Maybe you can fight City Hall

SALVADOR S. CARRILLO still gets angry when he talks about what he lost: a five-bedroom home with more than 50 shade and fruit trees, florid birds of paradise, a greenhouse for orchids and a garden he planted every year with tomatoes and pumpkins.

“It was our honeymoon cottage,” Carrillo said of the Baldwin Park home he and his wife, Dolores, lived in for 39 years. “We raised seven kids there.... It was paid off.”

That was before the Baldwin Park Redevelopment Agency declared the area -- which included a trailer park -- blighted and notified the Carrillos that it was taking their home. A decade later, a shopping area anchored by a Target store stands in its spot.

The Carrillos never imagined such a fate for their first home. Yet it’s right there in the U.S. Constitution. The government has the right to take private property for public use as long as owners are justly compensated. And in both celebrated and obscure cases coast to coast, governments are doing just that.

California is one of nine states that requires a finding of “blight” before allowing redevelopment agencies to condemn private property for economic development. That was not the case in New London, Conn., where a landmark 2005 U.S. Supreme Court decision allowed the taking of homes for private development without crime-ridden slums or decrepit buildings being an issue. In light of that decision, Congress and most states, including California, are considering measures that would help protect homeowners by restricting the use of eminent domain to take property from unwilling sellers.

Still, it’s happening across the Southland. The Los Angeles Unified School District is making way for 150 new neighborhood schools in South Los Angeles, Echo Park, Wilshire district, West Adams, San Pedro, downtown and other areas of the sprawling LAUSD. Caltrans acquired land for the addition of the carpool lane on the 405 Freeway, from the 105 near LAX to the 90 in Culver City; an interchange improvement project on the 405 at the 101 Freeway in the San Fernando Valley; and new ramps on Interstate 215 in Riverside County. And redevelopment agencies want to build new hotels, shopping malls, big-box retailers, auto dealerships and other projects that add sales-tax revenue and create jobs. In built-out communities, this means tearing down the places where people have built their lives.

“Very few people want their property condemned,” said Charles D. Cummings, an eminent domain lawyer at Sullivan, Workman & Dee in downtown Los Angeles. “They’re not against schools. They’re not against redevelopment projects. They just want it to be somewhere else.”

Although the school district and other agencies use commercial and industrial property for some projects, houses and apartment buildings are also being taken.

“The property owner is always an involuntary participant,” Cummings said. “Now they either have to cut a deal on their own, when they’re not really experienced in negotiating this kind of situation, or they have to go out and get an attorney and an appraiser to do that.”

An offer you can refuse

The process generally follows a step-by-step course, according to Christopher Sutton, an eminent domain lawyer in private practice in Pasadena. A site is identified, selected and approved by a public entity such as the local redevelopment agency, city council, board of supervisors, school board or Caltrans. Homeowners are notified. The property is appraised and an offer is made.

If the owner refuses the offer, the government agency sues. In that lawsuit, both sides have to prepare a narrative appraisal, a booklet 20 to 100 pages long that describes in detail how the appraiser came up with his opinion. The intent is to make both sides aware of the other side’s opinion if the case goes to settlement or a jury trial. “That’s not like the one-page appraisal you pay $200 for when you are refinancing,” Sutton explained. “It can cost $2,000 to $4,000.”

Homeowners who hire attorneys pay either an hourly rate or a percentage of the increase over the first offer. Fees can run from a couple thousand dollars per household when shared by a group of homeowners who settle quickly, to more than six figures for a prolonged and complicated case. If a percentage is charged, it can range from 6% to 33.3%.

An eminent domain case may take a year to go to trial or reach settlement talks before a judge or mediator. Meanwhile, the property is appreciating, but the appraisal remains fixed in an earlier time.

“It doesn’t work out too fair for many people,” Cummings said, since it’s almost impossible to buy something comparable a year after the appraisal when prices are rising.

Carrillo, a 75-year-old retired bus driver, believed his house was worth nearly double the $174,000 the city offered in 1996 based on the number of bedrooms. Since that was 10 years ago, the files of his case are in long-term storage and the faces have changed in the Baldwin Park municipal offices. In fact, Matthew Lamb, the Baldwin Park community redevelopment director, has only been on the job a couple of weeks. He couldn’t comment on the specifics of the Carrillo home. However, he did say independent, certified appraisers are required to follow strict guidelines to figure out the fair market value. He believes the process, by law, must be fair.

Sensing it wasn’t, the Carrillos refused the city’s offer and hired an attorney. They settled for a larger sum but nowhere near the $300,000 they believed their house was worth. They won’t disclose the amount they received, but because they were part of a group of homeowners, their share of the attorney’s fees worked out to be $2,000.

