November Preview? Local bond & tax measures fared well in June

When a third of California’s registered voters turned up to vote this month, most of them got the chance to consider one of the 89 local bond and tax measures on their ballots.  School construction bonds made up over half of these measures, and nearly all of those passed, including $850 million for Long Beach Community College District and $950 million for Chabot Las-Positas Community College District.  Other Districts with big bond victories included:

  • $245 million for Livermore Unified
  • $265 million for Marin Community College
  • $283 million for Dublin Unified
  • $300 million for Montebello Unified
  • $319 million for Irvine Unified
  • $485 million for State Center Community College

And a slim majority of non-school tax measures passed as well.  Michael Coleman has a great breakdown of the local measure results on his California City Finance website.  From Coleman’s website, it appears voters favored libraries and schools over police, fire and emergency services.  Can this tell us anything about the several California counties considering transportation sales tax initiatives for the November ballot?  (If you want to know if your county is one of them, check the Center for Transportation Excellence’s elections website.)  Perhaps.

In the nine-county Bay Area, voters approved Measure AA — a $12 per parcel tax for Bay conservation and clean up.  As Joel Fox states in his article “Election Prediction Record Not Bad – What do Results Mean,” “the success of the Bay Area’s Measure AA will prompt additional efforts to put regional measures on future ballots.”  On the other hand, sales tax measures requiring two-thirds approval fared poorly — only one of 6 passed.  Nevertheless, we can expect to see at least twice as many local measures on the ballot in November.  So stay tuned!

City of Perris v. Stamper Oral Arguments Tomorrow

Eminent domain fans!  Take heed: The City of Perris v. Stamper case (S213468) will finally be heard by the California Supreme Court tomorrow at 9:00 a.m. in San Francisco.  I recapped the issues that are going to be addressed in my prior post about the oral arguments.SC-Webcast-Button_efffb6ff-772f-4b5d-822d-a31e646333e2-prv

Remember – the California Supreme Court now broadcasts its oral arguments live on the web!  Go to the CA Supreme Court’s website (http://www.courts.ca.gov/supremecourt.htm) and there will be a blue box on the right that will launch the web viewer!  I hope you tune in!

 

Next Stops for the Alameda Corridor East – Montebello, Maple and Turnbull Canyon Grade Separations

Capture2

At some time or another, most of us have experienced sitting in our cars at a railroad crossing waiting for what seems like the longest freight train in the world go by. And it always seems to happen when you’re late for an appointment or for once trying to make it home in time for dinner.  If you live or work in the San Gabriel Valley, sitting in traffic waiting for the freight-train to go by is likely a daily occurrence.

With vehicle and rail traffic projected to increase, in 1998, the San Gabriel Valley Council of Governments (SGVCG) decided to do something about the safety and traffic concerns caused by the poorly designed and outdated intersections where cars, pedestrians and train traffic meet. SGVCG which is made up of 31 cities, created the Alameda Corridor East Construction Authority (ACE), and tasked it with addressing and mitigating the safety impacts of the increasing rail traffic at the various intersections.

Of the various safety improvements, grade separation projects[1] have been the most effective projects to eliminate train-vehicle and train-pedestrian conflicts and to relieve congestion.  However, the benefits of these projects to the overall community have come at a hefty price tag to some of the adjacent property and business owners who have had their properties and businesses forcibly acquired by ACE by or under the threat of eminent domain to make way for the grade separations.

