Small Business Owners Challenge Eminent Domain Utilization in Missouri

In a significant legal battle, small business owners are taking action against a city in Missouri over the government’s attempt to exert eminent domain over their properties. Officials plan to transfer ownership to a private developer, igniting controversy and legal scrutiny.

Martin George, one of the plaintiffs, expressed frustration at the situation, stating that the public should not be treated like participants in a game of musical chairs when it comes to property rights. This trial involves the city of Brentwood, Missouri, and the stakes are high for local entrepreneurs.

The plaintiffs argue that the city officials have employed a vague definition of blight to facilitate a massive $436 million development deal aimed at transforming their property into a mixed-use development featuring apartments, retail spaces, hotels, and restaurants.

Legal Defense Against Broad Blight Claims

Bobbi Taylor, an attorney with the Institute for Justice, voiced strong objections during a press conference preceding the trial in St. Louis County Circuit Court. Taylor asserted that the properties in question are safe and well-maintained, countering the allegations of blight.

The Institute for Justice, which is a non-profit civil liberties law firm, contends that Brentwood has mischaracterized properties based on minor imperfections, such as superficial cracks in paint or the age of buildings. Taylor warned that allowing such loose definitions of blight to stand could grant the government excessive powers to seize properties merely due to them being somewhat older or needing cosmetic updates.

Background on Eminent Domain and Kelo v. New London

The controversial practice of eminent domain gained traction following the 2005 Supreme Court case Kelo v. New London, which permitted cities to confiscate private property for economic development under the guise of public use. In that case, the justices ruled that a Connecticut city could transfer homeowners’ properties to developers for a commercial project to bolster local economic growth.

This ruling incited a national backlash and led many states, including Missouri, to implement stronger protections for property owners in the wake of Kelo. Nevertheless, the Missouri law permits cities to seize properties by designating them as blighted, which can include vague criteria such as being antiquated or presenting an economic liability.

Implications for Property Owners

The implications of this definition are significant, raising concerns that entire neighborhoods could be condemned despite many properties being in excellent condition. The Institute for Justice previously represented homeowners in the Kelo case, but ultimately lost, and the proposed development that initiated the legal conflict was never realized.

Brentwood officials initially declared a segment of Manchester Road blighted in 2018 due to flooding issues. However, following a series of improvements funded by a flood mitigation project, the area’s conditions radically changed. Yet, in 2023, the city continued with a new development deal requiring an updated blight designation.

Amy Stanford, co-owner of Time For Dinner, a local business on Manchester Road, expressed disbelief at the designation, noting that their restaurant is thriving. She questioned how a successful business could be labeled as blighted.

Local Business Perspectives

Many affected business owners are speaking out against the city’s actions. Bob Story, who has operated a fishing supply business on Manchester Road since 1989, described the city’s blight claims as unfounded. He pointed out that the area looks similar to other thriving parts of Brentwood and suggested that financial motivations, specifically around tax revenue, are driving the city’s actions.

Without the authority to invoke eminent domain, Taylor argues that the proposed redevelopment might not have the financial backing it requires. The ongoing situation illustrates a conflict between local business ownership and government authority under the framework of eminent domain.

Shifting Development Plans

Since the approval of the development deal, the project has shifted hands. The original developer, Green Street, faced numerous scandals, including allegations of owing close to $800,000 in unpaid property taxes. This prompted questions about their credibility and capacity to move forward with the project.

Some Green Street employees split off to create Halo Real Estate Ventures, which is now at the helm of the Brentwood project. Although representatives from Halo did not respond to inquiries, CEO Joel Oliver acknowledged the challenges associated with introducing change, emphasizing the importance of addressing community concerns.

Future Considerations for Eminent Domain

The trial has commenced in St. Louis County Circuit Court and is anticipated to span four days. The outcome could have far-reaching implications for local economies and the rights of business owners against the backdrop of governmental authority. As this legal battle unfolds, it will inevitably contribute to the ongoing discourse surrounding eminent domain practices and their impact on small businesses across the United States.