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H0525.........................................by TRANSPORTATION AND DEFENSE
EMINENT DOMAIN - Amends existing law relating to eminent domain proceedings
to revise the formula and procedure for assessment of damages when the
damages are to any established business of more than five years' standing.
02/07 House intro - 1st rdg - to printing
02/08 Rpt prt - to Transp
H0525
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-fifth Legislature Second Regular Session - 2000
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 525
BY TRANSPORTATION AND DEFENSE COMMITTEE
1 AN ACT
2 RELATING TO ASSESSMENT OF DAMAGES IN EMINENT DOMAIN PROCEEDINGS; AMENDING SEC-
3 TION 7-711, IDAHO CODE, TO REVISE THE FORMULA AND PROCEDURE FOR ASSESSMENT
4 OF DAMAGES WHEN THE DAMAGES ARE TO ANY ESTABLISHED BUSINESS OF MORE THAN
5 FIVE YEARS' STANDING AND TO MAKE A TECHNICAL CORRECTION.
6 Be It Enacted by the Legislature of the State of Idaho:
7 SECTION 1. That Section 7-711, Idaho Code, be, and the same is hereby
8 amended to read as follows:
9 7-711. ASSESSMENT OF DAMAGES. The court, jury or referee must hear such
10 legal testimony as may be offered by any of the parties to the proceedings,
11 and thereupon must ascertain and assess:
12 1. The value of the property sought to be condemned, and all improvements
13 thereon pertaining to the realty, and of each and every separate estate or
14 interest therein; if it consists of different parcels, the value of each par-
15 cel and each estate or interest therein shall be separately assessed. For pur-
16 poses of ascertaining the value of the property, the assessed value for prop-
17 erty tax purposes shall be used as the minimum amount for damages unless the
18 court, jury or referee finds the property has been altered substantially.
19 2. If the property sought to be condemned constitutes only a part of a
20 larger parcel,: (a) the damages which will accrue to the portion not sought to
21 be condemned, by reason of its severance from the portion sought to be con-
22 demned, and the construction of the improvement in the manner proposed by the
23 plaintiff; and (b) the damages to any established business of more than five
24 (5) years' standing which the taking of a portion of the property and the con-
25 struction of the improvement in the manner proposed by the plaintiff may rea-
26 sonably cause, where the business is owned by the party whose lands are being
27 condemned or is located upon adjoining lands owned or held by such party; pro-
28 vided that business damages under this subsection shall not be awarded if the
29 loss can reasonably be prevented by a relocation of the business or by taking
30 steps that a reasonably prudent person would take; and provided further that
31 compensation for business damages shall not be duplicated in the compensation
32 otherwise awarded to the property owner.
33 If the owner intends to claim business damages under this subsection, the
34 business owner must, within ninety (90) days after receipt of the condemning
35 agency's initial offer letter to acquire property, or after the date the let-
36 ter is returned as undeliverable by the postal authorities, or within ninety
37 (90) days after service of the summons and complaint for condemnation, which-
38 ever date is later, submit to the condemning authority a written claim of
39 business damage. The written claim must be sent to the condemning authority by
40 certified mail, return receipt requested. Absent a showing of a good faith
41 justification for the failure to submit a business damage claim within ninety
42 (90) days, or an agreed extension by the parties, the court shall strike the
43 business owner's claim for business damages in any condemnation proceeding.
2
1 The business damage claim must include an explanation of the nature,
2 extent, and monetary amount of such claimed damages and must be prepared by
3 the owner, a certified public accountant, or a business damage expert familiar
4 with the nature of the operations of the owner's business. The business owner
5 shall also provide to the condemning authority copies of the owner's business
6 records that substantiate the good faith offer to settle the business damage
7 claim.
8 As used in this subsection, the term "business records" includes, but is
9 not limited to, copies of federal and state income tax returns, state sales
10 tax returns, balance sheets, and profit and loss statements for the five (5)
11 years preceding which are attributable to the business operation on the prop-
12 erty to be acquired, and other records relied upon by the business owner that
13 substantiate the business damage claim.
14 3. Separately, how much the portion not sought to be condemned, and each
15 estate or interest therein, will be specially and directly benefited, if at
16 all, by the construction of the improvement proposed by the plaintiff; and if
17 the benefit shall be equal to the damages assessed, under paragraph 2. of this
18 section, the owner of the parcel shall be allowed no compensation except the
19 value of the portion taken; but if the benefit shall be less than the damages
20 so assessed, the former shall be deducted from the latter, and the remainder
21 shall be the only damages allowed in addition to the value.
22 4. If the property sought to be condemned be for a railroad, the cost of
23 good and sufficient fences along the line of such railroad, and the cost of
24 cattle guards where fences may cross the line of such railroad.
25 5. As far as practicable, compensation must be assessed for each source
26 of damages separately.
27 6. If the property sought to be condemned is private real property activ-
28 ely devoted to agriculture, the damages which will accrue because of the
29 costs, if any, of farming around electrical transmission line structure(s) for
30 a transmission line with a capacity in excess of two hundred thirty (230) KV
31 (kilovolts). If the property sought to be condemned has been the subject of a
32 previous condemnation proceeding or proceedings for electrical transmission
33 line structure(s) and at the time of condemnation the field holds other elec-
34 trical transmission line structure(s), such evidence of costs referred to
35 above may also include the cumulative effects, if any, of conducting farming
36 operations around other electrical transmission line structure(s) in the same
37 field, whether such structure(s) are of the condemner or not.
STATEMENT OF PURPOSE
RS 09304C2
"Just compensation" is a constitutional requirement in the event of a taking under eminent domain
condemnation law. The question of how "just" the compensation may be is established, in part,
through statute.
This proposed legislation would expand consideration of "just compensation" in eminent
domain condemnations to damages to businesses of more than five years standing which are
located upon or adjacent to a property taking, and the improvements thereon, as proposed by the
relevant governmental entity.
The proposed legislation would apply to all condemnation actions commenced by an
initial offer letter served upon the property owner on and after the effective date of this legislation.
FISCAL IMPACT
An expansion of damage consideration to both property and a business attached to that
property would result in additional costs to governmental entities that exercise eminent domain
powers. A property owner who is both an owner of property and an owner of a business attached
to the property could receive "just compensation" for both the loss of property and demonstrated
financial loss to the business attached to that property. In the event of disagreement between the
governmental entity and the effected property owner, "just compensation" is determined by a
court, jury, or referee in accordance with Section 7-711, Idaho
Code.
Just compensation determinations will vary based on the size and effect of the
condemnation action. The Idaho Transportation Department has estimated a possible impact of
$1.25 million (in state dollars) statewide per year. If so, that amount is also the additional cost we
are asking select property owners to bear above, and separate from, the costs of highway
development that all Idaho transportation users share throughout the existing transportation tax
structure.
Contact
Name: Representative Jim Kempton
Phone: 208/332-1146
STATEMENT OF PURPOSE/FISCAL NOTE H525