In particular, there are three grade separation projects on the horizon. The Montebello Boulevard and Maple Avenue projects in the City of Montebello and the Turnbull Canyon Road grade separation project in the City of Industry.  In a February 25, 2015 article, the Whittier Daily News reported that the two new proposed grade separations in the City of Montebello were approved by the Montebello City Council.  The new $142 million grade separation projects will create underpasses at the Union Pacific Railroad and Montebello Boulevard and Maple Avenue.  In a more recent article published yesterday, the Whittier Daily News reported that at an open house earlier this week, ACE revealed a preliminary design plan which shows the affected parcels for the Montebello Boulevard project.  One of the affected parcels is located at 439 Montebello Way.  The acquisition of this parcel will result in the displacement of multiple businesses including Otani Radiator and Auto Repair, a family business owned by brothers Louie and Leonardo Ramirez.  After operating at its current location for over 25 years, if the project proceeds as currently designed, Otani will be forced to vacate and relocate its home of over two decades.  ACE’s new study for the Montebello Boulevard project identifies up to six full acquisitions and approximately 23 properties where at least a portion of the parcel will be acquired, meaning the impacts to property and business owners can be wide spread.  No specific information appears to be available yet on the Maple Avenue project.

The Montebello City Council will further discuss the Montebello Boulevard and Maple Avenue projects at its July 13 City Council meeting. As indicated, in addition to the Montebello projects, ACE is also in the preliminary planning stages for a grade separation project at Turnbull Canyon Road in the City of Industry.  Regardless of which properties the designs affect, the projects are likely to adversely impact multiple property owners, occupants and business operators.

We’ve represented and continue to represent property and business owners against ACE to ensure they are receiving the maximum compensation and benefits they are entitled to. We will continue to monitor the progress of these projects, so be sure to check back often.  Alternatively, please feel free to contact me and I’m happy to provide you with further updates and discuss your particular matter with you.

A complete list of completed, under construction and upcoming ACE grade separation projects, including a map of where the projects are located, can be found on ACE’s website under the projects tab here. Some of the most notable ACE grade separation projects include:

Completed Grade Separations

  • Baldwin Avenue, El Monte
  • Ramona Boulevard, El Monte
  • Orange Avenue, City of Industry
  • Sunset Avenue, City of Industry
  • Nogales Street North, City of Industry and West Covina, and
  • Brea Canyon Road, Diamond Bar and City of Industry

Under Construction

  • San Gabriel Trench, San Gabriel
  • Puente Avenue, La Puente
  • Nogales Street South, City of Industry, and
  • Fairway Drive, Walnut

In Design/Planning

  • Maple Avenue, Montebello
  • Montebello Boulevard, Montebello
  • Durfee Avenue, Pico Rivera
  • Turnbull Canyon Road, City of Industry
  • Fullerton Road, City of Industry

[1] Grade Separations are projects wherein the alignment of the roadway and the railroad right-of-way are separated by constructing an overhead or underpass structure allowing cars and trains to cross at different heights so that they do not disrupt the flow of traffic.

Oakley to Condemn Century-Old Building for Street Widening Project

As cities become more dense and urbanized, it is common for infrastructure to get outdated or insufficient to handle increased demand.  We see this with roads, highways, schools, and even utilities.  When new infrastructure is needed, many times eminent domain becomes necessary to acquire property in the way of the proposed new project.  But sometimes those properties are historical or, given their longstanding presence, have sentimental meaning to the community.

Such a situation is currently playing out in the City of Oakley.  According to an article in the Mercury News, Oakley invokes eminent domain in quest to demolish century-old building, the City recently adopted a resolution of necessity in order to acquire — or at least partially acquire — the century-old building located at 3530 Main Street in order to make way for a street-widening project.  The building frontage is needed to widen the street, and the entire property may ultimately be needed for a proposed new train station for a passenger line that would run between Oakley and Oakland.

The property has a story that tugs at your heart-strings.  It was originally purchased in 1912 by an Italian immigrant named Venanzio Del Barba, who earned enough money to buy and open a general store after years of working on the railroad and farming.  In the 104 years since, the Del Barba family has held onto the property, weathering the storm through the Great Depression, the Great Recession, and two World Wars.

Having appeared at many city council, board of directors, or board of supervisors meetings over the years, I can tell you that these are the hardest acquisitions for local agencies.  And you hope for alternative, creative solutions.  Which may be a possibility in Oakley.  City Council members asked City staff to find a “creative compromise” with the family, perhaps a solution where the front of the building could be shaved off and partially re-built with a similar façade.

