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HomeMy WebLinkAbout2005-08-23 - AGENDA REPORTS - LEGISLATION SCA 15 ACA 22 (2)Agenda Item: CITY OF SANTA CLARITA AGENDA REPORT NEW BUSINESS City Manager Approval: Item to be presented by: Mayor Smyth DATE: August 23, 2005 SUBJECT: STATE LEGISLATION: SCA 15/ACA 22 DEPARTMENT: City Manager's Office RECOMMENDED ACTION lR City Council adopt a support position for Senate Constitutional Amendment 15 and Assembly Constitutional Amendment 22 and transmit copies of the Council's position to Senator McClintock, Assembly Member LaMalfa, Members of Santa Clarita% state legislative delegation and the League of California Cities. BACKGROUND On June 23, 2005, the United State Supreme Court held, in Kelo v. City of New London (Connecticut), that the use of eminent domain by government jurisdictions to obtain private property for economic development purposes and then transfer that property to another private party is lawful. The majority opinion of the court also stated, "We emphasize that nothing in our opinion precludes any State from placing further restrictions on the takings power." The Supreme Court ruling served as a reaffirmation of eminent domain law rather than creating any new law or expansion of government authority. In California, the predominant use of eminent domain law for economic development purposes is typically found in redevelopment areas. State law, as enacted by Assembly Bill 1290 in 1993, specifically outlines the use of eminent domain in redevelopment areas, requiring a finding of blight in an specified area. California law requires that in addition to the finding of blight, government jurisdictions must attempt to deal directly with property owners and offer fair market value for their properties. In response to the Supreme Court ruling and the express provisions of the majority opinion which enable states to enact more restrictive measures, Senator McClintock has introduced Senate tlNUL 1 C.o11116a13 /f'rm Constitutional Amendment 15. SCA 15, and an identical companion measure introduced in the Assembly, Assembly Constitutional Amendment 22 (LaMalfa), would place additional parameters around the use of eminent domain by government jurisdictions. The proposed constitutional amendments would change existing state law relating to eminent domain by requiring that if property is taken by eminent domain, it may only be used by the government jurisdiction exercising the eminent domain or leased to entities regulated by the California Public Utilities Commission. The proposed law would require an independent judicial finding that the condemning entity has clearly demonstrated that "no reasonable alternative" exists. Furthermore, if the property taken by eminent domain at any point in the future is no longer used for the original stated purpose, the former owner of the property, beneficiary or heir shall have the right to reacquire the property for the amount originally paid in compensation at the time the property was acquired or its present fair market value, whichever is the lesser amount. Eminent domain has rarely been used by the City of Santa Clarita or its redevelopment agency. Two recent examples of the use of this extraordinary authority are the acquisitions of property for the new Community Center and for the Veterans' Historical Plaza. In both instances, the use of eminent domain would be consistent with the proposed constitutional amendments as the new property owner is the public agency which undertook the condemnation action. Although often used as a tool to enhance economic development in a redevelopment area, the City of Santa Clarita has not used eminent domain in its redevelopment area to obtain private property and then convey it to another private owner and no plans are currently envisioned to do so. Supporters of SCA 15 and ACA 22 argue that the measures are consistent with the United States Supreme Court ruling which allows states to enact more restrictive measures on the "takings power." Proponents also argue that the taking of private property from one individual and then conveying it to another private party is fundamentally wrong and flies in the face of historic property right protections. Supporters also argue that existing law enables rich, powerful, or well-connected private interests to take property with the help of government entities from individuals who do not have the financial or political ability to fend off such efforts. Opponents of SCA 15 and ACA 22 advance the argument that existing California law is very specific about the use of eminent domain and provides property owners with proper protections against inappropriate takings. They further point out that eminent domain is a tool which can help revitalize blighted areas. Finally, they note that eminent domain is a mechanism whereby one individual can be prevented from thwarting the will of the majority. This might be the case where a number of properties need to be assembled for an economic development project to move forward and all parties agree save one, who holds out for a substantially higher price beyond fair market value or seeks to thwart the proposed neighborhood improvement. ALTERNATIVE ACTIONS 1. Oppose Senate Constitutional Amendment 15 and Assembly Constitutional Amendment 22. 2. Take no position on SCA 15 and ACA 22 and direct that staff monitor the legislation. 