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Glen Cove Piazza Developer Granted $1 Million For Eminent Domain

By   /  July 4, 2014  /  1 Comment

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Don't eminent domain me, broThe Beacon has learned of nontransparent workings underway that would grant the developer of the Glen Cove Piazza $1 million towards efforts to oust Robert Sztorc of State Farm from his property in the Village Square.

The Executive Director’s Report from the February 11 meeting of the Glen Cove Industrial Development Agency boasts “The Piazza project is back on track”, along with its PILOP (Payment in Lieu of Parking). Hidden in the minutes:

Mr. Puntillo is committed to the PILOP and has been awarded $1 million in NYS CFA funding toward the eminent domain aspect of this project that will be helpful in creating the “open space” design of the project.

Noteworthy is the language used to describe the importance of using eminent domain on Sztorc, who has operated since 1978 in Village Square. In 2011, Puntillo agreed to “peacefully coexist” and build around holdouts. However, the new Mayor doesn’t think that’s a good strategy. “It wouldn’t be as nice with that there, OK, so I wouldn’t like to see it go ahead with that,” he told Newsday.

In other words, Sztorc’s property is not of vital importance to the Piazza project, but if we take the Mayor and his Deputy at their word, they just don’t think it would look as nice, so therefore the City must take the land by force, and now it appears New York State will pay for their offensive.

On the one hand, eminent domain for private gain is an un-American transgression of individual rights that the Founders sought to prevent. From the drafting of the U.S. Constitution to only a few years ago, this practice would have been restricted by the Fifth Amendment. Unfortunately, in the 2005 ruling of Kelo v. New London, the Supreme Court interpreted the Takings Clause as to allow for projects of “economic benefit”, which allows cases like this to happen.

In other words, the pre-Kelo Constitution allowed eminent domain for the purpose of, for example, rebuilding West Glen Street or  public parks. The post-Kelo interpretation allows the government to take property from entrepreneurs and hand it to wealthier developers.

It’s not just the Constitution–Glen Cove’s charter narrows the use of condemnation. It mentions “public purposes”, “public work”, and “public uses” to describe the allowable uses of eminent domain. It says nothing of “economic benefit”.

§ C4-5Condemnation and sale of condemned lands.

A. 

All proceedings for the acquisition of property for public purposes shall be taken under the provisions of the Eminent Domain Law.
B. 

Whenever any public work authorized by law shall be undertaken, the city may take for the purpose such interest or easement in lands held or used for public purposes by any corporation, taken by eminent domain or otherwise, as may be necessary for carrying out such work.
C. 

The City Council may exchange or sell at auction upon a published notice, any property acquired by the city for public use and which at any time shall not be required for such purpose.

On the other hand, eminent domain for private gain entrenches politically-connected cronies with perverse incentives not to develop, or to build projects without a sufficient market. Government benefits (excluding tax breaks) destroy the risk-reward system that is inherent to the free enterprise system. That is, if the Piazza developer were forced to pay the true value of Sztorc’s (and others’) property and build its own parking, failed development would result in tremendous losses. The situation becomes morally hazardous when government distorts this process into one of private gains and socialized losses.

In fact, the current administration might be interested to learn that in effect they would be perpetuating a history of nepotism at the Village Square that explains why it has remained a desolate concrete jungle since the seventies. Tim Carney of the Washington Examiner summarizes the process we’ve seen in Glen Cove as a result of these failed ideas.

Weeds and rubble cover 90 acres along Long Island Sound. A room with cinder-block walls sits locked in an empty in Brooklyn basement. And a gleaming industrial palace has failed to bring jobs to the banks of Ohio’s Mahoning River.

These are monuments to failed central planning. Eminent domain, state and local subsides, and federal-corporate partnerships have yielded these lifeless fruits, failing to deliver the rebirth, community benefits and jobs they promise — but succeeding in delivering profits to the companies that lobby for them.

Therefore, if the City Council and Mayor truly want to encourage development in such an important area of Glen Cove’s downtown, it must explicitly rule out this use of eminent domain. It would do better to use eminent domain to rebuild West Glen Street.

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About the author

Founder, Executive Editor

Before founding the Beacon, Mike worked at AOL Patch, Anton News, and most recently at Reason Magazine.

1 Comment

  1. Dave Nieri says:

    Great piece, Mike. I wish you luck with the new site. Glen Cove needs a forum like this since the weekly papers do not concern themselves with anything outside of school news and the social calendar.

    I find it shocking that the City of Glen Cove administration would again threaten eminent domain against a long-standing business and successful local businessman – we need more successful businesses in Glen Cove, and shouldn’t be interfering with the few we have. This action would counter Mayor Spinello’s comment during his inauguration address: “Glen Cove is open for business”. The Administration should not involve itself in a dispute between one property owner/redeveloper and another property owner for benefit of Puntillo, who wants to overhaul the property that he owns and has neglected for so many years. There is no public interest which would compel the City to acquire the land in this instance. This sounds like a repeat of the failed Suozzi-era policies of giving away Glen Cove to developers for money and promises.

    Keep the pressure on. Using eminent domain in this case would be a grievous error.

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