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April 21, 2003

Host: Michael Grant
Topics:
Arizona cities' power of eminent domain: is it being abused?;
Stories of Arizona: Grace Frederick; Broadcast pioneer
In-Studio Guests:
Kevin Adam, Legislative Coordinator of the League of Arizona Cities and Towns;
Clint Bolick, Vice-President, Arizona Chapter of the Institute for Justice and the lead attorney for Randy Bailey case

>> Michael: Tonight on "Horizon," cities have the power to condemn private property but some legislators say that power is being abused. One man in Mesa continues to hang onto his business as his future is held in the hands of the appeals court. And she embodies the spirit of this state. We'll meet grace Frederick in our story of Arizona. Good evening, I'm Michael Grant. Imminent domain is a government's right to acquire private property for public use. Both the U.S. and Arizona constitutions limit the use of eminent domain, but the alleged abuse of this power has prompted action by the estate legislature. Perhaps the most contentious lawsuit on the subject currently in the Arizona Court of Appeals involves a Mesa brake shop and a hardware store. Larry Lemmons tells us more.

>> Larry Lemons: Randy Bailey makes a living making sure vehicle stop on a dime. His family has owned Bailey's break service in Mesa more than 30 years. These days Bailey is trying to put brakes on what he calls the good ol' boy deals. He says an effort is being made to rob him of his property, using a traditional power of government, eminent domain.

>> Randy Bailey: Eminent domain has its purposes, you know. True, legitimate public use projects have got to be carried out. Even if this was going to be a city park or a library, things that are public use, you've got to have tools to be able to do things like that. But you got to be able to stop the good ol' boy deals of transferring property to private people. The constitution says you cannot take private property and transfer it to a private person. That's black and white to me. What they're doing is not black and white. It's definitely shady.

>> Larry: Like many Valley cities, Mesa is trying to put a new face on some of its older thorough fairs. The city has already condemned and claims much of the area around Bailey's brake service near the corner of main and country club drive. Virtually surrounded by chain link fence, Bailey blames the territorial war on Mesa and Ken Lenhart.

>> Randy Bailey: It all began with somebody wanting my property, Ken Lenhart, you know, that way, wanting to redevelop this corner to build a bigger hardware store, and he wasn't able to come here and purchase all the individual properties on his own, so he come in and purchased a couple pieces of properties and went to the city to acquire the rest of them through the use of eminent domain because he wouldn't be able to, and letting taxpayers subsidize the growth of his business that way instead of doing it the American way of buying and expanding on your own.

>> Ken Lenhart, Lenhart's Ace Hardware: I'm paying for what I'm buying from the city 50% more per square foot than what I already own. So it's not a gift. It's not -- it's not one of those dollar deals. It's not a handout.

>> Larry: Ken Lenhart bristles at Bailey's interpretations much his motive's. The owner says he really thinks he's doing the right thing for all the right reasons. He says the area went out for public proposal for development and his proposal was chosen. The hardware store has been in his family since 1946. His children work there now. It still has the carriage turf a mop and mop establishment, all too rare these days. Still, he's felt the pressure to expand, and he says the area around Bailey's brake shop seemed a logical place to do it. He says the area was decaying when he began buying the property.

>> Ken: If you got country club and -- goes all the way through, doesn't it?

>> Larry: He shows us which part of the area around Bailey's he owns and which part is the city's. He says he owns more than half the property in question, although he spoke freely to us, Lenhart is cautious of the press, who he says has not treated him fairly. So he declined an on camera interview, but to answer Bailey's assertions, he says the idea to try to acquire the property came from a does it Zen member of the planning and zoning board who recognized the corner had been in a decaying state for some years and the corner needed to be cleaned up to help the whole neighborhood. The City of Mesa also declined an interview but e-mailed us this response. Thank you for the opportunity to participate in the program. However, due to the fact that the case of City of Mesa versus Randall E. Bailey is pending before the Court of Appeals, the legal department has determined that it is best not to discuss the factual and legal issues of the Bailey case or related eminent domain issues before the appellate

>> AZ Rep. Eddie Farnsworth: I think what we're seeing is a continual degradation of the protections for private property owners.

>> Larry: State representative Eddie Farnsworth thinks Arizona cities have gone too far using powers of eminent domain. He thinks legislation is the answer. He authored House Bill 2308 which limits the powers of eminent domain.

>> Farnsworth: We've seen it from very limited eminent domain authority that was given under section 2, -- article 2, section 17 of the constitution and we've seen that erode to the point that now cities are really relying upon eminent domain any time they don't like what is on a piece of property and we see that kind of abuse and problem going on all over the state.