3. Other action as determined by the City Council. FISCAL IMPACT Implementation of the recommended action requires no additional fiscal resources beyond those already contained within the adopted FY 2005/06 City budget for legislative relations. ATTACHMENTS Senate Constitutional Amendment 15 Assembly Constitutional Amendment 22 Senate Constitutional Amendment No. 15 Introduced by Senators McClintock and Florez (Principal coauthor: Senator Hollingsworth) (Principal coauthor: Assembly Member La Malfa) (Coauthors: Senators Aanestad, Ackerman, Ashburn, Battin, Campbell, Cos, Denham, Dutton, Maldonado, Margett, Morrow, and Poochigian) (Coauthors: Assembly Members Aghazarian, Benoit, Blakeslee, Bogh, Cogdill, DeVore, Emmerson, Garcia, Haynes, Shirley Horton, Houston, Huff, Keene, La Suer, Leslie, Maze, McCarthy, Mountjoy, Nakanishi, Negrete McLeod, Parra, Plescia, Sharon Runner, Spitzer, Strickland, Tran, Umberg, Villines, Walters, and Wyland) July 13, 2005 Senate Constitutional Amendment No. 15—A resolution to propose to the people of the State of California an amendment to the Constitution of the State, by amending Section 19 of Article I thereof, relating to eminent domain. LEGISLATIVE COUNSEL'S DIGEST SCA 15, as introduced, McClintock. Eminent domain: condemnation proceedings. The California Constitution authorizes governmental entities to take or damage private property for public use only when just compensation, ascertained by a jury unless waived, has fust been paid to, or into court for, the owner. It also authorizes the Legislature to provide for possession by the condemnor following commencement of the eminent domain proceedings upon deposit in court, and prompt release to the owner, of the money determined by the court to be the probable amount of the just compensation. 99 SCA 15 —2— This 2— This measure would add a condition that private property may be taken or damaged by eminent domain proceedings only for a stated public use and only upon an independent judicial determination on the evidence that the condemnor has proven that no reasonable alternative exists. The measure would require that the property be owned and occupied by the condemnor, except as specified, and used only for the stated public use. This measure would also provide that if the property ceases to be used for the stated public use, the former owner or a beneficiary or an heir, who has been designated for this purpose, would have the right to reacquire the property for the compensated amount or its fair market value, whichever is less, before the property may be sold or transferred. Vote: 2/3. Appropriation: no. Fiscal committee: yes. State -mandated local program: no. 1 WHEREAS, This measure shall be known and may be cited as 2 "The Homeowner and Property Protection Act"; and 3 WHEREAS, Eminent domain has been subject to widespread 4 abuse in California, whereby local governmental entities have 5 condemned property and transferred it, by sale, lease, or 6 otherwise, to the control, management, or exploitation of private 7 entities for private use and profit on the theory that generalized 8 public benefits will flow therefrom; and 9 WHEREAS, The United States Supreme Court, in Kelo v. City 10 of New London, _ U.S. _ (2005), has held that the United 11 States Constitution does not prevent the transfer of property, 12 seized through eminent domain, to private entities for private 13 profit; and 14 WHEREAS, The rights guaranteed in the California 15 Constitution are not dependent on rights guaranteed under the 16 United States Constitution (Section 24 of Article I of the 17 California Constitution), and the California Constitution should 18 protect the property rights of Californians to a greater degree 19 than does the United States Constitution; nor should the term 20 "public use" in the California Constitution be construed as 21 identical to that phrase as employed in the Fifth Amendment to 22 the United States Constitution; and 23 WHEREAS, It is the intent of the Legislature that private 24 property shall not be taken or damaged for the use, exploitation, 99 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 -3— SCA 15 or management of any private party, including, but not limited to, the use, exploitation, or management of property taken or damaged by a corporation or other business entity for private profit, as is currently permitted under the United States Constitution under Kelo v. City of New London, _ U.S. _ (2005); and WHEREAS, It is not the intent of this amendment to prevent the rental of space in a government building or any other government-owned property for incidental commercial enterprises, including, but not limited to, gift shops, newsstands, or shoeshine stands; and WHEREAS, This amendment shall apply only to condemnation actions that are completed after this amendment goes into effect; now, therefore, be it Resolved by the Senate, the Assembly concurring, That the Legislature of the State of California at its 2005-06 Regular Session commencing on the sixth day of December 2004, two-thirds of the membership of each house concurring, hereby proposes to the people of the State of California, that the Constitution of the State be amended as follows: That Section 19 of Article I thereof is amended to read: SEC. 19. (a) Private property may be taken or damaged for a stated public use only when just compensation, ascertained by a jury unless waived, has first been paid to, or into court for, the owner. the -Private property may not be taken or damaged for private use. (b) Private property may be taken by eminent domain only for a stated public use and only upon an independent judicial determination on the evidence that the condemnor has proven that no reasonable alternative exists. Property taken by eminent domain shall be owned and occupied by the condemnor or may be leased only to entities that are regulated by the Public Utilities Commission. All property that is taken by eminent domain shall be used only for the stated public use. (c) If any property taken through eminent domain after the effective date of this subdivision ceases to be used for the stated public use, the former owner of the property or a beneficiary or an heir, if a beneficiary or heir has been designated for this purpose, shall have the right to reacquire the property for the 99 SCA 15 —4— I 4- 1 compensated amount or the fair market value of the property, 2 whichever is less, before the property may be sold or transferred. 