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Outsiders Bankroll Prop. 90 Campaign

Out-of-state groups push for measure that would bar government from seizing businesses and homes for private uses.

October 12, 2006|Tim Reiterman | Times Staff Writer

Led by a New York businessman, a national network of property rights activists is bankrolling a proposed California constitutional amendment that would bar the government from seizing homes and businesses to use the land for private economic development.

Supporters say Proposition 90, on the Nov. 7 ballot, is a long-overdue reform to safeguard property owners whose rights are being trampled by local and state governments wielding their eminent domain powers.

"It is really a case of the little guy versus powerful interests," said campaign spokesman Kevin Spillane. "Lots of people who have eminent domain threatened [against them] are small business owners and urban dwellers who do not have the money to fight."

But opponents consider the measure dangerous because one section would require agencies to pay owners when future zoning, planning or environmental rules substantially harm property values.

Organizations representing cities and counties, police and fire chiefs, corporations and conservationists warn that this provision would hamstring government and unleash billions of dollars in damage claims.

"As government considers rezoning, development permits or timber harvest permits, property owners will say, 'You cannot do this, and I will sue you if you go ahead,' " said Tom Adams, board president of the 25,000-member California League of Conservation Voters. "Government agencies ... will back away from protecting the environment and quality of life."

There are similar measures on the ballot in Arizona, Idaho and Washington, but the stakes in California are particularly high. All sides agree that victory in the most populous state could lead to a nationwide groundswell of initiatives or legislation.

The measures follow last year's U.S. Supreme Court decision allowing government agencies to seize private property for economic development, not just traditional government uses. And they are loosely modeled after a measure passed by Oregon voters two years ago that has prompted thousands of damage claims.

Fears About Reach

Against this backdrop, property rights groups have provided several million dollars for the initiatives without having to disclose the identities of their donors.

Although the California Republican Party and some taxpayer groups endorsed Proposition 90, records show that the lion's share of $3.7 million raised has been donated by nonprofits associated with Manhattan real estate entrepreneur Howard S. Rich, an advocate of smaller government.

Opponents have collected more than $5.7 million, much from the League of California Cities and the California Public Securities Assn. They started airing television ads Wednesday; supporters also have ads prepared but have declined to say when they might begin advertising.

In e-mails, Rich declined to be interviewed but defended Proposition 90 fundraising. "Those opposed to Proposition 90 know they're stepping on basic constitutional principles.... Like any group in power that wants to keep it, they have attempted to confuse the issue, attack the messenger and engage in character assassination," he wrote.

The proposal would not prevent government from taking private property for roads, schools or parks, but it would block condemnations for construction of nonpublic facilities in redevelopment areas. And, according to the nonpartisan state legislative analyst's office, it apparently would increase the amount owners are paid when the government seizes property.

A more sweeping provision of Proposition 90 -- one that many opponents have seized upon -- would allow owners to seek payment whenever new regulations substantially reduce property values. One example is down-zoning, in which an agency reduces the number of structures that can be built on a parcel.

The legislative analyst concluded that Proposition 90 could cause significant statewide costs because it could be applied not only to eminent domain and land use but to new rules governing employment conditions, apartment prices, endangered species, historical preservation and consumer protection.

The initiative exempts health and safety laws, but the California Police Chiefs Assn. is opposing it because of the potential fiscal effects. "If it impacts city finances, it will impact public safety because we usually are the largest part of the ... budget," said Steve Krull, the association's president and chief of the Livermore Police Department.

Consumer advocates voiced concern that the measure could undercut Proposition 103, the insurance initiative passed by voters in 1988.

Others fear that future environmental regulations would be vulnerable. Kim Delfino, California coordinator for Defenders of Wildlife, said that if the burrowing owl were placed on the state's endangered species list, for example, developers might claim financial damage from new owl protection requirements.

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