>> Larry: House Bill 2308 calls for a number of limitations on the power of eminent domain, including renaming redevelopment areas as slum or blighted areas and subjecting those findings to judicial review by a court. Requiring at least 85% of the properties meet the conditions of a blighted area. And prohibiting a municipality from selling, leasing or otherwise transferring real property it acquires through eminent domain for a period of ten years following its acquisition. But the bill has its detractors, state representative Meg Burton Cahill thinks the bill gives too much power to the state.

>> Rep. Meg Burton Cahill: Eminent domain is a very useful tool for our cities and towns. But more than that, whether or not there's some problems with the way eminent domain -- the laws are used by cities and towns, it is a local issue. It's not something that we should do a blanket over the state. For example, in Tempe, we've had some very successful development using this tool. If there's any problems that need to be ironed out in an individual community, I believe that that should be addressed at the local level.

>> Larry: If it's true as a former U.S. house speaker once said that all politics is local, then Randy Bailey and Ken Lenhart are on the front line of the eternal political struggle between the individual and the state. Plastered on the windows is the chronicle of the conflict. It has left its mark on the so-called poster child of private property rights. The corner of country club drive and main is an intersection in limbo.

>> Randy: Every day I'm here, I'm winning. I'm doing what I do, you know, that way, other than the fact that I'm under this roof of the fact that they can come get me. There's things I would like to do here as far as my business. I have owned it now, my dad has been retired for eight years and I have been buying it from him and I need to do some things around here, but I'm unable to do that because of this roof of eminent domain and redevelopment over my head preventing me from even wanting to break out a paintbrush to do anything with my shop.

>> Michael: Joining me to expand on the issue is the legislative coordinator of the league of Arizona cities and towns, Kevin Adam and from the Arizona chapter of the institute for justice, its vice-president Clint Bolick who is also the lead attorney for Randy bail knee his case. Thank you for being here. Clint, what's the status of the case before the Arizona Court of Appeals?

>> Clint Bolick, Institute for Justice: It has been pending for about a year now, awaiting a decision, but fortunately the trial court issued an injunction against the City of Mesa, so Randy Bailey can continue to sell his brakes.

>> Michael: Is the basic point being made in the case that there is no appropriate public taking of property if your objective is ultimately the transfer to a private owner.

>> Clint: That's what our constitution says here in Arizona. It says flatly, private property shall not be taken for private use. This particular instance, and it's very, very common, not only here in Arizona, but around the country right now, it's brazan corporate welfare. The whole process was initiated by another private property owner who coveted this property and said, I'm not going to buy it like normal people do, I'm going to go to the city and ask them to condemn the property and they did exactly that, and on top of it, gave them a $2 million subsidy.

>> Michael: Kevin, I think cities see that issue substantial will he differently, correct?

>> Kevin Adam, League of AZ Cities and Towns: They do, Michael. In fact, if you look at the U.S. Supreme Court in 1954, as well as the Arizona Supreme Court in 1983, both of those courts held that condemnation for redevelopment, even if the property is going to be transferred to another private entity, is, in fact, constitutional, and, in fact, with redevelopment, the purpose is to revitalize a deteriorating downtown area where the public safety and public health is in question, as well as urban decay setting in. Redevelopment is an effort on the part of cities, or a tool, that cities can use to revitalize the economy of these downtown areas and also do away with the slum and the blight and the public safety hazards that exist in those areas.

>> Michael: Kevin, I think what troubles a lot of people, though, is this eye of the beholder phenomenon. We just saw a video of the shop there. It certainly doesn't look like a slum. Now, admittedly the area around it looks pretty bleak. But you get this sort of uneasy feeling that, hold it, it's just a seven-member council saying, well, you know, I think this would look better. Can we really live with that sort of standard?

>> Kevin: Well, clearly I think the Bailey's case is the most controversial one that is out there now, and you are correct in that you don't specifically -- there may be a specific parcel within a redevelopment area that may not constitute slum and blight in itself, but if you are going to do a major redevelopment of the area, sometimes it's necessary to bring in these other properties that may or may not be blighted when you look at the overall picture.

>> Michael: Clint, I guess here is the problem a lot of people have with your position. That is, take an area like the Mill Avenue area in Tempe, 15, 20 years ago, it looked pretty blighted, and the bottom line was that, unless there was some municipal action to try to change that, probably was never going to change.

>> Clint: Michael, I think you actually put your finger on the right word. Some municipal action. Municipalities, because they have no real limits on their power of eminent domain right now, use eminent domain as a first resort rather than as a last resort. People who own slum or blighted property are usually only too willing to sell that property. The issue comes up, usually, only when someone really wants to keep their property, someone like Randy Bailey, and the city is saying, absolutely not. To give you a case in point, the City of Mesa's own policies say that the city must rehabilitate and renovate property before they use eminent domain. No such effort was even tried here. They immediately went to eminent domain. Another example of the city's abuses lies in the fact that the cities can do all sorts of things to beautify the area, to require owners to improve it. None of that was done here. They just instantly went to transfer this property to a more powerful person.

