Taking Private Property to Build an Urban Sports Arena: A Valid Exercise of Eminent Domain Powers?
D'Orazio, Giovanna, Albany Law Review
On January 21, 2004, real estate developer Bruce C. Ratner, together with several partners, purchased the New Jersey Nets basketball franchise for $300 million dollars. (1) Mr. Ratner, through his real estate development company, Forest City Ratner Companies, proposes to bring the New Jersey Nets to Brooklyn, New York. He is planning a $3.5 billion dollar development project to construct an 800,000 square foot basketball arena along with a commercial and residential complex in Brooklyn's Atlantic Yards. (2)
This proposal has given rise to significant eminent domain issues because it requires the condemnation of private property to be used by a private party in a location that has been described as "the crossroad of three handsome neighborhoods where brownstones routinely sell for $1.5 million, restaurants long ago went gourmet, and affordable housing disappears at an alarming rate." (3) There has been significant public outcry against Mr. Ratner's proposal by Brooklyn residents who challenge the constitutionality of the proposed condemnations as being for private rather than public use and who do not want to see the character of their neighborhood changed and commercialized by this redevelopment project. (4)
This article discusses the eminent domain issues arising from this proposal, with a focus on the law in New York. Part II presents an overview of eminent domain law in New York State including what meets the constitutional "public use" requirement. Other issues discussed in Part II include whether the Atlantic Yards area of Brooklyn would qualify as substandard such that this project would fall into the urban renewal context, in which case, the benefit that will accrue to the private real estate developer and sports franchise would be virtually irrelevant. Conversely, if the area is not substandard, it must be determined whether building an arena in Brooklyn serves some other valid public purpose dominant to the private benefit that would accrue. Part III compares the law of eminent domain in New York to that of other states and further evaluates the level of protection New York offers to property owners. Part IV discusses countervailing considerations including environmental conservation issues and an inquiry into the character of the neighborhood and aesthetics. Part V discusses possible remedies available to Brooklyn residents in opposing this proposal including statutory and constitutional challenges and related standing issues.
II. OVERVIEW: THE LAW OF EMINENT DOMAIN IN NEW YORK STATE
A. The Public Use Requirement
The New York State Constitution includes a takings clause providing that "[p]rivate property shall not be taken for public use without just compensation." (5) New York courts have broadly held that the power of eminent domain applies to the government's purpose of protecting the "health, safety, and general welfare of the public," (6) and accordingly, courts have held that a host of uses of private property are "public uses." (7) Courts also defer to the legislature and to state and municipal agencies in determining what constitutes a public use. (8)
1. Public Use vs. Public Purpose
Further broadening the concept of public use in New York, courts and the legislature do not seem to make a distinction between public use and public purpose or benefit despite the plain language of the New York State Constitution which specifies public use alone. (9) Section 204 of the New York Eminent Domain Procedure Law requires the condemnor of private property to specify "the public use, benefit or purpose to be served by the proposed public project." (10) Moreover, most New York Court of Appeals cases interchange the terms use, benefit, and purpose without making a distinction between them. (11) Historically, however, this was not always the case.
2. Historical Distinctions Between Public Use and Public Purpose.
The takings clause was first inserted into the New York State Constitution in 1821. …