Property Rights

This Indiana Town Wants to Fine a Community Out of Existence on Behalf of Private Developers

Charlestown can't seize the properties, so it's citing them to force them to sell.


Pleasant Ridge
Institute for Justice

Members of a small, low-income community in Indiana are discovering that state-level protections that make it hard for cities to seize their property may not be enough. When city leaders decide to get into bed with private developers, there are all sorts of ways for cronyism to threaten the property rights of owners.

When we imagine how a city or town seizes private property from citizens in order to hand it over to developers for special projects, we often think about eminent domain. Governments can force citizens to sell them their property (often for much less than it's worth on the market). While eminent domain was supposed to be used solely for public works projects (roads, schools, et cetera), the infamous Kelo v. City of New London Supreme Court decision set a legal precedent allowing governments to use it to hand over property to private developers for big projects.

Some states that objected to that decision passed new laws to restrict how eminent domain may be used within their borders. Indiana was one of them.

So property rights-minded citizens might be surprised to hear that the mayor and city officials of Charlestown, Indiana, a rural community with a population of less than 8,000, are trying to arrange to hand over hundreds of homes to a private developer. He's not using eminent domain to do so. Instead, the city stands accused of deliberately finding excuses to burden the community's residents with thousands of dollars of fines that will be waived if they sell their properties to the private developer.

The property-rights-defending lawyers of the Institute for Justice (you may recall their efforts to stop abuse of civil asset forfeiture) are stepping in to represent several property owners in this community and are seeking an injunction to stop the city from trying to use code violation citations to essentially force property transfers.

Within Charlestown is a low-income neighborhood named Pleasant Ridge, full of working-class folks and retirees. According to the Institute for Justice, Mayor Bob Hall decided in 2014 that he wanted to get rid of the houses there and replace it with a more upscale planned community with fancier homes and retail options. But he needed to get rid of the houses (and the people within them) first. Starting in 2016, residents and property owners of Pleasant Ridge discovered Charlestown had a nasty tool to try to get rid of them. City officials started looking for any excuse to cite property owners for code violations. When you're looking at low-income neighborhoods full of working people and retirees, there are likely to be plenty. The Institute for Justice described how it played out:

Beginning in the summer of 2016, the city unleashed a torrent of code enforcement targeted specifically at the Pleasant Ridge neighborhood. City officials began performing exterior inspections of properties in Pleasant Ridge and mailing citations to the owners. So far, this campaign has primarily targeted landlords who own multiple rental properties, rather than smaller landlords and owner-occupied houses.

The citations state that the owner accrues penalties of $50 per violation, per day. Multiple citations are issued per property, which means that a single property will begin accumulating hundreds of dollars in fines each day. The fines can be for things as minor as a torn screen, weeds taller than eight inches or chipped paint. In many cases, the fines begin the day the citation was issued, not the day the owner received it. So owners can easily be on the hook for thousands of dollars in fines before they even receive notice, and the fines continue to accrue until the owner is able to repair the property.

The city knows that many of the residents cannot afford to pay these exorbitant fines, leaving them only two options: Sell their home to Neace Ventures or raze it to the ground to have the fines waived. The scheme would be bad enough if Neace were offering fair market value for the homes, but it is not. The inspections regime has been a windfall for Neace. Not only has it compelled more than 140 homeowners to sell—it has also forced them to sell at a considerable loss. Most of the homes have a tax assessed value of between $25,000 and $35,000, and they would be worth much more if the city had not caused the market to collapse by announcing in 2014 that it was going to destroy every home.

One grotesque little detail from the Institute for Justice is that that the city probably would have to pay the citizens more for the property if it did use eminent domain. But this nasty little system lets the private developer get the property on the cheap.

One of the plaintiffs the Institute for Justice is representing, a neighborhood association that owned a duplex in the neighborhood, had racked up almost $9,000 in fines due to citations for a bunch of minor violations. The fines bankrupted the association and resulted in them selling the property. (CORRECTION: The fines have not bankrupted the association yet, but they will if they are not thrown out by the courts.)

