Fordham Law


In NY, a "condemnor can condemn a Kasha Knish": more criticisms of eminent domain in New York and suggested reforms

Fordham in Atlantic Yards Report, May 25, 2011

Media Source

by Norman Oder

The latest issue of the Albany Government Law Review, published by Albany Law School, concerns Eminent Domain: Public Use, Just Compensation, & "The Social Compact", with several articles that touch on the Atlantic Yards eminent domain case.

And, as scholars indicated in a recent conference at Fordham Law School, few think that decision was wise, or that the legal regime in New York inspires confidence.

Probably the quote of the issue comes from attorney Michael Rikon, who represents condemnees (including Atlantic Yards opponent Daniel Goldstein) and suggests:

It is an aphorism in criminal law that a good prosecutor could get a grand jury to “indict a ham sandwich.” With regards to condemnations in New York, it can fairly be said that in New York, a condemnor can condemn a Kasha Knish.
Commentators in the issue propose numerous reforms to right the balance in New York--reforms that likely would be opposed by supporters of the status quo.

One commentator suggests that decisions to condemn made by elected officials should be given deference, but that decisions made by appointees and others not directly accountable should face a higher burden. That would impact projects like Atlantic Yards.

The judicial reaction

In THE JUDICIAL REACTION TO KELO, libertarian legal scholar Ilya Somin of George Mason University points out that, while scholars have analyzed the legislative reaction to the Supreme Court's controversial 2005 Kelo v. New London decision--reforms in 43 states, but most of them weak--there's been little such analysis of the federal and state judicial reaction.

He observes:
With a few important exceptions, I conclude that state courts have not reacted to Kelo by adopting similarly permissive approaches to public use issues. To the contrary, three state supreme courts have explicitly repudiated Kelo as a guide to their state constitutions. Other recent state supreme court decisions have imposed constraints on takings that go beyond Kelo even if they have not completely rejected the Kelo approach.

By contrast, federal and state courts have been all over the map in their efforts to apply Kelo’s restrictions on "pretextual" takings. There is no consensus in sight on this crucial issue. It may be that none will develop unless and until the Supreme Court decides another case in this field.
The New York exceptions

The exceptions, however, are the New York Court of Appeals' recent decision in the Atlantic Yards and Columbia cases, Goldstein v. New York State Urban Development Corp. and Kaur v. New York State Urban Development Corp. Somin writes:

Both decisions upheld the constitutional validity of extremely broad definitions of blight, and also endorsed Kelo’s highly deferential approach to public use issues. More problematically, both also upheld blight condemnations despite considerable evidence of political corruption in the blight designation process.
I don't know if you could call it political corruption, but surely there's evidence of favoritism, and sloppy, indefensible standards.

Why did courts tighten the law?

Somin, who notes that court decisions "have often been influenced by public opinion and the political climate," wonders if the public backlash to Kelo impacted the courts.

Maybe, but he suggests a preexisting trend around the country towards stronger judicial scrutiny of public use issues, such as in Michigan, where a unanimous state Supreme Court, in a case known as Hathcock, reversed the justification for the infamous Poletown decision, which allowed private-to-private transfers for economic development. (New York is an exception.)

That's important, he suggests, since, in 2009, only 42% of those polled recalled that the Supreme Court had upheld the constitutionality of private-to-private transfer for economic development.

Taking pretext seriously, except with AY

The Kelo decision, as well as the concurrence, suggested plaintiffs might argue successfully to stop a sweetheart deal, but that the New London case before them did not qualify, because, among other things, the beneficiary was not known at the time of the taking.

Somin again points to the Atlantic Yards case, writing:
Overall, most courts applying Kelo have left open at least some nontrivial possibility that a taking could be invalidated as pretextual. The major exceptions to this pattern are two decisions by the United States Court of Appeals for the Second Circuit, and the New York Court of Appeals blight decisions already discussed above.

