As part of its efforts to study the eminent domain-issue, the Senate Committee on State Affairs recently heard testimony from concerned parties on the subject, with emphasis placed on the matter of fair-landowner compensation for lost property. The hearing was in response to a charge from Lt. Gov. Dan Patrick, who asked legislators to research the problem in preparation for the 2017 legislative session.
At the hearing, representatives for condemning authorities stated that Senate Bill 18, passed in 2011, offered sufficient protections for landowners. They suggested that the three-step process consisting of an initial offer, a special commissioners’ hearing, and if necessary, a jury trial, gave landowners plenty of opportunity to obtain fair compensation.
Tom Zabel, an attorney representing the Texas Pipeline Association, noted that the bulk of necessary land could be acquired through negotiations with landowners without using the power of eminent domain.
“Pipeline companies don’t have time to condemn 90 percent of the tracts on a pipeline project. No pipelines would go in the ground,” he said.
Property rights advocates voiced concerns over the ability of landowners to negotiate favorably with entities seizing their land, citing disparities between landowners and condemnors inherent in the law.
“Fair market to me is two parties getting together to work out an agreement,” said State Senator Jane Nelson who wasn’t compensated for damages a pipeline company dealt to her property. “Under eminent domain, property owners are forced to negotiate.
Kathleen Hunker, a policy analyst with the Texas Public Policy Foundation had a similar view, noting that “Property owners walk into a negotiation with a sword dangling over their head. It is an inherently unequal relationship that Texas law exacerbates.” If a landowner and eminent domain user don’t reach an agreement, then the landowners know the condemning authority will just condemn their property anyway.
Property rights advocates also raised the issue of legal fees, citing that a combination of lowball initial offers, and having to compensate an attorney to fight to protect their rights hinders landowners from obtaining fair compensation. Judon Fambrough, an expert at the Texas A&M Real Estate Center, suggested that seeking a remedy in court rarely made financial sense unless the appeal had an expected return of $500,000 or more. He suggested that one solution could be to require condemning parties who provide low-ball initial offers to pay landowners’ attorney’s fees when cases result in compensation above a certain threshold.