The city attorney for Charlestown told The Courier-Journal that the city is acting completely within the law with their fines. But the Institute for Justice claims that Charlestown is violating state law for the exorbitant amount of the fines and violating its own code by immediately fining property owners rather than waiting for after providing a written order for repairs and determining that they've refused to cooperate. That's because the city doesn't actually want them to cooperate. They want the residents to sell their homes and get out. The mayor said as much in a Facebook post last fall trying to discourage property owners from repairing their homes.

Read the lawsuit here and watch the Institute for Justice's video about Pleasant Ridge below:

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  1. Trump and Pence are building a hotel?

    1. Obama needs a presidential library.

  2. I think it’s because of things like this that hitmen need to exist.

    1. Forget hitmen, where are the courts? What good are they if they cannot abate harassment?

      1. As I suggest below, the best (likely) outcome is that the courts force the city to stop and rescind the fines. I highly doubt that the public officials involved will even be charged with, let alone convicted of, graft or corruption. Unless the officials are punished in some way, shape, or form, what’s the disincentive for attempting this again?

        1. Seriously. And with half the neighborhood gone, the property isn’t worth much any more anyway. They really screwed these people.

        2. there should be damges too! I hate how the government can cause harm and its not even responsible to make the person whole and for their time. Process is the fucking punishment.

          If this was me i would go ape shit…..and probably end up in the news :/

      2. Well, when you’re poor (and home values of $35,000 ain’t rich) you probably lack the funds to win a protracted civil suit against your municipality. And even if you win, they’ll just do what the EPA does, and immediately start fining you again.

        I’ve seen this done in other towns. You’ll have to prove harassment (ie prove that they’re maliciously targeting you / your neighborhood) and that’s not an easy case. Often the judges are politically on the side of the city, because they all want to get rid of the poor people who are, in their eyes, bringing down their community.

        They’re lucky, honestly. If the city has adopted the newer form of the Uniform Maintenance Code, an exterior violation gives them the “probably cause” necessary to search the interior of your home for additional violations (such as wiring) and it doesn’t sound like the city has gotten to abusing that little number yet…

        1. What grates me is that when libertarians talk about inviolable rights to property, we’re accused of being plutocrats or plutocrat apologists. I’m pretty sure none of these people are plutocrats, and yet I’d stand for their property rights just as much as anyone living in a million-dollar home.

          But come election time, the segment of the voting population who (allegedly) cares about the poor oh-so-much will vote to re-elect all these shitheads and ensure their crusade continues.

        2. Loser pays would go a long way towards stopping these abuses, assuming it included all costs, so that lawyers could take good cases on contingency. It would be even better of the officials had to pay the fines themselves, but even if it’s the taxpayers ultimately, something like this would rack up lots and lots of losers paying to throw the budget out of whack and cause some grief at election time.

          The key is loser pays everything, including lawyer costs, because the very first victims would be able to attract attention and nip the problem in the bud.

          1. No it wouldn’t. Loser would just raise property taxes. Guess which properties would be line for the largest tax increases?

            1. Sure they would raise the taxes, and if it were just a few houses and lost cases, there’d be little repercussions at the polls. But if the idiots kept it up and lost hundreds of cases, there would be consequences.

              Loser paying wouldn’t stop the crimes at all, any more than murder laws stop murder. But it would prevent the mass evictions of this story, and that’s better than letting it go unpunished.

              A couple of cases isn’t going to make waves, not even in the papers. Bu the spector of losing hundreds of cases would stop them from continuing the evictions because even politicians can calculate the costs of hundreds of cases and the newspaper headlines that would make in the next election. People might be willing to overlook huge payouts for police, because law-n-order, but massive payouts to evict people for a developer’s benefit just won’t fly.

              1. this is very true and would give people spare cash to try a recall attempt.

          2. Loser pays would go a long way towards stopping these abuses, assuming it included all costs, so that lawyers could take good cases on contingency.

            Not getting your reasoning here. Lawyers don’t need loser pays to take cases on contingency — they are paid from the award.

            Loser pays would actually make contingency less useful, as the plaintiff would be on the hook for the city’s court costs if they lose, and in the case of a poor or even middle class plaintiff, that could potentially ruin them.

