An alternative to eminent domain: abatement

When it comes to actually eliminating "blight" -- not using it as an all-purpose make-weight for eminent domain in acquiring the land to allow redevelopment projects, as in Kelo -- there is an alternative: Abatement. Force the owner to remove the offending blight condition (that proverbial fire-trap rat-infested house). Or do it for them if they refuse and then send them the bill.

Society's authority to "Abate a Nuisance" originates, in my own folksy view, in the fundamental power of society -- the police power. Abating a nuisance is akin to self-defense; the normal rules of society -- the prohibition against killing another, the prohibition against the trespass and taking of another's property, for example -- are lifted because of the permissible imperative to survive.

Here's some material from Washington State -- and btw most US jurisdictions run in parallel on land use matters -- Authority to Regulate Nuisances.

In the big picture, government has a number of means to deal with "blight." It is unfortunate that the Supreme Court does not require government to use -- as it does with what are called "fundamental rights" or speech, worship, etc -- a "least intrusive means" test. If it did, I think you'd see more abatement and less eminent domain.

Comments

[Matt Edens]

>Force the owner to remove the offending blight condition (that proverbial fire-trap rat->infested house)

Ah, but revving up the bulldozers tends to be hell on the housing stock, no?

http://www.metropulse.com/dir_zine/dir_2005/dir_1510/t_urban.html

And then there's the question of what, if anything, gets built back on that vacant lot.

http://www.metropulse.com/dir_zine/dir_2005/dir_1512/t_urban.html

[David Sucher]

Matt,

It takes about one day at most to demolish a house and clear off the lot. It happens when most people are at work. I can't see your first point even enough to disagree with it.

As to your second point, whatever is built has to comply with zoning for the site. What's the issue?

[Matt Edens]

> I can't see your first point even enough to disagree with it.

I did not mean "revving" in the literal sense. Demolition and lot clearance is a rather permenant solution to what may be a temporary problem, no? The house referenced in the first link I posted above was condemned (and it was, I assure you, a mess). Click the link, have a look at the photograph (of it's present condition, unfortunately I have no "before" pictures) and ask yourself if demolition was the preferred solution?

As for the second, does zoning compliance always ensure that whatever is built actually replaces what is lost? Mileage may vary from city to city. Or even from neighborhood to neighborhood depending on local ordinances. Also note that, while I'm not too aware of Seattle's market, in my experience most rat-infested firetraps aren't in neighborhoods that builders are itching to break ground in:

http://www.metropulse.com/dir_zine/dir_2003/1338/t_urban.html

[David Sucher]

Matt, again I ask, if there is no market demand for a new house on that vacant lot, why should the public subsidize it?

[Matt Edens]

Am I asking for a subsidy for new houses? I

[David Sucher]

Honestly, I am not sure...I am not sure where your comments are going. I assume that most people who argue for eminent domain as a tool of redevelopment believe that "It won't happen without eminent domain i.e. subsidy." My answer to that is "Well, then, maybe it shouldn't."

[JRoth]

I can't quite tell what Matt is getting at, but my sense is that it has something to do with the dilemma of so many neighbrohoods in older cities - once decline has reached a certain point, you need to demolish something like 40%+ of the housing stock to clear it all out. And at that point, you no longer have a neighborhood. You have some old houses in the midst of the woods/meadows. I'll see if I can track down any photos of Pittsburgh's Hill District (where all of August Wilson's plays were set, BTW) to illustrate.

So simply tearing down, with no plans to replace (and no ability to replace in any planned way, since the plots remain in the original owners' hands), is a cure about as bad as the disease. The successful variation on this theme has been to rebuild at a lower density, thus maintaining some sense of neighborhood integrity, as well as introducing better housing stock for community members who desire it and have some capacity, but are in no position to build it for themselves. But, again, this requires land on which to build. Sometimes there are willing sellers, sometimes there aren't. It is certainly true that, if the bad houses are gone, unwilling property owners become a lesser obstacle.

