SYLLABUS
(This syllabus is not part of the opinion of the Court. It has
been prepared by the Office of the Clerk for the convenience of the
reader. It has been neither reviewed nor approved by the Supreme Court. Please
note that, in the interests of brevity, portions of any opinion may not
have been summarized).
Gallenthin Realty Development, Inc. v. Borough of Paulsboro (A-51-2006)
Argued April 26, 2007 -- Decided June 13, 2007
ZAZZALI, CJ., writing for a unanimous Court.
In this appeal, the Court ascertains the meaning of the term blighted as
used in the New Jersey Constitution and determines whether the Borough of Paulsboros
interpretation of
N.J.S.A. 40A:12A-5(e) (subsection 5(e)) is within the scope of that term.
The Gallenthin family has owned the Gallenthin property since 1951, although it has
enjoyed the parcel as early as 1902, when it used the land to
moor barges transporting produce from Mantua to Philadelphia. As it currently exists, the
property is bounded on its western edge by Mantua Avenue, on its eastern
edge by Mantua Creek, which flows into the Delaware River, and on its
southern tip by an industrial facility, across from which is a residential section
of Paulsboro. The propertys northern edge abuts a packaging facility and an inactive
British Petroleum (BP) storage site, which fronts the Delaware River across from Philadelphia
International Airport. Gallenthin Realty Development, Inc., George Gallenthin, III, and Cindy Gallenthin (collectively,
Gallenthin) own the property with clear, quieted title.
The land consists mostly of undeveloped open space and has been identified as
protected wetlands by the DEP. There is also an unused railroad spur tracing
the propertys western edge, an active gas pipeline bisecting the property, and several
mooring pylons designed to receive boats navigating Mantua Creek. At Gallenthins request, the
Paulsboro Planning Board (Board) rezoned the property in 1998 from manufacturing to marine
industrial business park, thereby permitting various commercial, light industrial, and mixed non-residential uses.
The property has periodically been used as a deposit site for dredging materials
over the years. Gallenthin also leased portions of the property to an environmental
clean-up organization in 1977 and 1978 for river access, employee parking and storage.
Additionally, since 1977, a wild growing reed, phragmites australis (phragmites) has been harvested
from the Gallenthin property three times a year. The phragmites reed is used
as cattle feed and is recognized by the EPA as a valuable plant
species that actively neutralizes soil pollutants.
In 1998, the town of Paulsboro adopted a new master plan that referenced
seven broadly defined areas of Paulsboro that should be redeveloped to stimulate economic
rehabilitation. The Gallenthin property was not included in the initial master plan. In
1999, the Board was authorized to investigate whether several parcels, primarily the BP
facility and an adjacent Dow/Essex Chemical (Dow) property, could be designated as in
need of development pursuant to the criteria set forth in N.J.S.A. 40A:12A-5(e). That
resolution did not encompass the Gallenthin property. The investigative reports, prepared by Remington
& Vernick Engineers, Inc. (R&V) and presented to Paulsboro, concluded that the parcels
comprising the study meet the statutory definition for an area in need of
development. Paulsboro adopted R&Vs recommendations in December 2002 and designated the implicated property
as the BP/Dow Redevelopment Area.
Also in 2000, BP and Dow retained URS Corporation (URS) to conduct a
two-phase Site Development Study of their combined facilities. In Phase II of that
report presented in 2002, it was first suggested that the Gallenthin property be
included in the BP/Dow redevelopment project in respect of discussions of access routes
to the property. Paulsboro asked R&V to look into the URS report, leading
to R&V ultimately recommending the inclusion of the Gallenthin property in the redevelopment
project based on the conclusion that the property was in need of redevelopment,
a designation that would subject the Gallenthin property to taking by eminent domain.
After a hearing, the Planning Board recommended that the Gallenthin property be included
in the BP/Dow Redevelopment Area. That recommendation was adopted by the governing body
in May 2003, which designated the Gallenthin property as a redevelopment area.
In June 2003, Gallenthin filed a complaint in lieu of prerogative writs, challenging
Paulsboros designation of the property as in need of redevelopment. Gallenthin claimed that
the property did not meet any of the statutory criteria necessary for that
designation. The complaint further alleged procedural flaws in the Boroughs enactment of the
redevelopment ordinance and other improprieties. The Law Division dismissed Gallenthins complaint, finding that
Paulsboro meticulously adhered to the Local Redevelopment and Housing Laws (LRHL) procedural requirements
and that the Boroughs inclusion of the Gallenthin property in the redevelopment plan
was supported by substantial evidence. The Appellate Division affirmed that decision.
The Supreme Court granted certification.
HELD: Because the New Jersey Constitution authorizes government redevelopment of only blighted areas,
the Legislature did not intend N.J.S.A. 40A:12A-5(e) to apply in circumstances where the
sole basis for redevelopment is that the property is not fully productive. Rather,
subsection 5(e) applies only to areas that, as a whole, are stagnant and
unproductive because of issues of title, diversity of ownership, or other similar conditions.
Therefore, the Borough of Paulsboros redevelopment classification in respect of the Gallenthin property
is invalidated.
1. The Constitution expressly authorizes municipalities to engage in redevelopment of blighted areas.
The State may take private property only for a public use. Under the
Blighted Areas Clause of the New Jersey Constitution, the clearance, replanning, development, or
redevelopment of blighted areas shall be a public purpose and public use for
which private property may be taken or acquired. The LRHL empowers municipalities to
designate property as in need of redevelopment and thus subject to the States
eminent domain power. (Pp. 15-20)
2. It is the Courts duty to construe a statute so as to
render it constitutional if it is reasonably susceptible to such an interpretation. When
the Blighted Areas Clause was adopted in 1947, the framers were concerned with
addressing the deterioration of certain sections of older cities that were causing an
economic domino effect devastating surrounding properties. The Blighted Areas Clause enabled municipalities to
intervene, stop further economic degradation, and provide incentives for economic investment. Although the
meaning of blight has evolved, the term retains its essential characteristic: deterioration or
stagnation that negatively affects surrounding properties. That articulation of the terms essential meaning
is consistent with other states statutory definitions of blight. (Pp. 20-28)
3. Paulsboro interprets subsection 5(e) to permit redevelopment of any property that is
stagnant or not fully productive yet potentially valuable for contributing to and serving
the general welfare. Under that approach, any property that is operated in less
than optimal manner is arguably blighted. If such an all-encompassing definition were adopted,
most property in the State would be eligible for redevelopment. Such an approach
is not reconcilable with the New Jersey Constitution. (P. 29)
4. Because it must be presumed that the Legislature intended subsection 5(e) to
function in a constitutional manner, and because subsection 5(e) is reasonably susceptible to
an alternative interpretation, the Court concludes that the Legislature intended N.J.S.A. 40A:12A-5(e) to
apply only to property that has become stagnant because of issues of title,
diversity of ownership, or other similar conditions. By adopting that construction, the Court
avoids rendering subsection 5(e) unconstitutional and gives effect to the Legislatures original purpose
in adopting the language that would become subsection 5(e). (Pp. 30-38)
5. Paulsboros only reason for designating the Gallenthin property as in need of
redevelopment was that it was not being utilized in a fully productive manner.
