Judges vs. Private Property

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The
judiciary's war on private property continues in Las Vegas. To borrow
a line from Rush Limbaugh, the bad guys in the old west used to
wear black hats, now they wear black robes.

This
was proved again earlier this month as the Nevada Supreme Court
sided with the city of Las Vegas over the Pappas family concerning
land located in downtown Las Vegas that the city took in order to
build a parking garage for the Fremont Street Experience. In a 5-2
decision, the court ruled that taking the property "did not
violate the state or U.S. constitutions." What was that about
life, liberty and the pursuit of happiness?

The
late John Pappas opened the White Spot restaurant on Fremont Street
in the 1920's. Mr. Pappas was famous for feeding the poor free soup
from the back door of his downtown restaurant while the Hoover Dam
was under construction in the early 1930's.

Upon
his death, Pappas left a 6,000 square foot retail center to his
wife Carol, a Greek immigrant who remembers the Nazi occupation
of her homeland when she was a girl.

The
city of Las Vegas Downtown Redevelopment Agency first took an interest
in the Pappas property in 1990. The city had its eye on clearing
a one-square-block area located at the southwest corner of Las Vegas
Boulevard and Fremont Street, with the intent of handing it over
to developer Bob Snow, who had redeveloped property in downtown
Orlando, Florida into an entertainment center called Church Street
Station in the 1970's.

Besides
the Pappas property, the one-block area contained the Cornet Store,
the First Western Savings building, and a small building owned by
former U.S. Senator Chic Hecht. In 1991, the City Counsel, in a
3-2 vote, decided that it couldn't take the block, because the block
did not constitute "blight." Supposedly, the definition
of blight is – properties that are boarded up and are considered
a nuisance by the city.

But,
soon after that vote, Jan Jones was elected Las Vegas Mayor, and
again the city block that included the Pappas property was targeted.
The city made Mrs. Pappas an insultingly low $450,000 offer for
her property, while at the same time offering former Senator Hecht
over $4 million for his same-sized parcel. Pappas refused the offer
and insisted on meeting with the Mayor.

During
their meeting, Mrs. Pappas explained to Mayor Jones that she had
never had a vacancy in her 6,000 square foot center and that she
depended on the $6,000 per month that she received in rent from
the property. Jones would not budge from the city's $450,000 offer
and stated "Mrs. Pappas, you have had your property long enough.
It's time to give it up!"

In
early-1994, the city of Las Vegas seized and bulldozed the Pappas
property. A $23 million parking garage was erected on the site and
the title to the property was quickly turned over to the Fremont
Street Limited Liability Company, whose members are the eight largest
downtown casino owners.

But,
the gritty Mrs. Pappas would not go away. She sued the city and
won, when District Court Judge Don Chairez, ruled in her favor in
1996. Chairez ruled that the city never proved that the area was
blighted; it never proved that the casino owners couldn't afford
to buy the land themselves, nor did they demonstrate how a privately-owned
parking garage constitutes a vital "public use." Judge
Chairez ruled that the property seizure was null and void.

Of
course the city immediately appealed the Chairez decision to the
Nevada Supreme Court. Another three and a half years later in 2000,
briefs were filed, along with 5,000 pages of documentation from
the city's attorneys.

Now,
after the wheels of in-justice have slowly turned for more than
a decade with the Pappas family never receiving a dime in compensation,
the Nevada Supreme Court rules that the condemnation was A-OK, and
"furthers the public purpose of eliminating blight in downtown
Las Vegas," wrote Justice Nancy Becker in the majority opinion.
Becker also wrote that, "the fact that the Pappas property
itself was not blighted does not prohibit its taking through eminent
domain proceedings."

The
majority of the court also found that the garage, "was not
built to serve a single business but to address inadequate public
parking in the downtown area and the need for new parking as visitor
volume increased in response to the attraction [Fremont Street Experience]."

However,
despite city government's redevelopment nonsense, downtown Las Vegas
continues to languish, because most Las Vegas visitors patronize
the newer, more exciting resort/casinos and shopping malls that
have been built on the Strip [south of downtown], with private investment
dollars. The garage, that the city and the courts believe to be
so vital, sits half empty most of the time.

Carol
Pappas' son Harry now intends to take their case to the nation's
highest court. "What we hope to get here is a ruling from the
U.S. Supreme Court that will put an end to this kind of tyranny,
this kind of oppression, this kind of injustice of taking people's
private property and turning it over to robber baron casinos,"
Harry Pappas told the press after the Nevada Supreme Court decision,
"We're hoping this will be a landmark case."

Unfortunately,
looking to the U.S. Supreme Court for satisfaction will likely prove
to be frustrating. As Dartmouth economist William Fischel told Reason.com,
"The Supreme Court clearly does not like most of these cases
and is leery of giving plaintiffs a federal forum. They want to
keep the cases in the state courts."

Without
intervention from the Supreme Court, the value of the property will
ultimately be determined back in District Court. But, for the Pappas
family, money is not the issue. As Harry Pappas says, "My goal
is to be sitting in a bulldozer with a hard hat on and knocking
down that garage."

Murray
Rothbard wrote in Power
& Market
; "The government itself is the original
holder of the u2018right of eminent domain,' and the fact that the government
can despoil any property holder at will is evidence that, in current
society, the right to private property is only flimsily established.
Certainly no one can say that the inviolability of private property
is protected by the government. And when the government confers
this power on a particular business, it is conferring upon it the
special privilege of taking property by force."

Flimsily
established indeed. With this ruling in their pocket, the guys and
gals at Las Vegas City Hall can run roughshod over property owners
throughout the City's designated Downtown Redevelopment Plan area.
The only thing that has kept the city at bay to this point has been
the heroic Pappas family and their willingness to fight.

Long
shots don't come through in Las Vegas very often, but maybe, just
maybe, we'll get to watch Harry Pappas knock down that garage.

September
22, 2003

Doug
French [send him mail]
executive vice president of a Southern Nevada bank. This first appeared
in the emailed newsletter of the Nevada Policy Research Institute.


        
        

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