>> Michael: Kevin, let me move to some of the details of the legislation. I think the provision that cities object to most is the ten-year restriction on transfer after acquisition by the city?

>> Kevin: There are several provisions that we have major concerns with. The ten-year moratorium is clearly up there as one. The expansion of judiciary review that would entitle judges to second-guess the opinion of a city council as far as whether or not an area is, in fact, slum and blighted is very trouble sum as well. We think that this is unprecedented in law in that -- in fact, the Supreme Court in this 1983 case, the City of Phoenix V. Superior Court, indicated that this is clearly more of a legislative decision that's more appropriate for the city council to make. The analogies that the court gave is that it's inappropriate for a judge to determine if an area is prone to flooding and warrants a flood control project. It's inappropriate for a judge to determine if a specific area has inadequate air service and a public airport needs to be built. And they connected that analogy to it's also inappropriate for a judge to declare an area -- whether an area is slum or blighted or not and requires

>> Michael: What about that point, Clint? We normally don't look to judges to make these sorts of policy calls. We look to them to review whether or not there's a rational basis for the policy call, but not to make the call in the first instance.

>> Clint: Well, Kevin's argument really is not with the bill. It's with our state constitution. The state constitution says private property shall not be taken for private use. This bill is actually more relaxed than that. It allows the transfer of property from the city to private owners after ten years. The judicial review component comes right out of article 2, section 17 in the constitution, which says that a city's determination of public use is not to be regarded as conclusive by a court, which will review this completely afresh. The framers of our constitution did not trust bureaucrats to make these determinations, as well they should not have trusted them.

>> Michael: But, Clint, let me go back to the mill Avenue example, though. There's an awful lot of people who will tell you, listen, what ultimately happened there was for a public purpose. That's a stronger, more vital, more beneficial, more public area than it was before, much more so.

>> Clint: I think that everyone would agree that clearing slum and blight, if you cannot buy it voluntarily, you can use eminent domain and this bill would not change that at all. But there are a lot of shop enoars --

>> Michael: But if you can't do it for 10 years, is the city going to use it if it can't move it for 10 years.

>> Clint: This pressures the city to use voluntary acts rather than involuntary acts. It's just the property that's acquired by eminent domain that can't be transferred for ten years. Again, it forces the cities to use eminent domain as a last resort, but a lot of shop owners, lot of legitimate business people could have been incorporated in this downtown redevelopment in Tempe and they're gone now, they're invisible victims. In Mesa, for example, the justification for the eminent domain use that affects Randy Bailey is supposedly a chronic shortage of housing in Mesa. Ten houses were torn down, not a single one new constructed.

>> Michael: Kevin, how do you guard against that? I mean, to a certain extent this just simply looks like the Mesa city council calling shots on, I think, a hardware store would be better than a brake shop. How do you guard against that?

>> Kevin: Currently the state law does require -- going back to a previous comment that Clint made, cities don't have cart blanche as far as ability to use eminent domain. The area has does have to be deteriorating, either the sound municipal growth has to be severely retarded or arrested. There's a set of criteria, such as dilapidated buildings that need to occur before they can make that determination. So, one, the statute does require certain standards to be met before a city can make that declaration. And even with that said, there is a level of judicial review. The courts do have the ability to go in and make sure that the city followed the process under law that it's required to make the determination, and then afterwards, you have the question of whether or not they acted in an arbitrary or capricious manner.

>> Michael: We are out of time. Thank you very much for being here. Grace Frederick acted on Broadway and was one of the first women to appear on television. Frederick is called Arizona home the last 40 years. Bill Leverton introduces us to Frederick and her many accomplishments.

>> Grace Frederick: I was born in Yonkers, and I was carried away from Yonkers, a babe in arms. We moved to Brooklyn.

>> Bill Leverton: This is Grace Voss Frederick. She was born in 1905, and 90-plus years later, she is spending her days fulfilling a long-long dream. Just down the hill from her home, just outside Cave Creek, Arizona is her dream, the Grace Museum.

>> Grace: It amazes me. Everything in there was mine.

>> Bill: She wants people to appreciate the history of a wonderful country, one filled with hope and wonder and changes, and it's also a showcase for a way of life much like the one she's lived.

>> Grace: My father was a printer, and when I visited there, I could see horses' legs going by and trolly cars going by, down the acrossed the Brooklyn bridge.

>> Bill: Our first visit to Grace's museum in September of 1999. She took command of a piano delivery. Fortunately a player piano, as she never proved to have musical talent.

