Vassallo & Salazar

Eminent domain vs. inverse condemnation

2022-07-14T09:50:52Z

At first glance, there may not appear to be much of a difference between eminent domain and an inverse condemnation proceeding. After all, both involve some type of entity with eminent domain authority “taking” of privately-owned land. However, there are distinct differences between the two, and it is worth understanding what your rights are when the government or another entity encroaches on your land.

Eminent domain and the condemnation process

Eminent domain refers to the power of federal, state or local governments to acquire private property for a government project or public use. This power is enshrined in the U.S. Constitution. Another entity with eminent domain authority, such as a utility, gas or electric company, may also attempt to take private property for a public use project. However, the Constitution also requires these entities to provide the property owner with “just compensation” for the land. The entity with eminent domain authority initiates the condemnation process, not the landowner. Most disputes arising from eminent domain concern whether the proffered compensation is just. It is important to discuss your concerns with a skilled legal professional.

Inverse condemnation proceedings

Sometimes, the government or another condemning entity may take land something away from a property owner without leaving a property owner without any form of compensation. The entity will claim that it never took anything from the landowner, thus eminent domain does not apply. These situations typically arise when there has been some type of interference with the landowner’s ability to use and enjoy the property. Some common examples which may trigger an inverse condemnation claim include:

Road construction
Pipeline installation
Power line installation

In this case, because the government or other condemning entity claims that there was no taking of the property, it is up to the landowner to file a claim for inverse condemnation. The property owner will be seeking just compensation for the impediment to using the property.

Asserting your rights

Remember that you have the constitutional right to receive adequate compensation in exchange for your land. You should explore your legal options to ensure that you receive the full value to which you are entitled.

How much notice will I receive if my property will be condemned?

2022-09-13T12:15:42Z

While condemning entities have guidance from the U.S. Constitution, State Constitution and statutes and local authorities for the eminent domain process, there is not always a quick answer as to how it will work in every circumstance. When exercising eminent domain authority, entities do need to provide landowners with notice. The amount of notice they provide, however, can depend a lot on the circumstances surrounding the exercise of eminent domain authority.

Process overview

Before condemning entities can move forward with a potential acquisition, there are several steps they must follow, including:

Landowner’s Bill of Rights. The entity must provide a copy of the Texas Landowner’s Bill of Rights both at the beginning of the process, at least seven days before giving a final offer or both.
Making a bona fide offer. You should receive any appraisal reports that were used to establish the offer the entity is making for the property being taken.
Opportunities to negotiate. During the offer/negotiation process, there may be opportunities for you to negotiate a new offer or question the validity of the compensation offered for the property taking. However, the negotiation process in many instances is nothing more than a perfunctory exercise the condemning authority is required to complete before filing its eminent domain proceeding.

Each step in the process can potentially take weeks to complete if there are delays or discrepancies between you and the condemning entity.

Determining a timeline

There can be a significant amount of time between the time you receive notice that there could be a taking and the date you will be required to vacate the property. It is essential to talk to an experienced attorney about potential condemnations. Although some eminent domain proceedings take a long time to conclude, others move much faster.

What does “public use” mean, in Texas?

2022-07-25T04:25:50Z

The use of Texas eminent domain authority is limited to projects dedicated to “public use.” Although easily articulated, the public use determination can be an element contributing to the confusing eminent domain process. In Texas, establishing public use is an integral part of meeting eminent domain requirements. While other states may be able to justify a taking with purposes that would bolster tax revenues or encourage the state’s economy, that is not the case in Texas.

What are typical public uses?

There are many entities who have the power of eminent domain for a wide variety of uses including, but not limited to:

Schools
Hospitals
Airports
Post offices
City, state or federal buildings
Bridges
Roads
Railroads
Pipelines

It is essential to stay attentive during the condemnation process. You have specific rights when it comes to a taking through eminent domain, as outlined in the state's Landowner's Bill of Rights. You do not have to accept the first offer you receive for your property. You have the option to reject the offer and to appear at the special commissioner’s hearing. Further, you have the right to appeal the decision of the special commissioners.

