The city of North Las Vegas might be getting into the real estate game. City Council is considering a plan that would include using eminent domain to seize some specific home loans.
The controversial move has been approved by five small communities in California and rejected by Chicago and San Bernardino.
If the plan were to move forward, North Las Vegas would be the largest city to sign on, but the idea is under fire.
Plenty of North Las Vegas homeowners are underwater on their home loans and in bad need of relief. The plan's proponents claim eminent domain would get those who need it most out of bad mortgages and keep the city from missing out on property taxes.
"The controversy here is, first of all, is the municipality solvent enough - even in this financial arrangement that's been made - to venture into this type of deal?" FOX5 legal analyst Bob Massi asked. "No. 2, is it in the best interest of the constituents in the municipalities as a whole? The third thing is, should government be getting involved in eminent domain for something that is really not, per se, a public use, even though the Supreme Court has ruled on that? Is this going too far?"
Only a few thousand homeowners in North Las Vegas would qualify. The plan is opposed by the Greater Las Vegas Association of Realtors (GLVAR), which is currently running a statewide commercial against the idea.
"The last thing the community of North Las Vegas needs is a reckless program like this that jeopardizes private property rights and hurts the entire community with the mere possibility of helping a small segment of it," said GLVAR's Sean Fellows.
GLVAR said there are unintended consequences under PISTOL, People's Initiative to Stop the Taking of Our Land, an initiative passed by Nevada voters that sets strict guidelines on the use of eminent domain. One of those consequences is that the city would have to pay legal fees for both sides.
That concerns Councilman Wade Wagner.
"We have a lot on our plate to deal with still, and taking on something like this at this time, I'm not sure is a very good idea. The only sure thing that will come out of this is it will end up in litigation," he said.
FOX5 reached out through the city to all of the council members. Only Wagner replied.
While council members could vote on this Wednesday, that meeting will be the last before the current mayor and another council member leave to be replaced by the incoming mayor and another council member.
There could be a movement to table the issue until the new council is formed. Wednesday's meeting will begin at 6 p.m. at North Las Vegas City Hall.
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