Eminent domain law: valuation of temporary construction easements

Eminent domain is generally the government’s ability to take private property for public purposes. It is a power granted by the Fifth Amendment to the United States Constitution, and it exists to ensure that the public has streets, sewers, power lines, and much of the rest of the public infrastructure that exists today. But if the government is going to take your property, it must pay you “just compensation.” Fair compensation is determined by calculating what a seller would pay and what a buyer would buy if there were no threat of government seizure of the property. It sounds easy, but it becomes difficult when applied in real life, particularly with temporary construction easements.

Before continuing, I want to emphasize to everyone reading this article that eminent domain is not something you should try to negotiate on your own. It is a very technical area of ​​the law, and determining how to obtain the correct amount of compensation for your property requires a lot of experience. Do not read this article and try to negotiate the sale of your property to the government on your own. Hire an eminent domain attorney.

In many cases, the land that will be used for the road, for example, is not the only property required to complete the public project for which your property is needed. For example, if the Seattle Department of Transportation were expanding Mercer Street, they would need not only the property for the actual highway, but also some property outside of that area to move their construction equipment, store supplies, and create what will eventually become the new. . Street. This property outside the actual construction area is often called a temporary construction easement, as once construction is complete, the property is returned to the owner.

But how is this valued? Traditionally, it is valued in two ways: a fixed rental rate is established and applied to the amount of time the property will be rented; or you take a percentage of the total property value and multiply it by the amount of time the property is needed. In any case, these numbers can vary widely and may be a long way from the actual value of the land being lost at the time.

For example, let’s say that by widening Mercer Street, the Seattle Department of Transportation construction easement would close one of the driveways to your gas station, making it nearly impossible for traffic to get in and out of your business. The actual value of the easement is much higher than the result of the previous two methods. It can be the total value of the income that could be derived from the property during the time the construction easement is used.

Another problem with these methodologies is that it is often difficult to determine what is an acceptable rental rate or what is an acceptable percentage of the property’s value. For example, as a tenant of a property in Seattle near Mercer Street, would you expect a rate of return of 8% or a rate of return of 10%? This difference could have a big effect on the final amount of just compensation.

It is difficult to determine the value of temporary easements. It is not an exact science. If you are a homeowner whose property is being taken for a temporary construction easement or other type of temporary easement, contact an eminent domain attorney for assistance today.