What happens if the taking is not a public use?

There are remedies when eminent domain authority is used for something other than a public use. When land is taken for non-public use, or when the condemning entity fails to use the condemned area for 10 years, a property owner has the right to challenge the condemnor’s right to take, or seek to recover the land that was not used for the identified purpose.

What is the Landowner’s Bill of Rights?

2022-09-13T12:15:35Z

When you learn the government or other entities with eminent domain authority wants to purchase your property for public use, you may feel like you do not have control. The initial offer may be underwhelming, and you may have many questions about the taking, as well as the process to come. The Office of the Attorney General of Texas prepared a document called the Landowner’s Bill of Rights to help citizens understand their rights when it comes to a taking. Here are some of the rights protected by the Landowner’s Bill of Rights.

The use of condemned property

Both the Texas government and private entities are limited in how they can use property taken through eminent domain authority. The property must be intended for public use. In Texas, your property cannot be taken for economic development projects or to enhance tax revenues. Examples of public use projects can include:

Utility lines
Pipelines
Roadways
Parks
Schools
Hospitals

If, after a certain period of time, the condemning entity does not use your land for public purpose, you may have the opportunity to buy your property back for the price the entity paid.

You can choose your own team

The entity who seeks to take your property must provide you with a written appraisal from a certified appraiser, offering adequate compensation in exchange for the property. This can be frustrating to receive an unsatisfying offer based on this appraisal. However, the Landowner's Bill of Rights states that the landowner may hire both their own appraiser to determine the value of the property and attorney to help them throughout the process. It is critical to talk to a professional who can support you through the taking process. An attorney can both inform you of your rights and help you advocate for these rights as a property owner.

What is “adequate compensation”?

2022-07-14T09:51:37Z

According to the Texas Constitution, when the government or another condemning entity wants to take your property through the power of eminent domain, it must offer adequate compensation. (Federal eminent domain proceedings are required to pay just compensation and utilize a different procedure). Condemning entities can include the city, county, and state government, as well as school districts, utility companies, pipeline operators and other agencies with eminent domain authority. No matter the entity that seeks to take your property, the term "adequate compensation" can be confusing. Adequate compensation for your property is based on a real estate appraisal.

The amount is based on an appraisal

Adequate compensation contemplates money for the portion of the property to be acquired, whether in fee (a transfer of title from the property owner to the condemning authority) or in easement (temporary or permanent use of land where the property owner retains title but the condemning authority acquires control), and the impact of the project necessitating the exercise of the eminent domain authority to your remaining property. For the condemning authority with a large project, there can be many properties to be appraised. Time constraints, lack of experience and training, lack of project information, and other factors may influence the determination of adequate compensation based on the real estate appraisal. Any or all of these factors can impact the compensation offered at the beginning of the eminent domain process, which may or may not be “adequate.” Although no amount offered may seem appropriate, a property owner is not required to accept this initial offer and should not assume the real estate appraisal accurately values the property and the compensation due if the property is condemned.

Evaluating the offer

While the condemning entity can ultimately condemn a property whether or not the property wants to sell, you have the constitutional right to be paid adequate compensation for the property taken and compensation for any damage to any property you will continue to own when the eminent domain proceeding is finalized. If the offer is less than adequate compensation, the Texas statutory condemnation process is intended to determine the compensation the condemning authority must pay for the property taken. The first step in a Texas eminent domain proceeding is a special commissioners’ hearing. During a commissioners’ hearing, a judge appoints three landowners in the county who will hear evidence from the condemning authority and property owner to determine what adequate compensation should look like in the specific situation. The task of the commissioners is to assess compensation, not whether the condemnation is appropriate. If neither party is satisfied with the commissioners’ decision, the matter can be appealed and presented to a jury, who will decide adequate compensation due as a result of the eminent domain proceeding. The condemnation process can be frustrating and confusing. It may seem like you have no control in the situation, but it is essential to remember that you have rights when it comes to selling your property for public use. An experienced attorney can support you and help you find the right solution.

