Public Power, Private Gain: West Virginia

Overview

West Virginia has a deplorable history of using eminent domain for private purposes. The reported instances of abuse of eminent domain have mostly been in Charleston, where every few years the City seems to try to wipe out existing homes and businesses for some new project. Wheeling also has threatened the use of eminent domain in order to replace certain local businesses with other ones. In 1998, the West Virginia Supreme Court effectively gave the green light to redevelopment agencies to condemn property for other private parties, as long as the agencies claim the purpose is eliminating slums or blight. Luckily for the agencies, and unluckily for West Virginia citizens, blight designations in West Virginia never expire,698 so the agency can condemn properties in a redevelopment area 15 or more years after the area was originally designated as blighted.

 

 

Private Use Condemnations

 

Charleston

Charleston has over the years undertaken a seemingly endless series of urban renewal projects. The City’s current $100 million East End redevelopment includes condemning properties in the 1300 block of Washington Street for a chain grocery store. The targeted properties consist of a Burger King, Nu-Way Cleaners, a two-story apartment building, four houses and two vacant lots.699 However, with no grocery store lined up after years of planning, the residents and businesses of Charleston’s East End remain in limbo about their future.700 Community activists, including Romona Taylor-Williams, fear that the City’s redevelopment projects will destroy local black communities, as they did during previous rounds of urban renewal.701 At the request of activists, the Institute for Justice submitted testimony opposing the redevelopment plan.

 

Charleston

The Charleston Urban Redevelopment Authority condemned four contiguous parcels of land in downtown Charleston on which the Courtland Company operated a commercial parking lot, so that it could sell the land to private developers. Courtland challenged the taking, and argued that since his property was not itself “slum and blighted,” the authority was precluded from condemning it even though it was located within a redevelopment zone. The West Virginia Supreme Court disagreed, concluding that the authority had acted within its legitimate power.702

 

Wheeling

Wheeling’s historic downtown consists mostly of attractive waterfront Victorian buildings. In October 2000, Congress passed the Wheeling National Heritage Area Act (WNHAA),703 which designated most of downtown Wheeling as a National Heritage Area. The Act established the Wheeling National Heritage Area Corporation (WNHAC), a nonprofit entity responsible for managing the Heritage Area,704 in hopes that redevelopment might restore the area to its former grandeur. Congress made clear its intent that any such redevelopment could occur only if property owners willingly consent to transfer ownership of their property to WNHAC.705

 However, Wheeling officials still tried to threaten unwilling sellers within the heritage area. In early 2002, WHNAC came up with a proposal to convert up to 90 percent of downtown Wheeling into a Victorian-themed outlet mall. The $160-million plan, for which the State would pay about half, calls for the WNHAC to take properties away from their present owners and give them to other private retail businesses of the City’s choosing. The measure potentially affects almost 200 businesses.706 The Institute for Justice has been working with owners who oppose the condemnations that could result if the City moves forward with its plan of removing existing businesses. Apparently undaunted by the fact that this scheme violates federal law, state lawmakers enthusiastically support it. On March 9, 2002, the West Virginia Legislature approved the funding mechanism for the State’s portion of the redevelopment project, voting to allocate $19 million in video lottery proceeds to float bonds for each year up to 30 years.707 Private developers pledged to come up with an additional $75 million for the project, but no retail stores have yet committed to join the project.708 Wheeling City leaders believe that the use of WHNAC to carry out condemnations for private use violates neither the letter nor the spirit of the WNHAA.709 However, the Interior Department thinks otherwise, explicitly stating that using eminent domain to carry out the mission of the Heritage Area is “a misreading of the spirit and intent of the law in establishing the Heritage Area.”710  The West Virginia Supreme Court is hearing an appeal on the validity of Wheeling’s redevelopment plan. A circuit judge validated all aspects of the plan except for the use of money from private developers for condemnation of privately owned land.711 The project is stalled, having missed its first deadlines for receiving the private funds while the parties wait for the high court’s ruling on the legality of the plan.712   

*These numbers were compiled from news sources. Many cases go unreported, and news reports often do not specify the number of properties against which condemnations were filed or threatened.

698 see W. Va. Code § 16-18-5 (2001).

699 Greg Stone, “East End and Eminent Domain; Washington Street Residents May Be Forced Out by Store,” The Charleston Gazette, Mar. 9, 2000, at 1C.

700 “East End If the Area Can Support a Grocery, a Company Will Buy Land and Build It,” Charleston Daily Mail, Sept. 13, 2001, at 4A.

701 Greg Stone, “CURA Appoints Blacks to East End Panel,” The Charleston Gazette, May 22, 2002, at 1C.

702 See Charleston Urban Renewal Authority v. The Courtland Co., 509 S.E. 2d 569, 570 (W.Va. 1998).

703 Pub. L. No. 106-291, § 157, 114 Stat. 922, 963 (2000).

704 Wheeling National Heritage Area Act (WNHAA), Pub. L. No. 106-291, § 157 (d)(2)(B), 114 Stat. 922, 964 (2000).

705 WNHAA § 157 (5)(e)(5)(B)(i), 114 Stat. 922, 966 (limiting the ability of the WNHAC to acquire property only by “gift” or “purchase from a willing seller…”) (emphasis added). This provision makes clear that acquisitions from unwilling sellers, i.e. through eminent domain, are not permitted.

706 Chris Stirewalt, “Wheeling Shopping Center Proposal May Revive Downtown,” Charleston Daily Mail, Jan. 15, 2002, at 1A.

707 “With Legislation Approved, Mall Developer Focuses on Obtaining Private Investment,” AP Wire, Mar. 13, 2002.

708 George Hohmann, “Wheeling Seeking Retailers; No Stores Committed for Proposed State Project,” Charleston Daily Mail, Feb. 9, 2002, at 1A.

709 Sam Tranum, “Wheeling Buyouts Contested; Attorney Says City Cannot Use Power to Take Land for Mall,” Charleston Daily Mail, May 17, 2002, at 1A.

710 Letter from Charles P. Raynor, Associate Solictitor, U.S. Interior Department, to William Mellor (May 3, 2002) (on file with author).

711 Toby Coleman, “High Court to Hear Grant Plan Appeal,” Charleston Daily Mail, Feb. 21, 2003, at C7.

712 Charles Shumaker, “Wheeling Mall Gets Reprieve,” The Charleston Gazette, Jan. 16, 2003, at C3.

 


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