His summary:
In two of its decisions, the Second Circuit has taken an extremely deferential approach to pretext issues, falling just short of defining the pretext cause of action out of existence. In Goldstein v. Pataki, the Second Circuit considered a challenge to the same Atlantic Yards takings that were later upheld in state court by the New York Court of Appeals. Despite the considerable evidence that the taking was intended to benefit developer Bruce Ratner, who had initiated the project and lobbied for its adoption by the government, the Second Circuit refused to consider either evidence of improper motive or evidence concerning the distribution of benefits from the condemnation. So long as a taking is "rationally related to a classic public use," the court ruled that it is impermissible to "give close scrutiny to the mechanics of a taking . . . as a means to gauge the purity of the motives of various government officials who approved it."
In both the Atlantic Yards and Columbia case, Somin contends, the court ignored "strong evidence" of all four pretext factors mentioned in Kelo:
Both featured considerable evidence of improper intent, a distribution of benefits strongly favoring the new private owner of the condemned area, a private beneficiary whose identity was known in advance, and a planning process that was often perfunctory and biased in favor of a preconceived decision in favor of condemnation.
So why did the court take a pass?

Somin suggests that, at least in the Atlantic Yards case, "the majority probably ignored Kelo’s pretext standard and the lower court cases interpreting it—because the property owners' federal constitutional claims had already been rejected in federal court" in the previous case.

More glaringly, the Court of Appeals ignored the pretext issue in the Columbia case even though it had been part of the appellate division ruling it was reversing.

The difficulty of establishing pretext

Like some other commentators, Somin recognizes that it may not be easy to determine pretext:
In practice, public officials can usually persuade themselves that any taking that advances their political interests and helps an influential constituent that benefits from a taking also advances the public interest.

Finally, relying on a detailed planning process to prevent pretextual takings ignores the possibility that politically influential private interests can "capture" the planning process and bend it to its own purposes. A more extensive planning process is not necessarily less prone to favoritism than one that is less elaborate.
So even "a relatively robust effort to enforce Kelo’s pretext doctrine" by courts may reap only modest results.

Need for reform in New York

In THE TROUBLE WITH EMINENT DOMAIN IN NEW YORK, three lawyers who represented plaintiffs in the Columbia case, Norman Siegel, Steven Hyman, and Philip van Buren, offer a broad argument for reform:
Between vague statutory terms and the limited review provided by the Eminent Domain Procedure Law (EDPL), New York law, as currently written and interpreted, enables the execution of policy not authorized by law, and encourages the fabrication of pretextual purposes to evade public accountability.
The trouble starts with the underlying law and condemning agency:
In New York State, the use of eminent domain for the purpose of creating or retaining jobs and taxes has for a long time been an element of municipal and state policy. The Urban Development Corporation Law (UDCL) cites the creation of jobs and increasing tax revenues as a public purpose, and it created the New York State Urban Development Corporation, now doing business as the Empire State Development Corporation (ESDC).

The UDCL is rooted in the concerns of 1968 (when it was enacted): depressed urban centers and dying rust belt industries. Though the UDCL explicitly states that job creation and increasing tax revenue are public purposes, and uses the term “development” in the title of the public benefit corporation it creates, the development it envisages appears not to be affirmative economic development in the abstract, as would be represented by any successful business activity helping lift the broader New York gross domestic product. The statute’s statement of legislative findings and purposes gives equal space and weight to addressing “substandard or insanitary” areas, and to the essentially remedial programs to redevelop such areas. The findings requirements limited projects to “substandard or insanitary,” “blighted” areas, or to meeting a housing or civic need.

And, for the last 30 years, the private sector has been looked to as the vehicle for solving urban problems:
Policy makers wanting to exercise government power towards this end have found the use of eminent domain a convenient option. Leveraging private investment, in the right circumstances, can generate jobs and keep tax revenues up, with the price being paid by a relatively small and usually marginal part of the electorate that suffers displacement. Using eminent domain to foster economic growth is easier to accomplish politically than raising taxes.

