cerrito has also sued, claiming the "true up" payment it purportedly owes ($1,756,794.67) is unlawful.  Read more about the El Cerrito lawsuit in the July 17 El Cerrito Patch article, City Sues State, County Over $1.76 Million "Demand for Payment".  Other cities have also reportedly ...

A new Court of Federal Claims opinion was handed down this month coming right out of our own Southern California backyard.  The case, Stueve Bros. Farms, LLC v. the United States, deals with whether a "physical taking of title" has occurred when a government agency's activities create a risk of flooding.  The answer, according to the Court, is no.

Stueve Bros. Farms owns property in San Bernardino County within the Prado Dam Flood Control Basin.  In the 1940's, the federal government condemned flowage easements over the property to an elevation of 556 feet above sea ...

Ever since the Supreme Court issued its decision in the Matosantos case last December, facilitating the dismantling of California's redevelopment agencies, there has been talk of new legislation -- either in the "clean up" variety or in the substantive overhaul variety. 

Today, the Legislature passed AB1484 as a budget trailer bill (the Senate approved the bill at around 1:30 p.m., and the Assembly followed about an hour later).  

AB1484 probably qualifies as too substantive to be characterized as mere "clean up," though it falls short of a major overhaul of the system.  And it ...

A few odds and ends for our readers:

• New Federal Eminent Domain Legislation:  According to the Eminent Domain Law Blog, two Senators have introduced a new bill, Protection of Homes, Small Businesses, and Private Property Act of 2012.  This, again, you may ask?  What ever happened with HR 1433, the Private Property Rights Protection Act of 2011?  HR 1433 appears to be dying a slow death, but the new 2012 bill seeks to pick up the slack.  In particular, it is targeted at the same issue:  preventing the federal government from using its eminent domain power and state and local ...

The International Right of Way Association's (IRWA) International Education Conference in Seattle has just wrapped up, and boy was it a great event.  Over 1,200 right of way professionals from across the United States and Canada (along with some visitors from Japan, Uganda, Saudi Arabia, Thailand, and the UK) all in one location for four days.  What could be better?  If you weren't able to make it, let me tell you that Alaska and Canada -- two chapters vying for hosting the 2017 event -- sure know how to have a good time. 

As I travel home on my flight back to Orange County ...

One of the trickiest circumstances to deal with in an eminent domain case occurs when the property being condemned suffers from a contamination issue.  This presents a number of thorny issues and, quite frankly, is an area of law which is shockingly undeveloped in most jurisdictions. 

• Should the cost of the remediation be offset from the value of the property? 
• Should the contamination be ignored since the owner is being compelled to "sell" the property, often against his or her will? 
• Should the appraisers treat the contamination as they would any other circumstance affecting the ...

 Here are a few updates for right of way professionals:

• IRWA International Conference:  The International Right of Way Association's (IRWA) 58th Annual International Education Conference will be taking place starting this weekend in Seattle.  Nossaman's eminent domain attorneys will be there in full force:  I know at least seven of us are attending, and we'll have representatives from our Orange County, Los Angeles, and San Francisco offices.  For the first time ever, we'll also be hosting a booth at the Conference, and we have a number of great give-aways, so plan to stop by ...

The opening skirmish in the next phase of the battle between cities and the state over control of property taxes played out in Sacramento Superior court yesterday afternoon.  At issue was property taxes formerly controlled by redevelopment agencies.  While the court ruled against the petitioning cities, as with every other aspect of the California’s budget battles, it is difficult to say that there were any real winners.   

In City of Palmdale, et al. v. Ana Matosantos, Palmdale and eleven other cities sued the Department of Finances and various county auditor-controllers ...