Eminent Domain Conclusions

In my series on eminent domain, I wanted to provide the background and progression of changes in the application of the eminent domain process by government. This past week, there was national attention on eminent domain abuses as this photo played on news stations.

I did not outline my thoughts but in my opinion, eminent domain will become a more powerful tool by local and state government for several reasons.

1. Competition for companies to relocate or start up operations in a new community will become intense as politicians seek ways to generate jobs. Government will not follow their own master plans, zoning ordinances and will exercise eminent domain to make well located property available for business. This will not only be critical for jobs but to generate taxes from the employees. I know of a company that relocated to South Carolina because of the tax breaks provided in their negotiated move. One stipulation was the company had to maintain a minimum number of employees.

2. In the ‘70’s, we experienced oil shortages which led to the strategic national oil reserve, energy conservation, and alternative energy sources. Not much has changed since, except government is again emphasizing the need for a comprehensive energy policy.

 

How will this re-emphasis on energy change our real estate development approach?
Will government restrict development patterns and approve only in-fill or redevelopment projects?
Will government become more active in guiding development through the eminent domain process?
Will municipalities restrict the number of homes to be built each year or initiate the zoning change outlined in my whitepaper on the future of land development Part II?

 

This paper is available on LinkedIn http://www.LinkedIn.com/in/djohnsonpe

It is clear energy will be an important element in guiding our housing and non-residential choices and those sensitive to this issue will thrive.

  

3. Sustainable Communities will be the future whether horizontal mixed use or vertical mixed use. Integrating a transportation element into the project will only strengthen the concept. Local government can make positive strides toward achieving sustainable communities by revisiting their zoning ordinances and land use now. Rethink, reinvent and re-establish community development patterns to encourage sustainable growth. Many municipalities have not changed their master plan and zoning ordinances for many years – now is the time! As an example, is working out of your home as a business in violation of your residential zoning ordinance? I will go out on a limb and state that over 95% of the 40,000 local municipalities have not changed their ordinances to allow home business use. It is not inconceivable that local governments will use eminent domain to consolidate land area and negotiate deals with large mixed use developers.

  

4. Infrastructure – in most locations, government doesn’t build any infrastructure and requires developers to either construct or pay for improvements. Government doesn’t have the money nor can they take care of the water, sewer, roads, buildings, drainage systems, etc. now. How will they be able to manage this in the future; by government consolidating growth patterns through design and the eminent domain process?