SACRAMENTO – Gov. Arnold Schwarzenegger says he opposes Proposition 98, one of two eminent domain initiatives on the June 3 ballot.

The Republican governor says in a statement released April 25 that the measure undermines California’s ability to build dams, water delivery systems and other public works projects.

Proposition 98 would forbid California redevelopment agencies and other government entities from using eminent domain to take homes, businesses and farms for private development. Government is required to pay fair market value when it seizes property.

The measure also includes a contentious provision that would phase out rent control at apartments and mobile home parks. That provision has raised fear among the elderly and others who live in mobile home parks, often on fixed incomes.

Adam Mendelsohn, a spokesman for Schwarzenegger’s campaign committee, says the governor has not taken a position on the other eminent domain initiative, Proposition 99. That measure is sponsored by the League of California Cities and supported by a coalition of farmers and environmentalists.

Schwarzenegger’s announcement raised ire among supporters of Proposition 98.

The National Federation of Independent Business/California issued an immediate response to the governor.

“We are disappointed that Gov. Schwarzenegger has come out in opposition to Proposition 98,” said NFIB/CA Executive Director John Kabateck. “The California economy depends on the jobs that small businesses create, and now, in the middle of a massive state budget deficit, is no time to make it more difficult for people to continue to create jobs. As we’ve said before, if you don’t have a roof over your head and place to do business, none of the other issues – healthcare or workers’ comp, to name a few – matter.”

Emphasizing that property rights protection and water development go hand-in-hand, the leader of the state’s largest farm organization said today he’s disappointed that Gov. Schwarzenegger has decided to oppose the property-protection measure on the June ballot.

The California Farm Bureau Federation co-sponsors Proposition 98, the California Property Owners and Farmland Protection Act, which would add needed protection for homes, farms, businesses and churches from abuse of the government property-seizure process known as eminent domain. It also assures fair treatment of property owners when property is seized.

“It’s not surprising that politicians and government would oppose Proposition 98,” Mosebar said. “After all, it would take power away from government and give more power to people who have been victims of eminent domain abuse. Government wants to be able to take property for whatever purpose it wants, even to give it to private developers for their own personal gain. Proposition 98 would curb that power. No wonder politicians don’t like it.”

Mosebar noted that legal experts and water groups including the Institute for Justice, Pacific Legal Foundation, Califor-nia Water Association and Family Water Alliance have all reviewed Proposition 98 and found that it protects property rights while allowing development of reservoirs and other needed public projects.

“Farm Bureau strongly favors protecting water rights and strongly favors water development, and our support of Proposition 98 fits with both,” California Farm Bureau President Doug Mosebar said. “Proposition 98 was written with a lot of thought and the best legal advice. It will protect property and water rights, while allowing government agencies to use eminent domain for legitimate public works such as water projects, roads and schools.”

The Associated Press contributed to this report.