Wed
Jan 25 2006
10:53 am

BB&T, a bank that operates locally, says:

BB&T Corporation today said it will not lend to commercial developers that plan to build condominiums, shopping malls and other private projects on land taken from private citizens by government entities using eminent domain.

The commercial lending policy change comes in the wake of Kelo v. City of New London, a controversial Supreme Court decision in June that said governments can seize personal property to make room for private development projects.

The court’s ruling cleared the way for an expansion of eminent domain authority historically used primarily for utilities, rights of way and other public facilities.

“The idea that a citizen’s property can be taken by the government solely for private use is extremely misguided, in fact it’s just plain wrong,” said BB&T Chairman and Chief Executive Officer John Allison.

“One of the most basic rights of every citizen is to keep what they own. As an institution dedicated to helping our clients achieve economic success and financial security, we won’t help any entity or company that would undermine that mission and threaten the hard-earned American dream of property ownership.”

Reward good behavior. Seriously. I may just have to switch my banking needs to BB&T. That is awesome. Hats off to them.

BTW, if R. Neal can add a Property Rights Issue, that'd be great.

R. Neal's picture

Done. That's pretty

Done.

That's pretty surprising news. You wonder if there's more to it than altruistic civic values. I'm wondering if the board got together, maybe reviewing a large e.d. deal for approval, and decided the potential for losses resulting from an eminent domain lawsuit driving a developer into bankruptcy and thus default wasn't worth the risk on these kinds of projects.

But whatever the motivation, I agree. Pretty impressive.

SayUncle's picture

There probably is some

There probably is some business aspect to it being left unsaid but I consider it great news.
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SayUncle
Can't we all just get a long gun?

rikki's picture

The only problem with this

The only problem with this is that Kelo does not allow eminent domain to be used for the limited purpose of allowing private development. It allows eminent domain to be used for broad public revitalization initiatives that may include private components.

New London created a redevelopment district and chose to build a medical facility and other components they thought would attract the investment and traffic needed to revive the district. Then they went through a public bid process to find private partners to realize the publicly adopted plan.

So a developer can not, for example, buy 150 acres, draw up plans for a 200-acre mall, then obtain the additional 50 acres from unwilling sellers by getting the local government to impose eminent domain on them. What can happen under Kelo is the local government can decide a mall is just thing to bring prosperity back to a run-down corner of town, adopt plans for a 200-acre mall and put the project up for bid.

It may be that BB&T understands the difference between what Kelo allows and what everyone thinks Kelo allows, and they are announcing this policy as a publicity stunt to exploit the widespread misunderstanding of Kelo.

Number9's picture

Do you support the Kelo

Do you support the Kelo ruling?

Ferenc Fricsay's picture

Hey, Crazy Freeper have you

Hey, Crazy Freeper have you read Kelo? rikki's assessment of what it did is correct.

SayUncle's picture

Rikki, I really find it

Rikki,

I really find it irrelevant whether a person's property is taken to turn over to a developer for revitalization or profit. It allows people's property to be taken unfairly. And taking land to build amenities next to a Pfizer facility is not revitalization. it's theft. And the ruling pretty much opened up the door to taking land from one private person to give to another.

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SayUncle
Can't we all just get a long gun?

Ferenc Fricsay's picture

The land your house is

The land your house is sitting on is the product of some government taking it from a private individual or group of private individuals in order to hand it to someone else. It is impossible to prove otherwise as contrary to what you were taught in school: North America was full of people (some estimates range up to 50 million) before Europeans showed up. Kelo was just an affirmation of US History and implicit in a lot of what it did was a realization that over turning eminent domain opens up a whole slew of indigenous rights to land arguments. I find it funny how SHOCKED ever one seems to be about Kelo, when it was nothing more than the affirmation of the status quo in American land-use history.

SayUncle's picture

Nice non sequitur. Care to

Nice non sequitur. Care to add something of substance to the issue at hand?

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SayUncle
Can't we all just get a long gun?

Ferenc Fricsay's picture

Uh oh. Uncle gets nose

Uh oh. Uncle gets nose rubbed in facts and pulls the 'you said nothing' argument. Give me a break. You are complicit in the long trajectory of US land history as any other person who owns property in this country. Kelo is so surprising? It's the status quo. Under your logic, Oak Ridge should not have been built. What about TVA? Y'know, where you get your electricity from down there in Maryville? The inconsistency is among the Libertarians (inconsistency being a hallmark of that "movement") who argue with all this moral authority but stand on stolen ground while they do it.

