Eminent Domain Report

We've been following the saga of the Keystone XL pipeline for a while now, and the battle rages on in Washington.  Yesterday, the Republican-led Senate attempted to override President Obama's veto of a bill to approve the pipeline.  For those a bit lost in all the political and legal wrangling, the recent story began with a bill in Congress designed to grant approval to the controversial pipeline project.  The bill passed the Senate on January 29 and the House in mid-February and was sent to the White House for President Obama's signature.

But just as promised, President Obama vetoed the ...

At its meeting last week, the California Transportation Commission allocated $174.8 million to 85 projects around the state.  Some of the projects receiving allocations this month include:

• $22.5 million for  construction of SR-905/SR-125 connectors in San Diego

• $20 million to realign Highway 1 in San Luis Obispo County away from the eroding shoreline

• $19.4 million to rehabilitate the Elysian Viaduct Bridge in Los Angeles

• $6.3 million for reabilitation of the Sierra Point Overhead bridge near South San Francisco

• $5.9 million to replace the aging Hilt Road Overcrossing on I-5 near ...

The California Transportation Commission met in Riverside on Wednesday.  On the agenda was the allocation of $254 million in funding for transportation projects throughout the state.  You can read Caltrans' press release here.  Caltrans Director Malcolm Dougherty commented:

Investing in our infrastructure benefits Californians for generations to come and these projects will improve mobility for all users of the transportation system, whether they choose to travel by car, take transit or ride a bicycle.

Just under half of the money allocated came from Prop 1B funds.  ...

There has been a remarkable movement lately throughout California:  local government agencies are attempting to take over investor-owned, quasi-public utility companies in an effort to reduce utility bills to their constituents.  A number of electric and water utilities are facing pressure from agencies to sell their assets -- or face having them acquired through eminent domain.  Does this make sense?

As just one example, according to one recent article by Garth Stapley in the Modesto Bee, SSJID can boot PG&E from Ripon, Escalon, Manteca, the South San Joaquin Irrigation ...

According to Robin Richard’s article, "Needles May Exercise Eminent Domain to make way for Highway 95 Connector," the City of Needles is considering adopting Resolutions of Necessity to acquire 14 parcels for its long-planned I-40 connector project.   The City will be acquiring permanent road easements and temporary construction easements of various sizes.  The impacted properties include residential, commercial and motel uses.  Some of the acquisitions are fairly small, but as my colleague Brad Kuhn recently posted, even these sliver acquisitions can have impacts to the ...

As traffic continues to increase and roadways become more congested, California's transportation infrastructure needs to keep up.  While there has been a concerted focus on alternative methods of transportation (such as rail, bikeways, etc.), street and highway widenings are still a major focus of local government agencies.  The County of Sacramento is no different, as it embarks on the Hazel Avenue and Fair Oaks Boulevard road widening projects.  These street improvement projects typically require right-of-way acquisition, and while the acquisitions are typically small ...

The Contra Costa Times reported last week that the City of Pittsburg certified the environmental document for the Donlon Boulevard extension after nearly two decades of trying.  Although the vote was unanimous, the project has vocal resistance.   According to the Save Mount Diablo website, the project may induce growth, destroy a "spectacular" ranch and actually create rather than relieve traffic congestion.  That group has made clear it does not agree with the City's action.

Often once an agency has certified its environmental document, right of way acquisition soon follows.  ...

At its meeting last week, the California Transportation Commission allocated $1 billion for local streets, highways and public transit.  This means a significant amount of money will be available for city, county and regional transportation agencies who will submit their projects to Caltrans in the coming months.   You can read Caltrans District 7 Press Release here.

The projects are spread around the state and include some major funding for rail projects as well as the usual highway improvements and also show that money will be coming to several California regions.  You can see a full ...

Good news California:  local projects are continuing to receive federal funding.  Caltrans announced last week that the U.S. Department of Transportation has granted nearly $35 million in TIGER funds to six local and regional projects throughout the state.