            1. rarely government awards are enough to pay lower and the victim. I do agree loser pay is not the exact type of thing to use here. I think he is misunderstanding how loser pay exactly works.

              I think what he means is state has to pay all lawyer, court fee, and victim time, and penal damages (penal damages is key here)

              Many law suits don’t recoup lawyer fees and thats the real issue.

        3. When the mayor has announced the intention to chase the owners out, I imagine it shouldn’t be hard to show malicious targeting.

          In a sane world, that is.

      3. Send it to the 9th circuit, I’m sure they are itching for more justice heroism.

      4. The Ballot Box.

        The . . . Judge Box.

        The Ammo Box.

        That’s how it goes.

        1. i have to agree. If a home owner uses the ballot box, judge box and still lost his house in a clear unjust way.

          If he murdered the people responsible and i was on the jury….i wouldn’t convict.

          What goes around comes around and if you destroy someones life, liberty and property, and aren’t held responsible. I wouldn’t judge someone for getting revenge. I honestly expect it.

    2. Problem is they all wear badges and work for the local po.

    3. Yeah, I was going to say, whatever happened to lunch mobs?

      1. They got lost between the breakfast and dinner mobs.

    4. I think it’s because of things like this that hitmen need to exist.

      I do not believe that what a hitman does is the correct punishment for what this city is doing to these people.

      Too lenient or too harsh? For the reader to decide.

  3. Who knows what evil lurks in the hearts of men?

    1. Greed. Sometimes malice, but mostly greed.

    2. Everyone who lives in the shadow of the two party system.

    3. the Shadow knows!

    4. The Shadow………knows!

      Fun fact re: the early Shadow:

      Before his fame in the pulps and on the radio, The Shadow was actually created as a protector of
      Wall Street. He made his first appearance in the February 1929 issue of Fame and Fortune. The
      story was called “The Shadow of Wall Street”, and George C. Jenks was the author (though he
      wrote it under the house name of Frank S. Lawton). Compton Moore was The Shadow’s alter ego.
      Instead of thugs and crime lords, the bad guys were the unethical businessmen of Wall Street.
      The mocking laugh and The Shadow’s legendary stealth were first introduced in this story. –

      So, sending the Master after crooked pols would be child’s play for him! Walter Gibson aka Maxwell Grant, Lamont Cranston and Margo all came later.

  4. They’re poor white people so nobody cares.

    1. Right.

      Here’s a perfect case where a mob with torches and pitchforks legitimately should be standing on the street outside the Vice President’s city leaders’ houses and it would actually make a difference. Not that I do/would condone rioting but where property damage at large for the sake of property damage isn’t or wouldn’t be complete nonsense (Good luck developing THIS!).

      Guess we have to make them immigrants to somewhere else and *then* worry about the issue.

      1. It reminds me of the Ferguson report that showed how racist and oppressive the town was. Every one of the laws and policies found in that report that picked on poor black people is found in every small town across the country, most of them white. It is about taking advantage of poor people, not just black people. The inability to make problems in this country about something other than race is what keeps most problems from being solved.

        1. Inability? It’s by DESIGN.

  5. Charlestown is (maybe, I would have to look at exact definition) in the Louisville MSA, so isn’t like its a small town in the middle of nowhere.

    Which makes sense actually, as with the new east end bridge, its value is probably booming.

    1. Charlestown is in Clark County, so, Yes, it is in the Louisville MSA. I thought it might have been one county up the river.

    2. A local realtor/analyst has done a good job of pounding the local pavement and doing the FOIA stuff and seeing what’s going on here (from a couple of years ago – late 2014):

    3. Charlestown is along I 65 and IN 62, well outside the northern loop, so the East End bridge won’t really do anything for them. It’s at the very northernmost tip of Clark County, so very few of them are Lousiville workers even though, by being in the MSA, it may look like it. I was in Clarksville until just a few years ago and had several friends in Charlestown and know the area fairly well.

  6. What’s the best possible outcome for the homeowners? That the city backs off?

    I doubt that anyone will serve jail time as the result of an illegal and immoral operation such as this and that’s a crying shame.

    1. That the city backs off?

      I think that is it. And maybe the rest of the city helps vote the mayor and city council out of office for doing this.

    2. Best? The state dissolves the city and mails a pink slip to these sociopaths.

    3. That the elected officials are personally on the hook for repaying the fees, and get dragged out of their homes at gunpoint as the homes go on the auction block to pay for the judgments.

    4. What’s the best possible outcome for the homeowners?

      It involves woodchippers.

  7. What’s a “low-income community”? Are they on some kind of public assistance or just live on the shitty side of town?

    1. Within Charlestown is a low-income neighborhood named Pleasant Ridge, full of working-class folks and retirees.

      Read much?

    2. A community composed of people who make relatively low incomes.

    1. Mayor Bob Hall decided in 2014

      My sarc meter may be off, but I’d say these guys were shitbags before Trump even thought of being president.

      1. They were shitbags before 1988? That’s probably correct, actually.

  8. “trying to discourage property owners from repairing their homes.”

    Wait, the fines are supposed to be for failing to make repairs, so…oh, right, government.

  9. A similar situation happened a few years ago when a town wanted to declare one part of town as blighted which would allow them to bulldoze the houses and turn it over to developers. One sign of being blighted was not having a attached garage. Even though most of the city council homes which weren’t being bulldozed did not have attached garages

    Whenever I hear of Public/Private Partnerships I fear for my money/safety/freedom

    1. “How big is your TV? Blight, next.”

    2. “But think about how great it will be in two years when you can come back to your neighborhoods and shop at Nordstrom.”

      1. Without Invankawear, why would you? 🙂

    3. “One sign of being blighted was not having a attached garage”

      This means we can start bulldozing large swaths of SanFran, no? And almost all of Manhattan.

      1. It’s blight, man. nuke, orbit, only way to be sure, etc.

      2. I read that as “not having an attached garage”. Where I grew up all the garages were down a long driveway at the back of the property. Oh well, tear it all down.

  10. This is also IJ’s biggest eminent domain case since Kelo. Hope it gets better results than Kelo!

    1. No, it’s not eminent domain. Read much? Doubt it.

      1. Kristen is pretty smart, no need to be an ass.

      2. Fuck off. You know I meant “property rights”. I guarantee you I know more about the IJ suit than you do, having followed it since their live press conference last week.

        Last week, we launched our largest property rights case since Kelo

        1. Then learn to type and proofread, or buck up and bear the consequences. I get dinged, you get dinged, we all get dinged. Too bad.

          1. It’s eminent domain by the backdoor.

            Some states that objected to that decision (Kelo) passed new laws to restrict how eminent domain may be used within their borders. Indiana was one of them.

            They are trying to thwart the people’s will as expressed by their elected representatives. They may be within the letter of the law, but not its spirit. The Leg may have to pass another law restricting cities from pulling this crap, too.

          2. Somebody pee in your cereal this morning?

  11. Mayor Bob Hall decided in 2014 that he wanted to get rid of the houses there and replace it with a more upscale planned community with fancier homes and retail options. But he needed to get rid of the houses (and the people within them) first.


    1. I Googled Bob Hall to see what party he’s from.

      Perhaps he should spend some time fixing the city’s fucking website, instead of trying to kick poor people out of their houses.

      1. He’s a Republican.

      2. I noticed that too. Lot of lorem ipsum dolor on both the town’s website and the real estate crony developers webite.

        Apropos of nothing at all, that Latin dummy text is a jumbled nonsense version of a text by Cicero. Cicero’s text is translated as There is no one who loves pain – who seeks it out and wants to have it – simply because it is pain. Except I guess a small-town mayor and a real estate crony developer who both seem to enjoy inflicting it on others.

        1. And the stupid thing is, WordPress makes it so easy to hide content and widgets that aren’t ready for public consumption yet. They’re just a bunch of lazy fucks who want other people’s land for free.

        2. Cicero obviously never heard of BDSM.

          1. It’s too easy. Text like that is known as greeking.

            Make your own joke.

      3. He’s a Republican:…..6a98b.html

  12. The scrunts who are pushing this need to be tossed in the clink for, fuck it, I’m sure they could find something to charge them with. This is disgraceful.

    1. Public indecency?
      Public nuisance?
      Facism(everyone else is using it)?

      1. Denial of property rights without adequate due process and being complete dicks.

      2. Discriminating against people who don’t have faces?

    2. I’m guessing an audit of their campaign donations will find something.

  13. Charlestown is in Clark County, so, Yes, it is in the Louisville MSA.

    Huh. I just assumed it was somewhere in the northwest part of the state.

    1. Nah, its poor and white, not poor and black.

  14. are stepping in to represent several property owners in this community and are seeking an injunction to stop the city from trying to use code violation citations to essentially force property transfers.

    And people think that regulations don’t come in handy.

  15. That’s because the city doesn’t actually want them to cooperate. They want the residents to sell their homes and get out. The mayor said as much in a Facebook post last fall trying to discourage property owners from repairing their homes.

    “When we said we wanted more affordable housing in our communities, we didn’t mean homes poor people could afford to live in. That’s just stupid.”

  16. It’s possible that the court finds the fines levied are excessive and cuts them back, but with the vast majority of the population in favor of building codes, the root from which this despicable tactic grows will always be there.

    Of course, the best way to prevent things like this is to not elect corrupt shitheads, but they can be good at blending in.

    1. No, just get the right corrupt shithead in charge who’ll harass someone else.

    2. This tactic may originate in building codes. But the root motive here is the way we tax/structure land ownership in this country. As long as we incentivize land speculation and deliver cronyist rewards to those who speculate; then we shouldn’t be surprised at what follows.

      1. God I hope you’re not a Georgist.

        1. Not strictly. His policy can only work in a country that isn’t mortgaged up to the hilt already and where land prices are already zero. And even then his prescription is too simplistic and overreaching – like everything made ‘political’.

          But the reality is that his analysis of classical economics has NEVER been refuted. Virtually everyone except anarchos-who-misread-Locke agrees that a land tax is better than a property tax – and distorts things less than any other tax.

          It used to be that he was viewed as almost libertarian himself – by guys like AJ Nock, Milton Friedman, William Buckley, David Nolan. And I’ll take the real world examples of pre-1960 Denmark, 1900-WW2 Detroit/Cleveland, and more recently Estonia, Taiwan, Singapore (all heavily Georgist influenced tax systems) as pretty damn successful compared to other real-world alternatives.

          1. Pittsburgh. uses a variation, along with some other Pennsylvania cities: a split-rate.

            My understanding is that the business district it applies to has been much improved.


      2. Where exactly is the land speculation in this story?

        1. I just linked to a local guy who followed the money starting in 2014 –

          He names about a dozen beneficiaries and specifies (but can’t name because he didn’t get local FOIA cooperation) about a dozen others. The land speculation being both the surrounding landowners where these people will be evicted to (with rent and ownership subsidies) and the future PR developer (where they will get initial tax assessments at ‘blight’ level and then sell before the tax adjusts upward post-development).

  17. but with the vast majority of the population in favor of building codes, the root from which this despicable tactic grows will always be there.

    I overheard a conversation, quite a while ago, about some guy who accepted a generous offer from the utility company for an “energy audit” and wound up with a bunch of citations from the fire marshal (I believe) for code violations.

    It was for his own good, though.

  18. The mayor tweeted about the city’s “Downtown Renaissance Project”. I can only imagine what kind of cronyism that entails.

    I despise city governments that want to play Sim City with real life towns. At the same time, I live near a number of rental houses. I hate landlords and many of their renters too.

  19. Crony whack a mole. You take one tool away from.them, and they will fashion a shiv out of whatever is available. Petty evil is very resourceful.

    1. Not entirely. This “tool” basically forces the government in question to be explicit about abusing their power on behalf of a private developer.

      Eminent domain powers gave them more cover to avoid accusations of honest services fraud.

  20. The owners should have followed the law! They deserve this.


  21. That Mayor is well-rippened fodder for Ye Ol’ Woods Chippa.

  22. If this gets any press, things will not go well for the mayor or his enforcers.

    Trump could prove his favor of the people vs the elites by subpoenaing the city and the developer for bribery and honest services fraud. Locking up a few of the principals wouldn’t hurt either — perhaps they could use a lesson on what it’s like to be on the other side of a byzantine mesh of laws.

  23. Now Naboth the Jezre?elite had a vineyard in Jezre?el, beside the palace of Ahab king of Samar?ia. 2 And after this Ahab said to Naboth, “Give me your vineyard, that I may have it for a vegetable garden, because it is near my house; and I will give you a better vineyard for it; or, if it seems good to you, I will give you its value in money.” 3 But Naboth said to Ahab, “The Lord forbid that I should give you the inheritance of my fathers.” 4 And Ahab went into his house vexed and sullen because of what Naboth the Jezre?elite had said to him; for he had said, “I will not give you the inheritance of my fathers.” And he lay down on his bed, and turned away his face, and would eat no food.

    5 But Jez?ebel his wife came to him, and said to him, “Why is your spirit so vexed that you eat no food?” 6 And he said to her, “Because I spoke to Naboth the Jezre?elite, and said to him, ‘Give me your vineyard for money; or else, if it please you, I will give you another vineyard for it’; and he answered, ‘I will not give you my vineyard.'” 7 And Jez?ebel his wife said to him, “Do you now govern Israel? Arise, and eat bread, and let your heart be cheerful; I will give you the vineyard of Naboth the Jezre?elite.”

    1. 8 So she wrote letters in Ahab’s name and sealed them with his seal, and she sent the letters to the elders and the nobles who dwelt with Naboth in his city. 9 And she wrote in the letters, “Proclaim a fast, and set Naboth on high among the people; 10 and set two[a] base fellows opposite him, and let them bring a charge against him, saying, ‘You have cursed God and the king.’ Then take him out, and stone him to death.” 11 And the men of his city, the elders and the nobles who dwelt in his city, did as Jez?ebel had sent word to them. As it was written in the letters which she had sent to them, 12 they proclaimed a fast, and set Naboth on high among the people. 13 And the two base fellows came in and sat opposite him; and the base fellows brought a charge against Naboth, in the presence of the people, saying, “Naboth cursed God and the king.” So they took him outside the city, and stoned him to death with stones. 14 Then they sent to Jez?ebel, saying, “Naboth has been stoned; he is dead.”

      15 As soon as Jez?ebel heard that Naboth had been stoned and was dead, Jez?ebel said to Ahab, “Arise, take possession of the vineyard of Naboth the Jezre?elite, which he refused to give you for money; for Naboth is not alive, but dead.” 16 And as soon as Ahab heard that Naboth was dead, Ahab arose to go down to the vineyard of Naboth the Jezre?elite, to take possession of it.

      1. Elijah Pronounces God’s Sentence

        17 Then the word of the Lord came to Eli?jah the Tishbite, saying, 18 “Arise, go down to meet Ahab king of Israel, who is in Samar?ia; behold, he is in the vineyard of Naboth, where he has gone to take possession. 19 And you shall say to him, ‘Thus says the Lord, “Have you killed, and also taken possession?”‘ And you shall say to him, ‘Thus says the Lord: “In the place where dogs licked up the blood of Naboth shall dogs lick your own blood.”‘”

        1. I think you’re using an obsolete translation.

          The current version ends with the Lord telling Ahab that he is pleased in his sight with the increase in property values and tax income that the new addition has brought the city through Ahab’s planning prowess.

  24. Shed the light on these cockroaches

  25. Is it just me, or is Reason finally stepping out of the shadow of electoral politics and starting to put up real libertarian red-meat articles the last couple of days?

    More please!

  26. This is such a clear injustice it is hard to believe it is happening in the USA.
    Apparently the Indiana legislature tried to prevent this sort of thing in response
    to Kelo. That did not work too well, so now the electorate needs to replace
    those legislators with someone who can think. Good luck to IJ. I hope Reason
    keeps tack of this item and lets us readers know how it turns out.

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