L.A.’s Seizure of Land Under Review

Investigators from a federal watchdog agency are coming to Los Angeles to meet with a group of business owners who allege that the city redevelopment agency has abused its eminent domain powers by forcing out their thriving enterprises to make way for other businesses.

Robert Blue, the owner of Bernard Luggage Co. in Hollywood, said Tuesday that he was approached by a representative of the Government Accountability Office, a nonpartisan investigative and research arm of Congress, which is studying eminent domain practices nationwide.

The local business owners said they planned to highlight at least three examples of what they considered to be inappropriate government condemnation, including the ouster of about 30 small businesses in Hollywood, including Blue’s, to make way for a $400-million project that includes a luxury hotel, apartments and condominiums. They also cited the forced sale of a furniture manufacturing site in South Los Angeles that is now proposed to be sold to a competing furniture maker, and the use of eminent domain to take a property from one shopping center developer to sell to another, also in South Los Angeles.

“Eminent domain” refers to the authority of government to take private property for public use or benefit, such as to build schools or to help revive blighted neighborhoods with commercial development.

The Supreme Court recently created a firestorm by ruling that a government could take even non-blighted property for commercial development. Some members of Congress, who are calling for revising eminent-domain laws, have asked for the federal study.

Blue, one of the most vocal critics of the Hollywood project, has sued the Los Angeles Community Redevelopment Agency, which condemned the property that holds his 60-year-old business at the intersection of Hollywood Boulevard and Vine Street.

Blue and others learned about the federal study in a letter from Julie E. Trinder, an analyst with the accountability office.

The letter and a list of questions indicates that the report will be a broad look at the use of the controversial redevelopment powers in Los Angeles and elsewhere.

“Our objectives are to describe the purposes for which eminent domain has been used, the process states and localities use to invoke eminent domain, and the impact on communities from projects where eminent domain was used,” Trinder wrote.

Accountability office representatives plan to visit at least five cities, including New York City, as part of its examination, which is due by Nov. 1, said Bill Shear, a spokesman for the federal agency. In Los Angeles, the federal officials will talk to Community Redevelopment Agency officials and community groups, he said.

Cecilia Estolano, chief executive of the redevelopment agency, said Los Angeles has strong safeguards to ensure that the power is not abused.

“The bottom line is eminent domain is rarely used, but it is an important tool for revitalizing communities. It is a tool of last resort,” Estolano said.

Trinder provided the L.A. businesses with a list of questions her team wants answered in the meeting, scheduled for July 10. Among them:

“Can you provide examples of property or land acquired by the city’s use of eminent domain that remained unused or were used for purposes other than those stated by the city when proceeding with the condemnation?”

To that question, Blue said the businesses would raise the example of Vaughan Benz, a furniture manufacturer that was forced by the city to sell its South Los Angeles property to make way for an animal shelter, only to see the city propose instead to sell the site to a competing furniture maker.

The displaced firm had successfully operated for more than 20 years before the city used eminent domain to force the sale of the South Western Avenue site.

“They told us it was for one thing when it was for another,” said Scott Vaughan, co-owner of the firm, on Tuesday. “It was definitely an abuse.”

Also planning to talk to the federal authorities are representatives of M&A; Gabaee, a development firm that was planning to build, without government subsidies, a shopping center at the corner of Slauson and Central avenues, also in South Los Angeles.

However, the Community Redevelopment Agency is spending at least $17 million to force the sale of the property so it can be developed with a shopping center by a builder with political ties to City Hall.