Eminent domain debated

Legislators may increase compensation for seized property

General Assembly

March 09, 2007|By Laura Smitherman | Laura Smitherman,sun reporter

As the courts wrestle with how much authority governments should have to seize private property, some Maryland legislators are uniting behind a proposal to boost compensation for owners whose property is taken.

Eminent domain became a hot-button issue last year - an election year - after the U.S. Supreme Court ruled that the economically depressed city of New London, Conn., could seize property to make way for a private developer. Last month, though, Maryland's highest court ruled that Baltimore City had no good reason to acquire a Charles North bar under a sped-up version of eminent domain called "quick take."

Legislators in Annapolis introduced more than 40 bills last year seeking to restrict condemnation powers, but they failed to reach an agreement.

By comparison, only a handful of bills dealing with eminent domain have been drafted this year. One is a constitutional amendment that would prevent state or local governments from seizing property for private use, specifically for urban renewal projects. Another bill that takes a more moderate approach, and that appears to have more backing, would bolster compensation packages for owners, including relocation expenses.

"There's a bit of wind out of the sails on this issue this year; however, everyone agrees that compensation needs to be increased," said Del. Maggie L. McIntosh, chairwoman of the House Environmental Matters Committee.

Del. Richard K. Impallaria, a Baltimore County Republican who proposed the constitutional amendment, acknowledged that his bill might not pass but said it still "sends a clear message." A fight over eminent domain launched his political career several years ago. After his auto body shop was slated for condemnation to make way for redevelopment in Middle River, he worked on a county ballot initiative that stopped the project.

"We hear about it across the country, that they are overstepping their bounds by taking homes and businesses that are not blighted to bring in a different class of people for what they call gentrification," Impallaria said. "And that's just wrong."

Under current law, a property owner must receive "just" compensation. If a bill by Del. Samuel I. Rosenberg, a Baltimore Democrat, is passed, owners could get additional costs paid, and a cap on relocation expenses would be lifted.

Some officials, including Baltimore City Solicitor George Nilson, object to a provision that would pay a property owner "goodwill," an accounting term that refers to the ability to make a profit. For example, a business might make more money at one location than it would at another, and under the legislation, the anticipated difference would be paid to the property owner.

David S. Bliden, executive director of the Maryland Association of Counties, said goodwill is "inherently speculative." And Harford County Attorney Robert S. McCord said that the process of calculating goodwill would draw out an already complicated process.

"In my mind, anything that causes delay or speculation so that my county will have to hire more experts is going to be a problem," McCord said.

Several property owners who have undergone the eminent domain process testified yesterday, including James M. Gillin, whose manufacturing plant has twice been targeted by Baltimore City for seizure. He moved to his current site in Poppleton 23 years ago after the city took his plant in South Baltimore for a school athletic field. Now the city wants to seize his current property for a housing project.

"We deserve compensation for all the turmoil that we as businesses go through," he said.

The House committee also considered two bills to address ground rents, as lawmakers work on a legislative package to reform the system of land leases. One bill would allow the Department of Housing and Community Development to make loans to low-income residents to buy out their ground rents; the other would require property buyers to be notified of their right to buy out ground rents.

Legislators are responding to accounts of some ground rent owners taking the homes of residents who had fallen behind on payments, in some cases over minimal debts.


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