The projects receiving funding include:

• East Side Access Improvement Project ($11.8 million): This Los Angeles County Metropolitan Transportation Authority project will create a network of bike lanes and sidewalks for bicyclists and pedestrians to access the new Regional Connector/1st Central Station in Los Angeles ...

As public agencies continue to expand and build infrastructure throughout California, I've noticed a few recent themes.  First, many projects are supported by federal funds, usually through the Federal Transit Administration (FTA) or the Federal Highway Administration (FHWA).  And second, agencies are becoming more creative in exploring joint development opportunities with the private sector to enhance their projects and the surrounding community.

To the extent you are part of, or work with a public agency, and are involved with a federally funded project involving a potential ...

As we have reported in the past, public agencies are often faced with deadlines to secure possession of necessary right of way and ensure project funding.  Given the amount of time it takes to secure possession through the court process, agencies must proceed with condemnation actions even where they need additional time to negotiate with property owners.  Delaying the condemnation action for several additional months, while likely to lead to a settlement, ultimately places the project at risk if no deal is reached and thereby forces the agency's hand.  This is exactly what ...

Undaunted by the so-called "death of redevelopment," several California cities have pushed to reinvent -- a.k.a. redevelop -- their downtown cores.  And it appears to be working.

The San Jose Mercury News recently reported that the city of Fremont is breaking ground soon on its extension to Capitol Avenue, creating a new "Main Street" for its Downtown District.  And Fremont is not alone.  Stockton also has a plan to "Bring Downtown Back."  In Southern California, The Desert Sun reports that Palm Springs is moving forward with its downtown redevelopment.

So perhaps redevelopment ...

As reported in the Willits News, Caltrans is going forward with public workshops for the Sherwood Road Intersection Project, one of four "child projects" of the Willits Bypass project, which is anticipated to increase the traffic on Sherwood Road.

But Willits residents won't be seeing improvements any time soon, because construction is dependent on the opening of the Willits bypass, a segment of US 101 through Mendocino County that has been in the works since the 1950s.  And construction of the bypass is currently suspended while Caltrans and the Army Corps of Engineers work ...

The Oxnard Union High School District began Eminent Domain procedures to acquire property owned by the Church of Jesus Christ of Latter-day Saints. The property is required for construction of a right-turn lane for the new Rancho Campana High School, scheduled to open in time for the 2015-2016 school year. According to reports, the City of Oxnard set a deadline of June 30, 2014 for the district to acquire the property or begin the eminent domain process. Although the parties are currently engaged in negotiations, the district initiated eminent domain procedures in order to meet the ...

As reported in Caltrans District 11's press release, there is much good news coming out of California Transportation Commission's meeting last week.  First, thanks to a new state budget that increased transportation funding by $351 million, CTC revised its budget for SHOPP projects to $2.4 billion.

Local projects also received good news with CTC's award of $510 Million to 83 transportation projects around the state.  As reported by Progressive Railroading, several rail projects received significant funding, which will hopefully allow those projects to proceed to ...

On June 10, 2014, President Obama signed into law the Water Resources Reform and Development Act of 2014, which, among other things, streamlines the U.S Army Corps of Engineers' infrastructure authorization process, accelerates project delivery, and authorizes federal funding for a variety of projects, including projects in California.  Among these California projects is the San Clemente Shoreline project, which includes construction and continuing maintenance of coastal protection measures along the San Clemente shoreline. 

Under the proposal that ...

Eminent domain litigation can be expensive.  Not just the cost of acquiring the property (which is valued based on its highest and best use, and the "highest price" a willing buyer would pay), but the attorneys' fees, expert appraisal fees, and court costs all add up as well.  We're seeing the impact of such costs in the City of Adelanto, where the City has changed course on its plans to acquire a property by eminent domain.  

According to Brooke Self's article in the Victorville Daily Press, Adelanto halts eminent domain efforts, the City of Adelanto once planned to use eminent domain to ...