The result?

The ESDC does not look to where there's "the greatest blight, or the most persistent unemployment," but rather gentrifying areas.

The trouble with "malleable" blight

State law defines blight as “substandard or insanitary.” In the case challenging the Atlantic Yards environmental review (Develop Don’t Destroy (Brooklyn) v. New York State Urban Development Corp.), the authors note, the Appellate Division declared blight to be a “highly malleable and elastic concept” that is “more facilitative than limiting”:
The idea of a “highly malleable and elastic” limitation on governmental authority is troublesome. It offends the constitutional value that a statute must have sufficient specificity to give adequate notice to citizens. In the criminal context, vagrancy and loitering statutes have been held void for vagueness, but also in the civil context.

"Blight,” they note, first was applied to slums, then to areas of vacancy and abandonment--a "contagion" that can spread.

But no such impact is required today:
The causal links of any proposed blight syndrome are not required to be identified and this makes it possible to distort the significance of supposed indicators of blight. This also creates a false narrative of an area driven more by the desire to find the area blighted than by comprehensive evidence of actual economic factions and relationships. Interested parties with unclean hands, such as a developer controlling substantial portions of the area sought to be condemned, can be rewarded for strategic behavior in vacating or running down property.
Safeguards recommended

The authors suggest several safeguards that would add time and process, and surely be opposed by the Bloomberg administration, among others, since they would have slowed or stopped projects conceived and presented in the way Atlantic Yards was:
First, the procedural safeguards outlined by Justice Kennedy in his concurrence in Kelo should be added to the EDPL and/or authorizing statutes such as the UDCL. Designation of areas proposed to be taken by eminent domain, the public purposes for such a taking, and a basic development plan should be required to be administratively determined and legislatively approved prior to the identification of any project sponsors or other private beneficiaries. Multiple plans and project sponsors should be considered by a transparent and competitive RFP process, and the bases for determination as to which best achieves previously determined public purposes at the least public cost should be required to be articulated.
Blight, they say, needs a definition:
Second, statutory language should be added to the UDCL and other authorizing statutes to give adequate certainty to the definition of blight. A showing of actual impairment of development or other harm to neighboring property areas or the public fisc should be required.
Ubiquitous consultant AKRF, which worked simultaneously for Columbia and the state (and consecutively for Forest City Ratner and the state), would not be allowed to find blight:
Third, the process of measuring and determining blight should be undertaken by disinterested third parties. Agencies should be prohibited from retaining consultants linked to, or paid by, developers.
As with some other critics, the authors think the arbitrary argument that a building does not fulfill 60 percent of development rights shouldn't stick:
Fourth, “underutilization” of land should be discontinued as a criterion of blight. Without causing any demonstrable harm in itself, an owner’s option to develop property less than the maximum allowed by zoning serves, at best, as an indicator of market demand.
Finally, an actual trial is needed:
And fifth, the EDPL should be amended to provide for proper trial-level proceedings—instead of giving exclusive jurisdiction to the appellate division—as currently provided. Upon a showing of likely favoritism, pretext, or bad faith, in any eminent domain taking for transfer to a private party, courts should be empowered to consider evidence beyond the administrative record, including discovery and cross examination of witnesses.
The need for abatement

In URBAN REVITALIZATION AND EMINENT DOMAIN: MISINTERPRETING JANE JACOBS,
Steven J. Eagle of George Mason University suggests that condemnation is a broad penalty for even severe blight, as private and public nuisance suits, and requirements for abatement, could either abate the blight or lead to foreclosure and a result with more public participation.

(That, however, does not allow for the formulation of large parcels out of "irregular," smaller lots--another justification for blight and eminent domain.)

