N ove m b e r 1 5 , 2 01 2 EMINENT DOMAIN

IN WYOMING

Eminent domain is the power of the government to acquire private property for public purposes.

Eminent domain is authorized by Article I of the U.S. Constitution and limited by the Fifth and Fourteenth Amendments.

The Fifth Amendment, which applies to the federal government, states that “…private property (shall not) be taken for public use, without just compensation.”

The Fourteenth Amendment extends this limitation to state governments.

WHAT IS EMINENT DOMAIN?

Private Property Taking Public Use Just Compensation

ELEMENTS OF EMINENT DOMAIN

Latter half of 19th Century, courts in some states, applied a narrow concept of public use in order to preserve rights of property owners by allowing a taking that would benefit a private party only if the project would actually be open to use by the public.

Early 20th Century courts returned to a broad construction of public use defining it as any “public purpose”

1890 Wyoming Constitution declares private property may be taken for private uses

Many speculate that state and federal deference to economic and natural resource development guided the next 100 years of eminent domain case law

HISTORY OF EMINENT DOMAIN

Court found “plain beyond any doubt” that purpose of statute and constitution “was to facilitate the development of our state’s resources”

“Great public interest in an imminent

need for energy”

CORONADO OIL COMPANY V. GRIEVES

2005: Kelo v. City of New London Issue of what constitutes a public use for purposes of eminent

domain City of New London planned to redevelop a waterfront area “to

increase tax and other revenues and to revitalize an economically distressed city” Proposed $300 million research facility for Pfizer New corporate headquarters to create jobs and help rejuvenate the

area City was unable to negotiate purchase agreements with all the

petitioner home owners in development area, so used statutory authority to initiate a condemnation proceeding.

RECENT HAPPENINGS IN EMINENT DOMAIN

United States Supreme Court Review: Determined whether “A city’s decision to take property for the

purpose of economic development satisfies the ‘public use’ requirement of the Fifth Amendment” 5-4 decision: constitutional public use

No bright line rule comes from this decision Justice Stephens emphasized, nothing in the opinion precluded any state from “placing further restrictions on its exercise of the takings power”

KELO CONT.

Article 1 , Section 32. Eminent domain. Private property shall not be taken for private use unless by

consent of the owner, except for private ways of necessity, and for reservoirs, drains, flumes or ditches on or across the lands of others for agricultural, mining, milling, domestic or sanitary purposes, nor in any case without due compensation.

Article 1 , Section 33. Compensation for property taken. Private property shall not be taken or damaged for public or

private use without just compensation.

EMINENT DOMAIN AND THE WYOMING CONSTITUTION:

Section 1-26-509: Improved good faith negotiations to require a three part

negotiation system. Section 1-26-509 Heightened accountability in the condemnor, requiring

payment of legal fees if responsibilities to condemnee are not met.

Section 1-26-704 Improved compensation through a changed definition of “fair

market value”

2007 REFORMS MADE TO THE EMINENT DOMAIN ACT IN RESPONSE TO KELO

Wyo. Stat. §§ 1-26-501 to -817

1-26-502. Definitions. (a) As used in this act: (i) "Condemn" means to take property under the power of eminent

domain; (ii) "Condemnee" means a person who has or claims an interest in

property that is the subject of a prospective or pending condemnation action; (iii) "Condemnor" means a person empowered to condemn

WYOMING EMINENT DOMAIN ACT

(a) Except as otherwise provided by law, the power of eminent domain may be exercised to acquire property for a proposed use only if all of the following are established :

(i) The public interest and necessity require the project or the use of

eminent domain is authorized by the Wyoming Constitution; (ii) The project is planned or located in the manner that will be most

compatible with the greatest public good and the least private injury; and

(iii) The property sought to be acquired is necessary for the project.

1-26-504. REQUIREMENTS TO EXERCISE EMINENT DOMAIN.

(c)When a public entity determines that there is a reasonable

probability of locating a particular public project on

specifically identifiable private property and that the project

is expected to be completed within two (2) years of that

determination, the public entity shall provide written notice of

the intention to consider the location and construction of the

project to the owner as shown on the records of the county

assessor……….