Those considerations, standing alone, are insufficient to engage the municipalitys power to designate
property as in need of development and, therefore, subject to eminent domain. Further,
there is no evidence in the record that the broader redevelopment area suffered
from a lack of proper utilization caused by conditions of title of the
real property therein. The record is also silent as to whether the Borough
considered the benefits of the protected wetlands in finding that the property was
in need of redevelopment. Lastly, the record contains no evidence suggesting that the
Gallenthin property is integral to the larger BP/Dow Redevelopment Area or that the
Planning Board based its determination on anything other than the property not being
fully productive. As such, Paulsboros redevelopment determination in respect of the Gallenthin property
was beyond the scope of subsection 5(e) and must be invalidated. This holding
does not prejudice any future inquiry by the Borough regarding whether the property
is in need of redevelopment based on any other legitimate grounds. (Pp. 38-40)
6. The Court further notes that municipal redevelopment designations are entitled to deference
provided that they are supported by substantial evidence on the record. However, the
substantial evidence standard is not met if a municipalitys decision is supported by
only the net opinion of an expert. A municipality must establish a record
that contains more than a bland recitation of applicable statutory criteria and that
those criteria are met. (Pp 40-41)
Judgment of the Appellate Division is REVERSED and Paulsboros redevelopment designation in respect
of the Gallenthin property is INVALIDATED.
JUSTICES LONG, LaVECCHIA, ALBIN, WALLACE, RIVERA-SOTO and HOENS join in CHIEF JUSTICE ZAZZALIS
opinion.
SUPREME COURT OF NEW JERSEY
A-
51 September Term 2006
GALLENTHIN REALTY DEVELOPMENT, INC., a New Jersey Corporation and/or GEORGE A. and CYNTHIA
L. GALLENTHIN III, h/w, both jointly and severally,
Plaintiffs-Appellants,
v.
BOROUGH OF PAULSBORO, a New Jersey Municipality and/or PLANNING BOARD OF BOROUGH OF
PAULSBORO and/or PAULSBORO REDEVELOPMENT AGENCY, jointly and severally,
Defendants-Respondents.
Argued April 26, 2007 Decided June 13, 2007
On certification to the Superior Court, Appellate Division.
Peter D. Dickson argued the cause for appellants (Potter and Dickson, attorneys; Mr.
Dickson and R. William Potter, on the briefs).
M. James Maley, Jr., argued the cause for respondents (Maley & Associates, attorneys;
Mr. Maley, Elizabeth L. Bancroft, Emily K. Givens, Joseph F. Kunicki, and Erin
E. Simone, on the briefs).
Ronald K. Chen, Public Advocate, argued the cause for amicus curiae Public Advocate
of New Jersey (Mr. Chen, attorney; Mr. Chen, Brian Weeks, Deputy Public Advocate,
Alexander D. Gladney, Assistant Deputy Public Advocate and Catherine Weiss, Director, Division of
Public Interest Advocacy, of counsel and on the brief).
Robert S. Goldsmith argued the cause for amici curiae New Jersey State League
of Municipalities, Downtown New Jersey, Inc. and New Jersey Chapter-American Planning Association (Greenbaum,
Rowe, Smith and Davis, attorneys; Robert Beckelman, on the brief).
Carter H. Strickland, Jr., Staff Attorney, Rutgers Environmental Law Clinic, submitted a brief
on behalf of amici curiae New Jersey Audubon Society and New Jersey Conservation
Foundation.
Kenneth E. Meiser submitted a brief on behalf of amicus curiae New Jersey
Builders Association (Hill Wallack, attorneys; Mr. Meiser and Anne L.H. Studholme, on the
brief).
Peter H. Wegener submitted a brief on behalf of amicus curiae Institute For
Justice (Bathgate, Wegener & Wolf, attorneys; Mr. Wegener and Jeff Rowes, a member
of the New York bar, on the brief).
CHIEF JUSTICE ZAZZALI delivered the opinion of the Court.
Gallenthin Realty Development, Inc. owns a sixty-three-acre parcel of largely vacant wetlands in
the Borough of Paulsboro. In 2003, Paulsboro classified the Gallenthin property as in
need of redevelopment under N.J.S.A. 40A:12A-5(e) because the propertys unimproved condition rendered it
not fully productive. Such a classification subjects property to taking by eminent domain.
N.J.S.A. 40A:12A-8(c). The trial court and Appellate Division upheld Paulsboros redevelopment designation.
Because the New Jersey Constitution authorizes government redevelopment of only blighted areas, we
conclude that the Legislature did not intend N.J.S.A. 40A:12A-5(e) to apply in circumstances
where the sole basis for redevelopment is that the property is not fully
productive. We therefore invalidate Paulsboros redevelopment classification concerning the Gallenthin property and hold
that N.J.S.A. 40A:12A-5(e) applies only to areas that, as a whole, are stagnant
and unproductive because of issues of title, diversity of ownership, or other similar
conditions.
I.
A.
Although the Gallenthin family has owned the parcel at issue since 1951, the
family had enjoyed the property as early as 1902, when it used the
land to moor barges transporting produce from Mantua to Philadelphia. As it currently
exists, the property is bounded on its western edge by Mantua Avenue, on
its eastern edge by Mantua Creek, which flows into the Delaware River, and
on its southern tip by an industrial facility, across from which is a
residential section of Paulsboro. The propertys northern edge abuts a packaging facility and
an inactive British Petroleum (BP) storage site, which fronts the Delaware River across
from the Philadelphia International Airport. Plaintiffs Gallenthin Realty Development, Inc. (Gallenthin), George A.