Can pretext work?
Eagle questions the argument for pretext:
Justice Kennedy’s concurring opinion attempted to supply some content to this null set by adding that “transfers intended to confer benefits on particular, favored private entities, and with only incidental or pretextual public benefits, are forbidden by the Public Use Clause.” Yet, it is not evident that, apart from possible criminal law liability for bribery, perjury, and the like, “intent” should matter at all. An honest public official agreeing to a condemnation for retransfer plan does not provide much help for his or her community if the city’s return is mediocre, even if the private counterpart’s return is worse. Likewise, the official has enhanced the city’s welfare if it receives a handsome return, even if the counterpart’s return is better.

...Justice Kennedy’s list of factors militating in favor of a finding of pretextual taking seem more like prophylactic rules against arbitrary or discriminatory conduct than explanations of why there is a lack of public benefit. Temptations to misfeasance or malfeasance by public officials might have the incidental detriment of making revitalization less efficacious. But that rationale sounds in substantive due process review within the Takings Clause, a concept the Court rejected, as Justice Stevens noted elsewhere in Kelo, and in Lingle v. Chevron U.S.A., Inc.

Kelo vs. AY
Eagle finds the Supreme Court majority opinion in Kelo more defensible than the New York Court of Appeals majority in Goldstein:
One important difference, however, is that Justice Stevens’ Kelo opinion was built largely on federalism and comity, matters not germane to a state court interpreting the state constitution. Given the imperfection of any neighborhood, and the multitude of effects intrinsic in any large condemnation, the possibility that any government assertion could be “irrational and baseless” [the line drawn by the Court of Appeals majority] is hypothetical, indeed.
Eagle suggests that the Atlantic Yards and Columbia cases "leave many important issues unresolved," notably courts' unwillingness to conduct "meaningful judicial review:

In Kaur, the Appellate Division did not independently ascertain the existence of evidentiary facts, but instead evaluated, and found wanting, the conclusions that the ESDC drew from those facts. When the Court of Appeals held that the Appellate Division was bound by the agency’s findings of blight and determined that the condemnation of petitioners’ property qualified as a ‘land use improvement project’ so long as they were not irrational or baseless, it in effect treated the agency as a part of the judicial system.

It's difficult, Eagle acknowledges to find facts to support allegations of pretext, a process that "involves intensive discovery" and is made more difficult by the Supreme Court's raising the bar, in a case called Bell Atlantic Corp. v. Twombly.

Kelo and blight

Eagle tackles the suggestion that Kelo didn't even apply to the two New York cases, because they were about blight, not economic development, as in New London. (That said, the line can be murky, as Nicole Gelinas has argued, pointing out that underutilization means lack of economic development.) He writes:

One proffered explanation of the New York Court of Appeals’ failure to mention Kelo in its Kaur decision is its possible unarticulated view that Kaur involved blight, and that the protections against pretextuality did not apply in blight cases. The U.S. Court of Appeals for the Second Circuit upheld the district court’s dismissal of the residents’ complaint that the Atlantic Yards project violated the Public Use Clause in Goldstein v. Pataki. The court held that the project was “justified in reference to several classic public uses,” including the provision of open space, additional affordable housing, and “construction of a publicly owned (albeit generously leased) stadium,” in the “long- blighted” area.
The court added that Kelo was not about blight, leading Eagle to comment:
The Second Circuit opinion points to the difficulty—and perhaps the futility—of trying to separate the strands of causation and result in a complex revitalization project. On one hand, as suggested by the court, “blight” might be an objective causal factor obviating “intent” in bringing about mixed public and private benefit. On the other hand, “blight” often has been an after-the-fact label justifying condemnation for (more upscale) private revitalization.
He adds that the two New York cases, especially Atlantic Yards, suggest both public and private benefit, "such that it is almost impossible to argue that no public benefit exists." That means that courts relying on simply the presence of public benefit will rule in favor of the condemnor.

(In a separate paper presented at the Fordham symposium, two academics suggested that the issue is not the presence of a public benefit, but the balance between public and private benefit.)