1-26-504(C) NOTICE PROVISION

(a) A condemnor and its agents and employees may enter upon real proper ty and make surveys, examinations, photographs, tests, soundings, borings and samplings, or engage in other activit ies for the purpose of appraising the proper ty or determining whether i t is suitable and within the power of the condemnor to condemn if the entry is:

(i) Preceded by prior notice to the condemnee specifying the particular activity to

be undertaken and the proposed use and potential recipient of the data thereby obtained and the condemnee has been given fifteen (15) days to grant written authorization;

(ii) Undertaken during reasonable hours, normally during daylight; (iii) Accomplished peaceably and without inflicting substantial injury to land,

crops, improvements, livestock or current business operations.

(b) The entry and activit ies authorized by this section do not constitute a trespass.

(c) The condemnor is l iable under W.S. 1-26-508 for damages result ing from activit ies authorized by this section.

1-26-506. ENTRY PRIOR TO CONDEMNATION ACTION.

Negotiations; scope of efforts to purchase. - (b): Definition of Good Faith Negotiation - (c) – (h): The Good Faith Road Map

1-26-509

1-26-510. Preliminary ef forts to purchase.

1-26-511. Purchase ef forts waived or excused.

1-26-513. Deposit at commencement of action.

1-26-514. Interest taken; due compensation.

1-26-515. Abandonment, nonuse or new use.

ARTICLE 5

When a person possessing the power of condemnation takes possession of or damages land in which he has no interest, or substantially diminishes the use or value of land, due to activities on adjoining land without the authorization of the owner of the land or before fil ing an action of condemnation, the owner of the land may file an action in district court seeking damages for the taking or damage and shall be granted litigation expenses if damages are awarded to the owner.

1-26-516. ACTION FOR INVERSE

CONDEMNATION.

Property Owner initiates the action

The owner alleges that the government has acquired an interest in his or her property without giving compensation, such as when the government floods a farmer's field or pollutes a stream crossing private land.

An inverse condemnation proceeding is often brought by a property owner when it appears that the taker of the property does not intend to bring eminent domain proceedings.

WHAT IS INVERSE CONDEMNATION?

Regulatory Takings: The Federal or State Government may create a regulation limiting

use, access or enjoyment to a parcel of property. If the regulation deprives land of ALL economically beneficial uses it

is a per se taking unless the government is acting to prevent a common law nuisance (offends the public at large). A regulation that destroys all economic value for only a limited time does not result in a per se taking.

A suit for compensation usually proceeds by way of an action in INVERSE CONDEMENATION. For regulatory takings, the government may be liable for interim and permanent damages. If regulation is unconstitutional it is void.

WHEN IS THIS ACTION NECESSARY?

1-26-701. Compensation standards. (a) An owner of property or an interest in property taken by

eminent domain is entitled to compensation determined under the standards prescribed by W.S. 1-26-701 through 1-26-713.

(b) Unless otherwise provided by law, the right to compensation

accrues upon the date of possession by the condemnor. (c) Except as specifically provided by W.S. 1-26-701 through 1-

26-713, compensation, damages, or other relief to which a person is otherwise entitled under this act or other law are not affected, but duplication of payment is not permitted.

ARTICLE 7 COMPENSATION STANDARDS

(a) Except as provided in subsection (b) of this section, the measure of compensation for a taking of property is its fair market value determined under W.S. 1-26-704 as of the date of valuation.

(b) If there is a partial taking of property, the measure of

compensation is the greater of the value of the property rights taken or the amount by which the fair market value of the entire property immediately before the taking exceeds the fair market value of the remainder immediately after the taking.

1-26-703. Date of valuation. The date of valuation is the date upon which the condemnation

action was commenced.

1-26-702. COMPENSATION FOR TAKING.

