By CHAD HEMENWAY, KAREN SUDOL and CAROL GORGA WILLIAMS

The Fanaro family has been offered $927,000 for its South Bound Brook property -- a building with three storefronts, a lot and a two-family home.

But Erna Fanaro, owner of Fanaro Carpet at 51 Main St. for about 25 years, does not want to make way for part of the borough“s downtown redevelopment project: a new retail building with more than 20,000 square feet of street-level retail space and 18 one-bedroom apartments above.

"They (South Bound Brook) are taking everything away," Fanaro said. "We“re losing money. Our tenants have left because they were scared because they were told we were going to be demolished.

"Our customers are in South Bound Brook. This is our business."

South Bound Brook is poised to seize the property through condemnation under the principle of eminent domain -- the right of a government to take private property for a public purpose with fair compensation to the owner.

Although historically reserved for projects like highways and reservoirs, a recent U.S. Supreme Court ruling seems to have encouraged many communities to consider using eminent domain to block unwanted development, to redevelop or to preserve what they call their "quality of life."

And the issue has manifested itself to varying degrees in towns across Central Jersey, including Bedminster, Bound Brook, Dunellen, Franklin, High Bridge, Middlesex, Piscataway, Plainfield, Readington and Somerville.

South Bound Brook officials, though sympathetic to the Fanaros, have a different perspective. They say the Fanaros are costing the residents of South Bound Brook thousands of dollars in tax revenue from a new, larger retail building.

Redevelopment Coordinator Colin Driver said the borough has made every effort to make the transition smooth, but the Fanaros have not cooperated.

In addition, developers Matzel & Mumford have lost patience because the retail component of the redevelopment project of the old GAF site is considered integral to the project. Cleanup of the 10.5-acre contaminated parcel cost them money, and it is the commercial aspect of the project that would put it in the black -- not the in-progress construction of a town house development known as Canal Crossing.

A big issue

The battle over eminent domain has become a national issue, capturing the attention of property owners, talk shows and legislators in the wake of the U.S. Supreme Court“s 5-4 decision last June 23 involving Susette Kelo, a Connecticut homeowner. The court ruled, in Kelo vs. City of New London, that taking private property -- Kelo“s home -- for economic development was a public use.

Consider this:

In a series of state and national polls, including a Monmouth University-Gannett New Jersey Poll last year, respondents said they overwhelmingly oppose the government“s right to use such power for economic development. For more traditional uses, such as building a road or library, there does not appear to be such opposition.

Right now, more than 40 states are considering eminent domain legislative reforms, including New Jersey, while 12 states have already enacted laws or modifications to existing laws on the practice of eminent domain, according to the National League of Cities. In Congress, legislation that would restrict federal funding for states and towns that use eminent domain for commercial development, and that also bans the federal government from using eminent domain for private development, has passed the House of Representatives. But it is stalled in the U.S. Senate.

During a five-year period from 1998 to 2002, the Castle Coalition, the Washington-based Institute for Justice“s grass-roots property rights division, found that 10,282 condemnations were filed or threatened against property for private use nationwide. In New Jersey, 640 petitions were filed or threatened to condemn property that benefited private parties, according to the coalition.

"Other than taking your life or putting you in jail, there is nothing worse that government can do than take your property away from you," said Steven Anderson, the Castle Coalition coordinator.

Legislation proposed

The state Legislature is considering numerous bills to tighten loopholes in how eminent domain is used and to reform the state“s redevelopment law. The state“s new public advocate has made reform of eminent domain his first project, and property rights activists are calling on the governor to declare a moratorium on condemning properties and designating future redevelopment projects.

In Central Jersey, eminent domain looms largely as a threat to homes and businesses within designated redevelopment zones. South Bound Brook appears to be the only town in comdemnation proceedings. Officials in other municipalities have either spoken out against such action or positioned it as a last resort.

In SOUTH BOUND BROOK, officials say that county sheriff“s officers can post the properties of the Fanaro family at any time, giving them 10 days to vacate. Several appeals filed by the Fanaros to county and appellate courts have been denied.

In READINGTON, voters on May 16 will consider a $22 million bond ordinance township officials say is needed to further preservation negotiations with owners of Solberg Airport. Detractors say the effort is too costly and a step toward using eminent domain to take the airport. Township officials have said the public will be reimbursed by state agencies for the bond.

Mayor Gerard Shamey said the acquisition of the open space surrounding the airport and development rights with respect to the airport itself via the use of eminent domain is not the preference of the township and remains "a distant possibility and last resort."

