New York Intermediate Appellate Court Invalidates Taking of “Blighted” Property for Transfer to Columbia University, but Contradicts Recent State Supreme Court Decision in the Process

In Kaur v. New York Urban Development Corporation,a close 3-2 decision [HT: Neighborhood Retail Alliance], a New York intermediate appellate court has invalidated the taking of property in the Manhattanville neighborhood of New York City for transfer to Columbia University. Columbia and the government claimed that the land in question was blighted. However, the court ruled that there was no evidence of any real blight (especially before Columbia acquired much of the surrounding area after 2002), other than claims of “underutilization” of property. And mere “underutilization,” the majority concludes, is not enough to justify the condemnation of property as “blighted.” As the court puts it, “[t]he time has come to categorically reject eminent domain takings solely based on underutilization.” I wholeheartedly agree with this general sentiment. Indeed, I have often argued against broad definitions of blight that allow virtually any property to be condemned on the grounds that some other use might lead to increased development (see, e.g., here). Overbroad definitions of blight undercut many of the eminent domain “reform” laws enacted in response to the US Supreme Court’s decision upholding “economic development” takings in Kelo v. City of New London. I also think the majority makes a strong case that the blight determination in this case severely flawed, and in large part the product of the government’s desire to transfer property to a politically influential university. Indeed, I have often criticized Columbia’s plans to use eminent domain in Manhattanville, in a series of posts going back to 2006 (see here for the most recent post, and links to earlier ones).

There is, however, one major problem with the Kaur decision: it seems to contradict the New York Court of Appeals’ (the state supreme court) recent decision in the Atlantic Yards case, Goldstein v. New York Urban Development Corporation, which specifically ruled that a property can be declared blighted and condemned if there was “economic underdevelopment” or “stagnation” in the area. As I explained in this post, Goldstein allows state officials to designate almost any area as blighted and then condemn property within it. As an intermediate appellate court the, Kaur court is required to follow state supreme court rulings. Unfortunately, the Kaur majority barely even mentions Goldstein, except for noting that the same private consultant conducted the study allegedly proving the existence of “blight” in both cases. Perhaps this neglect is explained by the fact that the Atlantic Yards opinion was only issued last week. If so, the Kaur court should have taken more time to fully consider it. The contradiction with Goldstein is in fact noted by the Kaur dissenters, who point out that the state supreme court ruling requires broad deference to administrative blight determinations, even if there is considerable evidence that the determination was flawed.

It might still be possible to invalidate the Manhattanville takings in a way consistent with Goldstein. For example, the Kaur majority based its ruling in part on the fact that the government failed to follow some of the procedural requirements of New York’s blight statute.

However, the central holding of Kaur - that “underutilization” isn’t enough to prove blight – is in clear tension with the Atlantic Yards decision. The fact that the same consultant conducted both blight studies and used similar arguments to justify his findings only accentuates the tension. Indeed, “underutilization” was the main evidence for the existence of blight in the Atlantic Yards project area, as well as in the part of Manhattanville condemned for transfer to Columbia.

In sum, I think that Kaur is a much better reasoned decision than Goldstein (except for its neglect of Goldstein itself). Unfortunately, the court that reached the wrong result is also the higher of the two. Thus, I fear that Kaur may well eventually be overruled by the Court of Appeals. At the very least, the Kaur majority should have taken more time to produce their opinion, and clearly explained why this case differs from Goldstein.

UPDATE: Perhaps it isn’t necessary to point this out. But in the title of the post, I was using “state supreme court” in the colloquial sense in which “supreme court” is used to indicate the highest court of the jurisdiction in question, regardless of its official name. I am well aware that the official name of New York’s supreme court is “Court of Appeals.” Similarly, one can use “head of state” as a generic term referring to the top official in a government, even though the official title may be “president” or “king” or whatever. Using “court of appeals” in the post title would have been confusing, because readers unfamiliar with New York’s strange nomenclature wouldn’t realize that I was referring to state’s highest court.

UPDATE #2: I have fixed an annoying typo in the title of the post.

UPDATE #3: Rick Hills at Prawfsblawg interprets Kaur as striking down the Columbia takings on federal constitutional grounds under Kelo v. City of New London, rather than on the state constitutional ground that there was insufficient proof of blight. Rick argues that the opinion ultimately holds that this is a “pretextual” taking forbidden by Kelo because the true purpose was to benefit Columbia, not alleviate blight. I don’t think this is correct. If the court merely sought to show that the taking failed to meet federal pretext standards, there would have been no need for the extensive discussion of state blight requirements. Moreover, the court at no point specifies that is ruling depends on the federal Constitution and not the state one, and indeed cites both at different times. In any event, the federal justification of the court’s decision is actually much weaker than the state justification. As Rick emphasizes, Kelo is extremely permissive. Moreover, Kelo explicitly focused on “economic development” takings rather than blight condemnations, setting up extremely permissive standards for the former, which are generally viewed as much more problematic than the latter.

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