Sports Eminent Domain and The Battle of Niagara

A 12-acre parcel in the South End of Niagara Falls, New York is currently the subject of ongoing eminent domain proceedings, featuring a battle between development and construction company Niagara Falls Redevelopment (NFR), and Niagara Falls officials, including its mayor, Robert Restaino. Restaino has been vocal in his support of an event center and campus, named Centennial Park, emphasizing the jobs and economic growth the project would bring to the area. However, there has been a lack of evidence that there will be adequate funding for the proposed project or that it will be viable long-term without a permanent tenant. The city argues that the Niagara University Basketball and Hockey Teams would fill this latter void, but the city has received no assurances from the school as to whether or not they are on board.

In response to the eminent domain proceedings and the city’s push to claim the land, Roger Trevino, a principal of NFR, said, “We firmly believe that eminent domain proceedings are not needed, and we oppose such actions as highly premature. Eminent domain can take years and cost taxpayers millions. It would be completely unnecessary in the face of the opportunities we have been discussing with Mayor Restaino” (Niagara Gazette, 2022). While this Niagara land battle presents some compelling legal questions, the more interesting inquiry is whether or not a city could or would ever initiate eminent domain proceedings for a major college or professional team, and what legal challenges those proceedings may face.

What Is Eminent Domain?

Eminent domain is the power of the government to take property for public use without the consent of the owner. It can be exercised either by public officials or by private parties to whom the power has been delegated. And it can be exercised either through the initiation of legal proceedings or simply by taking possession up front, with compensation to follow.

PennEast Pipeline Company, LLC v. New Jersey, 141 S.Ct. 2244, 2251 (2021). The Supreme Court has consistently upheld the right of government entities to transfer ownership of seized properties to third parties, as long as the seizure has a legitimate public purpose. See Kelo v. City of New London, 545 U.S. 469 (2005); see also

Hawaii Hous. Auth. v. Midkiff, 467 U.S. 229 (1984). Necessarily, the main issue in a sports-related context will be whether or not sporting venues have a “legitimate public purpose” to satisfy legislative bodies and, more importantly, courts.

The City of Niagara faces an uphill battle in its eminent domain proceedings not only because of the “legitimate public purpose” question, but also due to other factors like funding, economic viability, and whether or not the current land development plan is a more legitimate public purpose than the city’s plan. But using the Niagara case as a springboard, the question of whether or not a sports stadium or arena serves a legitimate public purpose becomes an interesting public policy debate.

Policy Arguments for a Public Purpose

In arguing for a “public purpose” for a stadium or arena, the positive arguments center around the economic benefit to the municipality, similar arguments to the ones currently made for public funding of stadiums. The city initially benefits from the construction of the stadium. That process creates scores of jobs, especially if the team adds a shopping district or some other attraction to the construction project. Once the venue is up and running, the city ideally benefits from having attractions year-round that fill that stadium, whether it be the principal occupant, concerts, amateur competitions, etc. Gameday visitors travel on mass transit and on toll roads, generating tax dollars. Visitors generate additional tax dollars when they park in paid lots, visit small businesses prior to the game, purchase concessions and souvenirs at the game, and stay in hotels or vacation rentals within the municipality.

Of course, there are benefits of the stadium that are not purely economic but still beneficial to the local community that receives a new venue. The increased attention on the team and their new arena naturally provide opportunities for the local government and businesses to promote social and community initiatives. Additionally, teams will more than likely have their own charitable foundations and projects that will positively impact the local community. Finally, the greater share of jobs required to continue to operate the stadium will usually allow for more employment opportunities for lower-income communities, and in doing so will ideally raise the standard of living for that city.

Policy Arguments Against a Public Purpose

In arguing against the seizure of land for sports venues, cities have a number of economic concerns that usually apply. The contested land may serve a more beneficial purpose, especially if the land desired has a viable economic, historic, social, or artistic purpose. The up-front taxpayer input usually required by most teams hampers the local economy, while the revenues generated may reside largely or solely with the team. The seizure of the land and construction of the stadium will naturally create disruptions to the local market and possibly the local infrastructure, including roads and mass transit. Further, once the stadium is up and running, there is no guarantee of financial viability, even if the team is very successful, depending on the cost of the project and any additional construction projects.

As a social matter, state and local governments may be hesitant to support eminent domain proceedings for sports-related purposes. The venue may be most beneficial to non-residents, depending on the average income of the city compared to the average price of tickets. Residents could, effectively, be priced out of the enjoyment the seizure was initiated to create, even more so if the area around the venue becomes too expensive, forcing current residents to relocate. Further, increased transient traffic will naturally create disturbances and require increased maintenance efforts, both for public services and for local residents. The economic investment and impact of the stadium may prompt the local government to cater more policies to visitors, potentially at the expense of residents. This may result in the municipal government ignoring larger social problems to support the team and the new venue. Finally, the seizure may have disproportionate effects on lower-income communities and communities of color, which may be amplified if the land is of particular historical or social significance within those communities.

A Potential Real-World Example

If Restaino and crew can prove that Centennial Park does in fact serve a public purpose, will the decision open the floodgates? With this case as precedent, it’s possible professional and collegiate teams are able to claim land for the construction of their own facilities and venues. The University of Miami is rumored to be looking into building its own stadium at Tropical Park in Coral Gables. The project is being spearheaded by Canes’ booster, John Ruiz, with the help of his son, Johnny Ruiz, and HKS architects, who are known for SoFi Stadium, AT&T Stadium, and U.S. Bank Stadium. While there hasn’t been any official word from the University, local Coral Gables residents and some city officials have been pretty vocal in their opposition to the proposal, citing increased traffic and loss of the use of the historical Tropical Park. If Niagra Falls city officials are able to claim the 12-acre parcel for an event and athletic complex by justifying the taking as ‘in the interest of public good’, it's possible Ruiz and company follow suit, potentially bringing in the University of Miami and the City of Miami to repurpose Tropical Park.