Last week I attended the 2014 California Passenger Rail Summit where industry leaders met to discuss the modernization and integration of passenger rail service in California. While the California High Speed Rail train was an important element, to me the main takeaway was the vision of statewide rail connectivity benefiting all of California’s communities.

Several regional government representatives spoke about the success of existing corridors, such as the Capitol Corridor and the expanding LOSSAN corridor, as well as emerging corridors such as the Salinas Rail ...

On March 20, 2014, the California Transportation Commission allocated $334 Million to 53 projects around the state.  As one Caltrans press release puts it, "Californians will be driving on smoother roads, safer bridges, and enjoying the benefits of enhanced transit."

According to Caltrans' director Malcolm Dougherty:

Every $1 spent on preventive pavement maintenance saves Californians $11 that would have been spent on future pavement repairs.

And we can all hope Caltrans is targeting those dollars in the right places.  Some areas that will be seeing significant funds include:

• $59 ...

The City of Bakersfield can now purchase property in the path of the Centennial Corridor Project between the Westside Parkway and Highway 58.  Under the early acquisition federal program, the City of Bakersfield may purchase properties from homeowners willing to voluntarily sell their property.  Approval for early acquisition of the sites will be requested at the next City Council meeting on March 5th.

On the other hand, the City may begin eminent domain proceedings for the 24th Street Widening Project to acquire the 23 homes in the project’s path.  The EIR for the project was approved ...

On Wednesday, a Nebraska District Court dealt the Keystone XL pipeline project a heavy blow.  The court invalidated a law that allowed the state's governor to approve the pipeline's passage through Nebraska.  The court ruled that the state's legislature circumvented the Public Service Commission (PSC), which regulates pipelines and other utilities, by allowing the governor to approve the route the pipeline would take through Nebraska.  The law also improperly granted TransCanada the power of eminent domain to acquire property within Nebraska, another decision that should ...

The California Transportation Commission allocated $138 million to 32 projects around the state at its January 29th, 2014, meeting.  As Caltrans director Malcolm Dougherty put it:

From one end of the state to the other transportation projects are providing good paying jobs while at the same time reducing traffic congestion for the people and businesses in California.

Many of the projects receiving funds are directly aimed at easing commutes.  Some highlights include:

• $8.5 million to Metrolink for its High Speed Readiness Program
• $11.9 million for the Raymond Avenue grade ...

On July 6, 2012 President Obama signed into law MAP-21, which, among other things, contained new National Environmental Policy Act ("NEPA") requirements for the Federal Transit Administration ("FTA") and Federal Highway Administration ("FHWA").  Earlier this month, pursuant to a mandate in MAP-21, FTA and FHWA adopted new regulations governing the implementation of two new categorical exclusions.  The two new categorical exclusions apply to (1) projects within an existing right-of-way, and (2) projects receiving limited Federal funding.  

NEPA is the ...

The City of Benicia recently secured funding to build the Benicia Industrial Park Bus Hub, a project that has been on the City's drawing board for years. But there are still some hurdles to construction.  The City will need to acquire at least one parcel for the project, and the owners of the parcel have questioned whether the City’s environmental review of the project is adequate.  The owners also have expressed concerns about the impacts of the project on their taco truck business.  But the City is confident that it can resolve these issues and just adopted a mitigated negative ...

The City of Sacramento took another step forward on the plan for a new multi-million dollar arena for the Sacramento Kings.  Last Tuesday, in a 7-2 vote, the city council passed a resolution of necessity approving the use of eminent domain to acquire a former Macy’s store property, which comprises more than half of the property needed for the $448 million dollar project.  Wasting no time at all, the City’s legal counsel filed the eminent domain action just two days later, and plans to file a motion to gain prejudgment possession of the property to keep the city’s construction timeline ...

California's infrastructure received another push in the right direction last week as the California Transportation Commission (CTC) allocated $152 million to 36 projects statewide -- bringing its total transportation funding for 2013 beyond the $3 billion barrier.  

