The Facts of the Case

The twenty city-block area of Forgotten City is in danger of being expropriated in favor of Bob Builder, a well-established city-redeveloper.  Forgotten City has a population of seven-thousand, thirty percent of which are between the ages of zero to eighteen.  The City Council had decided it appropriate to redevelop the city since it is an area that is inhabited by households with a little over $13,000 annual income, and where the buildings and structures are already old.  Furthermore, the old warehouses are havens for rampant illegal drugs and prostitution.

Bob Builder entered the picture in a timely manner, just when the City Council gave the owners to claim their properties.  Even after the City Council had deferred hearing the plans of Bob Builder, Mayor Dale Scott of Niceville mediated and brought the City Council and Bob Builder together, which resulted in the decision that Bob Builder’s proposed plans of redevelopment for Forgotten City will best serve its problems.  However, an important question looms: Can the City of Niceville, through its Mayor, legally move forward with the proposed plans of Bob Builder, when it directly affect Forgotten City and not the City of Niceville?

There exists no sufficient basis under the Community Redevelopment Act of 1969 (hereinafter “CRA”) for the City of Niceville to exercise its corporate powers and exercise the power of eminent domain in taking Forgotten City, because the standards for the determination of slum or blighted property have not been met.  Furthermore, there is a lack of declaration that the area is really a blighted area or a slum area as comprehended under the CRA.  This being said, the unilateral determination may be assailed in a judicial proceeding.

A couple of points in law and jurisprudence must be taken note of.  The most important of which is the power of eminent of counties and the municipalities over areas which are declared or to be declared blighted areas or slum areas.  This includes the definition of blighted areas, the requirements to be declared as such, the exceptions and the process in declaring such.  And the second thing that must be emphasized is the opportunity for the community to question the declaration that the area is a blighted area or a slum area.

The Community Redevelopment Act of 1969

The Community Redevelopment Act of 1969, provides that “[c]ounties and municipalities may not exercise the power of eminent domain for the purpose of preventing or eliminating a slum area or blighted area as defined...” (Section 163.370(1)) The only exception to this is found further in the sentence, thus, “counties and municipalities may acquire property by eminent domain within a community redevelopment area.” (Section 163.370(1))

To further understand the core provision of the law, as abovementioned, the definitions under the law must be studied carefully. On the one hand, a slum area is “an area having physical or economic conditions conducive to disease, infant mortality, juvenile delinquency, poverty, or crime because there is a predominance of buildings or improvements, whether residential or nonresidential, which are impaired by reason of dilapidation, deterioration, age, or obsolescence.” (Section 163.340(7))

This definition must be coupled with at least one of the following factors: “(a) Inadequate provision for ventilation, light, air, sanitation, or open spaces; (b) High density of population…and overcrowding; (c) The existence of conditions that endanger life or property by fire or other causes.” (Sections 163.340(7)(a)-(c))

On the other hand, a blighted area is “means an area in which there are a substantial number of deteriorated, or deteriorating structures, in which conditions, as indicated by government-maintained statistics or other studies, are leading to economic distress or endanger life or property.” (Section 163.340(8))  This definition must also be coupled with two or more of the following factors, as provided for in Sections 163.340(8)(a)-(n):

(a)     Predominance of defective or inadequate street layout, parking facilities, roadways, bridges, or public transportation facilities;

(b)     Aggregate assessed values of real property in the area for ad valorem tax purposes have failed to show any appreciable increase over the 5 years prior to the finding of such conditions;

(c)      Faulty lot layout in relation to size, adequacy, accessibility, or usefulness;

(d)     Unsanitary or unsafe conditions;

(e)     Deterioration of site or other improvements;

(f)      Inadequate and outdated building density patterns;

(g)     Falling lease rates x   x   x;

(h)     Tax or special assessment delinquency exceeding the fair value of the land;

(i)       Residential and commercial vacancy rates higher in the area than in the remainder of the county or municipality;

(j)       Incidence of crime in the area higher than in the remainder of the county or municipality;

(k)     Fire and emergency medical service calls to the area proportionately higher than in the remainder of the county;

(l)       A greater number of violations of the Florida Building Code in the area than the number of violations recorded in the remainder of the county or municipality;

(m)   Diversity of ownership or defective or unusual conditions of title which prevent the free alienability of land within the deteriorated or hazardous area;

(n)     Governmentally owned property with adverse environmental conditions caused by a public or private entity.

The exception to the two-factor criteria for a blighted area is when “at least one of the factors identified in paragraphs (a) through (n) are present and all taxing authorities subject to Section 163.387(2)(a) agree, either by interlocal agreement or agreements with the agency or by resolution, that the area is blighted. Such agreement or resolution shall only determine that the area is blighted.” (Section 163.340(8), ¶2)

With the definitions abovementioned, the counties and municipalities have specific powers as provided for in the statute.  The most important is that the counties and municipalities cannot exercise the power of eminent domain “for the purpose of preventing or eliminating a slum area or blighted area.” (Section 163.370(1))  They may, however, exercise the power of eminent domain when the slum area or blighted area is already within a community redevelopment area. (Section 163.370(1))

Discussion and Application

From the facts given, the current state of  Forgotten City must be highlighted.  There “are significantly older homes, low income homes, rental property, a governmental housing complex, two elementary schools, a community center, bus depot, neighborhood stores, and old warehouse buildings.”  Furthermore, statistics provide that thirty percent of the population is between the ages of zero to eighteen, with seventy-three percent of the households living in poverty and the average annual income is a little over thirteen thousand dollars.