SayUncle's picture

Facts about what? Let's

Facts about what? Let's take your argument to its logical conclusion that none of these problems would exist if that giant mass of matter hadn't big banged and created the universe. There is a here and a now.

Give me a break.

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SayUncle
Can't we all just get a long gun?

Anonymous's picture

So if everybody were armed

So if everybody were armed with a gun then wouldn't there be just a giant stand off? Anyone who advocates legalizing carrying a weapon into an establishment that serves alchol is nuts. You, sir, are nuts.

SayUncle's picture

Yup, that's exactly what I

Yup, that's exactly what I mean. In my house right now, there is alcohol and firearms. And they're not doing anything.

Geez, it must be troll day over at knoxviews.

Anyone who posts in the wrong thread is a moron. Is that oversimplified enough?

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SayUncle
Can't we all just get a long gun?

Number9's picture

I take it then Ferenc that

I take it then Ferenc that you support the Kelo ruling?

So your reasoning is that since the land was taken from the Native American people that a precedent was established and whoever has more power can take any land they desire?

How Imperial of you. Would you perchance be in the development business?

Ferenc Fricsay's picture

Your shock at the status quo

Your shock at the status quo is my point. The fact of the matter is this: US history is one long landgrab. When did US imperialism start? Basically when holdings in the contiguous US were consolidated. 1880s or so. Within 20 years you had the Spanish-American war.

Kelo is an affirmation of American history. The ugly side of it. I can't say that I agree with it. I can say that I see it for what it is.

Perchance: Methinks, you speak with archaic verbiage in order sound intelligent. Forsooth, it does not work.

rikki's picture

The Supreme Court didn't

The Supreme Court didn't think it was irrelevant. The Kelo ruling set clear limits on the use of eminent domain for development projects. I'd say the use of eminent domain for building a stadium is more abusive than what New London did, particularly since it benefits a private entity that is known beforehand, as opposed to benefiting a private entity who submits the winning bid afterward.

The Constitution allows the government to take land in exchange for fair compensation. A taking is only unfair if the compensation is inadequate or the public decision-making process is subverted.

SayUncle's picture

The Constitution allows the

The Constitution allows the government to take land in exchange for fair compensation.

And for public use, which Kelo wasn't.

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SayUncle
Can't we all just get a long gun?

rikki's picture

The Supreme Court said it

The Supreme Court said it was. If you want to dispute their ruling, step one is understanding it.

SayUncle's picture

Yes, they said it was for

Yes, they said it was for public use because that use wasn't public. And they also changed 'public use' to 'public purpose.' In other words, they were full of crap.

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SayUncle
Can't we all just get a long gun?

Anonymous's picture

(link...)

Hm. Purpose seems to be a synonym for use. Zounds, foiled again.

SayUncle's picture

Not foiled at all. Use and

Not foiled at all. Use and purpose also have different definitions otherwise the court would not have drawn the distinction.

---
SayUncle
Can't we all just get a long gun?

Number9's picture

Has anyone come forth with a

Has anyone come forth with a reason why Kelo is a good ruling? Other than adding to the tax roles what benefit does Kelo provide?

Weighing this small benefit against the great harm that Kelo allows how is it good law? More importantly, how is it constitutional?

Anonymous's picture

Anonymous's picture

Number9's picture

Are you saying that Kelo is

Are you saying that Kelo is good because it provides the precedent to take away Mark Saroff's property, the McClung Warehouses?

Don't be shy speak up.

Rachel's picture

This is why you need that

This is why you need that crash course in eminent domain, blighted property, and redevelopment areas, #9. The City didn't need Kelo to take the McClung Warehouses. They had the authority to do it before Kelo.

R. Neal's picture

Gemini, you say "didn't need

Gemini, you say "didn't need the authority to take" and "they had the authority" as in past tense. Has this already occurred? I wasn't aware of it.

Rachel's picture

Sorry, poor wording. No, it

Sorry, poor wording. No, it hasn't already happened. I'm just saying that the City didn't need Kelo to have the authority to take the Warehouses. Even before Kelo, the City had the authority, through KCDC, to take blighted property in defined redevelopment areas to sell to private developers for "public purposes."

I can't recall the case, but the Supreme Court declared this constitutional way back in the 50s.

