Riviera eyeing 30 properties to condemn

By William Cooper Jr., Alan Gomez
Palm Beach Post Staff Writers
Friday, May 12, 2006

RIVIERA BEACH; With the ink barely dry on a deal with its master developer, the city's community redevelopment agency is making way for its $2.4 billion waterfront redevelopment by threatening to condemn up to 30 properties.

The CRA's action follows a series of political and legal maneuvers that nearly killed the project, called International Harbor Village, but quickly brought the 400-acre plan back to life. Last week, state lawmakers passed legislation to strip cities like Riviera Beach of using eminent domain for economic purposes.

On Wednesday, the city council struck back by entering into an agreement with its master developer,
Viking Inlet Harbor Properties, to establish its constitutional right to have that contract protected from
any action taken by the legislature.

That end run around the legislature enraged Tallahassee officials. Stinging criticism came from both
Gov. Jeb Bush, who signed the eminent domain bill into law Thursday, and Senate Majority Leader
Daniel Webster, R-Orlando, the bill's sponsor.

"The governor thinks that the city's actions are reprehensible, when the legislature has clearly
spoken what the state's policy is on this issue," Bush spokesman Russell Schweiss said.

Webster said legislators understood Riviera Beach's plight and promised in the final days of the
session to seek other ways to help the city finish its redevelopment plan absent eminent domain
proceedings. Some of the ideas included financial help for infrastructure and incentives to lure
businesses to the area.

"I think a lot of people heard their story and wanted to help them get to where they wanted to go,"
Webster said. "They had that commitment yesterday. They may not have that commitment today."

Still, such political promises haven't slowed Riviera Beach's momentum. By issuing letters of condemnation, the CRA, on Viking's behalf, is taking steps that could produce the city's first eminent domain case involving International Harbor Village, which is to consist of a hotel, marina, maritime charter school, aquarium, condos, shops and restaurants.

It's a move that also tests an assurance council members have consistently made to the public: That eminent domain would be used only as a last resort.

"My hope is that they (Viking) can negotiate with these people," Council Chairwoman Ann Iles said. "If it is a real critical piece of property, we'll have to come to some decision on that."

Councilwoman Liz Wade, another who has touted using eminent domain sparingly, said the city will have review property owners case by case. Eminent domain might be warranted in cases of landowners who want to hold the project hostage by asking ridiculous sums of money for their property.

"It's just something we're going to have to work out," said Wade, who acknowledged that she wasn't totally sold on rushing into an agreement with Viking. But she voted in favor of the contract because Viking has promised to pay for a $7 million CRA loan that comes due in July.

Wade also said the reactions from the governor and Webster aren't surprising. "Tallahassee has overreacted," Wade said.

Viking, meanwhile, has signed an agreement that gives the developer the power to move forward with the project. But this contract is preliminary, and a later contract will have to resolve outstanding issues like which land the city will retain and which it will sell to Viking.

While the current contract gives the city legal leverage, it also contains terms favorable to Viking. It calls for Viking to have a 99-year lease on retail and boardwalk space, potential management of the city's marina and 50 percent of its net income.

Bob Healey, Viking's chairman, said that since being picked as the master developer in September, his company has spent $32 million buying more than 100 parcels in the CRA area.

Viking is expected to hand-deliver a condemnation letter to each of the landowners today, Healey said.

The owners have 30 days to respond, and if a deal can be struck, Viking will pay the closing costs, Healey said.

If not, Viking will notify the CRA. At that time, the city must determine if using eminent domain is warranted, he said.

"We really don't want to condemn anybody's property," Healey said. "But there are some people who are trying to put a gun to our head."

Still, the city's agreement with Viking doesn't mean Riviera Beach is out of the legal woods. State Rep. Dean Cannon, R-Winter Park, a member of the Select Committee to Protect Private Property Rights that helped draft the eminent domain reforms, said Riviera Beach's intentions are as important as its actions.

"In this case, they were already aware that the law is changing, and I think there would be a strong argument that it would not be in good faith to rush through a meeting and sign a contract knowing that the new law is coming," Cannon said.

"Ultimately, it will be up to the courts to see whether their argument holds water, but I don't think it passes the smell test."