NFIB

Testimony Before the Senate State and Local Government and Veterans Affairs Committees

Proponent Testimony, Senate Bill 7, Eminent Domain

127th Ohio General Assembly

From Ty R. Pine, NFIB/Ohio Legislative Director

Mr. Chairman and members of the senate state and local government and veterans affairs committee, my name is Ty Pine and I am here on behalf of the 25,000 governing members of the Ohio Chapter of the National Federation of Independent Business to provide proponent testimony in support of Senate Bill 7. Ohio's small-business owners thank you for your thoughtful deliberation on this matter and I want to thank you in advance for your commitment and sensitivity to small-business issues.

NFIB/Ohio is the state's largest small-business advocacy organization dedicated exclusively to representing the interests of independent business owners. Our membership spans the spectrum of the business community, ranging from sole proprietorships to substantial, independently held enterprises. The typical NFIB member employs fewer than ten workers and grosses less than $450,000 in annual sales. 

I want to provide this committee with NFIB's perspective on eminent domain and SB 7. As an organization, NFIB has advocated throughout the country to protect the rights of property owners. Inherent in NFIB mission statement, "To promote and protect the right for our members to own, operate and grow their business," is the concept that ownership of a business is of paramount importance to the success of a small business. Annually, NFIB members are asked to weigh in on pending public policy issues via a Member Ballot process. Our members' responses to the ballots determine NFIB's position on all public policy issues. Seventy-seven percent of NFIB members believe that private property rights should be protected and support limiting the government's power of eminent domain. Interestingly this percentage is similar to the recent Quinnipiac University survey where 82 percent of Ohioans oppose using eminent domain to take property for economic development.

This committee has heard the various and sundry components that local governments have cobbled together to justify the taking of private property. It is our position that small-business owners, like homeowners, deserve concise and understandable definitions and processes leading up to a take, and fair compensation if the action progresses. NFIB believes SB 7 balances private property rights while preserving the power of eminent domain. Below I have highlighted a few policy items of key interest to small-business owners related to the debate on eminent domain.

Definition of blight: SB 7 is a marked improvement over the recommendations of the Eminent Domain Task Force. SB 7 requires three blight factors that are clear and unambiguous be met, and appropriately eliminates the antiquated, ambiguous urban renewal blight factors of old such as obsolescence, excessive dwelling unit density, inadequate street layout and multiple ownership contained in the recommendations. Moreover, SB 7 contains a right to cure provision allowing for the owner to address deficiencies on code violations.

Compensation: A tremendous investment of money, time and personal sacrifice are a prerequisite to operating a successful small business. Allowing for a property owner to collect attorney fees and appraisal costs in cases where the final award exceeds 125 percent provides minimal protection for property owners against "low balling" tactics. Additionally, small businesses must be able to receive compensation for loss of business or goodwill.

Public purpose: As local governments have taken notice to the backlash of declaring non-blighted properties as blighted, and are no longer permitted from taking property solely for the purpose of economic development, they are stretching the definition of public use to mean "any" public benefit (increased tax revenue or highest and best use). NFIB supports a more traditional standard of public use such as roads, bridges and sewers, combined with the blight definition contained in the bill limit the possibility for abuse. SB 7 reverses the burden of proof to the taking authority providing the necessary protections against abuse.

Ohio relies on small businesses to create nearly all-new jobs and we employ half of Ohio's workforce. Entrepreneurs should have the piece of mind that if they live by the rules their government will not seize their property in favor of another venture that attracts more jobs or tax revenues. On behalf of our 25,000 governing members in Ohio I respectfully ask you to support SB 7. I would be happy to answer any questions.