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Court Clamps Down on Redevelopment Abuse: DIamond Bar Project Rejected When City Fails to Prove Blight

Making clear that the Community Redevelopment Law "is not simply a vehicle for cash-strapped municipalities to finance community improvements," an appellate court has thrown out the City of Diamond Bar's redevelopment plan. A unanimous three-judge panel of the Second District Court of Appeal ruled that Diamond Bar did not prove that its 1,300-acre redevelopment project area suffered from "blight," as defined by the Community Redevelopment Law (Health and Safety Code §§33000 et seq., 33030). The court found that the city, in establishing the redevelopment area, relied on boilerplate language and unsupported findings from a field survey. The court extensively cited another case, County of Riverside v. City of Murrieta, (1998) 65 Cao.App.4th 616, (see CP&DR Legal Digest August 1998) in which a city offered "little concrete evidence of actual conditions of blight." Diamond Bar has asked the state Supreme Court to review the case. In July 1995, the Diamond Bar City Council adopted an ordinance approving a 30-year redevelopment project for 1,300 acres. The city made the legal findings regarding physical and economic blight that presents a burden on the community and "cannot be expected to be reversed or alleviated by private enterprise or governmental action, or both, without redevelopment." Two weeks later, 12 Diamond Bar residents sued the city, claiming that the area was neither blighted nor "predominately urbanized," as required by the CRL. Los Angeles County Superior Court Judge Ernest Hiroshige ruled for the city in what the appellate court called "a terse minute order." The residents made the same arguments to the Second District, which overturned Judge Hiroshige on the question of blight. The appellate panel ruled for the city in one aspect, saying that the area was predominately urbanized because it passed the threshold of containing at least 80% urbanized land. The court found that 1,034 acres, or 79.5 percent of the land, was developed, and 191 acres of vacant land was "an integral part of an urban area." The court then proceeded step by step to address different ways the city tried to prove that the area was blighted. The court shot down all of the city's arguments. The city first argued that the area has unsafe or unhealthy buildings. But the city dropped that argument, which the court said was appropriate because a city consultant's survey found only one structure in need of "extensive rehabilitation." The city then argued that substandard building design, commercial areas with inadequate parking and small parcels inhibited economic development in the project area. But the court said the city did not identify specific buildings and based its determinations on a field survey by consultant Rosenow Spevacek Group, Inc. "At the end of the day, the raw data in the administrative record consists of a series of checkmarks reflecting the field surveyor's ultimate conclusions. The field surveyor's bald conclusions do not amount to tangible proof which can be scrutinized in a meaningful way," Presiding Justice Joan Klein wrote. Delving into the redevelopment project's details, Klein noted that although the city claimed there were buildings and lots of "inadequate size given present standards and market conditions," the city did not plan "‘power centers' in the project area to remedy this purported source of blight. Thus, there is a total ‘disconnect' between the cause of the alleged blight and the proposed remediation." The court also rejected the city's argument that incompatible uses hindered economic development. The identification of industrial uses next to an elementary school was irrelevant, as the city did not prove how the juxtaposition harmed economic development, the court ruled. The court dismissed the city's argument that small and irregular lots under multiple ownership hurt economic development. The city provided no evidence. "In addition," Justice Klein wrote, "although the City contends its commercial areas have been rendered obsolete by the shift toward large scale ‘power centers' and ‘big box' type retailers, as noted, the City has eschewed that type of development. Further, even assuming economic development requires the availability of large tracts of land, the redevelopment area contains a number of undeveloped parcels as large as 47, 41, 36, 35 and 24 acres." Finally, the court dismissed the contention that the project area lacks sufficient infrastructure. The court cited the city's 1995 general plan, which said the city "has a fairly new infrastructure." Redevelopment, the court pointed out, is not intended to deal with future growth. The Case: Barbara Beach-Courchesne v. City of Diamond Bar, No. B130244, 00 C.D.O.S. 3295, 2000 Daily Journal 4391, filed April 27, 2000. The Lawyers: For Beach-Courchesne: Murray Kane, Kane Ballmer & Berkman, (213) 617-0480. For Diamond Bar: Gregory Kunert, Richards Watson & Gershon, (213) 626-8484.
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