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Eminent Domain -4- February 9, 1996 will pull down property values in the surrounding area and preclude redevelopment of neighboring properties. Redevelopment of this property is clearly a catalyst to other activity in this part of East 14th Street. Eminent domain authority is therefore essential. Peralta Node (Area B) - Extending eminent domain authority to the Peralta Node was recommended for a variety of reasons, including the fact that redevelopment in this area will require the extension of Alvarado Street across the San Leandro creek into the area. These improvements will include the construction of a bridge to connect Davis Street to the area. The private sector action alone cannot facilitate the redevelopment of this property given the costs of the needed infrastructure improvements and the remediation of hazardous waste. Active code enforcement efforts on the old Cherry City Nursery site also indicate a need to spur reuse of the area to prevent further deterioration of that site and surrounding areas. Since the December 4 public hearing, staff has contacted all property owners in the Peralta Node and further studied existing conditions in the area. At this time, staff is recommending inclusion of twelve parcels in eminent domain authority. One property owner owns five parcels, another owns two, and the Flood Control District owns another. Therefore, this recommendation impacts six property owners and the Flood Control District. The owner of the Cherry City Nursery site (five parcels) is supportive of his property being included under eminent domain authority. The other owners are not supportive of their inclusion in eminent domain authority. The Flood Control District is neutral. It is clear that the largest property cannot be sold or developed without the knowledge that the surrounding properties will also be upgraded and redeveloped. Eminent domain is a critical tool to ensure redevelopment of the Peralta Node to its highest and best use. Staff recommends these sites for inclusion in eminent domain authority because deterioration tends to expand, potentially spilling over into adjoining areas and affecting increased numbers of residents and businesses. The types of problems exhibited by the listed properties cannot be addressed by the private sector acting alone. Future development of the properties will require public investment. Redevelopment is a critical tool available to municipalities to provide the necessary stimulus and financial means to reverse deteriorating trends, preserve and increase property values, and reuse vacant and underutilized properties. CONCLUSION Staff has discussed the possible impacts and benefits of eminent domain with potentially affected property owners. Staff recommends the extension of eminent domain to a limited number of properties to address the severe blighting conditions which typify the listed properties in order to overcome the barriers which inhibit future development. 312