An unfair process in NY

In MOVING THE CAT INTO THE HAT: THE PURSUIT OF FAIRNESS IN CONDEMNATION, OR, WHATEVER HAPPENED TO CREATING A “PARTNERSHIP OF PLANNING?”, attorney Michael Rikon reminds us that the New York State Commission on Eminent Domain once proposed a much more balanced process:
It is notable that in its 1973 report, the Commission strongly “recommended that during the planning phase of a public project, a procedure (public hearings) should be established to afford citizens the opportunity of participation in the planning decision.” The “condemnor’s decision concerning the necessity and location of a proposed public project should reflect both consideration of the project’s detrimental and beneficial effects on a locality and should also include a specific statement of the basis of the condemnor’s decision.” This first draft of New York’s Eminent Domain Procedure Law (EDPL) also contained the recommendation “that the condemnor’s decision should be reviewable by an impartial administrative agency which would have the power to approve, conditionally approve, or disapprove the condemnor’s decision.” This remarkable provision was quickly removed from subsequent drafts of the proposed law and never adopted. Indeed, the Commission eliminated the entire subject of the necessity of the taking from the scope of judicial review and stated that “[u]nder present case law, the question of necessity of the taking of a parcel, is a legislative question and is not subject to judicial review.”

The Commission, at least in its rhetoric, said there should be a “partnership of planning,” but that hasn't happened, Rikon points out.

Case in point: the ESDC does not require to have its directors present at its public hearings on eminent domain, and in most hearings those running the hearings don't respond to anything said. (I'd add that written responses have been made in the Atlantic Yards case.)

Don't blame Kelo

Rikon argues that the Kelo decision had no impact on jurisprudence in New York, as the UDC has long been able to "condemn a Kasha Knish."

Rikon endorses the dissent from Judge Robert Smith in the Atlantic Yards case, stating:
The deference to determinations made by the condemnor that property is needed indicates the judiciary’s abandonment of its function. If it can be said that the exercise of authority under the EDPL is an essentially legislative function, then a court should avoid violence to the fundamental separation of powers doctrine, which represents the constitutional check on powers in our form of government. The fact is that the courts have, by making determinations to take private property “legislative,” abdicated the responsibility of safeguarding property owners’ constitutional rights.

Indeed, the decisions made to condemn are not legislative determinations. They are not made by legislatures, or sometimes even by elected officials who are responsible to those that elect them. Rather, the determination of what property to take and who to give it to is made by a handful of appointees who are responsible to no one. The decision making process to condemn private property is not made by a deliberate assembly. Thus, a finding that a property condemnation furthers a public use or purpose will be affirmed unless it is “without foundation” in the hearing record.
Rikon points out that a task force of the New York State Bar Association on eminent domain issued a final report in July 2007, offering eight recommendations, but nothing happened in the State Legislature.

Commission needed

As with others, Rikon suggests "the need to define and perhaps limit the definition of public purpose and permissible acquisitions, and how New York defines “blight.” Thus, he recommends a
Temporary Commission to study and propose a new Eminent Domain Procedure Law for New York. In addition to the above, the Temporary Commission should study whether the power of eminent domain should be limited to true public use and should there be restrictions on takings which would enable developers to take private property for large scale developments.

A contrarian voice

In EVALUATING ECONOMIC DEVELOPMENT TAKINGS: LEGAL VALIDITY VERSUS ECONOMIC VIABILITY, David Schultz argues that "the problem with many eminent domain projects is not so much the use of eminent domain, but instead, the economic viability of the development project to be undertaken with the user of this authority."

He makes a reasonable case that the backlash to Kelo was overheated--as does Lynne Sagalyn in this paper--but does not address whether the cases in New York do constitute eminent domain abuse, as a rather broad number of commentators believe.

