10th Circuit: Blight Statute Unconstitutional for Lack of Notice
The Tenth Circuit recently held that a Colorado city violated an investment group’s procedural due process rights by failing to provide actual notice to the group that its property had been deemed “blighted” under state law in a redevelopment hearing.
The case was brought by an investment group under Section 1983, which provides a cause of action for violations of U.S. Constitutional rights under color of state law. A Colorado city had initiated a study to determine whether certain properties within an area were “blighted” in order to condemn the properties and initiate private redevelopment of the area. The investment group was informed of the study, and that a hearing would occur to approve the redevelopment plan, by letter. Upon inquiring about whether the investment group should take any actions in response, the group was allegedly told by a city representative not to “worry about the notice.” At the hearing, the city determined the investment group’s property to be “blighted,” but the city never informed the property owners of that decision.
The Colorado statute that the city was following requires notice to the property owner when a governing body begins a blight study and when the governing body will hold a hearing about acquiring property for redevelopment purposes. Notice is also required by mail when a governing body finds that the property is not blighted. The statute does not include a requirement to give notice, however, if the property is found to be blighted. The statute also provides a right to appeal a determination that a property is blighted, under an abuse of discretion standard, within thirty days of the adverse decision. Here, the investment group failed to respond within thirty days because it was not aware of the decision.
The investment group argued that the statute, as applied to it, violated its procedural due process rights under the Fourteenth Amendment by failing to provide notice of the blight determination and failing to provide notice of the thirty-day review period. The district court dismissed the suit, holding that no due process rights existed because the statute provides that the blight decision is legislative and not quasi-judicial.
The Tenth Circuit reversed, holding that the investment group had a procedural due process property interest in a statutorily-provided action to review the city’s blight determination for abuse of discretion. The court of appeals held that direct, actual notice of an adverse blight determination is required, which might entail mailing, emailing, or personally serving the adversely affected party. Because the city failed to provide this notice, the investment group was denied its procedural property right to a review of the determination. The court held, however, that specific notice of the right to obtain review of the decision was not required.