[Matt Edens]

Finally, someone seems to be catching on. Although rather than those neighborhoods that have already precipitously declined, I'm speaking more of those older neighborhoods that are teetering in the balance between rejevenation and decline. In such instances - particularly when the "blighted" housing stock is generally repairable but often in the hands of (typically absentee) owners who have little interest in repairing it - a very limited and judicious use of eminent domain power can help stop and even reverse said decline. The first piece I linked above is an example:

http://www.metropulse.com/dir_zine/dir_2005/dir_1510/t_urban.html

"Take this George Barber-designed Victorian in Parkridge, for example. Cut up into apartments, run through the slumlord rental wringer, condemned and abandoned, six years ago this house was a wreck. But it was still private property, even if the owner seemed satisfied to let it sit and rot. So the city stepped in, using its eminent domain authority to acquire the house and sell it to a private owner, in this case a small-scale developer who totally restored the house and sold it to a new homeowner."

The city purchased the dump for $35,000 (its appraised value). The developer purchased it from the city for $3,500 and, after gutting it down to the studs and totally replacing all systems, resold it for $150,000 (turning a VERY small profit). It has since about six years later) resold for $172,000 - about $66 bucks a square foot for what is a 2600 sq. ft. Victorianl (yes, housing is cheap in the city I'm in...)

Now, of course, a market advocate might argue that why wouldn't the owner sell of his own volition? That's a good question and the answer has always mystified me. Part of it is the nature of the market in transitional neighborhoods and way slum landlords value their property, as I wrote about in one of the other links above:

http://www.metropulse.com/dir_zine/dir_2003/1338/t_urban.html

"pick up a house at auction for $20,000, spend another $15,000 on a quick and dirty rehab to convert it into a duplex (building permit? We don't need no stinking building permit...) and rent it through HUD's Section 8 voucher program for three years, and you've covered your investment (HUD's "Fair Market Rent" for a two-bedroom unit in Knoxville is $505). After that, you'll be raking in over $12,000 in cash annually—minus insurance and property taxes (assuming you bother to pay them). You certainly don't spend anything on maintenance—that's for long-term investors looking to cash in on appreciation. You're playing a short-term game where the real estate itself is valueless, other than the cash you can squeeze out of it. Make it five or six years before a tenant or neighbor calls Codes Enforcement and, when that "Unfit For Human Habitation" sign goes up, simply walk away with a 100 percent profit. The house will get bulldozed and the lot left fallow, producing nothing but weeds. The center-city's littered with them."

This is the dynamic that contributes to the conditions JRoth described above). It is, of course, possible for our rehab developer to troll estate auctions, tax sales and foreclosures much as slumlords do (although slumlords, who tend to work with cash, can usually move faster than they do). And the house has to hit the market (Slumlords tend to buy houses rolling out of owner occupancy - as elderly homeowners die or struggling low income homeowners go belly up) The absentee owner of the house in the first example walked away because it was in a condition that no quick and dirty rehab could repair. Once it ceased having cash flow value it became worthless in his mind (he's the bottom of the real estate food chain, more or less, with an exception I'll get to in a minute).

Now the trick of neighborhoods with historic housing stock like this old Victorian is that, at least in the "transitional" stage there is little market for market-rate new construction. Why spend more per square foot for lower fit and finish than you can get by buying an old house and fixing it up?

Which means that, if the house in our above example was demolished, the only interest in the lot would come from non profit affordable housing providers (who, btw, would mostly likely aquire the lot via the same eminent domain and subsidy mechanism as our for-profit rehab developer, although, since the house has already been demolished, the figures are much smaller: $less than $5,000 for the acquisition and a token resale to the non-profit (often as little as $1). Now, since the neighborhood is in a "transitional" stage, let's assume it doesn't have any additional protections in the form of historic design guidelines, etc.. So, rather than the restored $172,000 2600 sq. ft. Victorian what the city winds up with is an 1,100 sq. ft. vinyl box (which will "comply with zoning for the site").

