Episode Transcript
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Speaker 1 (00:12):
This is our American stories, and now it's time for
our Rule of Law series. Will we tell stories about
what happens when the rule of law is present or
absent in our lives our own Alex Cortez brings us
this next story.
Speaker 2 (00:28):
This is the story of three residents of Winston Salem
in North Carolina.
Speaker 3 (00:34):
My name's Craig Richardson. I'm an economics professor at Winston
Salem State University.
Speaker 4 (00:41):
I'm Matthew Bryant, and I've practiced law in Winston Salem.
Speaker 5 (00:45):
North Carolina.
Speaker 6 (00:46):
My name is PAULA Smith. I sell placeable benefit Plans
so FSAs, hsas HRS. I have a wealth of knowledge
of hsas and FSA, so anyone needs to ask me questions,
I can answer those ques.
Speaker 3 (01:02):
I was driving on my way to work and I
heard a story on my local MPR station about a
couple named James and Phyllis Nelson and bought this little
dream home outside of Winston Salem, surrounded by hardwoods. Looking
out of their bedroom window, they could see Pilot Mountain.
And what they started to relay was something which was
(01:22):
shocking to me, which was the fact that one day
when they woke up in nineteen ninety six. This was
about seventeen years earlier. They woke up to see the
government workers driving stakes in their lawn and they came
out to ask what was going on, and they said, well,
this is where a road's coming through the highway, a
(01:44):
future highway, and it's the center line of the road
and it's going to go two hundred feet on each
side of these stakes. It turns out that that road
goes right through his kitchen, right through the middle of
his home.
Speaker 2 (01:57):
This wopping surprise arrived for Smith too.
Speaker 6 (02:02):
Both the house that we lived in for twenty nine
years in Winston Salem. So at that time we didn't
know anything about a highway coming through our neighborhood. There
was a lot of years there that we were living
not knowing what was about to happen to us. That's
for sure.
Speaker 3 (02:18):
Now when we hear a story like that, you know,
I think we know that sometimes this happens. We have
eminent domain, which means the government has the right to
have public projects and they buy out homes. But what
gave the twist to this story was that the Department
of Transportation was using a law passed by our General
(02:39):
Assembly in the late eighties that allowed the department to
make road plans that would restrict the development and use
of property indefinitely until the department got around to acquiring
and getting ready to construct the roadways. It turns out
that there's something called the Transportation cort or MAP Act.
What gave us a very unusual twist was that in
(03:02):
North Carolina, unlike any other state, which also there are
other states that have mapacks, but unlike any other state
in the United States, there was no time limit on
when these roads could be built. In other words, the DOT,
the Department of Transportation, could plan a road, could say
it would happen sometime in the future, and essentially have
(03:25):
carte blanche to decide whenever that road would be built.
And these were called road corridors. Now why would the
DOT do something like this, Well, the original intent was
that this idea would save taxpayers money. The idea behind
that was that if we designate your house in a
(03:47):
road corridor, and we're going to eventually buy your house out,
we don't want you to put in a new kitchen,
we don't want you to add a garage or add
value in any way, because that's going to cost taxpayers more.
Speaker 6 (03:58):
Money.
Speaker 3 (03:58):
So we're going to put you in this corridor, and
we're going to say that basically, any idea you have
about improving your value property is frozen. Now for the
vast majority of states, they have about you know, less
than a year they have to act or the corridor
goes away. But again in North Carolina, there was no
time limit whatsoever. This gave the power to the state
(04:23):
a tremendous amount of power and unlocked people like James
Nelson in for years, if not decades.
Speaker 5 (04:31):
I had never really heard of this law.
Speaker 4 (04:33):
However, they used it in Winston Salem back in nineteen
ninety seven and restricted hundreds and hundreds of properties and
didn't pay for it, and the owners were all sort
of stuck waiting for the department, and the department never
really got around of funding that road and building it.
Speaker 5 (04:51):
So that had festered.
Speaker 4 (04:52):
Since the nineties through the two thousands until two thousand
and nine.
Speaker 6 (04:57):
We put the house on the market in November of
two thousand and six. So we've redone all this stuff.
It's now better than it was. Let's sell this house
and let's go find something else we want to build.
