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Kelo-ed

October 30 , 2009
By Fredericksburg Free-Lance Star

In a Kelo replay, property owners in Roanoke face eminent domain proceedings.

The right to own property is a foundation stone in our democracy, embedded in the Constitution, protected by law, and cherished by homeowners across the land. But in 2005, in a disastrous decision, the U.S. Supreme Court chipped away at those rights, ruling that the city of New London, Conn., could exercise eminent domain and take Susette Kelo's well-kept little pink house for an economic development project.

As Supreme Court Justice Sandra Day O'Connor wrote in her dissent, the new ruling meant that "The specter of condemnation hangs over all property. Nothing is to prevent the state from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory." Almost immediately, Virginians began crying out for "Kelo reform"--a change in the state law to protect property owners.

Despite fierce opposition from condemning authorities and development interests, the General Assembly passed a Kelo reform bill in 2007, and property owners rested a bit easier. But, it turns out, the time for vigilance is not yet past. Look no farther than Roanoke for a case in point.

The Carilion Clinic is the Roanoke Valley's largest employer. A decade ago, Carilion decided to expand and began backroom negotiations (code named, "Andy's Warehouse") with Roanoke city officials for property. No doubt concerned they might otherwise lose Carilion to Roanoke County, the city decided to use eminent domain to "clear" about 100 acres (54 percent of which was blighted) of what would be called the South Jefferson Redevelopment Area.

Haunted by the specter of condemnation, most of the property owners took the buyouts offered by the city's Redevelopment and Housing Authority. But two did not: Stephanie and Jay Burkholder and William and Maeona Stegall decided to face down the eminent domain giant.

The Stegalls lost their initial battle in court and now are in the property valuation process. The Burkholders are still resisting.

The 2007 Kelo reform law tightened the "blight" designation requirements--saying the specific property in question had to be blighted, which the Burkholders' is not--and limited the reasons for which property could be condemned (i.e., public use, not economic development). But the city's petition for condemnation was filed June 29, 2007, the last business day before the new law went into effect.

Because of that technicality, the Burkholders may be out of luck. Still, the case raises many questions. Just how much protection does the new Kelo reform law offer Virginians? Could any local government dust off an old redevelopment plan and invoke pre-reform rules for condemning property, forcing owners to protect their rights in court? Does "public use" (think "highway," "school," "powerline") include a private nonprofit hospital that operates a whole lot like a corporation? Is a constitutional amendment needed to further protect Virginia property owners?

Today, the area surrounding Susette Kelo's former home in New London is barren. The notoriety of the case stalled the redevelopment project and the downturn in the economy killed it. The tax revenues the city was counting on have not materialized, nor will they, and public anger directed at the government has fractured the community. "Yes, the city won, but no one in the city of New London really won," says former Mayor Beth Sabilia.

That's because kicking at the foundation brings the whole house down.