Which brings me to the point I made in the middle piece I linked above:

http://www.metropulse.com/dir_zine/dir_2005/dir_1512/t_urban.html

"is building $50,000 houses where home values already hover around $50,000 (according to the 2000 census, the median value of owner-occupied homes in the Five Points area was $58,000) a boost for the neighborhood? Or does it, in some ways, guarantee that the area’s real estate remains depressed? Prices that, in an area where the housing stock’s age and size often means the cost of needed repairs will likely outstrip the already low appraisals...homes continue to be condemned and abandoned."

This cycle is only broken if the slum landlords figure out that there is a market for their cast-offs. Which is actually what occured in the case of my original example. Since the acquisition and resale of that house several others have been sold off on the open market (although, considering the guaranteed cash flows they're getting, most slumlords will wait until codes condemnation forces a vacancy to make a sale)

E.D., in this case, was the nudge needed to make the adjustment. And note, btw, that the slumlord came out better if the city used ED to acquire the standing houserather than the vacant lot post demolition.

Which brings me back to the point of the original article:

"if New London exercised more eminent domain of this sort, the city might not be in the sort of financial fix that makes it easy prey for developers proposing big silver-built projects"

The big silver bullet project being what your beef really is. You're using property rights to fight a planning argument.

[Brian Miller]

Matt does have an interesting (if rather lengthy :)) argument, David.

At the core, what you are basically saying to older cities is "let everything rot." If the market's not there, the government should do nothing to reverse the snowballing effect. I'm not sure that's a realistic or even moral position for city officials charged with looking after the welfare of the community. And, "the community" is still more than just the slumlords who have been bottom feeding for years, as Matt describes.

[Matt Edens]

Sorry for the length of the argument. Much of it was contained in the links I posted in my prior comments.

And I'll stress again that the let everything be bulldozed approach often does irreperable harm to the prospects of a struggling neighborhood developing a functioning market, (through the repair/restoration of old, typically historic, homes). Individual homeowner driven infill construction (without the sort of assemblage and cookie-cutter or super block approach) typically only occurs in neighborhoods that have already had most of their older housing stock repaired. Isolated demolition of the few hardest cases can help in tspeed that along. But loose too much fabric from demolition and the impetus towards repair will stop.

So theres an irony here: by reflexively choosing demolition as the cure for blight over limited/targeted acquisition and resale (note I do say limited) you are most likely priming the pump for a Kelo type acquisition and assembalage down the road (and the argument for it, of course, will be that there are so many vacant lots already, what's a few standing houses?).

And yes, I know that slumlords aren't the entire " community" in low income areas. They are, however, doing it the most harm. And displacing more homeowners than ED ever dreamed of. Slum landlords slowly work their own for of acquisition (and while government isn't directly responsible, they play a large incentivizing role ( http://governing.com/archive/2002/may/housing.txt)

As your rental house runs down and eventually ceases to produce, chances are the houses surrounding it (which may be owner-occupied) will come on the market - cheap. It is the slash and burn agriculture model: once a property is exhausted and fails to yeild, move on to the next. ( in some cases they may have their eye on assemblage, if they feel that the ground may have some value: slowly converting a student ghetto of old houses into midrse apartment blocks, for instance).

[David Sucher]

My basic perspective is that
1. most governments are not able to turn neighborhoods around via taking an active part in redevelopment and
2. if a particular government does have the staff smarts, it won't need eminent domain.

It is my observation that almost without exception, neighborhoods revive without active help from government. Government policies, zoning, code enforcement are of course important. Improvements in the ROW might be of some help.

But I am unaware of any necessity to have government be a market participant, as opposed to its proper (to me) being simply a market regulator.

Without exception, the vibrant and/or reviving neighborhoods in the entire Puget Sound basin have evolved without government needing to condemn land resell it to others. It can't be done under Washington law and yet we have tremendous urban revival. Eminent domain is simply not required.

Matt Eden's analysis is so far away from what I have personally observed, and seems to mix up so many different issues into one analysis, that I simply can't comment. For example, who is supposed to be arguing for the "bulldoze everything" approach? Certainly not I.

[Matt Edens]

>who is supposed to be arguing for the "bulldoze everything" approach? Certainly not I.