Gallenthin, III, and Cindy Gallenthin own the property with clear, quieted title.
The land consists mostly of undeveloped open space and is identified as protected
wetlands on the New Jersey Department of Environmental Protections (DEP) Geographic Information System.
There is also an unused railroad spur that traces the propertys western edge,
an active gas pipeline that bisects the property, and several mooring pylons designed
to receive boats navigating Mantua Creek. At Gallenthins request, the Paulsboro Planning Board
rezoned the property in 1998 from manufacturing to marine industrial business park, thereby
permitting various commercial, light industrial, and mixed non-residential uses.
The property historically has been used as a deposit site for dredging materials.
In 1902, the property was authorized to receive dredge deposits from the United
States Army Corps of Engineers, which was responsible for widening and straightening Mantua
Creek. The Army Corps of Engineers made deposits on the Gallenthin property in
1902, 1934, 1937, and 1963. Although nearby waterways are not currently being dredged,
plaintiffs contend that the property may still receive dredging deposits and that dredging
is a periodic activity that occurs every 35 years or so as the
need arises.
See footnote 1
Other than the propertys sporadic use as a dredging depot, Gallenthin leased portions
of the property to an environmental clean-up organization, Clean Ventures, in 1997 and
1998. Clean Ventures used the property for river access, employee parking, and storage.
Additionally, since 1997, a wild-growing reed,
phragmites australis (phragmites), has been harvested from
the Gallenthin property three times a year. The reed can be used as
cattle feed and, according to plaintiffs, is recognized by the federal Environmental Protection
Agency as a valuable plant species that actively neutralizes soil pollutants. Although the
record does not reveal how much profit Gallenthin generates from harvesting the phragmites,
Paulsboro characterizes any revenue as negligible and primarily for tax abatement purposes.
In 1998, Paulsboro -- a town of about 6,500 residents and covering approximately
two square miles -- adopted a new master plan. The plan referenced seven
broadly defined areas of Paulsboro that should be redeveloped to stimulate the Boroughs
economic rehabilitation. Although the Gallenthin property was not included in the master plans
redevelopment recommendations, the plan mentioned the Gallenthin property, stating:
The 63 acre Gallenthin property is idle and may be largely undeveloped due
to tidal wetlands regulations. This Mantua Creek site may, however, be available for
development as a boat launch or marina . . . . The Borough
should explore acquiring the property and working with redevelopers and with the Nature
Conservancy or other nature agency to assist in the development of a creek
front marina with the bulk of the property used as a nature center
for tidal river appreciation or passive recreation use.
In 1999, the Paulsboro governing body authorized the Planning Board to investigate whether
several parcels, primarily the BP facility and an adjacent Dow/Essex Chemical (Dow) property,
could be designated as in need of redevelopment pursuant to the criteria set
forth in
N.J.S.A. 40A:12A-5. The governing bodys resolution did not encompass the Gallenthin
property. In June 2000, the governing body authorized the Planning Board to investigate
additional, contiguous parcels, but the Gallenthin property was again not included.
The investigation reports, prepared by Remington & Vernick Engineers, Inc. (Remington & Vernick)
and presented to Paulsboro in 2000, described the properties under review as
land upon which are located a now closed liquid storage facility for petroleum
products and an unimproved three (3) acre parcel, all of which being owned
by BP Oil Company; contiguous unimproved parcels utilized for miscellaneous storage, owned by
Norman B. Swindell; and now a closed chemical plant, owned by Dow Chemical
Company.
Remington & Vernick concluded that given primarily the closure of the facilities and
the stagnant and not fully productive condition of the land, . . .
the parcels comprising the study meet the statutory definition for an area in
need of redevelopment. In December 2002, Paulsboro adopted Remington & Vernicks recommendations and
designated the implicated property as the BP/Dow Redevelopment Area.
Also, in 2000, BP and Dow retained URS Corporation (URS) to conduct a
two-phase Site Redevelopment Study of their combined facilities. The first phase of the
URS study did not reference the Gallenthin property. However, the phase-two report, presented
to BP and Dow in 2002, contained the first suggestion that the Gallenthin
property be included in the BP/Dow redevelopment project. URS observed that transportation to
the [BP/Dow redevelopment] site is an issue and proposed three alternative access routes.
One proposed route involved a bridge over Mantua Creek connecting to an access
road that would traverse a small portion of the Gallenthin property. URS expressly
discouraged that option, however, because of wetlands and ownership challenges. Rather, URS concluded
that the most natural alignment to the site and the preferred access route
involved a bridge to the north of the Gallenthin property that would directly
enter the BP/Dow site.
Paulsboro then requested that its own engineers, Remington & Vernick, compile a Redevelopment
Plan Summarization regarding the URS report. Presented in October 2002, the summarization noted
that [t]he URS Phase II Study indicates the possibility of ultimately including [in
the redevelopment project] the [Gallenthin] parcel immediately to the south of the BP
site . . . . In the event of said eventuality, a further
preliminary investigation would be necessary as [that] parcel[] w[as] not previously examined.
See footnote 2
Consequently,
in December 2002, Paulsboro authorized Remington & Vernick to prepare a Redevelopment Area
Study and Plan that, for the first time, included the Gallenthin property.
That plan described the Gallenthin property as an expanse of vacant unimproved land,
other than for a rail line. Regarding the statutory criteria for classifying the
property as in need of redevelopment, the report stated:
Conditions rising to the level of the requisite criteria for a redevelopment declaration
noted from field observation conducted in January 2003 include: a not fully productive
condition of land as evidenced by the expanse of vacant unimproved parcels which
otherwise could be beneficial in contributing to the public health, safety and welfare
of the community resultant from aggregation of the positive features of development such
as the introduction of new business, job creation, and enhanced tax base; and
as further evidenced by the underutilization of the existing rail line (Criteria [
N.J.S.A.
40A:12A-5(e)]).
Owing principally to the instances of stagnant and not fully productive condition of
land and circumstance of rail line underutilization, this report concludes that existing conditions,
as described herein, satisfy the statutory criteria necessary to deem the study area
an area in need of redevelopment.
[(Internal heading omitted).]
The report made no reference to the URS proposal that the Gallenthin property
be included because of access problems associated with the larger BP/Dow Redevelopment Area.
