Seeing Wrongs in Right of Way

The project to widen the Santa Ana Freeway may clear traffic running through Orange County, but it could clog the courts.

While 222 businesses will be partially or completely displaced by the project, 139, about 63%, have rejected the state’s offer to purchase their properties, forcing Caltrans to initiate eminent domain eviction proceedings.

The number of condemnation proceedings on the Santa Ana Freeway project is “unprecedented” in Orange County, said

Caltrans spokesman Albert Miranda, and he couldn’t point to any projects in the state where so many people had fought.

During construction of the Glenn Anderson Freeway in Los Angeles County, for example, 15% to 20% of the 294 affected properties rejected the state’s offers, according to Cleave Govan, a senior environmental planner for Caltrans. Even lower figures--about 10%--are common in other projects, he said.

Besides the eminent domain cases Caltrans has filed, some property owners have sued the agency, according to private attorneys.

Only a handful have gone to trial, and in two cases, juries dramatically increased the amount the state must pay the property owner.

In one case, a jury last month decided that the state should pay the Church of the Foursquare Gospel $1.33 million instead of the $722,500 it had offered. In a second case, a jury increased Caltrans’ offer for property owned by Western Mobile Telephone in Anaheim from $16,000 to $285,000.

“There’s no nice way to pull a guy’s tooth or evict someone from their business,” said Art Garabedian, owner of Western Mobile, “but these guys are deplorable.”

Other business owners agree.

“It’s immoral,” said Chuck Hance, owner of Coast Corvette in Anaheim. “It’s highway robbery.”

Under its eminent domain power, the state can purchase property to make way for projects deemed to be in the public interest. The planning for this project began eight years ago with the state’s gradual purchase of 310 homes along a 9 1/2-mile stretch of the Santa Ana Freeway, from the Garden Grove Freeway to Beach Boulevard, running through Anaheim, Orange, Buena Park and Fullerton.

The $1.1-billion project calls for the addition of a carpool lane and a mixed-flow lane in each direction as well as onramps and offramps.

Construction began earlier this year and is expected to be completed in 2001.

“This is one of the most complex and difficult right-of-way projects this state has ever had,” said Brice Paris, district chief of Caltrans in Orange County. “This is people’s livelihoods, and it’s very dear to them. Whenever you impact a business, you are hitting very hard.”

Many business owners, however, say that the state has been hitting them in particularly painful ways.

To begin with, they say, by moving hundreds of residents out years before construction began, Caltrans pushed out their customers and forced many establishments out of business without compensation. When the agency finally began making offers on businesses, some owners say, the terms often were unfair.

Hance’s Coast Corvette, for example, has sat on 1.3 acres at Vermont Avenue in Anaheim for the past 12 years. Caltrans officials decided they needed only part of his property. So they offered him $235,000, mostly for the 3,231-square-foot parking lot. Hance said he has spent $1.76 million on the property, and without the parking lot, his car dealership is out of business.

Hance said he has filed a lawsuit.

Todd Cashman, owner of Bandwest Productions, Inc., a recording and rehearsal studio in Anaheim, faces a similar dilemma. Located in a 16,480-square-foot building that has been appraised for $2.6 million, Cashman’s company is in the path of a planned onramp that is likely to generate traffic noise that will render his facility useless. Since the ramp will touch only his parking area, the state has offered him $87,792 for the slice of his property required.

“It will put me out of business,” Cashman said.

Caltrans officials will not discuss specific cases, but they defended the agency’s actions.

The early removal of the 310 homes, Paris said, would not have forced anyone out of business because the properties, rather than being concentrated in one area, were stretched along the length of the 9 1/2-mile freeway corridor.

In general, he said, Caltrans tries to reimburse business owners not only for the property taken, but for the loss in value of the firms themselves or of the real estate left behind.

One problem, Paris said, is that real estate values have declined in recent years. “What they paid in the past is really irrelevant,” Paris said. “We pay fair market value.”

Statistics compiled by Acxiom/DataQuick, a San Diego-based real estate information service, show that the value of commercial property in Orange County is about 30% less than seven years ago.

If property owners disagree with Caltrans’ offer, they can appeal to the California Transportation Commission. If the parties still are at odds, they can settle the matter in court, either through eminent domain condemnation proceedings initiated by the state or through lawsuits the property owners file.

While major highway projects often bring litigation, another reason this one has spawned more legal disputes than usual is that the area is highly developed.

“In most circumstances, when public agencies do a construction of this size it’s in an undeveloped area,” said Mike Leifer, an Irvine lawyer who represents several of the businesses affected by the freeway widening. “When it’s in a highly urbanized area such as this with many owners on a single parcel in some cases . . . it requires creativity and flexibility to avoid litigation.”

Instead, Leifer said, “I think the state is doing what it can to minimize the amount it pays.”

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Wide Swath

The 9.5-mile widening of the Santa Ana Freeway has displaced hundreds of homes and businesses as Caltrans claims property through eminent domain, a law that allows the state to take over property for what is determined to be just compensation. A closer look:

Houses purchased: 310

Businesses affected: 222

Lawsuits filed by state: 139

Recent jury award: Increased Caltrans’ offer for a mobile telephone business from $16,000 to $285,000

Source: Caltrans and court records

Researched by DAVID HALDANE / Los Angeles Times