The U.S. Supreme Court denied a petition to hear a developer’s case against the Florida Department of Environmental Protection over a permit denial for a beachfront parcel. The case relates to a DEP denial of a final permit for a project to build 17 luxury townhouse units on an oceanfront site. After the DEP’s decision, the developer lost the property through foreclosure, and a principal at the firm ended up with a roughly $10 million personal judgment, which prompted the firm to sue the DEP and claim the denial was a regulatory taking. The company won at the trial court level, but the Fourth District Court of Appeal last year held the case was in part “unripe” because the developer could have considered an alternative development plan. The Florida Supreme Court declined to revive the decision in March.
To address the homeless crisis, NY City will acquire buildings that house homeless families to convert them to affordable housing, using with legal force if necessary. It has stated that it will use eminent domain if necessary.
The city has rented apartments in private buildings to house homeless families since the Giuliani administration. On Wednesday, Mayor de Blasio said the city would buy 25 to 30 of the buildings where more than 50 percent of the occupants are homeless and turn them into permanent, affordable housing. The city said it will use eminent domain if the owners don’t agree to sell.
About 3,000 homeless New Yorkers live in the buildings the city plans to buy, and they will be able to stay in those apartments.
A NJ appellate court ruled that the state’s Sports and Exposition Authority had the right to use eminent domain to acquire a landfill to continue solid waste disposal there. The Court held that the New Jersey Sports and Exposition Authority could use eminent domain to acquire the Keegan landfill. The agency also was not obligated to honor the terms of a prior agreement with the town of Kearny to turn the landfill into a public recreation space, dismissing the municipality’s allegations that the agency violated the U.S. Constitution’s contract clause. “NJSEA did not violate the Contract Clause as it was duly authorized to use eminent domain to condemn the landfill,” the decision states. “[I]t exercised that authority in furtherance of one of its stated purposes; and eminent domain is an essential attribute of state sovereignty that cannot be contracted away.” The case is New Jersey Sports and Exposition Authority v. Town of Kearny et al., case number A-5152-15T1, in the Superior Court of New Jersey Appellate Division.
A New Mexico utility has filed a petition asking the U.S. Supreme Court to hear an appeal of a decision precluding it from condemning land for a power line because the Navajo Nation held an interest in that property. The Tenth Circuit Court of Appeals held there is no federal law permitting tribal lands to be condemned. That Court affirmed a lower court’s decision.
The Public Service Co. of New Mexico, also known as PNM, told the Supreme Court in a Nov. 20 petition that the ruling threatens the national power grid by effectively blocking Congress’ authorization of condemnation of allotted tribal lands. “In sum, the increasing need for condemnation to maintain and extend critical infrastructure will converge with the increasing unavailability of condemnation, and thus create a major problem for utilities and the public,” the company said.
The Georgia Supreme Court has ruled that the city of Marietta violated the Georgia Landowner’s Bill of Rights when it condemned a grocery store without providing a summary of its appraisal to the property owner. The City argued that these provisions were not mandatory. This was rejected by a unanimous Court explaining that the law is “an essential prerequisite to the filing of a petition to condemn,” and that because the city failed to fulfill that prerequisite, its petition to condemn the property must be dismissed.
The Louisiana Supreme Court heard oral arguments whether St. Bernard Parish port officials violated Louisiana’s eminent domain laws when they seized a privately run port operation along a mile of Mississippi River frontage in 2010. The property owner argued that port officials were trying to take the property at a bargain price and transfer it to a competitor. Louisiana law provides that “no business enterprise or any of its assets shall be taken for the purpose of operating that enterprise or halting competition with a government enterprise.” The property owner has support from national groups such as the Institute for Justice and the Pacific Legal Foundation. Attorneys for the port argued that Louisiana law specifically singles out ports and airports when it comes to the kind of “public purpose” that justifies eminent domain, citing the need “to facilitate the transport of goods or persons in domestic or international commerce.” The case is on appeal from a 2-1 split decision by a panel of the Fourth Circuit Court of Appeals.
The Federal Reserve Board has issued a statement providing for temporary exception to appraisal requirements in hurricane areas affected by severe storms and flooding related to Hurricanes Harvey, Irma, and Maria. Below is that statement:
Responding to widespread damage caused by Hurricanes Harvey, Irma, and Maria, four federal financial institution regulatory agencies today took action to facilitate the recovery process by temporarily easing appraisal requirements for real estate-related financial transactions in areas declared to be a major disaster.