In April 2003, the Planning Board held a public hearing regarding the classification
of the Gallenthin property as in need of redevelopment. The Planning Boards professional
planner, George Stevenson, presented the redevelopment plan and testified that the Gallenthin property
should be included in the plan. Stevenson had previously conducted a physical inspection
of the property and presented photographs of the property at the hearing. Commenting
on the photographs, Stevenson testified:
[W]e find [a] condition that lends itself to economic deterioration. That is, you
have no improvement; you have vacant unimproved conditions. Theres just no activity, and
I would suggest to the board that if there would be improvement upon
those parcels, particularly if there would be improvement in conjunction with the plan
thats been previously approved, the aggregate . . . would be beneficial to
the municipality in that there would be commerce occurring, there would be job
creation resulting from that commerce occurring and the bottom line [is] it would
certainly enhance the tax base for the municipality, and so I am able
to state to the board that because we have vacant, unimproved conditions, because
theres bits of land that could otherwise be more beneficial to use for
the overall welfare of this municipality, that these lands are considered to be
an area in need of redevelopment.
Criteria E [(N.J.S.A. 40A:12A-5(e))] of all the criteria, its the criteria that I
would point to.
At no point during Stevensons testimony did he recommend including the Gallenthin property
in the redevelopment plan because it was needed for construction of an access
road.
Plaintiffs planning expert, Paul Szymanski, testified regarding the application of the statutory criteria.
Szymanski began by emphasizing that Stevensons recommendation was based exclusively on N.J.S.A. 40A:12A-5(e),
not the alternative theory expressed in the URS report that the property may
be an important adjunct to the BP/Dow Redevelopment Area. Szymanski then provided his
own interpretation and application of N.J.S.A. 40A:12A-5(e):
Im not sure that other conditions is . . . as broad as
counsels trying to make it because there [are] other sections in the .
. . redevelopment law that even are broader and [more] vague[]. I think
that these other conditions relate to the issues dealing with title and ownership
and something similar, and I think it should be looked at in a
more narrow sense as similar conditions rather than any conditions.
Szymanski also testified that in his opinion the current use of the property
for farming, open space, and occasional dredging was sufficient to preclude classifying the
property as not fully productive under N.J.S.A. 40A:12A-5(e).
Additionally, Szymanski noted that the Gallenthin property was not necessary for the BP/Dow
Redevelopment Area. He observed that because much of the property was protected wetlands,
significant development by the Borough was not feasible. He concluded that the Gallenthin
property could not contribute meaningfully to the redevelopment plan because an environmental recreation
area would not produce key ratables and would not achieve the overall goals
and objectives of [the] redevelopment program.
George Gallenthin also testified. He reiterated that phragmites had been harvested from the
property since 1997 and stated that he was actively pursuing the propertys use
as a dredging depot. He admitted that he had not obtained the requisite
DEP water permits but testified that the permits were easily obtained once dredging
commenced.
At the conclusion of the hearing, the Planning Board determined that the Gallenthin
property should be included in the BP/Dow Redevelopment Area. The board emphasized that
its decision was based on the reasons expressed in the Remington & Vernick
report and Stevensons testimony. In May 2003, the Governing Body adopted the Planning
Boards recommendation and designated the Gallenthin property as a redevelopment area.
B.
In June 2003, plaintiffs filed a complaint in lieu of prerogative writs, challenging
Paulsboros designation of their property as in need of redevelopment. Plaintiffs claimed that
the Gallenthin property did not meet any of the statutory criteria necessary for
that designation. Their complaint further alleged procedural flaws in the Boroughs enactment of
the redevelopment ordinance and other improprieties by the Borough. The Law Division dismissed
plaintiffs complaint, finding that Paulsboro meticulously adhered to the Local Redevelopment and Housing
Laws procedural requirements and that the Boroughs inclusion of the Gallenthin property in
the redevelopment plan was supported by substantial evidence.
The Appellate Division affirmed the trial courts ruling in an unpublished, per curiam
opinion. Citing Stevensons testimony, the nominal economic benefit generated from farming phragmites, and
the infrequent use of the property as a dredging depot, the Appellate Division
concluded that the Boroughs decision was supported by substantial evidence. The panel also
noted that the Remington & Vernick and URS reports further supported the Boroughs
decision.
Plaintiffs petitioned this Court for certification, challenging the constitutionality of
N.J.S.A. 40A:12A-5(e) as
applied to their property and the lower courts application of the substantial evidence
standard of review. We granted certification.
188 N.J. 492 (2006). We also permitted
the following entities to participate as amici curiae: American Planning Association (New Jersey
Chapter); Downtown New Jersey, Inc.; Institute for Justice; New Jersey Audubon Society; New
Jersey Builders Association; New Jersey Conservation Foundation; New Jersey State League of Municipalities;
and Public Advocate of New Jersey.
II.
Plaintiffs central claim is that Paulsboros designation of their property as in need
of redevelopment, and thus subject to eminent domain, is in violation of Article
VIII, Section 3, Paragraph 1 of the New Jersey Constitution, which authorizes the
taking of blighted areas for redevelopment. Plaintiffs argue that the term blight, as
used in the Constitution, carries negative connotations that their property does not possess.
Plaintiffs also maintain that their property is not rationally part of the BP/Dow
Redevelopment Area and cannot be incorporated into the Boroughs redevelopment plan under the
guise that the parcel is necessary for the overall redevelopment initiative. Plaintiffs further
argue that the lower courts incorrectly applied the substantial evidence standard of review.
According to plaintiffs, Paulsboros designation was not supported by substantial evidence because it
was based on the net opinion of the Boroughs expert.
In response, Paulsboro contends that the Constitution delegates responsibility for defining the term
blighted areas to the Legislature, which provided clear guidance by enacting the Local
Redevelopment and Housing Law,
N.J.S.A. 40A:12A-1 to -73. Paulsboro asserts that under the
plain language of
N.J.S.A. 40A:12A-5(e), a planning board may designate property as in
need of redevelopment so long as the property is stagnant or not fully
productive. Further, Paulsboro argues that the meanings of stagnant and not fully productive
are interchangeable and stagnant should be read to explain the phrase not fully
productive. Paulsboro contends that the lower courts correctly applied the substantial evidence standard
and that the record supports the Boroughs decision.