Some highlights of projects receiving funding this year as 2013 winds to a close:

• Los Angeles received (i) $26 million to improve the Port of Los Angeles, (ii) $20 million to widen the I-5 freeway from the Orange County Line to the I-5/I-605 junction, and (iii) $28 million for the Exposition Light Rail Project ...

Last week, the Agoura Hills City Council approved acquiring 14 properties through eminent domain for its Augora Road Widening and Canwood Street Improvement Project, as reported by The Acorn.  The purpose of the project is to reduce traffic congestion and provide an emergency bypass road to the 101.  The project will expand Agoura Road from two lanes to four lanes, provide sidewalks, bike paths and landscaped pathways and medians. There will also be improvements to Kanan Road as a result.  Almost half of the acquisitions consist of only temporary construction easements. 

Some ...

Eminent domain litigation can be expensive.  Acquiring small strips of property often costs more in legal and appraisal costs than the value of the property itself.  Sometimes public agencies have no choice but to condemn these minor acquisitions, as property owners cannot be found, will not negotiate, or otherwise take unreasonable positions.  But when property owners are willing to reasonably negotiate, public agencies need to think hard about these cost savings and weigh them against setting a precedent for other acquisitions.  

For example, if it will cost an agency $20,000 in ...

Caltrans and the Amador County Transportation Commission have scheduled a public workshop for the proposed State Route 88 Pine Grove Improvements Project for tonight at 5:30 p.m.  The workshop will take place at the Pine Grove Town Hall, located at 19889 Highway 88, Pine Grove, California 95665.  The notice for the public workshop states that Caltrans and the County Transportation Commission have proposed "to modify State Route 88 through the Town of Pine Grove in order to reduce congestion, improve operations and enhance safety between the intersections at Climax Road and Tabeaud ...

The California Transportation Commission announced this week that it has awarded $359 million to help fund 36 projects in California.  Some of the projects receiving funding include:

• $140 million to the Bay Area Rapid Transit (BART)  to purchase 46 new rail cars that will provide new service from the BART/Caltrain Millbrae Station directly to San Francisco International Airport.
• $15 million to Santa Clara for the US 101 Freeway Performance Initiative.
• $43.8 million for the SR 99/Pelandale Interchange in Modesto.
• $46 million for improvements to I-405 in Orange County

A full list of ...

According to Jason Henry's article in the San Gabriel Valley Tribune, West Covina contests condemnation of properties at Westfield Mall, Lakes Drive, the City of West Covina plans to contest an eminent domain action filed by the California Department of Transportation (Caltrans) to acquire land near Westfield Mall needed for the expansion of the I-10 Freeway.  

Caltrans' proposed acquisition will eliminate a California Pizza Kitchen, the former Bob's Big Boy building, an AT&T store, as well as a row of parking spaces along the I-10 near Lakes Drive.  The City claims that Caltrans ...

More than 50 years ago, Caltrans purchased roughly 500 homes under threat of eminent domain within the planned right-of-way for the anticipated construction of the I-710 freeway (linking Monterey Park to Pasadena).  That freeway project still has not been built, yet Caltrans continues to own the properties.  There have been plenty of negative news stories about the amount of money Caltrans has spent on the upkeep of those residences (see Gideon's Trumpet), but apparently Caltrans' property ownership may finally come to an end.  Not because the I-710 freeway is actually going to be ...

According to an article in the Desert Sun, CVAG OKs plan to help fund passenger rail, the Coachella Valley Association of Governments ("CVAG") recently approved an agreement with the Riverside County Transportation Commission for a new rail fund that will devote a portion of local transportation funds to expanding passenger rail service.  It will likely take at least a year before the agencies are able to report on possible station locations and schedules, but the long-term plan is to have connections through the valley with Los Angeles.

A prior study proposed stops in three cities ...

OK, I'll admit it.  A year ago I thought this whole condemnation-of-underwater-mortgages thing would die off pretty quickly.  I predicted we'd never see any large-scale condemnation effort.  So far, I've missed badly on the first prediction -- but it remains to be seen whether I'm right on the second one.