True. I overstated that point (although I was just picking up on Miller's "Let everything rot" quote). But you do seem to be arguing that abatement (in other words, bulldozing) is the preferred solution to the problem of individual blighted properties. I'm arguing that, in some (perhaps many) cases bulldozing housing stock does more harm than good and does little or nothing to address the root problem: negligent owners (who are typically absentee).

The interesting thing is that, I agree that Kelo was an outrageous abuse of ED powers. And I don't really disagree with your point that neighborhood revitalization largely occurs off of Government's watch. It is an activity of individual homeowners and investors. And intrusion by large agencies (whether government, private or NGO) tends to mess with the dynamic (typically in direct proportion to the scale of the intrusion).

However, in their life-cycle, many urban neighborhoods find themselves at the tipping point between revitalization and decline. It is my experience (as someone who is now living in my third "transitional" neighborhood in rougly a decade and a half) that a very limited, targeted and judicious use of ED can be useful in tipping the neighborhood towards revitalization by transferring a few prominent and architectural significant (but repairable) abandoned properties to new owners (preferably owner-occupants) who will repair them. It is best that this occur in conjuction with more conventional revitalization efforts: zoning, infrastructure improvements, and better codes enforcement - (acquisition via ED, in my community, happens to be an option to demolition in the codes enforcement process). I am not talking about stamping an entire neighborhood a redevelopment area, hanging the threat of ED over everyones head and then aquiring/assembling a large number of parcels that will be passed on to some single private or NGO developer.

Perhaps this hasn't been needed/helpful in Puget Sound, but all cities aren't Seattle.

[David Sucher]

Matt and everyone else:

Abatement is NOT necessarily demolition.

Abatement can/should be tailored very precisely to the specific nuisance. For example, unk cars in the front yard is not an excuse for demolishing the house. Nor should it be, of course.

[Matt Edens]

Well sure, there are other ways to abate blight. It depends, largely on what the blighting condition is.

However, ED isn't one size fits all, either. All I am arguing in that in the case of a rundown house that is unfit for occupation but otherwise repairable and the owner (or owners, as is often the case with the estates of the deceased) refuses for whatever reason to either sell or repair is that acquisition and resale can be a viable and often helpful alternative to demolition. Particularly in areas where, for various reasons, replacement housing stock is problematic.

Do you disagree?

[Brian Miller]

I think Matt's second post nails it. There are examples of targeted, small scale, interference in the market that can work.

Nobody is arguing that Kelo was a good project. But, as jroth's example shows, even the apparantly egregious examples of eminent domain are often less black and white than you claim.

[Matt Edens]

>targeted, small scale, interference in the market that can work.

It is not as if government isn't already interfering with the market in low income neighborhoods. And I know, David, that's a different issue, but neighborhoods are complex organisms and all these things - blight, housing policy, the real estate market, aesthetic preferences - entertwine. And, while it feels good to rail against Kelp and such, it is overly simplistic to simply say no, zilch, nada to eminent domain if the end user is a private owner.

Btw, in Seattle, how do most low income housing NGO's get their lots?

[David Sucher]

Seattle's low income housing NGO's (of which there are many) buy the land on the open market like everyone else.

[Brian Miller]

And, I bet that as a result those NGO's build "affordable housing" that costs $100,000 per unit to build.

[David Sucher]

Brian,
I think that you have revealed a hidden agenda. No? To get the land cheaper via ED? No?

One of the justifications offered for eminent domain is that the property owner doesn't lose because the govt buys for fair market value. But your question implies some disappointment with a fair market transaction made without threat of condemnation.

That's assuming I understand the implications of your question i.e. that NGOs in Seattle end up building expensive affordable housing because they can't use ED. Of course ED is NOT supposed to be a way for govt to get cheap land.

[Brian Miller]

Well, you might be right, David. There is that subtext. I would probably rethink my post above, actually.

[Chris St John]

If you think that private owners do not influence government officials to use eminent domain to get cheap land...well...all I can say is your all naive cause it is happening right now as I type. Oh, and another thing, the government NEVER pays fair market value for properties. Never has,never will.