We begin by addressing plaintiffs constitutional challenge to Paulsboros interpretation of
N.J.S.A. 40A:12-5(e).
Next, because we conclude that Paulsboros construction of subsection 5(e) would render that
provision unconstitutional, we discuss whether
N.J.S.A. 40A:12A-5(e) is reasonably susceptible to an interpretation
that complies with the Constitution. Finally, we briefly address the parties arguments regarding
the standard of review for municipal redevelopment designations.
III.
A.
This Court has long recognized that the State possesses authority to take private
property, restricted only by the pertinent clauses of [our] Constitution.
Abbott v. Beth
Israel Cemetery Assn,
13 N.J. 528, 545 (1953). The Constitution imposes three significant
limitations on the States eminent domain power.
See generally Robert F. Williams,
The
New Jersey State Constitution 47-48, 71, 118-19 (1997) (discussing restrictions on eminent domain).
First, the State must pay just compensation for property taken by eminent domain.
N.J. Const. art. I, ¶ 20. Second, no person may be deprived of property
without due process of law.
Twp. of W. Orange v. 769 Assocs.,
172 N.J. 564, 572 (2002). Third, and germane to this appeal, the State may
take private property only for a public use.
N.J. Const. art. I, ¶ 20;
see Twp. of W. Orange,
supra, 172
N.J. at 572.
In respect of the public use requirement, Article VIII, Section 3, Paragraph 1
of the Constitution (Blighted Areas Clause) provides:
The clearance, replanning, development or redevelopment of
blighted areas shall be a public
purpose and public use, for which private property may be taken or acquired.
Municipal, public or private corporations may be authorized by law to undertake such
clearance, replanning, development or redevelopment; and improvements made for these purposes and uses,
or for any of them, may be exempted from taxation, in whole or
in part, for a limited period of time . . . . The
conditions of use, ownership, management and control of such improvements shall be regulated
by law.
[(Emphasis added).]
Pursuant to that authorization, the Legislature enacted the Local Redevelopment and Housing Law
(LRHL), N.J.S.A. 40A:12A-1 to -49, which empowers municipalities to designate property as in
need of redevelopment and thus subject to the States eminent domain power. See
N.J.S.A. 40A:12A-3 (defining redevelopment area or in need of redevelopment as pursuant to
constitutional authority of Blighted Areas Clause). In designating the Gallenthin property as in
need of redevelopment, Paulsboro relied on N.J.S.A. 40A:12A-5(e), which permits a municipality to
classify land as in need of redevelopment if it finds a
growing lack or total lack of proper utilization of areas caused by the
condition of the title, diverse ownership of the real property therein or other
conditions, resulting in a stagnant or not fully productive condition of land potentially
useful and valuable for contributing to and serving the public health, safety and
welfare.
[(Emphasis added).]
Paulsboro therefore asserts that an area may be classified as in need of
redevelopment so long as it is not fully productive and the property is
potentially useful and valuable for contributing to and serving the public health, safety
and welfare. According to Paulsboro, the phrase other conditions refers to any possible
condition. Paulsboro also claims that because the statute literally reads stagnant or not
fully productive, subsection 5(e) is most reasonably read to interchange the meanings of
stagnant and not fully productive.
Plaintiffs respond that Paulsboros interpretation of N.J.S.A. 40A:12A-5(e) is unconstitutional because it exceeds
the Blighted Areas Clauses delegation of authority. According to plaintiffs, the Blighted Areas
Clause authorizes the redevelopment of only blighted areas and Paulsboros interpretation of subsection
5(e) impermissibly extends a municipalitys redevelopment authority to any property that is not
fully productive.
This appeal therefore requires us to ascertain the meaning of the term blighted
as used in the New Jersey Constitution, and determine whether Paulsboros interpretation of
N.J.S.A. 40A:12A-5(e) is within the scope of that term. Because those issues present
questions of law, we review them de novo. Hodges v. Sasil Corp.,
189 N.J. 210, 220-21 (2007) (citing Balsamides v. Protameen Chems., Inc.,
160 N.J. 352,
372 (1999)).
B.
As a threshold matter, Paulsboro iterates that the Blighted Areas Clause authorizes the
Legislature, not the Judiciary, to define blight, and, therefore, we must endorse the
LRHLs definition of that concept. Several amici curiae also contend that because the
Blighted Areas Clause concerns only a grant of authority to the Legislature, the
clause cannot be the source of a private constitutional protection. Those contentions are
misguided.
Although the Blighted Areas Clause undoubtedly enlarges the Legislatures eminent domain power to
include the taking of private property for redevelopment purposes,
see Wilson v. City
of Long Branch,
27 N.J. 360, 381-82 (stating that Blighted Areas Clause authorizes
Legislature to enact enabling legislation),
cert. denied,
358 U.S. 873,
79 S. Ct. 113,
3 L. Ed.2d 104, (1958), the Judiciary is the final arbiter
of the institutional commissions articulated in the Constitution,
see Sherman v. CitiBank,
143 N.J. 35, 58 (1995) (It is emphatically the province and duty of the
judicial department to say what the law is.) (quoting
Marbury v. Madison, 5
U.S. (1 Cranch) 137, 177,
2 L. Ed. 60, 71 (1803)),
vacated on
other grounds,
517 U.S. 1241,
116 S. Ct. 2493,
135 L. Ed.2d 186 (1996). Our Constitution makes clear that [a]ll political power is inherent in
the people and that [g]overnment is instituted for the protection, security and benefit
of the people.
N.J. Const. art. I, ¶ 2. By adopting the Blighted Areas
Clause, the People entrusted certain powers to the Legislature, and the courts are
responsible for ensuring that the terms of that trust are honored and enforced.
We find no merit to Paulsboros assertion that the Blighted Areas Clause divests
the Judiciary of that responsibility.
Further, the Blighted Areas Clause authorizes governmental entities to exercise eminent domain power
in respect of blighted areas.
N.J. Const. art. VIII, § 3, ¶ 1. The provision
grants authority to those entities only to the extent allowed by our State
Constitution. The clause operates as both a grant and limit on the States
redevelopment authority. The contention that the clause cannot be the basis for invalidating
municipal action is thus incorrect.
IV.
We now turn to whether Paulsboros interpretation of
N.J.S.A. 40A:12A-5(e) violates the Blighted
Areas Clause. The Constitution is, above all, an embodiment of the will of
the People, and this Courts responsibility as final expositor is to ascertain and
enforce that mandate.