3 (d) The Legislature may provide for possession by the 4 condemnor following commencement of eminent domain 5 proceedings upon deposit in court and prompt release to the 6 owner of money determined by the court to be the probable 7 amount of just compensation. R VZ CALIFORNIA LEGISLATURE-2Oo5-06 REGULAR SESSION Assembly Constitutional Amendment No. 22 Introduced by Assembly Member La Malfa (Principal coauthor: Senator McClintock) (Coauthors: Assembly Members DeVore, Garcia, La Suer, Maze, McCarthy, Aghazarian, Benoit, Blakeslee, Bogh, Cogdill, Emmerson, Haynes, Shirley Horton, Houston, Huff, Leslie, Mountjoy, Nakanishi, Negrete McLeod, Parra, Plescia, Sharon Runner, Spitzer, Strickland, Tran, Umberg, Villines, Walters, and Wyland) (Coauthors: Senators Ackerman, Ashburn, Baffin, Campbell, Cox, Denham, Dutton, Florez, Hollingsworth, Maldonado, Margett, Morrow, and Poochigian) July 13, 2005 Assembly Constitutional Amendment No. 22—A resolution to propose to the people of the State of California an amendment to the Constitution of the State, by amending Section 19 of Article I thereof, relating to eminent domain. LEGISLATIVE COUNSEL'S DIGEST ACA 22, as introduced, La Malik. Eminent domain: condemnation proceedings. The California Constitution authorizes governmental entities to take or damage private property for public use only when just compensation, ascertained by a jury unless waived, has fust been paid to, or into court for, the owner. It also authorizes the Legislature to provide for possession by the condemnor following commencement of the eminent domain proceedings upon deposit in court, and prompt release to the owner, of the money determined by the court to be the probable amount of the just compensation. 99 ACA 22 —2— This 2— This measure would add a condition that private property may be taken or damaged by eminent domain proceedings only for a stated public use and only upon an independent judicial determination on the evidence that the condemnor has proven that no reasonable alternative exists. The measure would require that the property be owned and occupied by the condemnor, except as specified, and used only for the stated public use. This measure would also provide that if the property ceases to be used for the stated public use, the former owner or a beneficiary or an heir, who has been designated for this purpose, would have the right to reacquire the property for the compensated amount or its fair market value, whichever is less, before the property may be sold or transferred. Vote: 2/3. Appropriation: no. Fiscal committee: yes. State -mandated local program: no. 1 WHEREAS, This measure shall be known and may be cited as 2 "The Homeowner and Property Protection Act"; and 3 WHEREAS, Eminent domain has been subject to widespread 4 abuse in California, whereby local governmental entities have 5 condemned property and transferred it, by sale, lease, or 6 otherwise, to the control, management, or exploitation of private 7 entities for private use and profit on the theory that generalized 8 public benefits will flow therefrom; and 9 WHEREAS, The United States Supreme Court, in Kelo v. City 10 of New London, _ U.S. _ (2005), has held that the United 11 States Constitution does not prevent the transfer of property, 12 seized through eminent domain, to private entities for private 13 profit; and 14 WHEREAS, The rights guaranteed in the California 15 Constitution are not dependent on rights guaranteed under the 16 United States Constitution (Section 24 of Article I of the 17 California Constitution), and the California Constitution should 18 protect the property rights of Californians to a greater degree 19 than does the United States Constitution; nor should the term 20 "public use" in the California Constitution be construed as 21 identical to that phrase as employed in the Fifth Amendment to 22 the United States Constitution; and 23 WHEREAS, It is the intent of the people of the State of 24 California that private property shall not be taken or damaged for 99 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 -3— ACA 22 the use, exploitation, or management of any private party, including, but not limited to, the use, exploitation, or management of property taken or damaged by a corporation or other business entity for private profit, as is currently permitted under the United States Constitution under Kelo v. City of New London, _ U.S. _ (2005); and WHEREAS, It is not the intent of this amendment to prevent the rental of space in a government building or any other government-owned property for incidental commercial enterprises, including, but not limited to, gift shops, newsstands, or shoeshine stands; and WHEREAS, This amendment shall apply only to condemnation actions that are completed after this amendment goes into effect; now, therefore, be it Resolved by the Assembly, the Senate concurring, That the Legislature of the State of California at its 2005-06 Regular Session commencing on the sixth day of December 2004, two-thirds of the membership of each house concurring, hereby proposes to the people of the State of California, that the Constitution of the State be amended as follows: That Section 19 of Article I thereof is amended to read: SEC. 19. (a) Private property may be taken or damaged for a stated public use only when just compensation, ascertained by a jury unless waived, has first been paid to, or into court for, the owner. Private property may not be taken or damaged for private use. (b) Private property may be taken by eminent domain only for a stated public use and only upon an independent judicial determination on the evidence that the condemnor has proven that no reasonable alternative exists. Property taken by eminent domain shall be owned and occupied by the condemnor or may be leased only to entities that are regulated by the Public Utilities Commission. All property that is taken by eminent domain shall be used only for the stated public use. (c) If any property taken through eminent domain after the effective date of this subdivision ceases to be used for the stated public use, the former owner of the property or a beneficiary or an heir, if a beneficiary or heir has been designated for this purpose, shall have the right to reacquire the property for the 99 ACA 22 —4- 1 4- 1 compensated amount or the fair market value of the property, 2 whichever is less, before the property may be sold or transferred. 3 (d) The Legislature may provide for possession by the 4 condemnor following commencement of eminent domain 5 proceedings upon deposit in court and prompt release to the 6 owner of money determined by the court to be the probable 7 amount of just compensation. C 99