The Carrillos then bought a three-bedroom home in Covina that has a small backyard unsuitable either for a garden or adding on, they say.

To finance that deal, Carrillo said, “I canceled my life insurance.” Added Dolores, who still wells up when she talks about her first home: “And, we had a little savings.”

The Carrillos’ experience is instructive. Homeowners can fight and sometimes win larger amounts for the homes they are forced to sell. In much rarer cases, they can win the right to keep their homes.

She stayed put

That was the experience of Brigitte LaMonte in Rancho Mirage.

LaMonte grew up in her grandmother’s four-bedroom home, raised her own children there and ran a business selling herbs out of the commercial building, which has living quarters in the rear.

Six years ago, the Rancho Mirage redevelopment agency wanted to take the property to allow the development of a retail project. She set out to fight it.

“I was going to chain myself to the building, if I had to,” she said. “I was not going to let the bulldozer come.”

After two months of researching eminent domain on the Internet, she attended a meeting aimed at reforming the state law. There she met and hired Sutton. They prevailed when the developer backed out due to a zoning problem, Sutton said, and the attorney was prepared to prove LaMonte had not received proper notification.

At that point, the city backed down; she kept her property. The redevelopment staff has since changed in Rancho Mirage, and no one would comment on LaMonte’s case.

“There are not too many happy endings,” Sutton said.

But there are eminent-domain cases that turn out better than expected due to the homeowner’s tenacity.

In 2002, Sandra and Jackie Spivey and their four children lost their first home -- a restored Victorian with five bedrooms in West Adams -- as the city made way for a new high school in the L.A. Unified School District.

“The first offer was half of what our house was worth. I don’t necessarily fault the school district for that as much as I do the appraiser. We found out later on that he didn’t count one of the bedrooms, and he wasn’t accurate on the square feet,” Sandra Spivey said. To come up with the $300,000 offer, she explained, the appraiser also compared their home to houses in a much grittier and lower-income neighborhood around MacArthur Park instead of using comps from West Adams.

“We counter-offered at $600,000,” Sandra Spivey said.

By this time, lawyers were soliciting the Spiveys, offering to represent them for one-third of the increase between the first and final offer. They weren’t interested.

In response to their counteroffer, “the school district sent someone else, someone to look more carefully to address our issues and concerns,” she said. The result: a second offer for $425,000.

They decided to do more homework. Sandra, a banker, and Jackie, a police officer, found their own neighborhood comps and submitted them to the district. The result: $550,000 for the house. They also received a $49,000 differential, which school district real estate staff members calculated they would need to buy a five-bedroom replacement house in West Adams. The additional money did not obligate them to stay in the same neighborhood.

Satisfied with the money, the Spiveys moved to Las Vegas, where they paid $630,000 for a five-bedroom, 6,300-square-foot home -- much larger than the 3,400 square feet they had in Los Angeles.

Although the Spiveys left the state, the school district paid to pack the house, for partial moving costs and for the deposit needed to turn the lights on in the new home, on top of the $599,000 they received. The district pays such expenses for all transactions and bears the full cost of moving if the new house is within 50 miles of the old.

The Spiveys are no exception in their dealings with the school district.

In the roaring school-construction campaign, more than 60% of the district’s negotiations have been “friendly transactions,” according to Rod Hamilton, a consultant in the real estate division. The others went the legal route but, with the exception of one or two, reached settlement before trial.

As Jackie Spivey said: “You can’t stand in the way of progress.”

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What to do if your property’s targeted

If eminent domain comes knocking, what should you do?

* “Don’t ignore official letters or notices,” advised Faith Mitchell, who spent years working as an eminent-domain attorney for Caltrans. “It won’t go away.”

* Don’t panic. Find out about the government process, how soon the agency needs the property and what you are entitled to receive.

* Protect yourself financially. If necessary, get your own appraisal. A real estate broker can help you gather information about the availability and price of comparable properties. Don’t use a comp from the house next door if it was taken for eminent-domain purposes. Find other comps in the same area.

* Get organized, recommended community activist Joe Aguirre. He rallied homeowners to fight redevelopment in Placentia, drummed up community support with meetings and newsletters, obtained documentation such as city maps that showed project plans and researched the developer. Band together with neighbors and appear at public hearings. This can increase your influence especially in smaller cities, where city council members sit as the redevelopment board.

* “Don’t settle for just anything,” said Salvador Carrillo, who lost his Baldwin Park home a decade ago to eminent domain. If you believe you are being low-balled, make a counteroffer. Negotiate. Negotiate. Negotiate.

* Hire an eminent-domain lawyer. Contact the local bar association or the state bar association for names. Ask other types of lawyers if they know a specialist. Check references with past clients as you would before hiring any professional.

-- Gayle Pollard-Terry