And realtor comes out puts the sign the yard. She
does her due diligence. She comes back and she says,
about literally about two weeks after the house have been
(05:17):
on the market, she comes back and she says, I
think you've got a problem. And she said, your house
is going to be taken by the by the DOT.
I said, no, it's not. It's going to be like
three or four houses down away from us. It's not
coming through our yard. We're not They're not taking our house.
She said, oh, yes they are. They're taking your house.
They're coming all the way to the corner now. And
(05:38):
I'm like, oh no, Now what she said, Well, I
have to take the house off the market. There's no
other buyer for your house other than the DOT. She said, no,
one's going to buy your house knowing that eventually a
road's coming through, and you know your only buyer is
the DOT. I went, oh, okay, well this is interesting.
Now what do we do? And she said, you set
(06:00):
and wait And I thought, this is not right. This
is just not right. You can't just tell me I
can't sell it, you know, tell us we can't sell
our house. And she said, well, I, in good faith,
as a realtor, cannot sell your house to anyone else.
So we took the house off the market and we
sat there and went, okay, now what.
Speaker 2 (06:22):
And one of Matthew's business clients was also a victim.
Speaker 4 (06:27):
And b roth Old Company was sitting on a very
valuable piece of property that was, you know, underutilized. It
was basically they had to park used cars on it
because for twenty years the department had not let it
or at that time about fifteen years, had not let
it get a building permit to do anything because it
was trying to keep property prices down for its ultimate
(06:50):
acquisition of the properties. And my immediate reaction on that
day and late summer of two thousand and nine was
that cannot possibly be the law. It struck me immediately
as violative of your right to freely use your property
as long as it conforms with zoning. They can't stop
me from doing something legally permissible on my property, I said,
(07:14):
they can't stop us doing things legally. So I said, okay, well,
let me figure this out. And in the span of
a day or two, I figured that this kind of
legal gimmick had been used because it's not too novel,
you know, if you want to pay some less or something.
Just don't let anybody freely use it and the price
will go down. They had done this thing twenty five
(07:35):
or six times throughout the state.
Speaker 5 (07:38):
Well, they had tried.
Speaker 4 (07:39):
That in Florida in the early nineties and it had
been almost immediately challenged and struck down as unconstitutional.
Speaker 5 (07:48):
And we said, well, they can't do this.
Speaker 4 (07:50):
The department will tell them to just give us the
building permit or by us, and we'll tell them this
is why, and lo and behold. We went back and
forth with the Department of Transportation, and they had no
interest in considering what we were doing or really undoing
their practice of restricting these properties.
Speaker 5 (08:09):
And so they told us to just jump off a
you know, the cliff. And I said, oh, we got
to do something about this.
Speaker 4 (08:18):
And the client, b Roth and my partners all said, yeah,
this is unconstitutional.
Speaker 5 (08:23):
Let's go figure out what to do.
Speaker 1 (08:28):
And we're listening to our rule of law series. North
Carolina legislators and the DOT are clearly violating the rule
of law by completely disregarding their own citizens' constitutional rights
to own property and not have it taken without just compensation.
That's the eminent domain clause. Eminent domain clause these people
were referring to in the story, all to make their
(08:51):
own jobs easier and by the way, to bring down
the price for the so called good of the taxpayers.
Because again, if you can't negotiate with anybody but the
Department of Transportation, how do you find out the real
value of your home? What happens next in this story?
Will the rule of law ultimately reign in North Carolina?
We'll find out next after this break. This is our
(09:11):
American story, and we continue with our American stories and
(09:42):
the story of North Carolina's map aack that allowed the
state to essentially freeze the improvement, development, or sale of
private property. Let's return to one of the affected homeowners
and landowners, Paula Smith, and.
Speaker 6 (09:56):
We taught the dot and they said, oh, probably within
you two years, three years, will be out there and
we'll be buying your house and you'll be on your way.