To date (unless I've missed something), not a single condemnation action has been filed anywhere in the U.S. to condemn an underwater mortgage.  But the concept certainly has not disappeared quietly into the night.  Instead, some cities continue to pursue the idea.

One in particular ...

Yesterday, the City of Richmond caught a small reprieve with respect to its plan to condemn underwater mortgages.  As reported by Reuters, the federal district court ruled that the lawsuit filed by lenders Wells Fargo, Deutsche Bank and The Bank of New York Mellon is unripe. The judge denied the lenders' request for an injunction to halt the City's plan to condemn underwater mortgages even though the lenders argued that the City's use of eminent domain in this context is unconstitutional.  Next Monday, the judge will decide whether to dismiss the action or leave it pending.

Despite three major banks filing federal lawsuits against the City of Richmond last month related to its plan to condemn underwater mortgages, the City continues to press on.  On Tuesday, the City voted 4-3 to continue its partnership with Mortgage Resolution Partners (MRP), the mastermind behind the scheme. (See articles from The Press Enterprise and Contra Costa Times.)   The council and MRP will form a Joint Powers Authority to administer the plan and will attempt to attract more cities to join the effort. 

While the City is still moving forward, there continues to be ...

In July, the City of Hayward passed several resolutions of necessity to acquire property for its Interstate 880 / State Route 92 Reliever Route Project.  The Project will extend Whitesell Street to provide access to State Route 92 from Winton Avenue, which is more of an industrial area.  While it sounds straight-forward, there appears to be some complex acquisitions.  Last week, the San Jose Mercury News provided some insight to the complicated project.

The city prides itself on never having filed an eminent domain action for its public project and here, the city is only seeking to ...

Money is once again being allocated to improve public infrastructure in California.  The California Transportation Commission announced this week the award of $487 million to various projects throughout the state.  Included are:

• San Bernardino Associated Governments' (SANBAG) Lenwood Road Railroad Grade Separation Project in the City of Barstow.
• Orange County Transportation Authority's (OCTA) Lakeview Avenue Grade Separation Project in the City of Placentia.
• The Richmond Rail Connector for a new route between San Pablo and Richmond.
• Several Caltrans State Highway ...

We all knew this was coming (see my post from July 23).  If you poke a sleeping giant, it's going to file a lawsuit against you in federal court.  Yesterday, in response to the City of Richmond's preliminary actions to condemn underwater mortgages, three heavy-hitting banks fired back by filing lawsuits in California federal court to block the condemnations. 

According to multiple news sources (here, here and here), Wells Fargo Bank, Deutsche Bank and Bank of New York Mellon Corp. have asked the court to find the City's plan unconstitutional and block its implementation.  The banks argue ...

The Press Democrat is reporting that Sonoma County has agreed to pay $815,000 to acquire by eminent domain a family's 6.5-acre property next to the Charles M. Schulz airport for a runway extension project, settling the contentious case on the eve of trial.  According to the article, Landowners, Sonoma County settle airport expansion lawsuit, the County valued the property at $135,000, while the owner's appraiser reached a valuation conclusion of $1.5 million.  Why the large spread in appraisals?  Apparently because of a dispute over the property's highest and best use.

To provide ...

The City of Agoura Hills is moving forward with its plans for the U.S. 101/Palo Comado Canyon Road Interchange at Chesebro Road.  According to the City,

The City has received approval from the California Department of Transportation (CalTrans) and the Federal Highway Administration (FHWA) on the Project Study Report (PSR), which is the document that identifies the deficiencies of the interchange and future issues while identifying the most likely construction improvements that will resolve existing and future traffic issues.

Though the project is still in the design phase, it has ...

The City of Santee's Prospect Avenue Widening Project is moving forward, and because the City has not been able to secure all the necessary right of way voluntarily, the City is now poised to condemn the remaining interests it needs for the project. 