The agencies will not require financial institutions to obtain appraisals for affected transactions (1) if the properties involved are located in areas declared major disasters; (2) if there are binding commitments to fund the transactions within 36 months of the date the areas were declared major disasters, and (3) if the value of the real properties support the institutions’ decisions to enter into the transactions.
The exceptions apply to transactions in areas of Florida, Georgia, Puerto Rico, Texas, and the U.S. Virgin Islands and expire three years after the date the president declared each area a major disaster. The exceptions are being made under the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) and its implementing regulations.
Financial institutions that use the appraisal exception must maintain information estimating the collateral’s value that sufficiently supports their credit decision to enter into the transaction. The agencies will monitor institutions’ real estate lending practices to ensure the transactions are being originated in a safe and sound banking manner.
35 appraiser organizations including the Appraisal Institute are asking Congress to prevent Freddie Mac and Fannie Mae from issuing appraisal waivers. Freddie and Fannie recently announced plans to no longer require appraisals for first purchase loans, as well as for mortgage refinancing. In a letter to the chairs and ranking members of the Senate Banking, Housing and Urban Affairs Committee and the House Financial Services Committee, the Appraisal Institute wrote: “We recognize that the Enterprises have, since 1994, been exempted from appraisal requirements established by Congress on the basis that their requirements exceeded those established by Congress and that they would continue to make responsible decisions. These new programs call this privilege into question.”
The Appraisal Institute offered some suggestions to Congress and to the FHFA: “At a minimum, the Agency should request the estimates of the number of loan purchase and refinance transactions that would be subject to the new programs and make those estimates public for comment by affected stakeholders and other experts.
In addition to the Appraisal Institute, organizations signing onto the letter to Congress were: American Society of Appraisers; American Society of Farm Managers and Rural Appraisers; Appraisers’ Coalition of Washington; Arizona Association of Real Estate Appraisers; Association of Texas Appraisers; California Coalition of Appraisal Professionals; Coalition of Appraisers in Nevada; Coalition of Arizona Appraisers; Colorado Association of Real Estate Appraisers; Columbia Society of Real Estate Appraisers; Delaware Association of Appraisers; Foundation Appraisers Coalition of Texas; Illinois Coalition of Appraisal Professionals; Kentucky Association of Real Estate Appraisers; Louisiana Real Estate Appraiser Coalition; Maryland Association of Appraisers; Massachusetts Board of Real Estate Appraisers; Michigan Coalition of Appraisal Professionals; Mississippi Coalition of Appraisers; National Association of Appraisers; National Association of Independent Fee Appraisers; New York Coalition of Appraiser Professionals; North Carolina Real Estate Appraiser Association; Ohio Coalition of Appraisal Professionals; Oklahoma Professional Appraisers’ Coalition; Real Estate Appraisers Association of California; Real Estate Appraisers of Southern Arizona; Rhode Island Real Estate Appraiser Association; South Carolina Professional Appraisers Coalition; Tennessee Appraiser Coalition; United Appraisers of Utah; Utah Association of Appraisers; Virginia Coalition of Appraiser Professionals; and West Virginia Council of Appraiser Professionals.
A bill was introduced in the PA House of Representatives which stating that “in the case of a partial taking of the property of a condemnee, a condemnor may not render the remaining parcel inaccessible to the condemnee by creating a landlocked property with no ingress or egress to or from a public road or highway.” The bill contains an exception in the event the condemnee consents to that taking. The bill, HB 1773, was introduced on September 12, 2017 and was referred to the Committee on State Government.
Freddie Mac announced that it will utilize automated collateral evaluations to determine when an automated appraisal can be used for new home mortgages and refinancing. ACE uses data from multiple listing services, public records and historical home values to determine collateral risks. This decision was criticized by the Appraisal Institute. “Since 1994, the government sponsored enterprises have been exempted from appraisal requirements established by Congress on the basis that they would make responsible decisions,” said Appraisal Institute President Jim Amorin, MAI, SRA, AI-GRS. “Last week’s announcement to waive appraisals in blind loan purchase decisions calls this privilege into question, as it will undoubtedly result in a race to the bottom and create more risk for taxpayers.”