So two thousand and eight we got a new governor
of North Carolina, and Miss Purdue had her own agenda,
as most governors do. She's had her own areas of
the state that she favored, I should say, and the
(10:20):
Beltway around Winston Salem went from being I think we
were like priority number four or five in the state
to being Priority number twenty five. There was another group
of environmentalists called the Friends of Forsythe and the Friends
of for Sight. Then final lawsuit against the highway being
(10:42):
built because of some environmental issues. There was some creek
that had some kind of creature in the creek that
was going to be displaced and the creek was going
to be altered, and so the environmentalist got involved. So
that basically from two thousand and eight to two thousand
and ten, the DOT was going, we can't do anything
(11:02):
in the midst of this mess with the Friends of
her Sythe I think I even commented one time the
Friends of her Syfe were no friends of ours, because
you know, they we they were fighting against the highway
being built. I'm sitting here with a house. You know,
we can't sell because the DOT has a map on us.
It says you're going to take our house, but we
don't know when. It was just a mess. It's just
(11:23):
a total mess.
Speaker 2 (11:25):
Thankfully, the lawsuit was dismissed in twenty ten, and around
this time, Paula met Beverly Reynolds, whose family business had
a property that couldn't be expanded or sold because of this.
Speaker 6 (11:36):
Map Act, and she said, well, let's have a meeting. Well,
she got Steve Trogden, who was the head of the
DOT happened to be in Winston Salem that day, so
somehow or there she got him to come to our meeting.
I went out and put flyers in mailboxes and said
we're having a meeting at seven o'clock on this date.
(11:58):
Please be present. You'll find out what's going to happen.
So we had a good sixty five seventy people at
that meeting. And of course that's when Steve Trogden stood
there in front of all of us in twenty ten
and said, I don't know when you're ever going to
build your highway. I don't know when we're ever going
to take your houses. But you're you know you're in
the map, and we're going to buy your houses, but
(12:20):
we can't tell you when it could be twenty five
years from now before we buy your house. I think
we all just kind of our mouthage just dropped open
and went you can't stand here and say that. I mean,
you just cannot stand here and say something to these
people that this is their lives, this is their you know,
their land, their jobs there. You know, you can't just
stand here and say that he just he just didn't care.
(12:42):
I mean, I guess he was trying to be honest
with us, but he just it just seemed very cold
about the whole thing.
Speaker 4 (12:50):
The beer off Old company said, go find us some
other plaintiffs and turn this into a class action, which
we met with owners.
Speaker 2 (12:58):
They had a big group meeting.
Speaker 4 (13:00):
They, as you will hear, are as conversant as anybody
on the face of the earth about the wrongs that
the government can do when it thinks it's doing good
for the public. And Paula Smith, who I think I
may have heard her name before, we showed up within
seconds when I said does anybody want to do it?
Speaker 5 (13:20):
Boom, she's up at the front.
Speaker 6 (13:22):
We didn't hesitate, you know again, I think I after
hearing the mister Trogden, guy at the head of the
dot say it could be another twenty five years, my
husband I looked at each other and said, this is
not right. We have to do something. And Matthew he
wanted somebody to join the lawsuit, and I believed in him.
I'm not that kind of person that's going to set
(13:44):
around and do nothing. I sometimes get myself in trouble.
Sometimes I say things I shouldn't say sometimes because I just,
you know, believe that you've got to stand up for yourself.
Speaker 4 (13:56):
Paula and Kenny were always the face of the litigate
through the class action. So we said to everyone, the
more people we get, the more weight it has. And
I said, you know, you don't charge up a hill
at the opponent with five people, You send five.
Speaker 5 (14:13):
Hundred people up the hill.
Speaker 4 (14:14):
By the time we started showing up at the appellate courts,
we had fifty or sixty cases. Then the next time
we visited, we had seventy eighty or nine. We had
to maybe ninety cases. Every time we showed up, we
had more cases. And the Supreme Court and the judges
and justices knew this. So yes, the fact that this
was statewide and on such a large scale and not
(14:36):
just a little one off in some little town someplace
absolutely gave it gravity.
Speaker 6 (14:41):
And now I took my daughter, this might have been
the Court of Appeals hearing that we went to in Raleigh.
She said, I want to go to and see what
this is. And she was just amazed. I mean, she's like,
this is really okay, I want to say about it.
