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S1429......................................................by STATE AFFAIRS
EMINENT DOMAIN - Amends existing law relating to eminent domain to provide
an alternate method for establishing the minimum amount for damages when
ascertaining the value of the property.
03/06 Senate intro - 1st rdg - to printing
03/07 Rpt prt - to St Aff
03/13 Rpt out - rec d/p - to 2nd rdg
03/14 2nd rdg - to 3rd rdg
03/15 3rd rdg - PASSED - 35-0-0
AYES -- Andreason, Brandt, Broadsword, Bunderson, Burkett,
Burtenshaw, Cameron, Coiner, Compton, Corder, Darrington, Davis,
Fulcher, Gannon, Geddes, Goedde, Hill, Jorgenson, Kelly, Keough,
Langhorst, Little, Lodge, Malepeai, Marley, McGee, McKenzie, Pearce,
Richardson, Schroeder, Stegner, Stennett, Sweet, Werk, Williams
NAYS -- None
Absent and excused -- None
Floor Sponsor - Brandt
Title apvd - to House
03/16 House intro - 1st rdg - Held at Desk
03/23 Ref'd to St Aff
03/27 Rpt out - rec d/p - to 2nd rdg
03/28 2nd rdg - to 3rd rdg
04/11 3rd rdg - PASSED - 64-3-3
AYES -- Anderson, Andrus, Barraclough, Barrett, Bastian, Bayer,
Bedke, Bell, Bilbao, Black, Block, Boe, Brackett, Bradford, Cannon,
Chadderdon, Clark, Collins, Crow, Deal, Denney, Edmunson, Ellsworth,
Eskridge, Field(18), Field(23), Garrett, Hart, Harwood, Henbest,
Henderson, Jaquet, Kemp, LeFavour, Loertscher, Martinez, Mathews,
McGeachin, McKague, Miller, Moyle, Nielsen, Nonini, Pasley-Stuart,
Pence, Raybould, Ring, Ringo, Roberts, Rydalch, Sali, Sayler,
Schaefer, Shepherd(2), Shepherd(8), Shirley, Skippen, Smith(30),
Smylie, Snodgrass, Stevenson, Wills, Wood, Mr. Speaker
NAYS -- Lake, Rusche, Smith(24)
Absent and excused -- Bolz, Mitchell, Trail
Floor Sponsor - Moyle
Title apvd - to Senate
04/11 To enrol - Rpt enrol - Pres signed - Sp signed
To Governor
04/14 Governor signed
Session Law Chapter 452
Effective: 07/01/06
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature Second Regular Session - 2006
IN THE SENATE
SENATE BILL NO. 1429
BY STATE AFFAIRS COMMITTEE
1 AN ACT
2 RELATING TO EMINENT DOMAIN; AMENDING SECTION 7-711, IDAHO CODE, TO PROVIDE AN
3 ALTERNATE METHOD FOR ESTABLISHING THE MINIMUM AMOUNT FOR DAMAGES WHEN
4 ASCERTAINING THE VALUE OF THE PROPERTY AND TO MAKE TECHNICAL CORRECTIONS.
5 Be It Enacted by the Legislature of the State of Idaho:
6 SECTION 1. That Section 7-711, Idaho Code, be, and the same is hereby
7 amended to read as follows:
8 7-711. ASSESSMENT OF DAMAGES. The court, jury or referee must hear such
9 legal testimony as may be offered by any of the parties to the proceedings,
10 and thereupon must ascertain and assess:
11 1. The value of the property sought to be condemned, and all improvements
12 thereon pertaining to the realty, and of each and every separate estate or
13 interest therein; if it consists of different parcels, the value of each par-
14 cel and each estate or interest therein shall be separately assessed. For pur-
15 poses of ascertaining the value of the property, the minimum amount for dam-
16 ages shall be the greater of the assessed value for property tax purposes
17 shall be used as the minimum amount for damages unless the court, jury or ref-
18 eree finds the property has been altered substantially, or the plaintiff's
19 highest prelitigation appraisal.
20 2. If the property sought to be condemned constitutes only a part of a
21 larger parcel: (a) the damages which will accrue to the portion not sought to
22 be condemned, by reason of its severance from the portion sought to be con-
23 demned, and the construction of the improvement in the manner proposed by the
24 plaintiff; and (b) the damages to any business qualifying under this subsec-
25 tion having more than five (5) years' standing which the taking of a portion
26 of the property and the construction of the improvement in the manner proposed
27 by the plaintiff may reasonably cause. The business must be owned by the party
28 whose lands are being condemned or be located upon adjoining lands owned or
29 held by such party. Business damages under this subsection shall not be
30 awarded if the loss can reasonably be prevented by a relocation of the busi-
31 ness or by taking steps that a reasonably prudent person would take, or for
32 damages caused by temporary business interruption due to construction; and
33 provided further that compensation for business damages shall not be dupli-
34 cated in the compensation otherwise awarded to the property owner for damages
35 pursuant to subsections (1) and (2) (a) of this section 7-711, Idaho Code.
