The Casino Reinvestment and Development Authority in Atlantic City, New Jersey, which was granted the right to condemn private property and use it for casino redevelopment programs that supposedly benefit the community, has been handed a loss in its latest demand to take ownership of a home.
The state appeals court found it didn’t need the property for any project, didn’t have any pending projects that might need it and wasn’t likely to have a need any time soon.
The condemnation case was brought against Atlantic City property owner Charlie Birnbaum, whose family home was targeted by the government operation.
The CRDA was authorized to acquire private property for projects it considered necessary, but even the CRDA admitted the Birnbaum property was only for a “land bank” that might be slated for “future development.”
Birnbaum refused an offer of about $238,000 for the property, and when the agency went to court, it said it needed the land for a project.
But the CRDA admitted it had a “concept” but no “plans” for a project or any agreements with developers.
“Rather,” the court found, that “at an unspecified time, after a ‘massing plan’ had been approved by the CRDA’s board, the CRDA would put the project out for public bid.”
That amounted to land speculation, the court found.
The ruling upheld a lower-court decision by Atlantic County Assignment Judge Julio Mendez.
“Under these highly unusual circumstances, it was reasonable for the judge to question whether the project would proceed in the foreseeable future,” the ruling said. “… CRDA was attempting to ‘bank land in hopes that it will be used in a future undefined project.’ Approval of the condemnation could well leave the Birnbaum property vacant for an indefinite period of time, as the CRDA ‘wait[s] for the right project to present itself.’ … We affirm, because the CRDA could not provide evidence-based assurances that the project would proceed in the reasonably foreseeable future.”
Robert McNamara, a senior lawyer at the Institute for Justice, which defended the property owner, said the ruling is a victor for property owners nationwide.
“The power to seize private property through eminent domain is one of the government’s most frightening powers, and today’s opinion reaffirms that it can only be used for good reason – and that courts will stand in the way if government officials try to do otherwise.”
CRDA began demanding the property in 2012 when it adopted a resolution regarding a “new Revel Casino.”
But then the Revel went through two bankruptcies and an extended closure, only recently reopening.
During that time, the CRDA “never once articulated what (if anything) it would do with the land after it knocked down the Birnbaums’ longtime family home,” IJ said.
The trial court said the CRDA was exhibiting a “manifest abuse” of power.
“CRDA officials attempted to replay what happened in New London after the Kelo decision, where nearly 20 years after the approval of the redevelopment plan nothing has been built in the former neighborhood,” said IJ President Scott Bullock. “The New Jersey appellate court’s answer to CRDA was crystal clear: Think again. Property rights matter, and you can’t just take land in the hope that something else will be built in the future.”
Birnbaum, who inherited the property from his parents, rents out the top two floors and now uses the ground floor for a memorial, for a studio and as a base for his piano-tuning business.