On July 10, the City adopted a resolution of necessity which allows the City to proceed with the eminent domain actions on as many as 43 property interests, including several full take acquisitions, along with many partial takes and temporary construction easements.  

A July 23 article in the Santee Patch, Santee Council OKs Property Seizures ...

It's been a while since we focused on the whole condemnation of underwater mortgages scheme but that doesn't mean the idea has died off.  To the contrary, apparently at least four California cities have now signed advisory agreements with Mortgage Resolution Partners.  According to the Las Vegas Sun and various other news outlets (see here and here), the cities of Richmond, San Joaquin, Orange Cove, El Monte, and perhaps a few others, have entered into an agreement with Mortgage Resolution Partners and are looking to pursue the condemnation of underwater mortgages. 

The first ...

We haven't provided much in the way of updates recently on California infrastructure projects requiring eminent domain.  Either we've been too busy to notice or it's been surprisingly quiet recently.  But, some headlines did just catch our attention, so we thought we'd provide an update to our readers.

• San Luis Obispo to Institute Eminent Domain:  according to a recent article in the Tribune, City Council approves temporary easement on private land for work in congested area, the San Luis Obispo City Council unanimously adopted a resolution of necessity, approving the use of ...

According to an article in the Mercury News, Fremont may use eminent domain process to buy land needed for proposed downtown, the City of Fremont's City Council will be holding a public hearing on Tuesday to consider the adoption of a resolution of necessity to acquire a property for the Capitol Avenue Extension Project.  The impacted property is located at 39138 Fremont Blvd., and it consists of 65,150 square feet of land improved with a three-story building.

The Mercury News article indicates that the staff report supporting the adoption of the resolution of necessity provides ...

After two years of negotiating with residential property owners, the Stanislaus County Board of Supervisors approved acquisition of the property by eminent domain.  The Modesto Bee reports that the board approved the acquisition of a single-family residence at its meeting on Tuesday in order to construct its Claribel Road project, which will cost the county $15.2 million.  The project will widen Claribel Road from two lanes to a four-lane separated highway relieving congestion and reducing the safety concerns of the current configuration, which causes an estimated 16 accidents ...

The California Transportation Commission (CTC) recently announced the award of $878 million to fund 114 transportation projects.  Brian Kelly, the acting Secretary of Business, Transportation & Housing Agency, stated:

This billion-dollar investment helps preserve California’s great infrastructure of the past and put thousands of Californian’s to work building something new.  These investments in preservation and innovation are absolutely critical to California’s economy:  In 2010, traffic congestion caused 95 million hours of delay, wasting fuel and ...

The City of Imperial has taken the first step in pursuing an eminent domain proceeding by adopting a resolution of necessity to acquire a vacant property for its Transit Center Project.  As reported by the Imperial Valley Press, the City and the property owner have been negotiating the City's purchase of the property but have reached an impasse.  

While the owner concedes the project is needed in the city, he believes his property is "very valuable" and that other locations would be better suited for the Project.  The City disagreed and is moving forward with acquiring the ...

As reported earlier today by a number of news outlets (see for example this KCET article by Chris Clarke), the Bureau of Land Management ("BLM") will be issuing a Final Rule to facilitate right-of-way applications for lands with wind and solar energy development potential.  As explained in the press release issued by the BLM, in the past

"lands included in a proposed right-of-way [would] remain open to the location and entry of mining claims while the BLM" considered the application.

However, the Final Rule, which will be published in the Federal Register, permits the BLM to temporarily ...

Light rail and rapid transit appear to be the hot ticket in California.  Most of our right-of-way acquisition and eminent domain work over the last few years has centered on such projects.  One interesting dispute that regularly pops up between the land owner's appraiser and the public agency's appraiser is whether or not there are "project benefits".  In analyzing the property's "before-condition" value, such benefits need to be excluded (whether positive or negative).  (See Code Civ. Proc., sec. 1263.330.)  But when assessing the property's "after-condition" value in the case ...