>> Grace: I tried to learn the banjo, and I wasn't too successful as a musician. I said to him, it sounds like a lot of ash cans rolling down the street. And he said, well, I'm afraid I have to agree with you.

>> Bill: She had more luck attending a theatrical school.

>> Grace: I learned Shakespeare. I learned fencing. I played parts in dramatic school.

>> Bill: She played in Vaudeville and she played on Broadway. Grace Voss was one of the first actresses to perform on a rarely heard of medium, television.

>> Grace: And I performed 19, 15-minute programs through the year of 1931. You performed in a -- an area just big enough to stand in with a screen in front of you, and I did monologues and pantomimes in front of the screen.

>> Bill: But it wasn't a job that paid enough to support herself or the man she thought she would marry one day, a medical student. She decided to try her hand at photography.

>> Grace: So I opened a studio in New York during the depression days.

>> Bill: Well, her boyfriend married someone else, to Grace's good fortune, she says. She used to loan keys to her darkroom to amateur photographers. A guy by the name of Claude Frederick was one of the borrowers.

>> Grace: And eventually I met him in the darkroom, and we married.

>> Bill: She almost got out of the business thinking she'd be a society matron.

>> Grace: The young man I met in the television school persuaded us to go back into the photography business and make backgrounds for television. I was in this business from '53 to '63, the period when television was just developing. They couldn't at that time show moving pictures.

>> Bill: They invented something called a three-plex, capable of projecting 9 slides and creating a moving effect. But eventually other technology spelled the end to Grace and her husband's business. Being able to show movies beat out live shows with backgrounds in the viewer's minds.

>> Grace: So we closed our business and we traveled. My husband's health started to fail. It was recommended that he come out here, that this would be better for him.

>> Bill: In 1970, they moved to Arizona. They had visited Phoenix often and even spent time at the Sierra Vista dude ranch near Cave Creek.

>> Grace: Then one night they called us and said they were breaking up the ranch and breaking it into 40-acre pieces and would we like one. And we bought it. I'm glad if we had to move out here, that we did it that early, because Cave Creek was still an old western town. The post office was the center of town that everybody met. It was the local newspaper, all of the gossiping and talking.

>> Bill: Claude's health woes continued. When she needed a break from tending him in the hospital, Grace would do what she had done for years in New York, wander through interesting antique shops, buying what fascinated her, stuff that's in her museum. Even in ill health, though, Claude remained active and so did Grace.

>> Grace: He wrote articles for the local newspaper. He had a column. He wrote three books, and I was active in the town. I was president of the Cave Creek Association. I put on shows every once in a while.

>> Bill: Well, Claude died in 1981. Grace continued with her shows, getting quite a bit of press.

>> Grace: I developed putting on a little show called "Streaking Through History with Clothes On" I took every 10 years of history and studied the history and the music, and it opened my eyes both to the history and the fashions, and that is really why this museum is built.

>> Bill: While the museum grows, a work in progress, the history of a nation.

>> Grace: They came here because there were not jobs. They came here because of political domination. Here was the land of the free. One nation under God, with liberty and justice for all.

>> Bill: The exhibits, here a dark and sad memorial to civil war battles. Over here, offset by a cheerful Fourth of July, a lovely wedding, and a sinister gangster hangout complete with bathtub gin. This could be a scene out of the old west. Grace, ever the actress, bellying up to the bar with, well, a diet Coke. Here, one of the world's favorite inventions, the radio, and something that changed the world even more.

>> Grace: Television absorbs our life now. I was part of its development. I was glad to be that close to it. It was extremely interesting.

>> Bill: This is her dream, and she has spent a fortune to develop it. But more important to her, she wants it saved. Today's Cave Creek area is bustling and growing, but she loves her desert land the way it is, mostly undeveloped. Recently, in answer to her wishes, the Arizona State University Foundation has agreed to preserve the Grace Museum of Arizona and help preserve the land.

>> Grace: Why do I want the museum? We have been a great country. We have given a great deal to the world. I want it remembered.

>> Michael: (no audio) tonight's program. Please visit channel's's website at www.kaet.asu.edu, click on "Horizon" and follow the links. For a transcript of tonight's show and you can also e-mail us your comments. Join us tomorrow on "Horizon" for a look at an effort by lawmakers to increason employment benefits. Find out why benefits are likely going to be raised and what that will mean to businesses and employees alike. On Wednesday, senator Jon Kyl will be here to talk about issues of concern to our state in Washington D.C. and then Thursday a United States Supreme Court mid-term review. "Horizon" will take a look at the big cases which have been decided so far and those which remain to be decided. That's Tuesday, Wednesday and Thursday on "Horizon". Thank you very much for joining us on this Monday evening. I'm Michael Grant. Have a great one. Good night.

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