(a)Except as provided in subsection (b) of this section: (i)The fair market value of property for which there is

a relevant market is the price which would be agreed to by an informed seller who is willing but not obligated to sell, and an informed buyer who is willing but not obligated to buy; (ii)The fair market value of property for which there is

no relevant market is its value as determined by any method of valuation that is just and equitable;

1-26-704.FAIR MARKET VALUE DEFINED.

(iii)The determination of fair market value shall use generally accepted appraisal techniques and may include: (A)The value determined by appraisal of the

property performed by a certified appraiser; (B)The price paid for other comparable easements

or leases of comparable type, size and location on the same or similar property; (C)Values paid for transactions of comparable type,

size and location by other companies in arms length transactions for comparable transactions on the same or similar property.

1-26-704.FAIR MARKET VALUE DEFINED.

W.S. 1-26-801-809: grants the right of eminent domain to any state, county, municipal organization or public utility.

W.S. 1-26-810-812: grants the right of eminent domain to railroads and limits rights of way to 200 feet. Section 812 requires railroads to construct and maintain crossings.

W.S 1-26-814: grants the right of eminent domain to petroleum and other pipeline companies.

ARTICLE 8: POWER OF EMINENT DOMAIN GRANTED

Provides for a broad right of Condemnation: “Any person, association, company or corporation authorized to

do business in this state may appropriate by condemnation a way of necessity over, across or on so much of the lands or other real property of others as necessary for the location, construction, maintenance and use of reservoirs, drains, flumes, ditches including return flow and wastewater ditches, underground water pipelines, pumping stations and other necessary appurtenances, canals, electric power transmission l ines, railroad trackage, sidings, spur tracks, tramways, roads or mine truck haul roads required in the course of their business for agricultural, mining, exploration dril l ing and production of oil and gas, mill ing, electric power transmission and distribution, domestic, municipal or sanitary purposes, or for the transportation of coal from any coal mine or railroad l ine or for the transportation of oil and gas from any well .”

W.S. 1-26-815:

PRIVATE ROAD STATUTES WY's private road statutes provide a mechanism by which a

landowner may petition to exercise the state's eminent domain power to condemn a private road across another's property in order to establish access between his own landlocked property and a public road.

"NO OUTLET" Requirement: Any owner of land HAVING NO OULET TO OR CONNECTION WITH A

PUBLIC ROAD may fi le an application with the board of county commissioners in the county where his land is located to obtain access across the lands of another. Access to property via leased adjacent land or an i l logical, uneconomic, and unproductive road is NOT an 'outlet to or connection with' a convenient public road.

PRIVATE ROADS

Energy: mining, oil and gas, wind and other state natural resources fall into a Kelo type “economic development taking”

Statutes create a right to displace private property interests in

the name of economic development that ultimately benefits the public at large by facilitating the operations of private firms.

Land condemned by an energy company is not subject to public access or use, but rather is ‘public’ in the sense that the resource development will add to overall growth of state economy

ENERGY DEVELOPMENT AND EMINENT DOMAIN

Moratorium expires in June 2013

Currently : private wind energy developers do not have the authority to condemn private land for wind turbines, wind farms, or wind energy collector systems; private wind energy developers do have the authority to condemn private property for interstate transmission lines and energy distribution systems.

Landowners stil l have the power at the bargaining table with wind energy developers and can negotiate freely with them for the lease of their lands for wind farms and collector systems without the threat of condemnation.

WIND ENERGY

Seismic Exploration Create more compensation for landowners Will increase bond to be posted with the WOGCC Current bond is $2,000 minimum

Eminent Domain- Wind Energy Collector Systems Requirement of 85% of landowners involved or landowners owning

85% of land owned in agreement to proceed Trying to enhance landowner negotiation possibilities

Extends Moratorium till 2015 Working to define wind energy parameters in an eminent domain context

PROPOSED LEGISLATION

Know your rights Negotiate with confidence Advocate for protecting your private property ownership rights

HOW TO PROTECT YOURSELF

Stacia Berry Hageman & Brighton, P.C.

222 East 21st Street Cheyenne, Wyoming 82001 Telephone: 307-635-4888 sberry@hblawoffice.com

www.hblawoffice.com

THANK YOU