Eminent domain law leaves loophole

Eminent domain law leaves loophole
Bear landowner left powerless to stand in DelDOT’s way

By ADAM TAYLOR — The News Journal

BEAR — John Slawter raised his family on a truck mechanic’s salary.

He bought land along U.S. 40 near Bear when the roadway still mattered to truckers hauling loads between Baltimore and Philadelphia, before I-95 cornered the commercial traffic. When he retired, Slawter began depending on the rental income the property produced. Today, an Amish shed builder pays Slawter to ply his trade there.

Because Slawter was self-employed, he doesn’t have a 401(k) or pension. The property is his nest egg. So the 74-year-old fought back when a Delaware Department of Transportation engineer told a developer the agency was willing to take Slawter’s property through eminent domain.

Like many property owners in Delaware, Slawter was hopeful a private property rights bill that Gov. Jack Markell signed into law Thursday would protect his approximately one-acre parcel.

But it won’t, because lawmakers exempted DelDOT and the Delaware Department of Natural Resources and Environmental Control from the new law that says governments can’t use eminent domain to accommodate economic development. That means DelDOT could still lawfully take Slawter’s property.

The development firm Harvey Hanna and Associates plans to build a shopping center with a supermarket as its anchor directly behind Slawter’s property. It wants one of the entrances to go directly through Slawter’s parcel, where 31-year-old Sam Glick’s sheds and gazebos are now displayed along the roadside.

The entrance point is viewed as crucial to the shopping center’s success. It would allow westbound U.S. 40 motorists direct access without having to make a U-turn.

So Harvey Hanna offered Slawter $750,000, which the developer’s attorney, Shawn Tucker, said is hundreds of thousands above the market rate.

Slawter’s attorney, Rich Abbott, disagrees, saying the offer is about what his client’s property is worth.

The trouble is, Slawter doesn’t want to sell.

“Of course I want to keep my rental income coming in, but I also feel for my tenant,” Slawter said. “He’s a young man getting started. I feel duty, honor and integrity toward him. But apparently, we’re in the way of progress.”

Glick is trying to establish a successful family business on the site.

‘An absurd abuse’

In 2006, DelDOT put into writing its willingness to use eminent domain to take the land if negotiations between the developers and Slawter failed.

Abbott, Slawter’s attorney, said DelDOT’s plans would be “an absurd abuse” of its eminent domain powers.

“This wouldn’t be a public road for a public use,” Abbott said. “It would be a private entrance into a shopping mall that would only benefit a private developer.”

DelDOT spokesman Darrel Cole disagrees. Taking the road for a shopping center would be a “public use,” a requirement for using eminent domain under the new law.

DelDOT is now trying to mediate between attorneys for the developers and Slawter to try to avoid eminent domain coming into play.

Slawter has said he’s willing to relocate to a nearby spot that fronts on U.S. 40, but so far, the developers haven’t found a place for him that’s affordable to purchase, Tucker, their attorney, said.

The developers bought Vandyke Road, which runs through the middle of Slawter’s property, meaning he is technically trespassing whenever he uses it.

Tucker informed Slawter he was trespassing in a 2007 letter. To Slawter, the letter was a bullying tactic to force him out even though he’s been using the road for 30 years.

Tucker, however, said his client has been negotiating in good faith with Slawter for years and will continue to do so.

“We want to move forward with the project as quickly as possible and are willing to pay him more than market value to resolve the matter promptly,” Tucker said. “Frankly, we’re scratching our heads as to why he hasn’t taken our offer.”

The answer goes to the heart of many eminent domain battles.

Some property owners who face losing their land feel as though they were there first. They also don’t like the idea of a government stepping in to take their land and giving it to someone who’s richer than they are. How much money they’re offered isn’t the point.

Tucker counters that Slawter’s case isn’t an example of eminent domain abuse because the U.S. 40 corridor in Bear is “smack-dab in the middle of a growth zone,” he said.

“It’s very logical for DelDOT to want to look at improving the intersection that would lead into a new shopping center,” Tucker said. “This is what you want DelDOT to do when there is a plan to improve the area.”

Because the eminent domain process hasn’t started, Slawter’s property hasn’t been appraised. It’s also unclear what Slawter’s property would sell for if he sold it to someone else on his own, which he doesn’t want to do.

Criticism of new law

Slawter isn’t the only one worried about the new eminent domain law.

The losers in the fight over Senate Bill 7 say it will hurt local governments’ ability to put into place future urban renewal plans — a key way to improve a city — and could make it harder for officials to condemn blighted properties that have been neglected for years.

David Swayze, an official for the Riverfront Redevelopment Corp., which has overseen a decade’s worth of development on the banks of Wilmington’s Christina River, called the law a gargantuan overreaction in a well-meaning effort to protect property rights.

“They went after a flea with a cannon,” he said.

Wilmington Economic Development Director Joe Di Pinto agreed, particularly because Wilmington has rarely invoked its eminent domain powers.

“Senate Bill 7 has always been a piece of legislation that is looking for an issue to justify it, but it doesn’t exist, because we’ve never abused our rights of eminent domain,” Di Pinto said. “To suggest that we might one day do that is a compelling reason to support this legislation just doesn’t wash.”

Attorneys at the Institute for Justice, a libertarian nonprofit law firm in Washington, D.C., that helped get the bill through the Legislature, thinks there was more than enough reason for South Wilmington property owners to promote the law as a means of getting stronger protections.

In changing the South Walnut Street Urban Renewal Plan in 2007, the city’s new version included more than 60 properties — many industrial businesses — that could be condemned if the city needed to make way for enterprises that fit into its vision for the area, which includes high-end town homes and boutiques.

Delaware was the first state to pass a property-rights-protection bill after the U.S. Supreme Court ruled in favor of New London, Conn., over homeowner Susette Kelo.

The city took her home and her neighbors’ homes to make way for a more lucrative development project.

But Delaware’s first effort had too many loopholes. Senate Bill 7 closed them, and is now one of the best reform laws in the nation, said Steven Anderson, an Institute for Justice attorney.

“Delaware just shot to the head of the class,” he said.

The law goes too far, according to Rhett Ruggerio, a lobbyist for the Delaware League of Local Governments — an association of 57 towns and cities, including Wilmington.He said people need to understand that cities must be able to acquire dozens of properties to secure a site that would be attractive to a large business that would produce thousands of jobs and millions in tax revenue.”There will be a time when the reform of a law that was never abused in the first place will be regretted by many,” he said. “One small parcel will be in the way of a major development and will make the whole project unbuildable.”