WSJ on Eminent Domain in Brooklyn

It’s almost never a bad idea to do an eminent-domain story, especially the Kelo-type ones that pit the government in league with corporations to abuse private property rights. So it’s good to see The Wall Street Journal this morning take a look at a Brooklyn eminent-domain case winding its way through the New York courts.

The case is about the mega-project called Atlantic Yards, which involves pushing out several hundred residents (most of whom are already gone) so an arena and more than a dozen residential towers can be built by Forest City Ratner, owner and builder of some of the ugliest malls and complexes in the country, including the Atlantic Center across the street and Metrotech down Flatbush Avenue.

It’s unclear from the Journal story whether this case could have wider significance nationally—meaning, whether it could impact the almost-universally despised (almost) Kelo v. New London decision from 2005. It does say this:

The case before the Court of Appeals in Albany is being watched closely by legal experts and property owners concerned about the power of governments to use eminent domain to further economic-development projects.

Here’s the nut of the case:

The Brooklyn property owners allege that the state doesn’t have the right to use its powers of eminent domain to benefit a private developer.

The New York development corporation, meanwhile, argued in court filings that state law allowed it to take blighted property to make way for buildings that would benefit the public.

I lived in that area for a while and it wasn’t blighted—at least the properties in question here. The Chuck E. Cheese in Ratner’s Atlantic Center? Yes! But not the brownstones in Prospect Heights.

These eminent-domain cases are goldmines for journalists. They spark enormous, fervent interest and sell newspapers. There’s a reason for that and journalists should keep it in mind. These places aren’t being knocked down for a bridge or a public park, they’re being knocked down so somebody else can make money off of them.

And in this case, that somebody else is making money off the taxpayers, too:

The arena remains controversial. The city’s Independent Budget Office said in a report last month that the arena would cost the city nearly $170 million, nearly $40 million more in spending than it would generate in tax revenues.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum.