In a case that appears to break new ground, the Appellate Division, First Department, found that the proposed condemnation of a number of parcels to make way for a new Columbia University Campus should be rejected. In Matter of Kaur v. New York State Urban Development Corporation the split court issued a strongly worded decision finding the “process employed by ESDC predetermined the unconstitutional outcome, was bereft of facts which established that the neighborhood in question was blighted, and ultimately precluded the petitioners from presenting a full record before either the ESDC or, ultimately, this Court. In short, it is a skein worth unraveling.”
By way of background, the Manhattanville area of West Harlem has been in the sights of Columbia University for a number of years as the location for a new campus. Several years ago it began acquiring property in the area, but a number of property owners refused to sell to Columbia and Columbia began working with the Empire State Development Corporation (ESDC) to acquire the holdouts through eminent domain. The court found that while in 2000 Columbia owned only 2 properties in the area, by 2003 Columbia owned 51% of the properties in the roughly 17 acres at issue. In 2004, the New York City Economic Development Corporation (EDC), the ESDC and Columbia began meeting concerning the project. In 2006, the ESDC hired Columbia’s planning consultant to do a study of the area. The study, issued in 2007 noted that by 2007 Columbia controlled 72% of the properties. The study concluded that the majority of the lots in the area were substandard.
During the course of related litigation over release of documents under the Freedom of Information Law (discussed in this Blog in July, 2008) issues were raised concerning the neutrality of the consultant who worked for both Columbia and ESDC. ESDC thereafter retained another consultant to do a further study. By the time of the new study Columbia either owned or was in contract to purchase 48 of the 67 lots in the study area. The new study concluded many of the properties were neglected and the area was “blighted.”
In rejecting the findings of blight the court noted: “EDC’s 2002 West Harlem Master Plan which was created prior to the scheme to balkanize Manhattanville for Columbia’s benefit found no blight, nor did it describe any blighted condition or area in Manhattanville. Instead, as described above, the Plan noted that West Harlem had great potential for development that could be jump-started with re-zoning. It was only after the Plan was published in July 2002 that the rezoning of the “upland” area was essentially given over to the unbridled discretion of Columbia. In little more than a year from publication of the Plan, EDC joined with Columbia in proposing the use of eminent domain to allow Columbia to develop Manhattanville for Columbia’s sole benefit…. Columbia not only purchased or gained control over most of the properties in the area, but it also forced out tenant businesses, ultimately vacating, in 17 buildings, 50% or more of the tenants. The petitioners clearly demonstrate that Columbia also let water infiltration conditions in property it acquired go unaddressed, even when minor and economically rational repairs could arrest deterioration….Thus, ESDC delayed making any inquiry into the conditions in Manhattanville until long after Columbia gained control over the very properties that would form the basis for a subsequent blight study.”
The court then went on to reject “underutilization” as sole criteria in determining blight, no doubt because Columbia, in acquiring the properties and vacating them created much of the underutilization, stating “time has come to categorically reject eminent domain takings solely based on underutilization.” The court further found that the project had no “civic purpose, “Columbia is virtually the sole beneficiary of the Project. This alone is reason to invalidate the condemnation especially where, as here, the public benefit is incrementally incidental to the private benefits of the Project.”
The court then went on to find additional procedural defects which rendered the actions unconstitutional.
As this case is likely to be heard by the Court of Appeals, it will be interesting to see how these issues are ultimately resolved, particularly in light of the Court’s decision on eminent domain last week in the case of Goldstein v. the New York State Urban Development Corporation.