Eminent Domain

cropped-HSR-Path-Collage.jpgYes, the California High-Speed Rail Authority believes it has power under state law to seize land from property owners for “the best interest of the state.” Here is the perspective of the California High-Speed Rail Authority on property acquisition:

An article in the 2011-12 San Joaquin Agricultural Law Review described the legal issues surrounding the upcoming “showdown between the construction of modern day technology and the farms that have enriched the state for many years.” See Un-Just Compensation: How Severance Damages and Inverse Condemnation Will Affect California High-Speed Rail Takings by Mary Raterman-Doidge.

Recent Developments in State Law for California High-Speed Rail Acquisition of Property

The text of Proposition 1A (Senate Bill 3034, enacted in 2008) authorized the California High-Speed Rail authority to spend money borrowed through Prop 1A bond sales on “all activities necessary for acquisition of interests in real property” and “relocation assistance for displaced property owners and occupants.”

In a letter dated August 2, 2013, Assemblymembers Jim Patterson and Frank Bigelow asked the Joint Legislative Audit Committee to audit the California High-Speed Rail Authority “processes for acquiring privately-owned land in the Central Valley.” The Committee denied the request.

On August 26, 2013, Governor Jerry Brown signed into law Assembly Bill 481, which relieves the California High-Speed Rail Authority of the need for the California Department of General Services to approve acquisition of property for the project. AB 481 also establishes criteria for the California High-Speed Rail Authority to sell or exchange property or interest therein at fair market value if it determines it no longer needs it for the high-speed rail project. And it allows the California High-Speed Rail Authority to sell or lease excess right-of-way parcels to municipalities or other local agencies for public purposes and contribute funding toward the cost of developing local parks and other recreational facilities on those areas. The bill creates a High-Speed Rail Property Fund in the State Treasury.

On October 1, 2013, Governor Jerry Brown vetoed Assembly Bill 374, which would have required property owners to be compensated under eminent domain for “goodwill,” that is, “the benefits that accrue to a business as a result of its location, reputation for dependability, skill or quality, and any other circumstances resulting in probable retention of old or acquisition of new patronage.” Read the Governor’s veto message for AB 374.

Brown Veto Aids Eminent-Domain Use – news article by Steven Greenhut in UT San Diego – October 3, 2013.

The bill’s author, Assemblyman Don Wagner, R-Irvine, told me the legislation was the victim of the governor’s push to build a rail line through the Central Valley. The veto “is coming from High Speed Rail. They (rail supporters) visited me with their hair on fire,” he said.

In a statement Thursday, Wagner said: “This legislation is necessary because case law has established different, inconsistent standards when it comes to eminent domain cases. The bill not only had bipartisan support, it passed both houses without a single ‘No’ vote. Unfortunately, the governor’s decision leaves the law muddled. And that confusion can only help the government as it tries – more cheaply than is fair – to take property from business owners, including property to be taken to pursue high speed rail through the Central Valley.”

On January 16, 2014, California State Senator Andy Vidak introduced Senate Bill 902, which would prohibit the California High-Speed Rail Authority (or the State Public Works Board acting on behalf of the authority) from adopting a resolution of necessity to commence an eminent domain proceeding to acquire a parcel of real property for the high-speed train system unless the resolution does the following:

  1. identifies the sources of all funds to be invested in the property
  2. identifies the anticipated time of receipt of those funds
  3. declares that the authority, or the board, has offered to purchase the property at not less than the fair market value or the amount necessary to discharge the liens against the property, as described, whichever is greater

Senate Bill 902 would also require the California High-Speed Rail Authority (or the State Public Works Board acting on behalf of the authority) to be responsible for compliance with any environmental protection laws or regulations that are applicable to the property it acquires pursuant to eminent domain.

News Articles and Other Sources Referencing the Number of Targeted Land Parcels

Rail Authority Gets OK to Solicit 356 Valley Parcels – news article by Tim Sheehan and John Ellis in Fresno Bee – January 13, 2013

The state’s Public Works Board on Monday cleared the way for the California High-Speed Rail Authority to begin negotiating for property in Fresno and Madera counties needed for high-speed train tracks. In a meeting that lasted less than 10 minutes, the board – which includes the directors of the state’s Finance, General Services and Transportation departments – voted 3-0 to approve the formal selection of 356 separate parcels by the rail authority.

California Still Hasn’t Bought Land for Bullet Train Route – news article by Ralph Vartabedian in Los Angeles Times – January 27, 2013

About 400 parcels are needed for the first construction segment, a 29-mile stretch from Madera to Fresno. The formal offers will start an eminent domain action, the legal process for seizing land from private owners.

California High Speed Rail Authority Small Business Newsletter – Volume 1, Issue 4, July/August 2013

As work on building the high-speed rail system carries on, about 600 parcels between Fresno and Bakersfield will require surveying.

California High Speed Rail, Now Having Slow Delays – news article and TV story by Bob DeCastro of Fox News 11 (Los Angeles) – August 12, 2013

Assemblymen Jim Patterson, R-Fresno, and Frank Bigelow, R-O’Neals, submitted a request Tuesday to the Joint Legislative Audit Committee seeking an investigation into the appraisal process, assessment of land values and the role of private contractors as the rail authority seeks to acquire or seize 356 parcels for the first leg in the Central Valley.

Land Acquisition for High-Speed Rail Moving Slowly – news article by Juliet Williams of Associated Press in San Jose Mercury-News – November 9, 2013

But months after shovels were supposed to be in the ground, the California High-Speed Rail Authority is in escrow on just one parcel of the 370 it needs to buy or seize through eminent domain for the first 30 miles of construction. The agency says it is within 30 days of reaching deals on another 38 parcels and is negotiating over hundreds of others.

State Seeks to Condemn First Fresno Sites for High-Speed Rail Project – news article by Tim Sheehan of Fresno Bee – December 8, 2013

Two pieces of property in Fresno are being targeted as the first parcels to be condemned for California’s high-speed train system…Progress has been slow — very slow — in the California High-Speed Rail Authority’s efforts to buy the right of way it needs for the first 29 miles of construction planned between the northeast fringe of Madera and the south edge of Fresno.