See Bd. of Chosen Freeholders of Morris v. State,
159 N.J. 565, 575-76 (1999). Generally, the surest indicator of that intent is a
provisions plain language.
See Gangemi v. Berry,
25 N.J. 1, 10 (1957). However,
[w]here the text is unclear or ambiguous . . . a court may
look to sources beyond the Constitution itself to ascertain the fundamental purpose underlying
the language.
Bd. of Chosen Freeholders of Morris,
supra, 159
N.J. at 576
(citing
Lloyd v. Vermeulen,
22 N.J. 200, 206 (1956)).
Additionally, when evaluating a constitutional challenge to a statute, we presume that the
[L]egislature acted with existing constitutional law in mind and intended the [statute] to
function in a constitutional manner.
State v. Profaci,
56 N.J. 346, 349 (1970)
(citations omitted). [E]ven though a statute may be open to a construction which
would render it unconstitutional or permits its unconstitutional application, it is the duty
of this Court to so construe the statute as to render it constitutional
if it is reasonably susceptible to such interpretation.
State v. Miller,
170 N.J. 417, 433 (2002) (quotation and citations omitted).
A.
Blight is generally defined as [s]omething that impairs growth, withers hopes and ambitions,
or impedes progress and prosperity.
American Heritage Dictionary 196 (4th ed. 2000);
see
New Oxford American Dictionary 177 (2d ed. 2005) (defining blight as an ugly,
neglected, or rundown condition of an urban area). In 1938, an influential urban
planner and author defined blight as an area in which deteriorating forces have
obviously reduced economic and social values to such a degree that widespread rehabilitation
is necessary to forestall the development of an actual slum condition. Mabel L.
Walker,
Urban Blight and Slums 5 (1938). A more recent definition, as used
in the context of urban redevelopment, describes blight as an area, usually in
a city, that is in transition from a state of relative civic health
to the state of being a slum, a breeding ground for crime, disease,
and unhealthful living conditions. Hudson Hayes Luce,
The Meaning of Blight: A Survey
of Statutory and Case Law, 35
Real Prop. Prob. & Tr. J. 389,
393 (2000). Thus, the term presumes deterioration or stagnation that negatively affects surrounding
areas.
The word was incorporated into our Constitution when the 1947 Constitutional Convention adopted
the Blighted Areas Clause. According to Delegate Jane Barus, who sponsored the Blighted
Areas Clause, the provision was intended to enable the rehabilitation of our cities.
Proceedings of the New Jersey Constitutional Convention of 1947, vol. I at 744.
Barus described the impetus for the clause as follows:
Certain sections of [the older cities in the State] have fallen in value,
and have [become] what [are] known as blighted or depressed areas. This has
happened, sometimes, because the population has shifted from one part of the town
to another, or one section has become overcrowded. Sometimes it has happened because
the district has turned to business instead of residential, or partly to business;
and sometimes simply because the buildings themselves, although they were originally good and
may have been fine homes, have become so outdated and obsolescent that they
are no longer desirable, and hence, no longer profitable.
These depressed areas go steadily down hill. The original occupants move away, the
rents fall, landlords lose income and they make up for it by taking
in more families per house. Its impossible to keep the properties in good
condition, the houses deteriorate more and more, and what was once a good
section of the town is on the way to becoming a slum.
Naturally, this slump in value is not confined to the original area affected.
It spreads to neighboring blocks. No one person . . . can counteract
this spread, because no one can afford to sink money into a blighted
area . . . because the improvement is so small that it cannot
turn the tide of deterioration.
[Id. at 742-43.]
Barus also noted that prior legislation aimed at slum clearance had been unsuccessful
in securing private investment because of the understandable fear that those statutes would
be declared unconstitutional. Id. 743-44. The Blighted Areas Clause was intended to alleviate
those concerns and facilitate investment in blighted areas. Id. at 744; see McClintock
v. City of Trenton,
47 N.J. 102, 105 (1966) ([T]his blighted area provision
was adopted to remove any doubts with regard to earlier pertinent legislation.) (citations
omitted).
The legislation referenced by Barus, the 1944 Redevelopment Companies Law, L. 1944, c.
169, and the 1946 Urban Redevelopment Law, L. 1946, c. 52, contained descriptions
of blight. The Redevelopment Companies Law described blighted areas as areas . .
. where there exist substandard conditions and [un]sanitary housing conditions owing to obsolescence,
deterioration and dilapidation of buildings, or excessive land coverage, lack of planning, of
public facilities, of sufficient light, air and space, and improper design and arrangement
of living quarters. L. 1944, c. 169, § 2. Likewise, the Urban Redevelopment Law
sought to remedy congested, dilapidated, substandard, unsanitary and dangerous housing conditions, which were
a menace and a social and economic liabilit[y]. L. 1946, c. 52, § 2.
Accordingly, in adopting the Blighted Areas Clause, the framers were concerned with addressing
a particular phenomenon, namely, the deterioration of certain sections of older cities that
were causing an economic domino effect devastating surrounding properties. The Blighted Areas Clause
enabled municipalities to intervene, stop further economic degradation, and provide incentives for private
investment.
B.
Our Constitution, however, is a living charter -- designed to serve the ages
and to be adaptable to the developing problems of the times.
Vreeland v.
Byrne,
72 N.J. 292, 328 (1977) (footnote omitted). Thus, in 1958, we upheld
the constitutionality of the Blighted Areas Acts (BAA) progressive definition of blight.
Wilson,
supra, 27
N.J. at 378-82. The BAA was the predecessor of the statute
at issue in this appeal, the LRHL, and it contained a provision substantially
similar to
N.J.S.A. 40A:12A-5(e). Under the BAAs subsection (e), an area was blighted
if there was:
A growing or total lack of proper utilization of areas caused by the
condition of the title, diverse ownership of the real property therein and other
conditions, resulting in a stagnant and unproductive condition of land potentially useful and
valuable for contributing to and serving the public health, safety and welfare.
See footnote 3
[
N.J.S.A. 40:55-21.1(e) (repealed 1992) (emphasis added).]
