The Government Took a Developer’s Land and Gave It to a Competitor. In New York, That’s Business As Usual.
After the Mohawk Valley Health System announced plans for a new hospital in downtown Utica, New York, Bryan Bowers, a local developer, saw a business opportunity. He and his partner contracted to buy the former Rome Plumbing and Heating Supply building at 411 Columbia Street, across from Wynn Hospital, intending to offer medical office space. That project would have directly competed with another medical building next to it: Central New York Cardiology, which opened its Utica location in January 2024, three months after the hospital started accepting patients.
The cardiologists had different plans for 411 Columbia. In October 2021, their business, Central Utica Building, asked the Oneida County Industrial Development Agency (OCIDA) to seize the property under its eminent domain powers and transfer it to them so they could use it for a parking lot. Although Bowers objected, OCIDA favored Central Utica’s proposed project, which it said would “result in the betterment of community prosperity within Oneida County.” Last February, after years of litigation, a New York appeals court upheld OCIDA’s decision, blessing the agency’s protectionist intervention.
Specifically, the court said, “the acquisition of the property will serve the public use of mitigating parking and traffic congestion, notwithstanding the fact that the need for the parking facility is, at least in part, due to the construction of a private medical facility.” In New York, it noted, “what qualifies as a public purpose or public use is broadly defined as encompassing virtually any project that may confer upon the public a benefit, utility, or advantage.” That sort of broad deference, Bowers argues in a petition asking the U.S. Supreme Court to take up his case, nullifies the Fifth Amendment’s “public use” requirement for government takings of private property.
“Taking our property wasn’t for the public; it was to benefit our competitors,” says Bowers, who is represented by the Institute for Justice. “New York’s abusive use of eminent domain should not stand under the U.S. Constitution. We hope that the Supreme Court rights a historic wrong and affirms that the government can’t take private property to benefit another private party.”
The Supreme Court opened the door to such abuse with its widely reviled 2005 decision in Kelo v. City of New London, which blessed the use of eminent domain to promote economic development by transferring property from one private owner to another. But even under Kelo, the Institute for Justice argues, the Utica land grab is suspect. In any event, it says, “Kelo was wrong the day it was decided, and this Court should grant certiorari to reconsider it.”
Writing for the majority in Kelo, Justice John Paul Stevens emphasized that the condemnation of homes in the Fort Trumbull neighborhood of New London, Connecticut, was based on “a ‘carefully considered’ development plan” that supposedly would “create in excess of 1,000 jobs,” “increase tax and other revenues,” and “revitalize an economically distressed city” (none of which actually happened). In Bowers’ case, by contrast, OCIDA was not implementing a “development plan”; it was simply imposing its judgment that a parking lot was a better use for his property than the medical office space he planned to offer.
The main beneficiary OCIDA’s assessment was a private business that stood to profit by limiting competition. According to the New York appeals court, that did not matter, as long as the project could conceivably “confer upon the public a benefit.” But even Stevens suggested that such reasoning went too far.
“The City would no doubt be forbidden from taking petitioners’ land for the purpose of conferring a private benefit on a particular private party,” Stevens wrote. “Nor would the City be allowed to take property under the mere pretext of a public purpose, when its actual purpose was to bestow a private benefit.”
Stevens thought New London had avoided t
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