OKC has plans for blighted area...

[Midtowner]

The condemnation itself doesn't affect the appraisal. But if the property is in poor condition, that would. The auction analogy doesn't quite work because at an auction, you're limited by the folks who show up, so you might not actually get a 'willing buyer.' Fair market value is more of a legal fiction than anything else. It assumes a willing buyer and a willing seller and that the property isn't condemned.

And as far as that 'low ball' offer goes, I do think this situation is a lot more unique and public than, say, someone's land being taken or damaged for a drainage easement in NW OKC, so we might see politics playing a role in the value of these properties.

A better analogy might be this -- say you have a Stradivarius violin that's been in your family for generations. There's a fire and it's destroyed. You have a really good insurance policy, but you haven't had it appraised in 25 years. Well, the insurance company is going to offer you X, but you think it's worth more, so you hire an appraiser, and sure enough, it appraises at Y. You now have the choice to either take the insurance company's original offer or take them to court and get them to pay more. The price that the court's going to make up is going to be the fair market value of the violin. That's reached by listening to your expert's testimony as well as the other guy's, then arriving at a number that is equitable, probably going with whichever expert is more believable, or just splitting the difference.. or whatever. Juries do what they do and God knows they do some weird things to get where they go... so that number that comes out of the jury room? That's fair market value.

[warreng88]

Urban renewal project to aid Oklahoma City area, official says
BY BRYAN DEAN The Oklahoman
Published: February 22, 2010

Oklahoma City officials say they have no intention of using eminent domain to buy the entire 692 acres south of downtown recently declared blighted.

The city council voted earlier this month to begin an urban renewal project in the area generally between Interstate 40 and the Oklahoma River south of downtown.

The city plans to buy a small portion of the land for a 70-acre downtown park included in MAPS 3, Assistant City Manager Cathy O’Connor said. A few surrounding parcels could also be bought to protect the park development, she said.

Some property owners in the area have expressed concern that all the land will be bulldozed to make way for private development. City officials said the concerns reflect confusion about the urban renewal process, which they say is complicated and misunderstood by the public.

Leslie Batchelor, attorney for the Oklahoma City Urban Renewal Authority, said the purpose of urban renewal is to help responsible property owners in a blighted area by bringing up the neighborhood around them.

How urban renewal works
Urban renewal begins when the city conducts a blight study for an area. The study looks at various factors, including dilapidated buildings, environmental hazards and rundown infrastructure. The completed study is then presented to the city council, which decides whether to declare the area blighted.
Oklahoma City officials began looking at the area south of downtown after plans were announced to move the I-40 Crosstown Expressway to the south. City officials started a program called Core to Shore, aimed at developing the area between I-40 and the Oklahoma River.

Batchelor said urban renewal and planning development made sense for the city’s Core to Shore plan.

"Nothing is happening there because of what’s going on in the area,” Batchelor said. "That doesn’t mean there aren’t pockets of economic activity, but as a whole, it isn’t operating as an effective part of the city. It needs help.”

The council declared the area blighted at its Feb. 9 meeting. The next step is for the Oklahoma City Urban Renewal Authority to come up with an improvement plan for the affected area.

The plan identifies the types of urban renewal actions that will be used in the area, including conservation and rehabilitation of buildings and the acquisition of property for redevelopment. The plan also functions like a city master plan, setting out the kinds of development the city would like to see in the area.

This acts as a guide for private developers who might want to buy land in the area and re-develop it, Batchelor said.

"The hope is that if the public makes its investment, the private will respond,” Batchelor said. "We’ve seen that work with other public investments in Oklahoma City.”

Urban renewal also allows some special forms of public assistance. For example, the city could more easily offer incentives to encourage retail development in certain areas, Batchelor said.

The plan also identifies the specific properties that will be targeted for public purchase.

"Even though it’s a 692-acre area that’s been identified, the area of acquisition is primarily going to be the park and the edges of the park,” Batchelor said.

The proposed boundaries of the park are Robinson Avenue on the east, Hudson Avenue on the west, the river on the south and a new boulevard on the north, which will replace the existing I-40 after it has been moved.

Negotiate or eminent domain?
Although the city can use eminent domain to buy property in a blighted area, Batchelor said it is a last resort. Property owners usually negotiate and agree to move on their own.

"When we go in to make someone an offer for their property, the offer will be not only for the fair market value of their property, but there will be a relocation specialist who determines where they could move and what it would cost them,” Batchelor said.

Those moving costs are factored into the offer. Property owners who aren’t satisfied can negotiate. If the negotiations reach an impasse or a property owner can’t be located, eminent domain comes into play.

If the city persuades a court to condemn the property, three appraisers are appointed to determine a fair market value. Batchelor said the owner can fight the appraisal in court if not satisfied.

She said most of the property is likely to change hands privately as interest increases.

The plan is expected to come before the city council for approval next month. The rest of the process will move slowly, Batchelor said.

"A decade will only begin to accomplish the overall objectives for the area,” she said. "Development takes time.”

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