How Eminent Domain Hurts California

See Jerry Brown's Good Deed Gets Punished: California's governor wants to close his state's redevelopment agencies, which abuse property rights and breed dependency among city governments by Steven Greenhut, from the WSJ, 3-12/13-11. Excerpts:

"Once public officials deem an area blighted, redevelopment agencies can use eminent domain to clear old properties and sell bonds to pay for improvements.

To pay off the bonds, the agencies gobble up any subsequent increase in tax revenue—what the state calls the "tax increment." In addition, a portion of the sales taxes generated by the new retail and commercial centers go into city, not state, coffers."

"...redevelopment agencies have become fiefdoms that run up enormous debt and abuse eminent domain by transferring private property to large developers promising to build tax-generating bonanzas. Today, there are 749 such projects. In the late 1950s, there were only nine. According to the state controller, redevelopment agencies consume about 12% of all state-wide property taxes..."

"In the 12 years I've spent reporting on this issue, I've seen an agency attempt to bulldoze an entire residential neighborhood and transfer the land to a theme-park developer. I've witnessed agencies declare eminent domain against churches—which pay few taxes—in order to sell the property at a deep discount to big-box stores that promise to keep city coffers flush. Working-class people and ethnic minorities often are the victims of this process since they often live in the vulnerable neighborhoods, and they have less muscle than big business developers."

"Once "blight" is found, the agency creates a project area and can then begins selling bonds (incurring debt) without a public vote. In 1995, one area of the city of Diamond Bar, where I lived, was declared blighted because there was chipped paint on some buildings."