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H0197...................................................by LOCAL GOVERNMENT
EMINENT DOMAIN - Amends existing law relating to eminent domain to require
business owners claiming business damages to submit a written business
damage claim to the condemning authority within ninety days after the
condemning authority's initial offer letter; to provide that the condemning
authority's initial offer letter shall include certain information; to
provide that the business owner's claim must be sent by certified mail; to
provide the court shall strike the business owner's claim for business
damages in subsequent condemnation proceedings under certain conditions; to
require that the business damage claim be prepared by an individual
familiar with the operations of the business owner's business; to provide
that the business owner shall provide the condemning authority with certain
business records; and to provide that the condemning authority's good faith
in failing to offer compensation shall not be contested at a possession
hearing if the business owner has not given notice of its intent to claim
business damages within a certain time period.
02/09 House intro - 1st rdg - to printing
02/12 Rpt prt - to Loc Gov
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature First Regular Session - 2001
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 197
BY LOCAL GOVERNMENT COMMITTEE
1 AN ACT
2 RELATING TO EMINENT DOMAIN PROCEEDINGS; AMENDING SECTION 7-711, IDAHO CODE, TO
3 REQUIRE BUSINESS OWNERS CLAIMING BUSINESS DAMAGES TO SUBMIT A WRITTEN
4 BUSINESS DAMAGE CLAIM TO THE CONDEMNING AUTHORITY WITHIN NINETY DAYS AFTER
5 THE CONDEMNING AUTHORITY'S INITIAL OFFER LETTER, TO PROVIDE THAT THE CON-
6 DEMNING AUTHORITY'S INITIAL OFFER LETTER OR ACCOMPANYING INFORMATION SHALL
7 INCLUDE CERTAIN INFORMATION, TO PROVIDE THAT THE BUSINESS OWNER'S CLAIM
8 MUST BE SENT TO THE CONDEMNING AUTHORITY BY CERTIFIED MAIL, TO PROVIDE
9 THAT THE COURT SHALL STRIKE THE BUSINESS OWNER'S CLAIM FOR BUSINESS DAM-
10 AGES IN SUBSEQUENT CONDEMNATION PROCEEDINGS UNDER CERTAIN CONDITIONS, TO
11 REQUIRE THAT THE BUSINESS DAMAGE CLAIM BE PREPARED BY AN INDIVIDUAL FAMIL-
12 IAR WITH THE OPERATIONS OF THE BUSINESS OWNER'S BUSINESS, TO PROVIDE THAT
13 THE BUSINESS OWNER SHALL PROVIDE THE CONDEMNING AUTHORITY WITH CERTAIN
14 BUSINESS RECORDS, TO PROVIDE THAT THE CONDEMNING AUTHORITY'S GOOD FAITH IN
15 FAILING TO OFFER COMPENSATION SHALL NOT BE CONTESTED AT A POSSESSION HEAR-
16 ING IF THE BUSINESS OWNER HAS NOT GIVEN NOTICE OF ITS INTENT TO CLAIM
17 BUSINESS DAMAGES WITHIN A CERTAIN TIME PERIOD AND TO MAKE TECHNICAL COR-
18 RECTIONS.
19 Be It Enacted by the Legislature of the State of Idaho:
20 SECTION 1. That Section 7-711, Idaho Code, be, and the same is hereby
21 amended to read as follows:
22 7-711. ASSESSMENT OF DAMAGES. The court, jury or referee must hear such
23 legal testimony as may be offered by any of the parties to the proceedings,
24 and thereupon must ascertain and assess:
25 1. The value of the property sought to be condemned, and all improvements
26 thereon pertaining to the realty, and of each and every separate estate or
27 interest therein; if it consists of different parcels, the value of each par-
28 cel and each estate or interest therein shall be separately assessed. For pur-
29 poses of ascertaining the value of the property, the assessed value for prop-
30 erty tax purposes shall be used as the minimum amount for damages unless the
31 court, jury or referee finds the property has been altered substantially.
32 2. If the property sought to be condemned constitutes only a part of a
33 larger parcel: (a) the damages which will accrue to the portion not sought to
34 be condemned, by reason of its severance from the portion sought to be con-
35 demned, and the construction of the improvement in the manner proposed by the
36 plaintiff; and (b) the damages to any business qualifying under this subsec-
37 tion having more than five (5) years' standing which the taking of a portion
38 of the property and the construction of the improvement in the manner proposed
39 by the plaintiff may reasonably cause. The business must be owned by the party
40 whose lands are being condemned or be located upon adjoining lands owned or
41 held by such party. Business damages under this subsection shall not be
42 awarded if the loss can reasonably be prevented by a relocation of the busi-
43 ness or by taking steps that a reasonably prudent person would take, or for
2
1 damages caused by temporary business interruption due to construction; and
2 provided further that compensation for business damages shall not be dupli-
3 cated in the compensation otherwise awarded to the property owner for damages
4 pursuant to subsections (1). and (2). (a) of this section. 7-711, Idaho Code.
