Portland City Commissioner Randy Leonard wants the government to use its power of eminent domain to take property from one set of owners in SE Portland and transfer it to some others, in the hope that they will build an upscale supermarket. Commissioner Leonard believes that the lack of development on a four-acre parcel in the Lents neighborhood is evidence of “market failure,” which justifies government intervention.
Many local property owners object, but Commissioner Leonard insists, “If you want your property values to go up, if you want business to rise, you have to allow condemnation.”
In fact, there are other ways to improve neighborhoods and increase property values. Throughout the 20th century, St. Louis revitalized some of its worst neighborhoods by transferring control of streets to local homeowners. In 1974 the residents of one deteriorating neighborhood formed a residential association and assumed management responsibility for the primary boulevard. They raised $40,000 to erect a gate that partially closed the street, giving owners more control. A block watch was started, crime decreased, and the association borrowed funds to improve the street and housing. The result was that property values doubled.
There’s no guarantee that this strategy would succeed in Lents, but it’s better than threatening property owners with condemnation. Empowering local homeowners by strengthening their property rights creates new investment opportunities, and investment is exactly what Portland needs.