Despite the requests for compromise, the City has proceeded with filing an eminent domain lawsuit.  In the condemnation litigation, there could be an interesting dispute on fair market value.  The City has valued the property at $145,000 — more than $100,000 less than what the property was appraised at in 2010.  (This seems surprising given the market has significantly improved in that time.)  Moreover, similar buildings on Main Street have been recently listed for sale in the $450,000 – $500,000 range.  And in addition to the valuation dispute, it sounds like the owners could have a potential pre-condemnation damages claim for loss of rents, as they’ve been unable to find tenants for the building since the City made it clear it was planning to acquire the property.

As for the historic significance of the building, I consulted with Joseph Haney, an attorney at Haney & LaBriola, who specializes in real estate transactional matters and handles historic preservation issues.  Mr. Haney indicated:

This situation shows the limits of California’s historic preservation laws which are primarily procedural in nature.  CEQA requires a review of historic resources impacted by a project, but it does not compel preservation.  The City’s Environmental Impact Report did identify the significant impacts from destruction of the historic buildings, however, that finding was ultimately outweighed by other concerns.

We’ll continue to follow this one and see if a solution can be reached.

Preparing for the Future – SCAG Adopts 2016 RTP/SCS

2016MaintInfraFactSheetImg

The Southern California Association of Governments (SCAG) is the nation’s largest regional planning agency and is governed by an 86-member Regional Council, made up of elected officials from among the six counties and 191 cities who are members.  SCAG develops  a variety of policy and planning initiatives to create a sustainable Southern California region.  Every four years, SCAG must develop a Regional Transportation Plan, which sets out a vision for the next 25 years. SCAG adopted the most recent plan last month.  In the 2016 Regional Transportation Plan/Sustainable Communities Strategy (RTP/SCS), SCAG sets out a long-range vision for transportation throughout Southern California that is consistent with the region’s environmental, economic and public health goals.  The “Interactive Executive Summary” provides a good summary about the plan, including the overarching strategy, the financial realities, and how SCAG intends to measure the success of its goals.   And those goals are quite lofty.  The RTP/SCS plans to accomplish:

  • A 20% reduction in greenhouse gas emissions by 2040
  • Improvements in regional air quality
  • A 4% increase in work trips made via transit, carpooling or active transportation (walking, biking etc.)
  • A 7% decrease in per capita vehicle miles traveled and 17% fewer vehicle hours traveled per capita
  • A one-third increase in travel on public-transit
  • A 22% decrease in daily delay per capita

But there are challenges.  As described in the RTP/SCS, the region is expected to add 4 million residents by 2040.  The population will also be older, with fewer working adults.  This means we will need to provide more transit options for seniors, while also facing a decrease in tax revenue as there are fewer people in the labor force. And while the common view is that Millennials want a more urban, transit-friendly lifestyle, many people will still live in the suburbs and commute alone in their vehicles.  Finally, while there will be an increased demand for an integrated and larger transit network, the existing infrastructure must also be repaired and maintained while SCAG reports funding is “scarce and insufficient.”

To meet these challenges and accomplish the goals, the RTP/SCS identifies $556.5 billion in transportation investments over the next 25 years, with about half of that going towards maintenance of the existing system.  $56.1 billion is marked for capital transit improvements throughout the area.  The RTP/SCS calls for significant expansions of the Metro subway and light-rail systems in LA County, a streetcar system linking destinations in Orange County, and wider Bus Rapid Transit service that will connect the entire region as well as new Metrolink services in the Inland Empire.   While the RTP/SCS does not implement funding, including these and other projects in the plan allows project sponsors to qualify for Federal funding.

In her recent article “There are 7 Good Reasons to Invest in Southern California’s Transportation System,” Duarte Council member and SCAG 2nd Vice President Margaret Finlay summed it up well:

[T]ransportation is about more than mobility. It truly is a quality-of-life issue, impacting our prosperity — and our health…Investing in our transportation system is no longer optional.

