Last week, I blogged a link to George Mason lawprof Ilya Somin’s op-ed defending the recent Michigan Supreme Court ruling that certain seizures of private property were unconstitutional, even if compensation was paid, because they weren’t for a constitutionally authorized “public use.” I also blogged a link to an op-ed on the other side, by Wayne State lawprof John Mogk, and the text of Somin’s rebuttal.
John Mogk now passes along this response:
In reply to Ilya Somin’s comments posted on August 9, 2004, I agree that the facts surrounding Poletown, Hathcock and other cases in which a taking is based upon economic grounds should drive the legal and policy analysis. We do not agree on the facts.
For those interested in the Poletown debate I recommend that the case be read from the original reports, rather than relying upon an interpretation of it contained in the case law, articles or legal texts. Poletown Neighborhood Council v. City of Detroit, 410 Mich. 616, 304 N.W. 2d 455 (1981).
None of the cases referred to in Somin’s remarks convince me that Detroit does not stand alone among the 25 largest cities in the nation in being denied the power of eminent domain to take private property for transfer to private developers to further economic development, when the taking is authorized by the legislature, “serves a legitimate public purpose and provides a predominant public benefit.” This is the requirement in Poletown.
The principal cases to which Somin refers are distinguishable on the basis of involving a predominant private benefit or not being authorized by the legislature. Hathcock prohibits Detroit and other distressed municipalities from using condemnation to further economic development, when the authorized taking provides a predominant public benefit.
The question that the Poletown court addressed, according to the opinion, was “Can a municipality use the power of eminent domain granted to it by [the legislature] to condemn property for transfer to a private corporation to build a plant to promote industry and commerce, thereby adding jobs and taxes to the economic base of the municipality and state?”
The Poletown court found on the facts of the case that “The power of eminent domain is to be used in this instance primarily to accomplish the essential public purposes of alleviating unemployment and revitalizing the economic base of the community. The benefit to a private interest is merely incidental.”
Poletown did not permit all economic development takings. It was not a case involving the use of condemnation to “increase the profitability of a private business.” There was no evidence whatsoever introduced in the case that GM would be more profitable if it build an assembly plant in Poletown than outside of Detroit.
Nor was it a case involving a project contributing to regional economic growth. The problem was local in nature and addressed a massive exodus of manufacturing jobs from the City, resulting in a dramatic slide in its tax base and employment levels.
The Poletown project was initiated by the elected officials of Detroit to keep 6000 jobs in the City that were to be lost by the closing of a 50 year old, obsolete GM manufacturing facility several miles away. This it did. Automobile manufacturing plants built around World War I were multi-story and no longer efficient to operate. They had neighborhoods tucked up next to them and were frequently reached on foot or by local transit systems. After World War II new plants were designed as one-story structures, requiring greatly expanded boundaries to accommodate assembly lines and employee parking.
Several years before the Poletown project, a similar aging, obsolete plant (Dodge Main) had been closed by the Chrysler Corporation immediately adjacent to the Poletown neighborhood. The vacated plant site was on a major rail head, power grid and Interstate Freeway (I-94). There were no jobs remaining on the site. No other available site in the City offered the same favorable conditions for a state-of-the art manufacturing plant.
The site needed to be significantly expanded to accommodate a one-story manufacturing plant. Mayor Coleman Young prevailed upon GM to be permitted to assemble the Poletown site for a new plant.
GM needed the Mayor’s cooperation to improve conditions around its world headquarters, which it was renovating at a cost of $250 million, and the restoration of a major 30 block neighborhood to the north of the headquarters in partnership with the residents living there (New Center Commons). The three projects were ongoing at the same time. GM agreed to cooperate with the Mayor, if its time-lines could be met.
The project transferred 6000 jobs to the site. Detroit has a personal income tax of 3% and a tax on personal and real property. The combined sum of these taxes should have yielded several hundred million dollars to the City since completion of the project and continue to generate substantial revenue in the years ahead.
Condemnation is not needed to further economic development where the market is strong and growth occurring, such as in L.A., San Francisco and San Diego, referred to by Somin. Strong market demand will eventually result in land development which the local government can control through the use of its regulatory powers (zoning, et al) in the public interest. If one beneficial project is not build, another will be.
In distressed areas the market is virtually non-existent or in a state of collapse. If developers are to be attracted, they must be assured of land control within a reasonable time-frame. “Time is money.” Condemnation is needed under these conditions, when the public purpose is legitimate and public interest predominant. Project feasibility is often tenuous, at best, and delays in land assembly cannot be tolerated by the private investor.
Condemnation alone is not the answer for a City in decline. It is only one tool contributing to redevelopment, but one of the most important. Reversing a city’s downward course takes years, particularly one that had the Nation’s largest civil disturbance of the 1960s, dismantling of neighborhood schools through busing in the 1970s and widespread HUD housing abandonment in the late 1970s and 80s. Census data suggests that Cleveland, Philadelphia and St. Louis are not far behind Detroit in experiencing urban collapse.
The foundation projects to which Detroit looks to rebuild itself in the 21st century have been primarily facilitate through the use of condemnation for economic development purposes, in accordance with Poletown. They were believed not to be possible without it.
In Hathcock, the Michigan Supreme Court could have clarified and tightened the public purpose and predominant public benefit standards of Poletown and protected Hathcock and other landowners from condemnation. Their land lies in one of Wayne County’s growth areas. The Court appears to have been on a mission to throw Poletown out. Not to keep and clarify it, will have profound detrimental effects on areas within Michigan where disinvestment and decline is occurring.
Comments are closed.