Schultz writes:
The reaction to the Kelo decision and the labeling of it as eminent domain abuse did not come out of nowhere. It was the culmination of a lobbying and public relations process on two fronts. First, it was part of a political effort to reinvigorate property rights that were rooted in a neo-liberal effort to limit government intervention in the economy. Second, it was a reaction to decisions such as Poletown Neighborhood Council v. City of Detroit and Hawaii Housing Authority v. Midkiff, which critics contended had vastly and incorrectly expanded the public use justification for eminent domain at the expense of property rights. Thus, especially beginning with William Rehnquist becoming Chief Justice in 1986, there was hope for a revival of property rights. This hope was never fully realized and critics of eminent domain were often disappointed.
Criticizing the IJ

He takes aim at an April 2003 report by the Institute for Justice and Castle Coalition entitled Public Power, Private Gain: A Five-Year, State-By-State Report Examining the Abuse of Eminent Domain:
It asserted that from January 1, 1998 until December 31, 2002, there were at least 10,282 examples of eminent domain abuse across forty-one states in the United States. This report, released as Kelo was working its way through the Connecticut courts en route to the United States Supreme Court, was critical in terms of laying the ground work for asserting that eminent domain abuse existed. But the media never did critically examine the report and its assertions. How does the report stack up when examined? Not well.
He criticizes assumptions in the report, such as threatened but not enacted condemnations, or counting each property targeted, rather than each project. He cites research by Robert Dreher and John Echeverria, Kelo's Unanswered Questions, who say the alleged 10,000-plus abuses works out to one potential abuse per state, per year.

(Here's IJ's reponse, Dreher and Echeverria: Disinformation & Errors on Eminent Domain. which contends, "To lump everyone together is simply the authors’ way of belittling the hard-working people that deal with eminent domain abuse every day. And frankly,
it doesn’t matter if only one person was being abused—it is still abuse." But don't the numbers matter?)

Schultz also thinks that "courts have demonstrated a capacity to protect against eminent domain abuses," which may be true in a good number of states outside New York.

Unwise projects

He then demolishes "several assumptions regarding efforts by governments to induce economic development often times in conjunction with eminent domain," criticizing the following:

tax breaks to encourage economic relocation
enterprise zones
the public use of tax dollars for a sports stadium
convention-entertainment center/tourism strategies
What about sports? Schultz observes:
If one accepts this logic of sports being necessary to make a city first class, can we say that New York City became second class when the Giants and Dodgers fled for California in the 1950s, or that Los Angeles became second class when it lost the Angels to Anaheim or the Rams to Saint Louis? The answer is obviously no.

New York's redevelopment experiments

In FROM SLUM CLEARANCE TO ECONOMIC DEVELOPMENT: A RETROSPECTIVE OF REDEVELOPMENT POLICIES IN NEW YORK STATE, Albany Law School researcher Amy Lavine (and co-author with me of an article on Atlantic Yards legal cases), suggests a closer look at the state's experimental early redevelopment laws:
Redevelopment projects in New York increasingly focused on the revenue-generating possibilities of project sites, rather than the severity of dwelling conditions faced by residents. “These kinds of projects,” New York City historian Samuel Zipp wrote, “confirmed that the primary objective of redevelopment had become keeping white and middle-class residents, shoppers, and . . . audiences in town, thereby offsetting suburbanization, propping up central business districts, and easing the fiscal troubles of cities. This was the ultimate endgame for the ethic of city rebuilding.” Increasingly broad blight determinations were also made possible by the growing importance of administrative discretion, which the courts were reluctant to question. As [Charles] Abrams explained, this contributed to an “unrestricted exercise of public power on behalf of private interests . . . [that] transformed social reforms into tools of oppression.”
She addresses the ESDC's precursor, the Urban Development Corporation:
The UDC’s enabling legislation, which was passed in 1968 just after Martin Luther King’s assassination, gave the authority a suite of impressive features, including “the power to override local zoning laws and building codes, the freedom from various restrictions that would prevent rapid development, and a particularly flexible and independent financing mechanism.” These vast powers were unprecedented and raised serious concerns about home rule and accountability. Moreover, it was questionable whether the UDC would actually be able to become self-sufficient...