Update: California Supreme Court Oral Arguments

Today, the California Supreme Court heard oral arguments in the Property Reserve v. Superior Court case.  Today was also the day the Court began showing live webcasts of oral arguments online, so I was able to not only hear the arguments but see the Justices and attorneys in action.  If the Court provides a link to the oral arguments, I will include that in another post.

My initial reaction from the oral arguments – all of the Justices were very engaged in the arguments and the Court hammered both sides pretty soundly.  If I had to pick a winner, I think they went easier on the State.

The Court did seem concerned about activities taking place on properties under the Right of Entry statutes and whether the activities constituted a taking but it also seemed like the State was able to waylay some of those concerns by saying the Right of Entry statutes, as drafted, protect property owners and offer them avenues to obtain compensation for the entry and a jury trial on the amount of damages, if they so choose.

The Court seemed to like the notion that the statutes already provide an expedited eminent domain proceeding because the Justices spent considerable time grappling with the idea of denying owners their rights under Article I, Section 19 of the California Constitution and finding how the Right of Entry statutes are reflective of constitutional rights.  The Chief Justice and Justice Liu asked the million dollar question: What is at stake if agencies cannot get onto properties to complete their precondemnation investigations — would public projects stop, would they be endlessly delayed, would they cost way more to build, and if we take away this course of action, what happens?

The Petitioners argued that they are not challenging the constitutionality of the Right of Entry statutes, but are merely saying that if an interest in property is obtained by an agency using the statutes, then it is a taking deserving of all of the trappings of an eminent domain case.  The Court seemed skeptical that such a line could be drawn.  At one point, I thought one of the Justices was going to call them on splitting hairs…

The Justices tried to force petitioners to define the line between what constitutes a taking versus a non-compensable entry, but petitioners dodged those traps, for the most part.  The glaring omission in the argument is that there appeared to be no middle ground – if the Court strikes down the Right of Entry statutes (which petitioners say they aren’t requesting), and at the same time, we can’t expect agencies to go through double-condemnation (one for testing and one for the actual project) to get a project off the ground, what is an agency to do?  The petitioners want the Court to require agencies to acquire an investigatory easement before proceeding with testing but isn’t that the exact double-condemnation situation that everyone recognizes creates the problem?

It was definitely interesting, for me, anyway. I can’t say with any certainty how the Court will rule on the matter, but based on the oral arguments, the Court is definitely wrestling with the issues.  We should hopefully see a decision within the next 90 days!

As a side note, unfortunately the City of Perris v. Stamper oral arguments were continued and will not take place on May 5.  The hearing is being rescheduled for the late May calendar.  We will let you know the date when it is set by the Court.

City of Perris v. Stamper Oral Arguments Are Next Week

If you are an eminent domain junkie like us, then you will appreciate knowing that the City of Perris v. Stamper case (S213468) will be heard by the California Supreme Court on May 5, 2016, at 9:00 a.m. in San Francisco. As a quick refresher, this is yet another case where the Court is trying to delineate the role of the judge versus the jury in eminent domain cases. The case considers the constitutionality of a dedication requirement imposed by the City of Perris.  The Court will be addressing two questions:

  1. Is the constitutionality of an otherwise reasonably probable dedication requirement that a governmental entity claims it would have required in order to grant the property owner permission to put his or her property to a higher use a question that must be resolved by a jury pursuant to article I, section 19 of the California Constitution?
  2. Was the dedication requirement claimed by the City of Perris a “project effect” that the eminent domain law requires to be ignored in determining just compensation?

(If you’d like a more detailed discussion, you can review our original post from August 2013.)

The Court typically issues a decision within 90 days of oral arguments, so in addition to getting a decision on the Property Reserve v. Superior Court case (which is being heard on May 3), we should have the answers to the above-questions as well.  This should be a very interesting summer!