Goert's picture

Whether or not Kelo allows

Whether or not Kelo allows this or not, what Rikki says developers cannot do, they do.

rikki's picture

Goert, wealthy people use

Goert, wealthy people use government to do things they cannot do all the time. OJ Simpson got away with murder. The case you referenced is absolutely an example of eminent domain abuse, and I hope as much as you those people can afford to fight it. Our legal system favors the wealthy. It is possible, routine even, for wealthy interests to bluff their way to victory with no viable legal strategy other than to simply outspend and outlast the poor schmoes who wind up in their path.

There are numerous cases of eminent domain abuse, and people lose their homes and land because they simply lack the resources to fight. The first step is always a corrupt government beholden to the wealthy interest. I'm sure the developer in the case you cited donated the maximum amount to the campaigns of the various office holders who permitted his abusive scheme to proceed.

Don't mistake what the wealthy get away with for what is right and what is legal.

Bubba, you are correct that the South Knox waterfront plan presents the possibility of the city using eminent domain. That threat existed during the Market Square redevelopment process as well. The public planning process will hopefully preclude any need to exercise that power. Many options exist for homeowners who might need assistance sprucing up their houses, and the general rise in property values will give them borrowing power they lacked before the planning started. The process could spawn a holdout who simply opts to be stubborn over a swath of right-of-way. Given how things have gone so far and the people involved, I seriously doubt anyone will be hauled off in a caneback chair or found dangling from the rafters the morning the bulldozers arrive.

R. Neal's picture

The only problem with this

The only problem with this is that Kelo does not allow eminent domain to be used for the limited purpose of allowing private development. It allows eminent domain to be used for broad public revitalization initiatives that may include private components.

Not to start an argument or go off on a tangent or anything, but isn't that second part the very definition of the South Knox waterfront project?

Don't get me wrong, I'm all for something happening over there. (Just as I was all for something finally happening with the WFP, especially if it involved saving the Sunsphere and the Amphitheater. Which I realize has nothing whatsoever to do with e.d.)

Rachel's picture

I'm on the south waterfront

I'm on the south waterfront oversight committee. We are a long way from finished with the vision component of the plan, much less the action component. But here is what I expect will happen wrt public and private property:

There will be no wholesale use of ED to assemble blocks of property for private development, especially where there is existing residential. That doesn't represent good planning, the public won't stand for it, City Council won't stand for it, the City can't afford it, and Bill Haslam wants to get re-elected.

There will be some property identified as appropriate for City acquisition (for a new park, for example). I expect most of it will be existing industrial or vacant land along the waterfront. Eminent domain might be used in isolated cases to acquire some of that.

In other words, I expect ED will be used in isolated cases to purchase single, targeted tracts. I am absolutely confident it won't be used in a wholesale way, nor to assemble tracts for private developers.

If I'm wrong, I will be the very first person camped outside Bill Haslam's office screaming to high heaven.

R. Neal's picture

I expect most of it will be

I expect most of it will be existing industrial or vacant land along the waterfront. Eminent domain might be used in isolated cases to acquire some of that.

Like that blighted rats nest that was once the molasses factory? About time. You go girl!

edens's picture

>Like that blighted rats

>Like that blighted rats nest that was once the molasses factory?

Speaking of which, Gemini, has there been any discussion on the places where old industrial commercial property - much of it pretty blighted rat's nests (I'm thinking of all the fenced off lots with rusty cars all over them between Davenport and Jones, before you head up the hill) intruded into the residential area south of Sevier? Personally, I think a little "dis-assemblage" may be in order: break those areas back into 50X150 lots and reweave them back into the surrounding residential.

Hell, I'd even love to see the resulting lots sold of idividually, somewhat akin to what the city has done with the old McCallie School site.

Reminds me, anybody got any recent pics of any of those new houses?

Rachel's picture

You know, that's a very

You know, that's a very interesting proposal, and not one I've heard discussed. I'll bring it up at the night Oversight Committee meeting.

foo's picture

i enjoyed the context FF

i enjoyed the context FF used to explain FF's argument as well.

i for one, would love to see detroit start using ED. there are literally 100's of thousands of abandoned homes and business in the city. i think it would be great if the city, using ED, accquired them, used what they wanted, and sold the rest at auction for a dollar. if nothing else, you've got properties back on the rolls that otherwise serve illicit purposes at best. (i.e. crack houses.)

now i know that #9 is not a fan of using ED just to put properties back on the tax rolls, but hey, if detroit had more property taxes rolling in, we wouldn't have to sell candy factories and whatnot. also, we could turn the rest of the traffic lights back on.

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