As the UDC matured, it became known as the Empire State Development Corporation (ESDC), and the scope of its “truly amazing powers” also become more apparent. As Abrams would have predicted, these powers often proved especially helpful to the authority’s private partners. The Times Square redevelopment, for example, was facilitated by ESDC’s use of eminent domain and its override of New York City’s land use approval process. More recently, the Brooklyn Atlantic Yards project similarly benefited from eminent domain and an override of New York City’s zoning and planning laws. In the case of Atlantic Yards, moreover, ESDC demonstrated its ability to work cooperatively with a favored developer to all but ensure project approval and escape public scrutiny.

Who's in charge?

Lavine suggests oversight is insufficient:
While appointed boards may be responsive to political pressure and private interests, they are largely unaccountable to the voters. Additionally, because of the questionable conclusion of the Court of Appeals that public authorities’ debt is separate from the state’s, it is not clear whether ESDC is even subject to taxpayers challenges. ESDC and IDAs have also taken up complex and non-transparent financing methods intended to circumvent the minimal limitations imposed on them by state law. The legislature has made some progress in creating accounting and operating requirements for public authorities, but it has yet to enact legislation imposing stricter limitations on eminent domain and other discretionary powers.
In New York, plaintiffs had no chance

In THE RISE OF ROBERT MOSES AND THE FALL OF NEW YORK CONSTITUTIONAL PROTECTIONS AGAINST EMINENT DOMAIN, Christopher Dunn of the New York Civil Liberties Union, like Rikon, suggests that the die was cast against plaintiffs well before the Columbia and Atlantic Yards cases:
the constitutional protections largely expired starting in the 1930s, a development that coincided with Robert Moses’s four-decade campaign of bulldozing around New York State, through New York City, and over anyone who stood in his way.
In a case known as Muller, the court concluded that slum clearance qualified as a public use, even if the ultimate use was private, thus contradicting previous rulings:
Indeed, the court essentially held that what controlled was not the ultimate use of the property, but instead, the reason for it being taken

Even less scrutiny

Two additional cases cemented the notion that "public use" meant "public purpose," and that increased commercial activity could suffice:
According to the court, the public use inquiry ended if the government could establish that the property was underdeveloped: “Where, then, land is found to be substandard, its taking for urban renewal is for a public purpose.” Thus, under such circumstances, there was no need to balance the public benefit against the private benefit: “It would not then be necessary, as a precondition to the taking, to determine that the public benefit in assuring the retention of Otis as an increased source of employment opportunity in Yonkers was sufficient to outweigh the benefit that may be conferred on Otis.”

Thus, by the time the Moses era came to an end, the Court of Appeals had effectively foreclosed eminent domain challenges grounded in the constitution’s public use provision. The two recent decisions in the Atlantic Yards and Columbia University cases simply adhere to the hands-off approach adopted by the court thirty-five years ago.
That may be true, but the Court of Appeals, in the two recent decisions, also had to affirmatively ignore the efforts to invoke Kelo and its indicia of sweetheart deals.

Dunn does not blame Moses for dictating eminent domain law, but says
his reign and the corresponding transformation of the New York Court of Appeals’s view of constitutional restraints on eminent domain both reflected a broader societal acceptance of massive public works projects and a corresponding decline in the perceived sanctity of the private ownership of property that stood in the way of those projects.
New York's unique procedures

