Editorial | Eminent Domain

The New Jersey Supreme Court has shown the way for fairer and saner use of eminent domain in rejecting Paulsboro's effort to acquire a waterfront property for redevelopment.

The case involved a 63-acre plot along Mantua Creek that the borough deemed was not being used to its fullest economic potential. The town designated the property for redevelopment, even though most of the plot consists of wetlands and therefore cannot be developed.

The justices have wisely used the case to set the bar higher for all eminent-domain takings motivated by economic development proposals.

New Jersey's constitution "does not permit government redevelopment of private property solely because the property is not used in an optimal manner," the court said. The constitution limits government redevelopment to "blighted areas," it added, reiterating the familiar, constitutional meaning of blight as "deterioration or stagnation that negatively affects surrounding areas."

Paulsboro officials had added the 63-acre plot at the last minute, almost casually, to an adjacent former industrial site that they deemed - appropriately - to be in need of redevelopment.

Borough officials proposed turning the industrial site into a port complex. A consultant went out to the abutting plot, owned by the Gallenthin family and its real estate firm since 1951. He noted that there were "no physical improvements" and "all I could see was trees" - and concluded that the land was not being "fully productive."

While two lower courts ruled there was sufficient justification to take the property, the high court accepted the Gallenthins' argument that the consultant was just expressing an unsubstantiated opinion, and that, moreover, the vacant land might be contributing to the community's welfare precisely because it was vacant - by serving an environmental purpose.

In deciding against Paulsboro, the court correctly reined in the expansive and often controversial interpretation of eminent domain powers under a 1992 redevelopment law that local officials have preferred. The court has rightly restored the constitutional "blight" test at the core of every local government's decision to take private property for redevelopment.

The court said Paulsboro had wrongly interpreted the law to permit redevelopment of any property that is "stagnant or not fully productive." Under that approach, the court said, "any property that is operated in less than optimal manner is arguably 'blighted.' If such an all-encompassing definition were adopted, most property in the state would be eligible for redevelopment."

The decision echoes observations by the state's public advocate, Ronald K. Chen, who argued in court on behalf of the Gallenthins. Chen noted that even the governor's mansion could qualify for redevelopment under the broad interpretation of the law.

The court's decision lends new urgency to Trenton's pending effort to reform the redevelopment law. The legislation is not perfect. It lacks effective pay-to-play restrictions, for one thing, that would reduce the influence of campaign contributions in local development decisions. But it would provide a variety of new protections for property owners, including improving their ability to challenge redevelopment designations in court and obtain better compensation. The Assembly has passed the bill; it's time the Senate followed.

Crowded New Jersey is a built-out state struggling with urban and suburban decay. Eminent domain should be available as a tool to redevelop appropriate properties, but only if it is used fairly and with due care.