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2007-06-18
Hercules, CA. Court Overturns City's Eminent Domain Against Wal-Mart

Eminent domain is a powerful tool. The municipal police power that allows a community to take property for a public purpose, has been a controversial move -- whether used to promote development, or to stop it. In more cases than not, cities and towns have used eminent domain powers to promote a big box store, but in a few cases, the method been used to stop development. On December 2, 2006, Sprawl-Busters reported that the city council in Hercules, California had voted to use eminent domain powers to acquire a parcel of land owned by Wal-Mart. Residents opposed to Wal-Mart applauded the move, but the retailer's response at the time was, "Eminent domain is not supposed to be used as a popularity contest." The city ruled that Wal-Mart's property was economically "blighted" because of the lack of activity there. The city said Wal-Mart's plans to build a supercenter did not conform to a 64,000 s.f. store size limit at the so-called Bayside Marketplace. In late 2005, Wal-Mart purchased the Bayside Marketplace to build a superstore, but this set off a public explosion of opposition from residents who argued that the project clashed with Hercules' pedestrian-oriented development goals. In September, 2006, the city reaffirmed the Hercules Redevelopment Agency's authority to invoke eminent domain in a part of the city known as "the Dynamite Area," and extended this power for 12 years. But Wal-Mart argued that the Hercules Redevelopment Authority's power to invoke eminent domain in this case had expired. The city council argued that its action was a "resolution of necessity," which allowed the Hercules Redevelopment Agency to initiate an eminent domain action without a further council vote within six months. The city would have paid Wal-Mart the fair market value for the property. Wal-Mart's suit against Hercules was filed Nov. 7, 2006 in Contra Costa Superior Court in Martinez. This week, a Contra Costa judge invalidated the Hercules ordinance that was used to justify the city's eminent domain action. The city charged that Wal-Mart had shown bad faith by filing application after application for a store that would exceed the size limit under a 2003 development agreement with the previous owner of the tract. The parcel remained fallow, leading to a finding of economic blight by the city. Wal-Mart's most recent application last year was for a 99,000 s.f. store, shrunk from the 140,000 s.f. size of two earlier applications. The city says the size limit for the Dynamite Area parcel (named after a former dynamite plant there) is 64,000 s.f., but Wal-Mart says a 168,000 s.f. store is allowed on the roughly 17 acre parcel. Wal-Mart brought its case on the grounds that the city's eminent domain power had expired, and that the property was not physically and economicly blighted. Contra Costa Superior Court Judge Judith Craddick agreed that Hercules did not made the case that the property was blighted -- but she did not address the issue of the expiration of eminent domain power. "We're pleased with the judge's decision confirming that the city's ordinance was not valid," a Wal-Mart spokesman said. "We're looking forward to working with the city to complete the application process and bring a very distinctive new store to the community."

What you can do: When Hercules decided last year to invoke eminent domain powers against Wal-Mart, it was like placing a stick of dynamite in the center of the retailer's expensive plans. After the court ruling this week, Hercules City Attorney Mick Cabral told the media that the city is looking at other legal avenues for possibly using eminent domain. He would not go into specifics, but the council discussed the Wal-Mart issue in executive session. Cabral noted that even if the city dropped its eminent domain effort, the terms of the 2003 development agreement would block the size of the superstore Wal-Mart proposed. The judge's ruling did not allow Wal-Mart's request to issue a permanent injunction to prevent the city from implementing their 2001 redevelopment plan. The judge wants the city to produce evidence that it has begin to implement the 2001 plan. The city expects to present such evidence by mid-August and a final court ruling on the issue is likely in mid-September. Wal-Mart's ability to build a superstore in Hercule is not over yet, and the city will still try to flex its muscles against the retailer. None of this would be happening if the retailer has not set flame to fuse in Hercules by proposing a project so huge that it blew up in its face. Rather than fit in, Wal-Mart in essence detonated its own plan. Wal-Mart knows that people consider its stores to be enormously similar to one-another, so the company is now claiming at every turn that its project in any given town will be "very distinctive," by which they mean it will have a different skin than the several thousand box stores they have created as their legacy. Rather than work with the city, Wal-Mart chose a confrontative approach, which has lead to a courtroom, not a ribbon-cutting. Readers are urged to contact Hercules Mayor Ed Balico at ebalico@ci.hercules.ca.us. Tell the Mayor, "Keep up your battle against the Wal-Mart supercenter. This project is like a stick of dynamite in the middle of Hercules' future plans."










 
 
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