In STACKING THE DECK: NEW YORK’S UNIQUE APPROACH TO EMINENT DOMAIN, Robert McNamara of the Institute for Justice continues themes in the issue, writing:
New York’s abuses make it unique. “Eminent domain” means something different in New York—both procedurally and substantively—from what it means anywhere else. New Yorkers stand alone in the country in being wholly unable to protect their property using ordinary judicial procedures—things as basic as being able to question witnesses under oath—that everyone else simply takes for granted. New Yorkers stand alone in the country in facing a judiciary that flatly refuses to take seriously the arguments of those hardy few who manage to get into court in the first place. Furthermore, New Yorkers stand nearly alone in facing a legislature that has failed to even attempt to reform the state’s eminent domain procedures in the wake of the U.S. Supreme Court’s 2005 decision in Kelo v. City of New London.
As has been pointed out, evidence is not presented under oath, nor is there any opportunity to conduct discovery. McNamara writes:
There is perhaps no better illustration of the utter backwardness of New York’s procedures than this: If a government official wants to take away a citizen’s personal property, that citizen is entitled to an adversarial hearing where the official’s right to take the property is put to the test. But if that same official merely wants to take away the building where a citizen keeps her personal property, the need for an adversarial hearing (according to New York officials) magically evaporates. This cannot be justice. Simply put, the idea that individuals in New York can be deprived—irrevocably—of their real property without an opportunity to test the government’s evidence—to ask even the most basic questions about the purpose of the taking, or just engage in a “give and take” with the officials who would assert the power of eminent domain—is foreign to the American system of law and incompatible with the most basic notions of fairness. New York’s eminent-domain procedures cannot be squared with the basic norms of due process as described by the Supreme Court, nor can they be squared with the procedures used in any other state. They are, in a word, indefensible.
Proposed reforms

As with some other contributors, McNamara suggests several reforms:
• Property owners should be allowed to contest the government’s right to take their property at the time of taking.... Because it could be months or years before the government uses its power to condemn the property—if indeed it ever does so—which forces property owners to choose between spending tens of thousands of dollars in legal fees fighting a speculative risk and hoping against hope that the condemnation notice never comes. [Consider that eminent domain has been approved for Atlantic Yards properties yet to be taken.]
• Failing that, New York should prolong the time property owners have to challenge the government’s right to take their property....
• New Yorkers should also be entitled to defend themselves using ordinary litigation procedures, including discovery and the right to question the government’s witnesses under oath...
• Giving New Yorkers access to the ordinary tools of litigation is best accomplished by moving the review of condemnation decisions to the trial court in the first instance. ...
• Failing trial-court review, the state should at minimum allow property owners to build a record in front of a neutral finder of fact...
• Procedural reforms, of course, will only go so far. New York must change the substance of its laws. The best reform is also the simplest: New York should prohibit the use of eminent domain for private development.
• Failing that, New York should at least correct the errors introduced by the State Court of Appeals’ 2009 and 2010 decisions and clarify that the existence of blight is a judicial question.... Judges are at least as capable of evaluating the existence of “blight” as are condemning authorities, and restoring the traditional role of the judiciary in supervising blight designations would do much to curb the worst abuses in the state.
•At minimum, the state must make clear that pretextual takings are prohibited.... But the state’s Court of Appeals has refused to seriously engage with claims of pretext, bringing the protection of property rights in New York below even the minimal floor outlined by the Kelo majority.
When to defer

In THE EDPL REVISITED, attorney M. Robert Goldstein, a partner in the law firm with Rikon, allows for the other side: that condemndation is an important tool, and it can be blocked by a loud, not necessarily right, minority.

He offers an intriguing, and worthy, measure toward progress:
That solution is to divide the decision to condemn into two categories: one where the decision to condemn is made by elected officials, and the second as to the balance. When the decision is made by elected officials, the usual rules would apply. Recourse, while rarely possible in the courts, at least in theory, is available at the ballot box.
When made by public corporations, authorities, utilities, railroads and the like, where the decision makers are appointed, in private corporations and/or anonymous, different rules would apply. In such cases, I propose a burden would be placed on the proponents to prove public use. The burden of challenging such a finding would be less than that in challenging findings by elected officials, but more than just a weighing of the evidence. There still could be a presumption of regularity. To overcome it would require clear and convincing evidence.
Authorities like the ESDC were created to shield legislators from accountability, Goldstein writes, but now "there must be a rebalancing."

So, under his schema, projects like Atlantic Yards would have faced a much higher burden in court.