36 (i) If the business owner intends to claim business damages under this
37 subsection, the owner, as defendant, must submit a written business damage
38 claim to the plaintiff within ninety (90) days after service of the sum-
39 mons and complaint for condemnation. The plaintiff's initial offer letter
40 or accompanying information must expressly inform the defendant of its
41 rights under this subsection, and must further inform the defendant of its
42 right to consult with an attorney.
43 (ii) The defendant's written claim must be sent to the plaintiff by cer-
2
1 tified mail, return receipt requested. Absent a showing of a good faith
2 justification for the failure to submit a business damage claim within
3 ninety (90) days, or an agreed extension by the parties, the court shall
4 strike the defendant's claim for business damages in any condemnation pro-
5 ceeding.
6 (iii) The business damage claim must include an explanation of the nature,
7 extent, and monetary amount of such claimed damages and must be prepared
8 by the owner, a certified public accountant, or a business damage expert
9 familiar with the nature of the operations of the defendant's business.
10 The defendant shall also provide the plaintiff with copies of the
11 defendant's business records that substantiate the good faith offer to
12 settle the business damage claim. The business damage claim must be
13 clearly segregated from the claim for property damages pursuant to subsec-
14 tions (1) and (2)(a) of this section 7-711, Idaho Code.
15 (iv) As used in this subsection, the term "business records" includes,
16 but is not limited to, copies of federal and state income tax returns,
17 state sales tax returns, balance sheets, and profit and loss statements
18 for the five (5) years preceding which are attributable to the business
19 operation on the property to be acquired, and other records relied upon by
20 the business owner that substantiate the business damage claim.
21 (v) The plaintiff's good faith in failing to offer compensation for
22 business damages shall not be contested at a possession hearing held pur-
23 suant to section 7-721, Idaho Code, if the defendant has not given notice
24 of its intent to claim business damages prior to the date of filing of the
25 motion that initiates the proceeding under that section.
26 3. Separately, how much the portion not sought to be condemned, and each
27 estate or interest therein, will be specially and directly benefited, if at
28 all, by the construction of the improvement proposed by the plaintiff; and if
29 the benefit shall be equal to the damages assessed, under subsection 2. of
30 this section, the owner of the parcel shall be allowed no compensation except
31 the value of the portion taken; but if the benefit shall be less than the dam-
32 ages so assessed, the former shall be deducted from the latter, and the
33 remainder shall be the only damages allowed in addition to the value.
34 4. If the property sought to be condemned be for a railroad, the cost of
35 good and sufficient fences along the line of such railroad, and the cost of
36 cattle guards where fences may cross the line of such railroad.
37 5. As far as practicable, compensation must be assessed for each source
38 of damages separately.
39 6. If the property sought to be condemned is private real property activ-
40 ely devoted to agriculture, the damages which will accrue because of the
41 costs, if any, of farming around electrical transmission line structure(s) for
42 a transmission line with a capacity in excess of two hundred thirty (230) KV
43 (kilovolts). If the property sought to be condemned has been the subject of a
44 previous condemnation proceeding or proceedings for electrical transmission
45 line structure(s) and at the time of condemnation the field holds other elec-
46 trical transmission line structure(s), such evidence of costs referred to
47 above may also include the cumulative effects, if any, of conducting farming
48 operations around other electrical transmission line structure(s) in the same
49 field, whether such structure(s) are of the condemner or not.
STATEMENT OF PURPOSE
RS 16188
Kelo highlighted the need to ensure there is a balance between
condemners and property owners, and the importance that
government act in good faith when acquiring property. Existing
law requires condemners to attempt to purchase property via good
faith negotiations prior to filing suit for condemnation. The
condemner's last apprisal before litigation should therefore be a
good faith apprisal. However, currently just compensation can be
reduced once suit is filed, resulting in condemners asserting
that just compensation owed is lower once litigation is filed
than they asserted pre-litigation. This penalizes property
owners who do not settle out of court and allows condemners to
ignore their constitutional obligation assess just compensation
in good faith. As a practical matter, there is no remedy for
abuses of this type currently. This modification to existing
code would require the condemner to stand by its last
pre-litigation apprisal and set that amount as a floor for just
compensation; if the condemner asserted the amount was just
compensation prior to filing suit, it cannot assert less than
that amount for just compensation after suit is filed. This
would ensure that good faith and the spirit of the Constitution
are complied with, as condemners are charged with the
constitutional obligation to assess and pay just compensation,
not the lowest price they can convince a judge or jury to award.
FISCAL NOTE
This may result in cost savings to condemners if they are
required to stand by their appraisals rather than incur
additional costs for new appraisals once litigation commences.
It should not result in additional costs to condemners, as
merely requires that they pay no less as just compensation in
litigation than they were willing to pay pre-litigation. If the
pre-litigation appraisals are fair and the condemners are
negotiating in good faith based thereon, no costs will increase.
If condemners are currently paying less than just compensation in
litigation, costs could increase, but only because constitutional
requirements are being complied with.
Contact:
Name: Representative Mike Moyle
Phone: 332- 1000
STATEMENT OF PURPOSE/FISCAL NOTE S 1429
REVISED REVISED REVISED