Common errors in appraisal reports

2022-07-14T09:51:47Z

When a condemning entity (State of Texas, a city, a county, Gas, Electric, telephone, Pipeline or other agency) in exercising its eminent domain authority offers you compensation for your property, the offered compensation is based on a real estate appraisal of your property. The government hired the appraiser but that does not mean the appraisal should not be scrutinized to determine whether the offered compensation is accurate. Eminent domain is a complicated process on its own, but you can still defend your rights and secure the actual value of your property. An experienced attorney can help defend the actual value of the property by reviewing the appraisal report to confirm its accuracy and point out any discrepancies.

What errors can look like

There are many ways that an appraisal report can inaccurately create a deficiency in the value of a property. Common errors in the real estate appraisal include:

Improperly adjusting the sales price of comparable properties
Failing to identify, review and report any changes to the market trends
Inaccurate assessment of the neighborhood to suit the appraisal of the property
Citing inaccurate replacement or repair costs
Underestimating the impact of the proposed property use on the remaining property
Failing to accurately identify the actual scope of the work
Improperly identifying the property appraised and the project necessitating the eminent domain proceeding

Any of these mistakes can cost a property owner dearly. Knowing how an appraiser can devalue a property will help owners assess whether the appraisal represents compensation due as a result of the property acquisition.

Do not settle for the first offer

Fair market value may seem anything but fair at first. It is important to remember that this value will not include other items like the costs of moving, including expenses, stress, time and more. Property owners across Texas and the rest of the country should understand that they have rights and can challenge the compensation offer from a condemning authority.

U.S. government faces land acquisition challenges

2022-07-14T09:51:56Z

Eminent domain allows the government and other condemning entities the right to purchase private property for public use. Public-use projects must have some benefit to the general public, and can include roads, utilities, schools, pipelines, and more. Unfortunately for landowners, the eminent domain process compels a land sale to a taking authority familiar with the process and procedure, which can be to the detriment of the uninformed property owner. For Texas landowners who live along the border, it is necessary to understand what rights property owners have in the eminent domain process.

The process for taking private property

Because of its extensive border with Mexico, Texas faces the brunt of the wall-building initiative by the United States. Much of the land along the Texas-Mexico border is privately owned.

Fortunately, the government cannot merely seize the property of citizens without consent or compensation but, according to the Fifth Amendment of the U.S. Constitution, must pay "just compensation" when taking land through eminent domain.

What amount of compensation is just?

For a landowner who does not wish to sell their property, it may seem that no amount of money is just compensation. Even so, the eminent domain process establishes a procedure to determine the value of the property being taken, which process can result in disproportionate value determinations among a group of property owners. Understanding and properly using the established procedure will enhance a property owner's chance of being paid just compensation for the taking of their property.

For example, in the Rio Grande Valley, one landowner accepted $13,500 per acre for 23 acres of land, while another accepted $6,400 per acre for six acres of similarly situated land. Those who accept the first offer from a condemning entity are likely to receive less compensation than those who negotiate.

What options do those facing eminent domain have?

It is wise for landowners to thoroughly consider the options available to them. Consulting an attorney will assist property owners in understanding their rights and obtaining just compensation contemplated by the eminent domain procedure.

Was the condemnation of your property motivated by development?

2022-07-14T09:52:06Z

There's a saying that progress waits for no person, and that can certainly seems to be the case when influential people or businesses develop a plan to profit off of property somewhere. Plans to construct anything from a school to a road will often require the acquisition of multiple parcels of property, which can complicate the process.

While some individuals are eager to sell and receive a fair market value offer for their real estate, others may intend to hold onto the property that the developer needs to move forward. When that happens, developers or planners may try to push local authorities into assisting them. They could also perform construction or development work on your property without your permission.

An unjust or improper condemnation of a property in order to assume control or possession of said property is in violation of your rights as a Texas resident. Effectively, this practice is an improper use of eminent domain.

Eminent domain laws protect your investment

When the property in question is your family home or a parcel of unimproved land that you want to hold onto and sell in the future, you should have the right to retain or dispose of that property as you wish. Only in circumstances in which development is directly to the benefit of the public should Texas state or local government authorities attempt to utilize eminent domain to take control or possession of a property.