A strict construction of the statute will not make the situation fall under the definition of a blighted area.  There is nothing in the facts to suggest that any of the fourteen requirements under the CRA are present, even if it may be argued that the mere fact that Forgotten City has significantly older homes and low income homes may be equated to “deteriorated or deteriorating structures.” (Section 163.340(8)) But there is no proof that the structures “are leading to economic distress or endanger life or property.” (Section 163.340(8))

The low income of the families may be caused by other factors not specified in the facts.  And assuming arguendo that the low income is caused by the old homes, it still lacks any of the fourteen factors, as provided for in Sections 163.340(8)(a)-(n), needed to declare that Forgotten City is indeed a blighted area.  There must be an emphasis on the word and between the definition of a blighted area and the enumerated factors.  Both must be present so as to qualify the place as a blighted area.

It is probably easier for the City that the area is actually a slum area, wherein there are “physical or economic conditions conducive to disease, infant mortality, juvenile delinquency, poverty, or crime because there is a predominance of buildings or improvements, whether residential or nonresidential, which are impaired by reason of dilapidation, deterioration, age, or obsolescence.” (Sections 163.340(7)(a)-(c))  Poverty is definitely present, and so is crime such as illegal drugs and prostitution.  Furthermore, to be a slum area, only one of the factors enumerated must be present, and in this case, Forgotten City is overcrowded with seven thousand inhabitants within a twenty-block radius.

However, regardless of whether Forgotten City is indeed a slum area or a blighted area, the City of Niceville still cannot move forward with the plans of Bob Builder for a couple of reasons.  First and foremost, there really was no declaration that Forgotten City has been classified as a slum area or a blighted area.  From the facts given, the City Council just “set up a time within which to hold hearings which would declare property blighted in the community of Forgotten City.”

The facts do not show that the hearings were indeed held.  In fact, the next thing that happened was the fifteen-day notice to claim the properties, otherwise, the same will deemed abandoned and demolished.  In this case, even if there was a public purpose for the taking of the properties, the hearings were not held and to declare the property as abandoned and its demolition would be tantamount to taking of the property without just compensation.  This, in effect, would be an exercise of the power of eminent domain on properties in a slum area or blighted area, which is actually expressly prohibited by statute.  (Section 163.370(1))

The power of eminent domain may only be exercised over a slum area or blighted area when the same is already part of a Community Redevelopment Area, which is not the case here. (Section 163.370(1))

A Community Redevelopment Area, defined in Section 163.340(10),  is “a slum area, a blighted area, or an area in which there is a shortage of housing that is affordable to residents of low or moderate income, including the elderly, or a coastal and tourist area that is deteriorating and economically distressed due to outdated building density patterns, inadequate transportation and parking facilities, faulty lot layout or inadequate street layout, or a combination thereof which the governing body designates as appropriate for community redevelopment.”

Even assuming that Forgotten City is already validly declared as a slum area or a blighted area, there is nothing in the facts to show that it is already a part of a Community Redevelopment Area.  Just because an area is a slum area or a blighted area, it does not automatically make it part of a Community Redevelopment Area.  Furthermore, City of Jacksonville v. Moman, 290 So.2d 105 cited in Rukab v. City of Jacksonville, 811 So. 2d 727 (2002) declared that “although a city ‘may designate an area as a slum ... such designation does not make it a slum.’”

The proper procedure must be followed:  “[t]he governing body must adopt a resolution supported by data and analysis that makes a legislative finding that slum or blight conditions exist and that redevelopment is necessary in the interest of the public health, safety, morals, or welfare of the residents of the county or municipality.”   (Section 163.355 cited in Fulmore v. Charlotte County, 928 So. 2d 1281 (2006))

This did not happen for Forgotten City.  What happened was a special private meeting wherein the proposal of Bob Builder was presented to the City Council and not to the residents of Forgotten City.  The required resolution was completely bypassed, thus violating procedural rules.

In the event that it is proven that Forgotten City is indeed a slum area or blighted area within a Community Redevelopment Area,  and the City is set on moving forward with the proposed plans of Bob Builder, the community is not left without recourse.  As Rukab v. City of Jacksonville, 811 So. 2d 727 (2002)  has held in almost the same facts , the community of Forgotten City is “not precluded from raising a claim of a regulatory taking” and that “[f]uture generations, too, have a right to challenge unreasonable limitations on the use and value of land.”

Conclusion

The City of Niceville and the proposed plans of Bob Builder cannot legally move forward.  There were procedural lapses in the declaration that Forgotten City is a slum area or a blighted area.  There was no resolution to declare Forgotten City as a slum area or blighted area.  Also, the mere declaration that the area is a slum or blighted area does not automatically justify its taking.

The power of eminent domain in taking slum or blighted areas cannot be exercised by counties or municipalities if the area to be taken is not within a Community Redevelopment Area and if there is not public purpose to be achieved, which the same must be proved by the taking power.  However, in the event that the power of eminent domain is properly exercised, the affected property owners can always challenge the same in a judicial proceedings or during the eminent domain proceedings.