5 (i) If the business owner intends to claim business damages under this
6 subsection, the owner, as defendant, must submit a written business damage
7 claim to the plaintiff condemning authority within ninety (90) days after
8 service of the summons and complaint for condemnation condemning
9 authority's initial offer letter. The plaintiff's condemning authority's
10 initial offer letter or accompanying information must expressly inform the
11 defendant business owner of its rights under this subsection, and must
12 further inform the defendant business owner of its right to consult with
13 an attorney.
14 (ii) The defendant's business owner's written claim must be sent to the
15 plaintiff condemning authority by certified mail, return receipt
16 requested. Absent a showing of a good faith justification for the failure
17 to submit a business damage claim within ninety (90) days, or an agreed
18 extension by the parties, the court shall strike the defendant's business
19 owner's claim for business damages in any subsequent condemnation proceed-
20 ing.
21 (iii) The business damage claim must include an explanation of the nature,
22 extent, and monetary amount of such claimed damages and must be prepared
23 by the owner, a certified public accountant, or a business damage expert
24 familiar with the nature of the operations of the defendant's business
25 owner's business. The defendant business owner shall also provide the
26 plaintiff condemning authority with copies of the defendant's business
27 owner's business records that substantiate the good faith offer to settle
28 the business damage claim. The business damage claim must be clearly seg-
29 regated from the claim for property damages pursuant to subsections (1).
30 and (2).(a) of this section. 7-711, Idaho Code.
31 (iv) As used in this subsection, the term "business records" includes,
32 but is not limited to, copies of federal and state income tax returns,
33 state sales tax returns, balance sheets, and profit and loss statements
34 for the five (5) years preceding which are attributable to the business
35 operation on the property to be acquired, and other records relied upon by
36 the business owner that substantiate the business damage claim.
37 (v) The plaintiff's condemning authority's good faith in failing to
38 offer compensation for business damages shall not be contested at a pos-
39 session hearing held pursuant to section 7-721, Idaho Code, if the defend-
40 ant business owner has not given notice of its intent to claim business
41 damages prior to the date of filing of the motion that initiates the pro-
42 ceeding under that section.
43 3. Separately, how much the portion not sought to be condemned, and each
44 estate or interest therein, will be specially and directly benefited, if at
45 all, by the construction of the improvement proposed by the plaintiff; and if
46 the benefit shall be equal to the damages assessed, under subsection 2. of
47 this section, the owner of the parcel shall be allowed no compensation except
48 the value of the portion taken; but if the benefit shall be less than the dam-
49 ages so assessed, the former shall be deducted from the latter, and the
50 remainder shall be the only damages allowed in addition to the value.
51 4. If the property sought to be condemned be for a railroad, the cost of
52 good and sufficient fences along the line of such railroad, and the cost of
53 cattle guards where fences may cross the line of such railroad.
54 5. As far as practicable, compensation must be assessed for each source
55 of damages separately.
3
1 6. If the property sought to be condemned is private real property activ-
2 ely devoted to agriculture, the damages which will accrue because of the
3 costs, if any, of farming around electrical transmission line structure(s) for
4 a transmission line with a capacity in excess of two hundred thirty (230) KV
5 (kilovolts). If the property sought to be condemned has been the subject of a
6 previous condemnation proceeding or proceedings for electrical transmission
7 line structure(s) and at the time of condemnation the field holds other elec-
8 trical transmission line structure(s), such evidence of costs referred to
9 above may also include the cumulative effects, if any, of conducting farming
10 operations around other electrical transmission line structure(s) in the same
11 field, whether such structure(s) are of the condemner or not.
STATEMENT OF PURPOSE
RS 10904
The purpose of this amendment is to motivate both the condemning
authority and the property owner to enter into good faith
negotiations to establish any business damages that may result from
a taking before an eminent domain proceeding has been initiated.
Many times a condemning authority reaches a voluntary settlement
with the property owner without having to resort to litigation. At
present, the statute does not allow the condemning authority to
obtain the business records and other information necessary for it
to make a good faith settlement offer of business damages until
after the condemnation action is filed. Amending this section to
require the condemning authority to notify the property
owner/business owner of this possible right to claim business
damages at the time of the initial offer letter, and allowing the
business owner the next ninety (90) days to make and support a
claim for business damages, will cover all situations not just
those requiring litigation.
FISCAL IMPACT
There is no fiscal impact to the general fund. There should be a
savings to the general public and the public condemning authority,
reflecting a reduction in the costs of acquiring right-of-way and
other property needed for a public use as a result of an expected
decrease in the number of condemnation suits where business damages
are involved.
Contact
Name: Stuart O. Davis, Executive Director
Idaho Assoc of Highway Districts, Inc.
Phone: 859-9378
STATEMENT OF PURPOSE/FISCAL NOTE H 197