Court sees Soopers-sized ruse
Appellate panel rules Lafayette acted in “bad faith” to stop grocer from moving to Erie
Lafayette acted in “bad faith” when it attempted to condemn land belonging to neighboring Erie for the stated purpose of turning it into open-space buffer when the city’s real aim was to stop a future retail project in Erie along with the coveted sales tax dollars that come with it, the state’s appellate court ruled Thursday.
The three-judge panel of the Colorado Court of Appeals dismissed Lafayette’s attempted eminent domain action, upholding a district court ruling from 2017 that spurned the city’s condemnation of 22 acres in Erie at the southeast corner of U.S. 287 and Arapahoe Road, where the Boulder County municipalities share a border.
The appeals court concluded that Lafayette’s 2016 open-space play, sold by the city as an attempt to create a buffer for its Beacon Hill neighborhood, was actually a ploy by the city to derail Erie’s planned commercial development at the site, known as Nine Mile Corner. The driving factor behind the eminent domain action, the judges wrote, was the desire by Lafayette to prevent a King Soopers grocery store in the city from relocating to Nine Mile Corner and taking its sales tax dollars to Erie.
“The (court) holds that the municipality’s ultimate reason for condemning the property — to prevent a grocery store and its associated tax revenue from relocating — is not a valid public purpose,” the judges ruled.
Evidence in the case, the court said, supported the idea that “Lafayette had no interest in the property until it learned of Erie’s proposed development.” The appellate judges observed that while a 2008 Colorado Supreme Court case out of Telluride upheld the right of a municipality to condemn property beyond its boundaries, such action has to be in support of a “valid public purpose.”
“The stated public purpose of an open space buffer is valid, but blocking Erie’s planned development — planning that predated Lafayette’s condemnation petition — is not lawful,” the court opinion stated.
Arguments in the case were made before three appeals court judges in March.
Lafayette spokeswoman Debbie Wilmot expressed disappointment in the appeals court’s Thursday ruling. She said the area surrounding Nine Mile Corner had long been protected from development by an agreement signed on to by Erie, Lafayette and Boulder County “until Erie decided to drop out of the (agreement), backfill the existing reservoir and make plans to develop the land that Lafayette, Erie and the neighbors in Beacon Hill relied upon as a community separator.”
“Despite Lafayette’s $2.3 million offer to purchase approximately the southern half of the Nine Mile property to serve an open space buffer, and the fact that the (intergovernmental agreement) stood for many years to provide that buffer, the court saw it as bad faith,” Wilmot said.
She said Lafayette’s attempt to create a buffer at Nine Mile Corner was in keeping with similar openspace purchases that the city has made that provide a physical separation between it and its neighbors, including Broomfield and Louisville.
“It is obvious that some parts of the state do not see the value of open space and community separators the same way we do in Lafayette and Boulder County,” Wilmot said.
Erie had cast the battle with its neighbor as an ongoing attempt by Lafayette to quash competition for sales tax dollars along the busy U.S. 287 corridor, where the city already has a Walmart and other retail outlets. The town pointed to Lafayette’s ambitious development plans all around the Nine Mile Corner site as evidence that it is being hypocritical in its call for open-space preservation.
An attorney for Erie, Mikaela Rivera, told The Denver Post that the ruling sends a message to cities and other government entities in Colorado that if they are going to exercise their eminent domain powers, they better have legal justification for doing so.
“The opinion doesn’t allow condemning authorities to hide behind the assertion of legitimate public purpose — that a court will look at what is truly motivating a condemnation action,” she said. “The message is that governments have to use their awesome power of eminent domain in good faith and that courts will be there to review it.”
No decision has been made about whether Lafayette will appeal Thursday’s ruling to the state’s high court, Wilmot said.