Monday, January 25, 2010

When will the Government Figure it Out?

Three weeks ago, the State of Florida deposited $8.85 million with the Clerk of Court for Monroe County to compensate the landowners in Florida DEP v. West for the condemnation of their North Key Largo properties in April 2004. When this eminent domain action was filed as a slow-take in 1995, the State offered a mere $160,000 for the subject properties. Our response to the slow-take was a regulatory taking counterclaim. That was our way to protect landowners from the State "walking away" from any jury verdict it did not like.

Land values began to rise in 2001 -- although not on these properties. In 2004 the State opted for a "quick-take." At that time, the State's estimated fair market value of the two parcels -- based on the confiscatory regulatory scheme -- was $630,000. But after executing the quick-take, the State could no longer walk away from a jury verdict that exceeded its budget. After all, nobody had been able to build on North Key Largo since February 8, 1982 (except at the Ocean Reef Club and a few existing subdivisions).

After the 2004 quick-takes, we re-cast the regulatory taking counterclaim into a jury instruction on condemnation blight. Even though the Florida Supreme Court has embraced condemnation blight on at least two occasions, the State's in-house attorneys could not grasp the concept. Fortunately we had a trial judge, Luis Garcia, who understands government cannot prohibit a landowner from using his property, and then benefit from its own actions by driving down the property's acquisition cost. (In 2001, Judge Garcia ruled the same way in another case, Shadek v Monroe County, where White & Case attorney Doug Halsey raised the same issues and Monroe County settled by paying $6 million in temporary taking damages.)

So ... the government goes down for the count again! I have remarked, on numerous occasions, that the reason for this waste of money is nothing more than the "tyranny of the majority" in small, attractive, relatively well-to-do communities such as the Florida Keys. Those who already own homes in the Keys will do everything in their power to prevent others from doing so. To that end, the "got-miners" elect like-minded County Commissioners, who respond by prohibiting new development wherever they find it. It's a self-perpetuating, downward spiral, that could well -- unless reversed -- bankrupt every owner of developed property in the Keys.

To got-miners: think about it!

No comments: