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Eminent-domain issue roils Stanhope

New Jersey Star-Ledger | November 30, 2005

Two weeks before Christmas, the tiny Sussex County borough of Stanhope is scheduled to hold a wrenching, soul-searching town meeting to determine its future.

Norma Peterson Fluke, a 68-year-old widow who has lived in town her whole life, will be there, as will some factory owners who are her neighbors in the old industrial park at the edge of town.

At issue is whether their properties alongside the Musconetcong River would be better suited to a large-scale housing development -- and whether the town should consider using its powers of eminent domain to seize the land and turn it over to a private developer.

"If this goes through, I'll be run out of town," Fluke predicted bitterly as she stood on her porch beside a large sign reading, "Please save our business and my home."

Supporters of the plan argue that it twins nicely with one proposed across the river in Netcong, where officials want to put upscale housing beside the borough's train station.

The case illustrates how even rural areas are beginning to use the powerful redevelopment tools that were devised as a solution to urban blight. But in a small town like Stanhope, town leaders will have to look longtime neighbors in the eye as they make life-altering decisions.

The town of 3,500 people straddling the Morris County border has signed an agreement with K. Hovnanian Homes, the state's largest residential builder, to build some kind of large-scale townhouse development. (The builder has provided no specifics but says it could include senior housing.)

The borough's land-use board is scheduled to decide Dec. 12 whether to designate the 19-acre tract "in need of redevelopment," a first step toward invoking eminent domain.

Government is increasingly using these powers, once devoted to making way for things like schools, highways or rail lines, to advance private development. In June, the U.S. Supreme Court upheld this expanded use of eminent domain, but the decision has caused a nationwide backlash. Bills are pending in dozens of states -- including New Jersey -- that would curtail the practice.

Supporters of people like Fluke argue private citizens shouldn't be forced to sell their land just because a town can improve its ratable base by flipping the property to a developer.

"We've been here paying our taxes all along, and now the town can come along and say we have to sell so they can make a profit," said Fluke's brother, Rusty Peterson, who runs the family tree-service business on the property. "Are we living in a democracy or under communism?"

Fluke's father, Pete Peterson, bought the house in 1949. He ran a tree service, an auto-body shop and, down by the river, a sawmill. Peterson and Sons Tree Service, which has maintenance contracts with 140 towns, including Stanhope, still operates from the one-acre property.

Fluke grew up in the house, which perches on an acre of high ground at the edge of the industrial park, and she moved back in 1982 after her mother died. She worked in the local post office for decades before retiring. One relative served as postmaster, and her father was a councilman.

Mayor Diana Kuncken said it may be possible for the tree service and other businesses to relocate, and she noted that people would be compensated for their land if the borough chose to move forward.

"This is an evolving situation, with nothing set in stone," she said. "And we are very sensitive to the needs and rights of the property owners. We're not out to hurt anyone."

Fluke argues that the tree service would be hurt: Owning the centrally located property outright keeps the tree service competitive. Without it, she said, the business would falter.

"Is this going to be a town filled with houses and no businesses?" asked her grandson, Jim Tuttle.

Town officials say they were forced into the dilemma in recent years, after Compac, operator of one of the larger factories, built a new facility in Hackettstown and started shopping its Stanhope building around.

The only prospective buyers were developers, Mayor Kuncken said. One, K. Hovnanian, suggested creating a broader redevelopment zone around the Compac site, and town officials decided that might improve their chances of influencing the look and scope of the project, she added.

Doug Fenichel, a K. Hovnanian spokesman, said the project would transform underused or abandoned industrial properties into good ratables.

"There are only a few property owners, and certainly we would want to make sure they were dealt with very fairly," he said.

Not moving forward, Kuncken said, would mean waiting for the remaining factories to fall like dominoes, leaving the town with a patchwork of new development.

"We could sit back and let it happen," she said, "or we could be proactive and plan something for the future that blends with what we have and provides financial stability."

Fluke said she isn't as angry at Hovnanian -- she said builders have been forced into such situations by longtime resistance to development by towns. But she is livid about a shroud of secrecy that has surrounded the project.

At one meeting, she said, the mayor denied any specific plans. Fluke's daughter, Marjorie, who lives nearby in town, turned up evidence of the Hovnanian agreement after demanding public records.

"It's the lying that makes you the angriest," Fluke said. "They try and pull the wool over your eyes."


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