City moves ahead with eminent domain plan

This article should be of great interest to those  of us who live in Nevada. A plan similar was shut down this month by city council in N. Las Vegas. 

A plan in place such as eminent domain would allow cities to seize private properties for public use. Which, poses the question, how much is too much Government?

City moves ahead with eminent domain plan

Underwater mortgages would be seized to help owners stay

RICHMOND, CALIF. — A San Francisco Bay Area city voted Wednesday to try to expand a first-in-the-nation plan to use its power of eminent domain to seize hundreds of mortgages that exceed the value of homes.

The Richmond City Council voted 4-3 to set up a joint powers authority to bring more cities into the plan, according to reports in local media.

Mayor Gayle McLaughlin says the city of El Monte in Southern California has expressed interest, and she believes other cities will follow.

Under the plan, Richmond would use eminent domain to seize so-called underwater mortgages. It would then offer the bank fair-market value for them and give homeowners a new loan that would lower monthly payments and improve their chances of staying.

Banks have filed lawsuits to stop Richmond from going ahead with the strategy, and investors have shied away from purchasing city bonds since the eminent domain plan began garnering national attention.

More than 200 speakers jammed City Hall to debate the plan, delaying the vote until after 1 a.m. Wednesday.

Critics fear the city will lose its legal battle with the banks and face millions of dollars in damages if it adopts the plan.