In upholding that definition of blight, we observed:
Community redevelopment is a modern facet of municipal government. Soundly planned redevelopment can
make the difference between continued stagnation and decline and a resurgence of healthy
growth. It provides the means of removing the decadent effect of slums and
blight on neighboring property values, of opening up new areas for residence and
industry. In recent years, recognition has grown that governing bodies must either plan
for the development or redevelopment of urban areas or permit them to become
more congested, deteriorated, obsolescent, unhealthy, stagnant, inefficient and costly.
[Wilson, supra, 27 N.J. at 370.]
Recognizing the important role of redevelopment in our society, we concluded that the
BAAs definition of blight was within the bounds of the Constitution. Id. at
382 ([N]o reasonable argument can be made that the connotation ascribed to [blight]
overreaches the public purpose sought to be promoted by the Constitution.).
In 1971, we revisited the validity of the BAAs definition of blight and
held that the BAA applied to more than slum clearance. Levin v. Twp.
Comm. of Bridgewater,
57 N.J. 506, 511-16, 545 (1971); see also Jersey City
Chapter of the Prop. Owners Prot. Assn v. Jersey City,
55 N.J. 86,
96 (1969) (noting that BAA applied to more than perceptually offensive slums). Specifically,
we approved redevelopment plans aimed at suburban and rural areas and upheld the
acquisition of land in that context. Levin, supra, 57 N.J. at 512. Thus,
Levin expanded the definition of blight to include areas that were not necessarily
contemplated by the framers but were within the true sense and meaning of
the term. See Bd. of Chosen Freeholders of Morris, supra, 159 N.J. at
576 (explaining that Constitution must accommodate true sense and meaning of the language
used) (quotation and citations omitted).
That said, blight still has a negative connotation. In Levin, supra, for example,
we found that the parcels at issue were preventing the proper development of
surrounding properties because they had reached a stage of stagnation and unproductiveness. 57
N.J. at 512, 538. In Wilson, supra, we noted that much of the
designated area contained dilapidated homes and other buildings, which were obviously beyond restoration,
27 N.J. at 394, and we observed that community redevelopment was a means
of removing the decadent effect . . . on neighboring property values, id.
at 370. Although the meaning of blight has evolved, the term retains its
essential characteristic: deterioration or stagnation that negatively affects surrounding properties.
C.
That articulation of the terms essential meaning is consistent with other states statutory
definitions of blight. In 2000, Hudson Hayes Luce conducted a comparative survey of
statutory and case law defining the term blight. Luce,
supra, 35
Real Prop.
Prob. & Tr. J. at 394 (noting that all fifty states, District of
Columbia, Guam, Puerto Rico, and Virgin Islands have statutorily defined blight). Although Luce
noted variation among the fifty-four statutes defining blight, he observed that they all
contained common language such as: Constitutes an economic and social liability, conducive to
ill health, transmission of disease, infant mortality, juvenile delinquency, and crime, and detrimental
(or a menace) to the public safety, welfare, or morals.
Id. at 403.
Conversely, Luces survey reveals that only eight states and the District of Columbia
permit local governments to classify property as blighted based on an economic evaluation
of the propertys use.
Id. at 401, 403. Moreover, even within those jurisdictions,
courts tend to hold that property is not blighted if the only statutory
criterion identified by the redevelopment agency is the not fully productive use of
the land.
Id. at 464.
For example, in
Sweetwater Valley Civic Assn v. City of National City,
555 P.2d 1099, 1103 (Cal. 1976), the California Supreme Court held that it is
not sufficient to merely show that the area is not being put to
its optimum use, or that the land is more valuable for other uses.
Rather, according to the court, blighted property presents a real hindrance to the
development of the city [which] cannot be eliminated or improved without public assistance.
Ibid.;
see, e.g.,
Regus v. City of Baldwin Park,
139 Cal. Rptr. 196,
203 (Ct. App. 1977) (holding that area was not blighted because there is
no evidence to show that the [p]roject area is either a social or
an economic liability -- except in the sense that it might be made
more profitable to the [c]ity than it now is);
Sw. Ill. Dev. Auth.
v. Natl City Envtl., LLC,
710 N.E.2d 896, 904 (Ill. App. Ct. 1999)
(In this case we have no blight . . . . [A] condemning
authority is [not] justified in using its power of eminent domain to take
private property from an unwilling seller and to transfer it to another private
enterprise to increase the profits of that enterprise.),
affd,
768 N.E.2d 1 (Ill.
2002).
D.
We recognize that government redevelopment is a valuable tool for municipalities faced with
economic deterioration in their communities. As noted, our Constitution expressly authorizes municipalities to
engage in redevelopment of blighted areas. However, Paulsboro interprets subsection 5(e) to permit
redevelopment of any property that is stagnant or not fully productive yet potentially
valuable for contributing to and serving the general welfare. Under that approach, any
property that is operated in a less than optimal manner is arguably blighted.
If such an all-encompassing definition of blight were adopted, most property in the
State would be eligible for redevelopment. We need not examine every shade of
gray coloring a concept as elusive as blight to conclude that the terms
meaning cannot extend as far as Paulsboro contends. At its core, blight includes
deterioration or stagnation that has a decadent effect on surrounding property. We therefore
conclude that Paulsboros interpretation of
N.J.S.A. 40A:12A-5(e), which would equate blighted areas to
areas that are not operated in an optimal manner, cannot be reconciled with
the New Jersey Constitution.
V.
We now address whether
N.J.S.A. 40A:12A-5(e) is reasonably susceptible to an alternative interpretation
that conforms to the Blighted Areas Clause. A courts goal when interpreting a
statute is to give effect to the Legislatures intent.
See SASCO 1997 NI,
LLC v. Zudkewich,
166 N.J. 579, 586 (2001). Generally, the statutes plain language
is the most reliable indicium of that intent.
See L.W. v. Toms River
Regl Schs. Bd. of Educ.,
189 N.J. 381, 400 (2007). However, we presume
that the Legislature intended the [statute] to function in a constitutional manner, and
articulation of the elements which furnish that essential intent need not appear in
the statutory language.
Profaci,
supra, 56
N.J. at 349 (citation omitted). Thus, under
New Jersey law, a challenged statute will be construed to avoid constitutional defects
if the statute is reasonably susceptible of such construction.
Bd. of Higher Educ.
v. Bd. of Dirs. of Shelton Coll.,
90 N.J. 470, 478 (1982) (citing
Profaci,
supra, 56
N.J. at 350).
A.