In the event that they do so, the property should be carefully evaluated to determine a fair market value, which is then offered to the owner as compensation for the loss of the real estate in question. Texas law is very clear on the fact that owners should receive compensation for property seized through the eminent domain process.

Condemnation is a way to avoid fulfilling obligations

For a property that has an older building on it or that lacks updates or improvements, it could be possible for state officials to condemn the property as a means to the desired end of developing in the area. Instead of going through the complicated process involved in an eminent domain seizure, officials may attempt to seize the property without compensation through condemnation.

Inverse condemnation occurs when a property owner sues the condemning authority for a violation of eminent domain rules. In fact, owners who did not have property seized but merely damaged by development they did not permit or receive compensation for may also have the right to pursue inverse condemnation.

Could SpaceX use eminent domain to take a Texas neighborhood?

2022-07-14T09:52:20Z

SpaceX is a company run by Tesla founder Elon Musk. The company's many goals include building a rocket that can get to Mars. The company has already been working toward this goal for some time.

This project is located in Texas and SpaceX built an experimental spaceport as part of the process. The site they selected is Boca Chica Village. It is a small residential neighborhood with "a few dozen houses."

Recently, SpaceX has been attempting to convince the homeowners in this community to leave. They claim this is a safety issue and note that there have been "disruptions." To get people to leave, they are offering to buy the houses from the people who live there.

However, many do not wish to leave. They are retired, elderly individuals who want to stay in their homes. While some have indicated they will accept the offer, the majority have little interest in selling.

Now, eminent domain is not something that a company like SpaceX can use on its own. However, back in 2013, a nonprofit started in the area. It is called the Cameron County Spaceport Development Corporation. That nonprofit does have eminent-domain authority, according to Business Insider.

The organization has not used these powers yet. However, when a chairperson was asked, they claimed they were "willing to explore" the option if needed. So, while SpaceX itself cannot use eminent domain to take the neighborhood, could the nonprofit use it on their behalf to buy out elderly residents who want to stay?

These are very important questions to ask, and it will be interesting to keep an eye on this moving forward. All those involved should understand their legal rights.

Bullet train builders say they’ll use eminent domain if necessary

2022-09-13T12:15:20Z

The company behind a multibillion-dollar high-speed railway is touting the project as a revolutionary step in the state’s transportation network. What’s unclear, however, is how many property owners might lose some of their land to make this corporation’s vision a reality. Texas Central is forging ahead with its proposal – a newly built railway that would get passengers from Houston to Dallas in about 90 minutes – even as legal questions linger. Texans along the proposed 240-mile route may find it particularly worrisome to read some recent comments from the company about the use of eminent domain. Securing the needed land According to a report from The Leader, the project reached a significant milestone in early September when the Federal Railroad Administration agreed to create a custom set of rules for the new train’s operation. Texas Central said if all goes according to plan, construction could start in 2020. At this point, however, the company only has about 30% of the land it needs to build the railway. That means it will need to secure the remaining 70% in the months ahead – potentially by taking it from private property owners via eminent domain. A spokesperson for Texas Central said the company’s goal is to agree to terms with every private landowner along the route. “But ultimately, if [the use of eminent domain] is necessary and we’re forced to do that, we will have to go down that path,” the spokesperson continued. Legal questions remain It’s not clear whether Texas Central even has the authority to use eminent domain for its high-speed train project. While railways are considered as for the public good, a judge earlier in 2019 ruled Texas Central wasn’t actually a rail company because it had not laid any tracks – and therefore cannot use eminent domain. The company appealed that ruling, and the case is still working its way through the courts. Texas landowners along the proposed route may want to begin preparing now for any outcome. If you or someone you know is worried about their property being taken as part of the high-speed rail project, it may be time to speak with an eminent domain attorney. A lawyer can serve as your advocate and, in the worst-case scenario, help ensure you get fair compensation. A high-speed train shouldn’t run over any individual’s rights on the way to its destination.