Centene Plaza Redevelopment Corp. v. Mint Properties
225 S.W.3d 431, 2007 Mo. LEXIS 101, 2007 WL 1695163 (2007)
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Rule of Law:
Under Missouri statute § 353.020, a legislative determination that an area is "blighted" requires substantial evidence of both economic liability and a separate, distinct social liability. Evidence of economic underperformance alone cannot satisfy the social liability requirement, which concerns negative impacts on public health, safety, and welfare.
Facts:
- Centene Plaza Redevelopment Corporation (Centene) intended to expand its office and parking space in the city of Clayton.
- In response to a request from the City of Clayton for redevelopment proposals for a block on Forsyth Boulevard, Centene submitted the sole proposal, which required the power of eminent domain to acquire properties.
- The city commissioned a consulting firm, Peckham, Guyton, Albers, & Viets (PGAV), to conduct a study to determine if the area qualified as 'blighted' under state law.
- The PGAV study concluded the area was an 'economic liability' due to age, obsolescence, and underperformance, but it did not find the area to be a 'social liability.'
- A PGAV employee testified that the factors present in the area did not constitute a social liability as he understood the term.
- Data requested by the city manager from the Clayton police and fire departments revealed very few calls for service to the properties in question over a multi-year period.
- Despite the lack of evidence of social ills, the city passed an ordinance declaring the area blighted and approving Centene's redevelopment plan.
- Centene failed to reach purchase agreements with all property owners in the designated area, including Mint Properties.
Procedural Posture:
- Centene Plaza Redevelopment Corporation filed a condemnation action in the trial court against Mint Properties and other property owners.
- The trial court found in favor of Centene and entered an order of condemnation.
- The defendants (Mint Properties et al.) appealed the trial court's judgment to the Missouri Court of Appeals, Eastern District.
- The Court of Appeals transferred the case to the Supreme Court of Missouri for its determination.
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Issue:
Does a city's legislative determination that an area is blighted, based primarily on evidence of economic underperformance and future redevelopment benefits, satisfy the statutory requirement under § 353.020 that the area be both an 'economic and social liability' when there is no substantial evidence of negative impacts on public health, safety, or welfare?
Opinions:
Majority - Per Curiam
No. A determination of blight must be supported by substantial evidence that the area is both an economic and a social liability. The statutory term 'social liability' relates to conditions that are 'conducive to ill health, transmission of disease, crime,' or other menaces to public health, safety, and welfare. In this case, the evidence presented to the city, including police and fire department reports, did not support a finding of social liability; in fact, it indicated the area was safe. The PGAV study, a critical component of the city’s decision, only found economic liability. The prospective benefits of redevelopment, such as more jobs or a 'vibrant' atmosphere, are not evidence of the properties' current condition and cannot substitute for a showing of social liability. To allow evidence of economic liability to also constitute evidence of social liability would render the plain language of the statute, which requires both, meaningless.
Concurring - Stith, J.
No. I concur in the result but write separately to clarify the definition of 'social liability.' While the majority correctly finds no social liability here, its reasoning focuses too narrowly on existing crime and disease. The statute allows a finding of blight for conditions 'conducive to' such problems, meaning a city can act preemptively. However, Centene failed to present any substantial evidence of social liability at all. Its expert improperly collapsed the two distinct statutory requirements by arguing that an inability to pay reasonable taxes, which stems from economic liability, is itself a social liability. This conflates the cause with the effect. Centene was required to identify a separate social liability that, in conjunction with economic liability, led to an inability to pay reasonable taxes or was conducive to other social ills. Because it failed to do so, the condemnation order must be reversed.
Dissenting - White, J.
Yes. The City of Clayton had sufficient evidence to determine the redevelopment area was an 'economic and social liability.' The statute's phrasing recognizes the inherent causal connection between economic decline and the erosion of social welfare. I would interpret the statute to reflect that a decline in one inevitably undermines the other. Even if the two liabilities must be evaluated separately, there was enough evidence for the city's finding to withstand judicial review. I would therefore affirm the order of condemnation.
Analysis:
This decision significantly clarifies the standard for declaring an area 'blighted' in Missouri, thereby limiting the use of eminent domain for private economic redevelopment. By establishing that 'economic liability' and 'social liability' are two distinct and independent statutory requirements, the court makes it more difficult for municipalities and developers to condemn property solely on the basis of economic underperformance or a desire for a 'higher and better' use. The ruling strengthens protections for property owners by requiring a specific evidentiary showing of negative impacts on public health, safety, or welfare to justify a blight designation. This creates a higher bar for takings and reinforces the judiciary's role in scrutinizing legislative blight declarations.