The overall structure of
N.J.S.A. 40A:12A-5 suggests that the Legislature did not intend
subsection (e), which pertains to defects in title and diversity of ownership, to
be as broadly applied as Paulsboro contends. The Legislature included eight subsections within
N.J.S.A. 40A:12A-5, any one of which may be the basis for designating property
as in need of redevelopment.
See Concerned Citizens of Princeton, Inc. v. Mayor
of Princeton,
370 N.J. Super. 429, 435-36 (App. Div.),
certif. denied,
182 N.J. 139 (2004). Although there is a degree of overlap between those criteria,
see,
e.g.,
ibid. (finding both subsections (d) and (e) applicable), under Paulsboros interpretation, subsection
(e) would entirely subsume several other subsections. For example, subsection (b) permits a
planning board to include property in a redevelopment area if the property contains
buildings previously used for commercial, manufacturing, or industrial purposes; the abandonment of such
buildings; or the same being allowed to fall into so great a state
of disrepair as to be untenantable.
N.J.S.A. 40A:12A-5(b). Under subsection (c), a redevelopment
designation is also appropriate where
unimproved vacant land . . . has remained so for a period of
ten years . . . and[,] by reason of its location, remoteness, lack
of means of access to developed sections or portions of the municipality, or
topography, or nature of the soil, is not likely to be developed through
the instrumentality of private capital.
[
N.J.S.A. 40A:12A-5(c).]
If Paulsboros interpretation of subsection (e) were adopted, land that qualifies under either
subsection (b) or (c) would also surely qualify as not fully productive under
subsection (e), rendering subsections (b) and (c) superplusage. Although statutory provisions often overlap,
under Paulsboros interpretation, subsection (e) would entirely envelop several other subsections.
Further, within subsection (e) and immediately before the phrase other conditions, the Legislature
listed two specific criteria that trigger the applicability of the subsection, namely, diverse
ownership and condition of the title. If other conditions is interpreted to mean
any condition, those two phrases, which are conspicuously descript, would be redundant and
subsection (e) would be applicable in any event.
Because we seek to avoid rendering any part of a statute meaningless,
State
v. Reynolds,
124 N.J. 559, 564 (1991), we cannot accept the Planning Boards
conclusion that subsection (e) applies to any parcel that is not fully productive.
Rather, in view of the statutes context and structure, a reasonable interpretation of
N.J.S.A. 40A:12A-5 is that each subsection provides, at least to a degree, an
independent basis for designating property as in need of redevelopment.
Consequently, the phrase or other conditions should be interpreted in accordance with the
ejusdem generis principle of statutory construction.
See State v. Hoffman,
149 N.J. 564,
584 (1997). Under that canon of statutory interpretation, where general words follow specific
words in a statutory enumeration, the general words are construed to embrace
only
objects similar in nature to those objects enumerated by the preceding specific words.
2A Norman J. Singer,
Sutherland Statutory Construction § 47:17 (6th ed. 2000) (emphasis added).
The phrase other conditions is not a universal catch-all that refers to any
eventuality. Rather, it refers to circumstances of the same or like piece as
conditions of title or diverse ownership. In that respect, we are in substantial
agreement with Judge Presslers conclusion in
Forbes v. Board of Trustees of South
Orange Village,
312 N.J. Super. 519, 526-27 (App. Div.),
certif. denied,
156 N.J. 411 (1998), that the 1992 alteration to
N.J.S.A. 40A:12A-5(e) should be viewed as
the substantial equivalent of the BAAs subsection (e).
We also must presume that the Legislature did not intend the phrase stagnant
or not fully productive to create two alternative criteria for designating property as
in need of redevelopment. As discussed above, such an interpretation would exceed the
meaning of blight and render
N.J.S.A. 40A:12A-5(e) unconstitutional. Rather, the term not fully
productive must be viewed as elaborating on the operative criterion, that is, stagnant.
See State v. Holland,
132 N.J. Super. 17, 24 (App. Div. 1975) ([I]t
has long been settled that the disjunctive or in a . . .
statute may be construed as the conjunctive and if to do so is
consistent with the legislative intent.) (citing
Baum v. Cooper,
131 N.J.L. 574, 575
(Sup. Ct. 1944)).
B.
That interpretation is supported by
Levin,
supra, where we upheld the constitutionality of
subsection (e) of the LRHLs predecessor, the BAA, and addressed subsection (e)s intended
scope.
57 N.J. 506. Regarding the particular problem subsection (e) was intended to
address, we observed:
The lawmakers recognized that where an undeveloped land area was burdened with defective,
questionable or unusual conditions of title, unsuitable lot layouts, diverse ownership, and outmoded
and undeveloped street patterns, serious difficulties stood in the way of a unified
development which would serve the health, welfare, social and economic interests, and sound
growth of the community. They knew that fractionalization could be eliminated and the
area dealt with as a whole if it could be treated as blighted
and if the municipal power of eminent domain could be exercised to expeditiously
bring it into such ownership as would permit realization of its maximum potential
as part of an orderly community growth. The conclusion is inescapable that subsection
(e) was added to the blighted area statute in order to make such
a result possible.
[
Id. at 515.]
We thus recognized that the Legislature intended subsection (e) to apply in circumstances
where the orderly development of a particular area is frustrated by its peculiar
configuration. That is, subsection (e) was meant to apply to areas that for
a variety of reasons -- such as diversity of ownership and conditions of
title -- were not susceptible to unified development. The subsection enabled State agencies
and local government to facilitate redevelopment by eradicating impediments to sound land use
planning.
Indeed, the area at issue in
Levin contained many problems associated with (1)
diverse ownership of the lots, (2) questionable or invalid titles resulting from defective
tax foreclosure proceedings, (3) . . . conflicting conveyances . . . ,
[and] (4) the need for vacation of many paper streets in order to
provide proper and convenient . . . ingress and egress.
Id. at 531.
Those issues created a situation where redevelopment could not occur without municipal intervention.
Id. at 539.
Moreover, we observed that in addition to suffering from fragmentation, the area at
issue had deteriorated to such an extent that it could accurately be described
as stagnant and unproductive.
Id. at 515. We characterized the land as fallow,
id. at 540, and suffering from a long standing condition of stagnation and
unproductiveness,
id. at 539. Our approval of municipal redevelopment was not based on
underutilization or the propertys not fully productive use. Rather, we found that the
area was subject to government redevelopment because, as a result of suffering from
defects of title, and the like, it ha