This is really bad, because of course she's a twenty
something at that time, like this is really bad, and
I'm like, yes, this is. I mean, it's kind of
(15:03):
fun to watch. The courtrooms are packed. I mean, Matthew
did a good job of getting people to go to
the courtrooms and being in the courtrooms and letting the
judge and the Court of Appeals and the Supreme Court
see that, you know, these are real people that are
being affected here. These people is sitting here in this
room are the ones being affected. It always bothered me, said,
(15:25):
I go to these meetings of the churches, or I
go to the meetings at the court hearings, and you
look around the room and the majority of people and
get little Terry I talked about this. You get in
these rooms and these people that are in these rooms
are all probably mid sixties to late sixties to seventies
to eighties. These are people that have lived in their
(15:45):
homes their whole lives, or their family farms and things
like that that the dot had no they didn't care.
They just had no compassion for these people whatsoever. And
you hear that somebody away and then now they're family.
They couldn't finalize the estate because the DOT is holding
onto their land and won't pay them out. And you know,
(16:08):
it's like, this is so sad what they were doing
to people's lives, and it was just wrong. I'm glad
that we fought it.
Speaker 3 (16:17):
I was really happy to see that this case was
ultimately brought up to the North Carolina Supreme Court and
the MAP Act was overturned in twenty nineteen, after more
than thirty years of people enduring the MAP Act. I
know a person who wanted to retire in Florida was
unable to sell their home and died in that home
(16:39):
because they were stuck. The iron of the MAP Act
is it was supposed to save taxpayers money by giving
the state power to hold onto land until it needed
to be developed and pay a lower price. But in
fact it is incredible in terms of how much this
has backfired because home have fought for their property rights,
(17:01):
the proper rights that are constitutionally guaranteed, have sued the
state and now our owed money that is many times
multiple of their original home, and the lawsuits, according to
one estimate, could cost the state over one billion dollars.
So this is an unfortunate road, so to speak, that
(17:22):
the state took.
Speaker 4 (17:24):
Whatever they have saved, they are now having to pay
for it. You know, it has increased their anticipated acquisition
costs in today's dollars two or threefold.
Speaker 6 (17:35):
Now, the judge says, these people are entitled to interest
back to the date of the taking. So the date
of the taking I think was for us was two
thousand and eight, and we think it was eight percent interest,
which was a nice, nice sum of money. And because
they kept dragging this out in court, we got a
lot more money for our house in twenty nineteen than
(17:55):
we would have gotten for our house in twenty ten.
But it's because they just kept dragging it out and
driving it out and dragging it out.
Speaker 3 (18:05):
In my own backyard, there are three thousand people who
have property rights that is very similar to a country
I've been studying for fifteen years in Babwe. In fact,
they have the worst property rights in the entire country.
And what I did was, I said, well, let's pretend
that this area outside of my city is a little country.
Let's stack it up against a well known property rights
(18:29):
in decks put out by the Heritage Foundation, a think
tank based in Washington, d C. Which has a very
well regarded property rights in decks. And what I did
when I sort of put in, here's what the power
you have to sell your property, here's the power to
upgrade your property, here's the power to go to the bank.
I found out that, in fact, the people had property
rights that were equal to living in some of the
(18:52):
worst countries in the world. That would be places like
Zimbabwe or Cuba. So that's why I named the title
my articles, is this North Carolina or Zimbabwe? How property
rights in North Carolina deteriorated to the level of a
third world country.
Speaker 4 (19:12):
What we had learned is that your average Joe does
not like lawyers, does not like the government, loves their property,
and would rather be left alone at least as a
road going through their living room. So we had to
overcome their distrust of lawyers, and their distrust of the government,
and their distrust of the court system. And they have
(19:34):
all been rewarded with putting their faith in us. And
that is a reward beyond the money we've made people.
It's a professional reward that I gather most people don't
get to have in their career. And it's been very gratifying.
Speaker 6 (19:50):
It's just been an ordeal from the beginning. And I
guess that's whine kind of a little cheerio because it's
comably almost over, and it's like I can kind of
let my emotions get the best of me now because
it's it's you know, it's over.
Speaker 1 (20:04):
It is indeed over. And what voices we heard there?
What a story about property rights, great storytelling by Alex Cortez.
As always, the rule of law, North Carolina's Map Act
no longer. This is our American stories