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June Proposition Battle About Eminent Domain and More:

The television commercials leading up to the June 4 California primary – and they will air thousands of times in all parts of the state before that vote – will tell voters this election is all about eminent domain, with the big question whether government at any level should be allowed to take property from one private owner for the purpose of selling it to another.

But this election will really be about things like rent control, new freeways, and rail lines, and whether the National Football League will ever return to Los Angeles.

Both major initiatives on the June ballot, Propositions 98 and 99, would restrict eminent domain, the government’s right to take private property for public purposes.

Under that broad definition, the state and its cities, counties, water districts, and other public entities have long been allowed to buy up property from reluctant owners. Often that property is used for highways, schools, courthouses, and other purely public uses.

But many cities also use their confiscatory powers to take land from one owner and then resell it to another. Without such takings, there would be no Staples Center in downtown Los Angeles (home to basketball’s Lakers and Clippers plus hockey’s Kings), nor would there be an AT&T Park in San Francisco’s China Basin (home of baseball’s Giants). Many shopping malls would not exist, nor would some big box stores.

All these developments sit in areas local government once designated as “blighted,” a requirement under California law before property taken under eminent domain can be sold off to other private owners. They also vastly increased the property tax take of the local governments involved, as the new developments exponentially upped property values of the lands involved and many properties around them. Those property tax increases, called incremental financing, don’t have to be shared with outside government agencies.

The right of governments to do all this was solidified by a 2005 U.S. Supreme Court decision in a case from New London, CT.

That ruling drew an almost immediate response in California, where anti-eminent domain activists tried to ban virtually all government taking of private property via the 2006 Proposition 90. When it became clear the measure would threaten road building, water projects, and even some land purchases made to preserve public health, that measure lost by a narrow 52-48 percent margin.

The activists returned this year with Proposition 98, less broad in some ways than 90 was and more restrictive in others. Proposition 98 allows taking of private property only for public purposes like roads and dams.

But its attempt to eliminate all rent controls in the state goes far beyond anything tried in 90. The brainchild of the anti-tax, anti-rent control Howard Jarvis Taxpayers Association, 98 bans “regulation of the ownership, occupancy, or use of privately-owned real property or associated property rights in order to transfer an economic benefit to one or more private persons at the expense of the property owner.”

That means no regulation on rents, either in apartments or mobile home parks. “Rent regulations are as close to a physical taking as you can get,” says Jon Coupal, head of the Jarvis group.

In practice, this provision would let rent controls stand until today’s renters move out, just like existing rent control laws. But where today’s laws in cities like San Francisco, Los Angeles, Cotati, Santa Monica, and others demand that rents be limited again after a new occupant moves in, that would be forbidden by 98. There would be no limits to what a renter can be charged once his or her lease expired.

Trying to protect current laws, the League of California Cities responded with Proposition 99, which concentrates purely on private homes. It forbids state and local government from using eminent domain to acquire any owner-occupied residence and then turn it over to a private person or business. But it says nothing about apartments, commercial property, or rental homes, thus leaving open most current eminent domain options.

Backers of the far more Draconian Proposition 98 say the rival measure exists mainly to confuse the issue and cause voters to nix both initiatives, as they often do when unsure how to vote.

If 98 passes, chances of building a new stadium to National Football League standards in Los Angeles will be greatly diminished. So would the chances for new developments like the massive building project now rising near Staples Center.

But the mostly-poor residents of areas most likely to be taken by governments would have far more permanence.

It’s a classic case of the voters literally deciding the physical shape of much of California’s future.

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