Absent a “Taking,” Property Owner Cannot Recover for Loss of View

One of the most valuable assets many homeowners enjoy is their property’s view. If the government undertakes an activity that eliminates or obstructs that view, is an owner entitled to relief?  In Boxer v. City of Beverly Hills (April 26, 2016, B258459), the California Court of Appeal held that in an eminent domain action (where there is a direct taking of property), view impacts are compensable, but in the absence of a taking of property, a property owner is not entitled to compensation for loss of view.

Background

In Boxer v. City of Beverly Hills, a group of property owners filed an inverse condemnation action against the City based on the City’s planting of redwood trees on adjacent City-owned property, which trees obstructed the owners’ views of Beverly Hills, the Hollywood Hills, the Hollywood sign, the Griffith Observatory, downtown Los Angeles, and – on a clear day – Mount Baldy 50 miles away.  The trial court dismissed the action, concluding that the allegations of impairment of view did not establish a taking under inverse condemnation law.  The owners appealed.

Court of Appeal Affirms No Liability Solely for Loss of View

On appeal, the Court explained that a property has been “taken or damaged” so as to give rise to a claim for inverse condemnation when the property has been physically taken or damaged, or experiences an intangible intrusion that is direct, substantial, and peculiar to the property itself. In the second instance, the owner must demonstrate that the consequences are “not far removed” from a direct physical intrusion.  Neither the mere existence of a public use or a diminution in value to the property alone establishes a compensable taking or damaging of property.

The Court identifies several examples of the limited circumstances in which an intangible intrusion may be sufficient to trigger inverse condemnation liability, such as where:

  • An adjacent sewage treatment facility rendered the owner’s home uninhabitable and caused nausea and burning eyes;
  • Noise, dust, and debris from a freeway expansion that included a 23-foot embankment directly in front of the owner’s home caused physical damage and respiratory problems; and
  • Noise from commercial jet aircraft landing and taking off substantially interfered with the use and enjoyment of neighboring residential property.

In the context of view impairment, the Court explained that as a general rule, a landowner has no natural right to air, light or an unobstructed view, and such rights are only created by private parties through the granting of an easement or CC&Rs, or through local government regulations. As a result, view impairment, standing alone, cannot constitute an “intangible intrusion” that triggers inverse condemnation liability.

The Court then walked through several cases in which view impairment was found compensable in direct eminent domain actions. The Court explained that once a taking is established, any diminution in value due to loss of view is taken into account in determining damages.  Therefore, if there has been a direct taking or other compensable claim triggering inverse condemnation liability (such as a substantial impairment of access), view impacts are compensable.  In other words:  “a compensable visibility interest has been recognized when the government has physically taken part of someone’s property, but this is merely an aspect of the owner’s damages, and is not itself a taking or damaging of the property.”

Despite there likely being a significant diminution in property value due to the City’s blocking previously unobstructed views enjoyed by the homeowners, because there was no physical taking of property, the Court of Appeal affirmed there was no liability.

Conclusion: Physical Takings Open the Door to Liability

While the Boxer case involved the narrow issue of liability for view impairment due to an agency’s planting trees on government-owned property, it potentially has much broader impacts, and serves as a strong lesson for public agencies planning public projects.  Many public projects involve some impact to views enjoyed by adjacent property owners; once there is a taking of property – no matter how small – the door has been opened to potential exposure for diminution in value.  As a result, it is essential for agencies to engage in early pre-condemnation planning and undertake efforts to avoid small sliver acquisitions or temporary construction easements.

For property owners, it serves as a reminder that no matter how unique or special a view your property may have, it can be gone in an instant – possibly without any recourse absent a physical taking or other local regulations. If your local government agency does not have height restrictions in place, it is imperative to secure view rights privately, either through an easement on adjoining property, or through CC&Rs in the development community.

In most cases, Boxer may establish a bright-line rule that there must be a taking in order for a property owner to recover for view impairment caused by a public project.  What that means is that two property owners, identically situated and identically impacted by a government agency’s project, may be treated completely differently if the agency acquires one inch from one owner and nothing from the other.

