Eminent Domain in Mount Holly on Hold

On March 16, a federal court came to the rescue of many of the remaining Gardens residents, putting on hold Mount Holly Township officials’ plans to condemn their homes as they consider their civil rights lawsuit.[1] It could take up to a year for this case to be heard.

Meanwhile, Mount Holly is in dire straits, and the townspeople are up in arms. Last week, they packed a meeting in which council members considered laying off over a third of the township’s police force, a decision that would almost certainly diminish public safety.[2] The Council has already asked the state for special permission to jack up property taxes beyond the annual cap of two percent.[3]

The township is faced with these tough decisions in part because for a decade, it has been preoccupied with feckless and destructive “redevelopment” that has destroyed a community, infringed on property rights, and positioned Mount Holly for another decade of financial woes.

Mount Holly’s Gardens neighborhood was having difficulties with crime around the turn of this century. Rather than increasing enforcement of the law and protecting that community’s residents, the Township Council decided it would be better to kick everyone in the community out and replace them with luxury apartments and townhomes for wealthier residents who could swell the township’s coffers.

Using the threat of eminent domain, the township took a wrecking ball to the working class neighborhood, leaving piles of rubble in the wake and even damaging occupied homes. The Gardens now looks like a warzone and not a single new home has been built.

Meanwhile, Mount Holly has been left with an enormous debt load costing millions of dollars, not including the millions more the township must spend acquiring the nearly 70 homes left in the Gardens before the developer will begin new construction.[4] Since officials are no longer able to quickly snatch up those properties with eminent domain, they are left with no choice but to negotiate with the owners on fair terms—something they should have done from the start.

Mount Holly’s financial difficulties are more than a spot of bad luck that the Township Council could not have foreseen; they are the result of a pipe dream that Mount Holly’s taxpayers will likely have to pay for indefinitely. The Gardens redevelopment was always pie-in-the-sky. The developer used overly-optimistic estimations to make the project seem win-win for themselves and the township, but when more realistic numbers are used in the calculation their rosy forecast changes into a grim outlook. Using current data about the housing market and economy, a recent Institute for Justice analysis demonstrates that this development could actually lose the township more than a million dollars each year—that’s ten percent of the township’s budget.[5]

Even if Mount Holly officials ultimately prevail in court and are able to condemn the remaining Gardens properties, it is questionable whether their finances will allow them to do so. This leaves the developers with a choice. They can be heroes and offer the remaining Gardens residents replacement housing in the new development, as the homeowners have requested for years. Or, they can continue to bank on the cash-strapped township and hope that in another year the properties can be condemned for them.

Mount Holly’s unenviable balance sheets are the result of a history of poor planning. Township officials believed they could solve a crime problem by running roughshod over Mount Holly’s more vulnerable residents, and now they risk exposing the whole township to inadequate law enforcement and the dangers that entails. As taxes are increased as a result of this blunder, it will be the whole township that pays for the Council’s hubris.