IN SOMERVILLE, officials are nearing the point of using eminent domain to condemn a few holdout businesses being displaced from the Downtown Somerville Shopping Center. The site is slated to be redeveloped with a mixed use of retail and residential. Somerville redevelopment adviser Colin Driver said the tenants -- McDonald“s, Country Fresh and Hollywood Video -- remain in talks to see if a price for the properties can be negotiated. Should those talks collapse, condemnation may be used, Driver said.

IN BOUND BROOK, a designated redevelopment zone is large in scale, encompassing much of the borough“s downtown. A variety of retail, office, residential and parking structures have been discussed to revitalize Bound Brook and provide much-needed ratables. But Planning Board Chairman Robert Fazen said the borough is "very, very opposed" to the use of eminent domain.

"We have encouraged our developer (Advance Realty Group of Bedminster) to make fair offers to purchase any land that needs to be taken," Fazen said. "We are very reluctant to use eminent domain to acquire any property -- so much so that if no agreement on price can be reached, we might cancel the planned development in that area."

IN DUNELLEN, officials unveiled a plan to redevelop 23 acres around the NJ Transit train station on South Washington Avenue. Developer Kaplan Companies of Highland Park is already negotiating with business owners -- specifically The Provident Bank and Power Gas Station on Route 28 and World Gym Fitness Center on South Washington Avenue. "I“ve heard they“re going to tear this place down, and I“m a little worried about where I“m going to go, or where I“ll be able to find a space like this," said Christopher Guarraci, who has owned World Gym for nearly six years, leasing his 10,000 square feet of space.

While Provident Bank is getting a new bank building, the others are being demolished. Jason Kaplan of Kaplan Properties said the borough will use eminent domain if the other two businesses and the developer cannot reach a settlement on price but Kaplan is quoted as saying eminent domain "is a last resort."

IN FRANKLIN, Somerset County, plans by developer Jack Morris“ plans to build a Home Depot and 864 houses between Bennetts Lane and Veronica Avenue has drawn heavy opposition from homeowners who argue that it will destroy the quality of life in the town. The developer has asked the Town Council to designate the area as a redevelopment zone, making properties within the zone, many of whom were at a meeting late last year to oppose the plan, eligible to be acquired by eminent domain.

IN HIGH BRIDGE, borough officials voted unanimously in September 2005 to use eminent domain to condemn a portion of Pat Catanzareti“s property on Dewey Avenue, hoping to end a 20-year legal battle. The measure was taken to stop the construction of 138 residential units. Mayor Al Schweikert said the borough would build just 34 units of affordable housing at the site and preserve the remainder as open space.

Catanzareti said he will fight the condemnation. His plan to build 170 units by developer Ken Pizzo of Bridgewater was approved 20 years ago but only 32 units have been built because litigation over issues such as sewer capacity and affordable-housing requirements have stalled the job.

IN MIDDLESEX BOROUGH in January, the Borough Council renewed a resolution against the usage of eminent domain to condemn property for any redevelopment. "We want the residents to know their property is theirs," said Middlesex Borough Clerk Kathleen Anello.

IN PISCATAWAY, the town took the Halper property, a 75-acre parcel, to put an arboretum, gazebos, dog park, tree nurseries and jogging and bike paths on the former farm. Township officials have been trying to take the land since the 1990s. They began condemnation proceedings in 1999 and seized it in 2004. Early this year a jury assessed the land at $18 million, a decision the township appealed.

IN PLAINFIELD, there are 13 different redevelopment plans or proposals -- the largest being the Downtown Station South concept. The concept calls for the construction of a "transit village" with shops and condominiums around the North Avenue train station. Though no one has mentioned eminent domain as a possibility, residents and business owners have attended Planning Board meetings to express fears about condemnation.

Municipal officials, planning and professional associations and developers argue that eminent domain is a necessary tool to cure blight in older towns and cities. They contend that it is a fundamental function of government to undertake such projects. Without the ability to use eminent domain, they say, redevelopment would not occur.

While they have not backed away from redevelopment projects since the June 23 Supreme Court decision and the subsequent outcry from citizens nationwide, municipalities are trying to involve the affected property owners more in the process, said Stanley Slachetka, a planner with T & M Associates in Middletown, who along with David Roberts authored "The Redevelopment Handbook."

"Where it has been successful, there has been significant community outreach," Slachetka said. "There has to be an ultimate fairness in this process . . . with or without eminent domain."

There has always been a clash over property rights and the rights of the government to provide public improvements at the expense of individuals, even while the outcry after the Kelo decision made it more pronounced, said Damon Y. Smith, assistant professor at Rutgers University Law School-Camden.

from the Courier News website www.c-n.com

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Date: May 7, 2006 Source: C-N.com — Courier News Online
URL: http://c-n.com/apps/pbcs.dll/article?AID=/20060507/NEWS/605070331