Developers may sue over state's new limit on eminent domain

Published October 19, 2006

RIVIERA BEACH - The builders of a planned multibillion-dollar redevelopment project are considering legal action against the state and this city after being told eminent domain powers will not be used to seize property to make way for the plan.

Viking Inlet Harbor Properties has already spent more than $50-million acquiring property in the redevelopment zone, said Mike Clark, president of its real estate arm.

"Now I'm stuck with these properties but can't develop them because I can't fill in the puzzle pieces," Clark said. "The city spent millions ... putting together its comprehensive plan, and we spent well over $1-million in engineering, architectural and planning fees. Our plan now becomes virtually worthless.

"We're certainly considering joining with other developers and perhaps a group of municipalities about the changing of the rules in midstream."

The $2.4-billion project, planned for an area encompassing about 1,700 homes and businesses in one of Palm Beach County's poorest cities, is an effort to revamp it with high-end condominiums, houses, shops, offices and yacht slips.

The city was moving ahead with the plans over the objections of some residents and business owners who refused to sell their properties. Mayor Michael Brown had said the city would use eminent domain against the holdouts, justifying it as an effort to bring a higher tax base and better paying jobs to the city.

But after the U.S. Supreme Court ruled last year that local governments could use eminent domain to obtain property for such private development, Florida and 30 other states passed laws restricting the seizures.

Brown insisted the plan would move forward because it was already in the works when the law was enacted this year.

However, Floyd Johnson, executive director of Riviera Beach's redevelopment agency, said the city now has no choice but to follow the new law. It cannot force residents out of their homes against their will, he said.

The City Council was set to consider a resolution Wednesday night making it official that it intends to abide by the law, but the measure was taken off the agenda. Leaders said they needed time to study the matter.

Several lawsuits that have been filed against the city by residents seeking to stop the project.

Florida voters have a chance to put the state law's restrictions into the Constitution if they pass Amendment 8 on the Nov. 7 ballot. It would ban using eminent domain to transfer homes or businesses to private developers unless an exemption is approved by three-fifths of both houses of the Legislature.