While this may seem unfair, the California Supreme Court once addressed a similar quandary regarding the ability to offset general benefits from public projects in eminent domain actions, and explained that “[t]he law has no mechanism by which to ensure an absolutely fair distribution of costs and benefits across the entire community. We must instead search for the rule of greatest relative fairness, or least unfairness.”  (Los Angeles County Metropolitan Transportation Authority v. Continental Development (1997) 16 Cal.4th 694, 716.)

We’re left questioning whether this bright-line approach is the least unfair, and if not, whether a better approach exists. And while Boxer appears to establish a clear delineation for recovery depending on whether a taking exists, we’re also left questioning whether such a rule applies in all circumstances, especially when other published appellate decisions suggest a potentially different result in the case of substantial impacts to a property owner’s abutter’s rights.

Eminent Domain for California’s Social Infrastructure

While much of the focus in California lately has been on eminent domain for transportation projects, there’s some new condemnations moving forward in both Northern California and Southern California for social — or community — development projects.

  • downloadDown south, the San Diego Union Tribune reports that the Port of San Diego has exercised its condemnation powers to acquire four acres of prime property on Chula Vista’s Bayfront in order to construct the Chula Vista Bayfront Master Plan project.  The Master Plan, approved by the Coastal Commission in 2012, is a joint project between the Port and the City of Chula Vista to transform 550 acres into a waterfront destination.  The Port originally appraised the 4-acre parcel at $2.4 million, but reduced its appraised value and offer to $1.6 million after it discovered the presence of contamination.  The next step will be filing the eminent domain lawsuit in court.

 

  • Up Plans for the upcoming civic center project in downtown Fremont call for a new city hall to be built in 2020. Courtesy of City of Fremontnorth, the Mercury News reports that the City of Freemont has adopted a resolution of necessity allowing for the use of eminent domain to acquire a 1.54-acre parcel needed for the development of the Downtown Civic Center.  The City Council also approved a relocation plan for up to 23 businesses displaced by the acquisition of the property at 39156-39200 State Street, which structures will be demolished under Freemont’s plans for a new City Hall and other municipal buildings.  Adopted in 2014, the Civic Center Master Plan identifies a 5.7-acre site on the northeastern corner of Capitol Avenue and State Street for a large public plaza, city administrative offices, and other community-focused uses as well as adjacent parking.  Groundbreaking is expected to start in 2017.  The article reports that the property owner has retained an attorney and an appraiser, but has not responded to the City’s appraisal or offer or otherwise engaged in negotiations with the City.

Join Us at IRWA Los Angeles’ Annual Valuation Seminar and IRWA San Jose’s Spring Conference

SE-Corner-final-notitleThere are a couple exciting International Right of Way Association (IRWA) events coming up next week:

  • On April 26, I will be participating in IRWA Chapter 1’s (Los Angeles) 2016 Annual Valuation Seminar.  I will be presenting with Brad Thompson of Mason & Mason on “Project Benefits and Construction-Related Impacts:  Tangible or Speculative?”.
  • On April 29, I will also be participating in IRWA Chapter 42’s (San Jose) 4th Annual Spring Conference.  I will be presenting with my partner, Artin Shaverdian, and Steve Parent of Bender Rosenthal on “The Value of Transit Proximity:  Assessing Project Benefits”.

The 2016 Annual Valuation Seminar is approved for 8 hours of BREA credit and will take place at the Quiet Cannon, 901 North Via San Clemente in Montebello. For more information, or to register for this event, click here.  The 4th Annual Spring Conference will be held at the Santa Clara Valley Transportation Authority (VTA) Auditorium at 3331 North First Street in San Jose. Applications for up to 7 hours of IRWA, BREA, SBE, SR/WA and MCLE are pending. For more information, or to register for this event, click here.

Anyone who is not an IRWA member is welcome to attend both events.  I look forward to seeing you there!

LexBlog