Key Topic: Takings

An otherwise proper taking does not lose its public character merely because a redeveloper may profit from the taking.

In Re:  Condemnation of Land for the South East Central Business District Redevelopment Area #1, 946 A.2d 1143 (Pa. Cmwlth. 2008).

On April 14, 2004, the City Planning Commission certified Yarnall’s property (Property) within the South East Central Business District Redevelopment Area #1 (Redevelopment Area) as blighted.  On May 12, 2004, the Redevelopment Authority entered an agreement with a redeveloper to renovate a charter school.  On February 9, 2005, City Council approved the Agreement and amended redevelopment plan which included providing for educational uses in the Redevelopment Area.  The Authority filed a Declaration with the trial court on July 14, 2005, stating that the Property was condemned to fulfill an approved redevelopment plan to clear off certain properties.  These properties, including Yarnall’s, were to be used to redevelop educational buildings, including the charter school discussed in the redeveloper’s agreement.

Yarnall filed preliminary objections to the Declaration, arguing that the Authority condemned the property for the private, for-profit use of the redeveloper in order to expand the redeveloper’s real estate holdings.  The trial court dismissed the objections, concluding that the Authority could condemn the Property because it was for public use, since a charter school is an independent public school.  The court also stated that the taking did not lose its public characteristic simply because the redeveloper may make a profit.  Yarnall appealed, arguing the trial court erred in finding that the Authority did not take Yarnall’s property primarily for the private use of the redeveloper.

The Commonwealth Court affirmed, stating that under the Urban Redevelopment Law, 35 P.S. §§ 1701 – 1719.2, authorities are permitted to select redevelopers and negotiate contracts for the sale and redevelopment of property prior to submitting a redevelopment proposal for approval.  The negotiation of a contract before the redevelopment plan is approved cannot form the basis of a claim for improperly taking the Property for private use.  Further, any profit for the redeveloper does not negate the redeveloper’s contribution to eliminating blight in the redevelopment area.

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