Eminent Domain Reform in 2017

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Eminent domain and the condemnation process is not a willing buyer and willing seller transaction.

It is necessary to make further improvements to the laws that govern the use of eminent domain so that Texas landowners can have more assurance that this process is fair and respectful of their private property rights when they are forced to sell their land. These improvements should include:

Reimbursement of Landowner Costs and Expenses

  • Due to attorney’s fees and other legal costs, landowners who challenge in courts for just compensation are often never made whole when their property is taken.

  • Condemnors should be required to pay the costs and fees incurred by property owners in eminent domain proceedings if final damages awarded are greater than 125 percent of the entity’s offer.

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Property Rights Protections in Bona Fide Offer

  • Although current law requires a bona fide offer, it is important to better specify in statute what exactly this should include.  

  • A true bona fide offer should require the condemning entity to provide minimum property rights protection and delineate all uses or restrictions for the condemned property.  Terms to ensure the condemning entity will maintain the surface of the property throughout the life of the easement should also be required.

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Valuation of Easements

  • As the basis for assessing damages to a landowner from a condemnation, evidence of sales of freely negotiated comparable easements are usually not admissible in condemnation proceedings.

  • The court should admit evidence on the price paid for pipeline or powerline rights of way in privately negotiated transactions made in the absence of condemnation authority.

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Bond Requirement

  • Some condemnors have refused to purchase a bond and then claimed bankruptcy or insolvency to avoid payment to the landowner for just compensation.

  • A condemning entity should be required to either pay the jury award or secure a bond in the amount of the jury award in order to guarantee payment to a prevailing landowner at the conclusion of the legal proceedings.

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Royalty Payments

  • Often landowners are not aware that they have the ability to request rental payments as an option in negotiating payment.

  • Statute should state condemning entities and landowners can agree to rental payments. This option should be permissive but noticeably available to landowners.

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Possession and Use Agreements/Property Taxes

  • There are instances where landowners give possession of their property to a condemning entity through a possession and use agreements. Any written agreement made between the condemning authority and the property owner during a condemnation case should be enforceable.

  • When landowners transfer possession of their property to condemning entities under possession and use agreements they still have to pay taxes on the condemned property. Dispossessed property owners should not have to pay taxes on condemned land.

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  • Some condemning entities are taking advantage of a loophole in the law regarding appraisals. Although entities will make an appraisal available at the time of initial and final offer, they are being allowed to present a new or updated appraisal immediately before a commissioner’s court hearing. Meanwhile landowners are required to provide appraisals no later than 3 business days prior to a hearing.

  • Appraisals or opinions of property value, and damages caused by the condemnation, should be made available to the landowner at the time of the initial and final offer, no less than 3 business days prior to the special commissioner’s court.

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