Feds Continue Crown Beach Court Action

McKay Neptune with housingLast July, the Alameda City Council heeded the will of Alameda citizens and zoned federal surplus property near Crab Cove as open space. As a result, private developer Tim Lewis Communities–the same company that is trying to develop the Del Monte warehouse property–recently defaulted on its contract to purchase the property from the federal General Services Administration (GSA) and walked away from its plan to build 48 houses on the property.

One might think this is great news and that the East Bay Regional Park District can now acquire the land and expand the park at Crab Cove, just as the voters intended back in 2008 when they passed Measure WW. But no. The U.S. Department of Justice, acting on behalf of the GSA, is continuing its eminent domain action. They want to take over title to McKay Avenue, the state-owned street leading to the Crab Cove Visitor Center.

Currently the GSA only has utility easement rights for federal government agencies. If it were to take over McKay Avenue, it could sell its surplus property to a private developer, who would then be able to dig up the street to install the utilities necessary for a private project. The state and park district are fighting the eminent domain action so that the GSA will decide instead to sell the property to the park district.

McKay AvenueThe Department of Justice says it needs to seize McKay Avenue for the “continuing operations of the Alameda Federal Center,” which is located on the upper part of the street. (The 3.89 acres vacated by the Department of Agriculture—and now zoned open space—are located at the end of McKay Avenue closest to the beach.) But the state and the park district argue that the eminent domain action is actually intended to secure a more profitable sale of the vacant property.

On November 10, the federal court sided with the state and the park district. In his ruling, Judge William Alsup determined that the Department of Justice’s claim that it needs to take ownership for its “continuing operations” is disingenuous and “belied by the easement it already retains and the circumstances around the now defunct sale to the private developer.” The judge went on to write: “The only real reason the United States seeks to obtain title to McKay Avenue … is to secure easements for a prospective private development of the vacant federal parcel.”

This ruling was good news, but it is far from the last word on the matter. At the hearing Judge Alsup also determined that selling the land for a higher price might constitute the “public purpose” that allows the federal government to seize state-owned property through eminent domain. He ordered the Department of Justice to cite the statutory authority allowing such a seizure. But he also urged the parties to pursue immediate settlement negotiations. If the case is neither settled nor resolved by the judge, it is scheduled for trial in October 2015.

Meanwhile, a separate court action between the City of Alameda and the East Bay Regional Park District over the former residential zoning of the parcel is still pending. Hopefully it will be settled or dismissed early next year.

Originally published in Alameda Sun

Related story:  Dispose of Properly

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4 Responses to Feds Continue Crown Beach Court Action

  1. David says:

    It looks like the judge told the feds exactly what they need to do to amend their condemnation declaration…

    • Irene says:

      Correct. But the feds may not have a relevant federal disposal-of-property statute that says selling land for a higher price constitutes a “public purpose.” To date, it has failed to do so.

  2. David says:

    Irene – read Section 2., Public Use of the ruling, specifically the part where the court writes “…this dictum does them no good.”

    It’s not that statutory authority doesn’t exist, it’s that the government didn’t appeal to the correct statutory authority in their initial declaration. The judge can only rule on what’s in the filing.

    If the feds amend their declaration and cite the correct authority – here is where the judge helped them – they will probably win.

  3. Jane says:

    I wonder whether there is some reason the DOJ failed to cite one of the disposal statutes in their initial filing. Irene, who attended the hearing on the motion to strike affirmative defenses, told me that Judge Alsup gave the DOJ attorneys several opportunities to name such a statute during oral argument, but that they gave only blank looks in response. I certainly agree that the judge gave them a playbook to follow, and stated unequivocally that if they find a relevant disposal statute, he will find that the caselaw supports condemnation for the public purpose of raising the sale price.

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