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Proposition 90: A First Look at a Revolutionary Initiative

Richard Brenneman
Tuesday September 05, 2006

What Howard Jarvis started, Howard Rich aims to finish. 

Rich, an elusive New York developer, has been bankrolling initiatives aimed at stripping state and local governments of their power to limit development. 

His California measure, Proposition 90, masks that agenda. It’s portrayed as simply a ban on government eminent domain actions that take private property and hand it over to developers for private use. 

And the strategy seems to be paying off. With comparatively little media coverage to date, the measure has managed to win the support of a strong cross-section of California voters. 

The highly respected Field Poll reported early in August that the measure had attracted strong support from both parties, with favorable/unfavorable ratings of 51/28 for Republicans and 42/32 among Democrats. Surprisingly, support was even stronger among those who rated themselves as “middle of the road” rather than conservative (50/46). 

The poll was based on a survey of 762 voters conducted between July 10 and 23. 

The results should be music to the ears of Rich, a wealthy New York developer and hard core property rights libertarian, who primed the Prop. 90 pump with a $1.5 million donation from his Fund for Democracy. 

The second largest contributor is Howard Ahmanson, the fundamentalist advocate of theocracy who is also the primary bankroll for the so-called Intelligent Design campaign—a movement which seeks to replace Charles Darwin’s theory of “evolution by natural selection” with a divinely ordained process. 


Protecting what? 

Though it’s billed as the “Protect Our Homes Act” and fueled by the controversy over a recent U.S. Supreme Court decision, the measure could equally be dubbed the “Unleash the Developers” initiative. 

While the measure does restrict the use of eminent domain, the law’s most far-reaching effects weigh heavily in favor of developers. 

Rich himself has acknowledged that his priority is not eminent domain but the elimination of what he calls “government takings,” actions that impose controls on property development. 

While the measure does limit the seizure of homes by eminent domain to a narrow range of public necessity cases, Proposition 90 would also allow developers to sue any time local governments tried to minimize the size or impact of the projects they planned. 

According to Priority Focus, the newsletter of the League of California Cities, if a voter initiative limited a developer who wanted to build a 2,000-home subdivision to only 500, the developer would be entitled to sue for the value of the 1,500 homes he could build if they were permitted under previous zoning. 

And in the case of eminent domain actions, the former owner would be entitle to payment at value of the land under the new use, even if the use were barred to private owners. 

The initiative would also annul all unpublished court decisions in eminent domain cases, which are often resolved in local Superior Courts, which do not publish decisions. 

It would limit city controls over air space as in building height.  

Under the measure, property owners could sue any time local governments tried to limit their project to anything less than the maximum extent allowed by law. 

Thus, new regulations to reduce zoning, limit height, or otherwise minimize development impacts would provide grounds for costly lawsuits. 

After a similar measure was passed in November 2004, by voters in Oregon—a state with one tenth the population of California—2000 claims seeking more than $3.8 billion were filed, according to news reports.. 


The Jarvis gambit? 

By playing on sympathy for the small homeowner, Rich is following the same line laid out by Howard Jarvis and Paul Gann, who used the image of fixed-income homeowners in the inflationary 1970’s to fuel Proposition 13. That measure capped annual property tax increases and barred reassessments until the next property sale. 

The campaign relied heavily on images of elderly folks forced to sell their beloved homes because of rapidly escalating property taxes. 

But the biggest beneficiaries of Proposition 13 have been corporations, who typically sell their property stores, plants, warehouses, apartment Buildings and other facilities far less frequently than individual homeowners. 

The ballot argument prepared by supporters pushes the eminent domain angle in much the same way. 

The cases cited are: 

• The owner of a Mexican restaurant who lost his business through eminent domain so a Mercedes dealer could tear it down and build a parking lot. 

• A luggage store owner whose business was taken to make way for a hotel. 

• A pastor whose church was threatened with an action so a city could sponsor a condo development. 

The arguments mention nothing about potentially litigious developers. 


Cash players 

The measure has drawn heavy criticism from a wide range of organizations, including the League of California Cities, the California State Association of Counties, the California Housing Coalition, the California Police Chiefs Association, the California Fire Chiefs Association, the Coalition of Mobilehome Owners-California, the Sierra Club, the California School Boards Association, the League of Conservation Voters, the Greenbelt Alliance, the American Farmland Trust and dozens of other groups. 

Lt. Gov. Tom McClintock is a major supporter of Prop. 90, announcing on his campaign website that the measure “prohibits local officials from seizing homes and businesses for the profit of politically well-connected private interests, and requires government to pay you for any damage it does to your property.” 

Another organizational supporter is Americans for Limited Government, which turns out to be one of Rich’s organizations and a supporter of school vouchers. 

Three coalitions have arisen to fund the election campaign, one on the pro side and two against. 

According to the most recent campaign filings, Rich and his allies have raised at least $2,135,000, with the largest single donation, $1.5 million, coming from Rich’s Fund for Democracy on March 10. 

Montanans in Action chipped in $600,000 on May 8. It’s a group Shane Goldmacher at Capitol Weekly News in Sacramento reports is closely allied with Rich. 

Howard Ahmanson’s Fieldstead & Company kicked in $200,000 on April 27. Ahmanson is the primary sponsor of the Discovery Institute, the institutional home base of “Intelligent Design” theory. 

Fieldstead—which is Ahmanson’s middle name—also funds many conservative religious groups. 

Another $10,000 came from the Shelbran Company, a development firm, and $5,000 came from Atel Financial Services, LLC of San Francisco. 

The coalition spent at least $651,236.50 with Arno Political Consultants for gathering the signatures to place the measure on the ballot. 

On the opposing side, a larger coalition of organizations—many from the environmental movement and others representing local governments—managed to raise $855,000. 

The actual figure is lower because some of the funds raised by one group were donated to another. 

The four main opposition coalitions are: No on 90, Conservationists for Taxpayer Protection; Californians for Neighborhood Protection; Californians Against the Taxpayer Trap; and the Coalition to Protect California. 

Donations of $5,000 or more all came from organizations, including the League of California Cities, the California Redevelopment Association, the Sierra Club of California, the National Resources Defense Council Action Fund, Environmental Defense, the Defenders of Wildlife, the Nature Conservancy and the California Conservation Campaign.