BILL ANALYSIS



C.S.H.B. 1357
By: Alexander
May 6, 1995
Committee Report (Substituted)


BACKGROUND

Current law provides no regulation of eminent domain proceedings or
condemnation hearings.  Many municipalities, especially larger
cities, do not offer fair market value for land or easements
encumbered through eminent domain.  Because these municipalities
often have their own legal departments dealing with these
proceedings, private landowners are often at a financial
disadvantage in condemnation court.  Private landowners must hire
their own legal representation and pay for all condemnation
proceedings because a municipality refuses to pay fair market value
for the property.  Currently, even if landowners win a judgment in
a condemnation case, they still lose financially through attorney's
fees and court costs.

PURPOSE

This bill would require municipalities or state agencies which
initiate eminent domain proceedings to offer the greater of either
the local market value as determined in a special commissioners
hearing or 70% of the fair market value as determined by the ad
valorem tax appraisal.  If, upon completion of a condemnation
hearing, the award in the hearing exceeds the amount offered by the
condemnor, then the condemnor must pay the costs of the landowner. 
However, if the award is equal to or lower than the pre-hearing
offer, then the landowner must pay the court costs.  If the
commissioner's award is is appealed by the condemnor, and the court
awards greater damages than the commissioners awarded, then the
condemnor would be liable for the costs and attorney's fees
incurred by the landowner in the appeal.  Because municipalities
and state agencies initiate condemnation hearings, and landowners
cannot choose to not sell condemned land, landowners are not liable
for attorney's fees in appeals.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly
grant any additional rulemaking authority to a state officer,
department, agency, or institution.

SECTION BY SECTION ANALYSIS

SECTION 1  Amends Section 21.042(b), Property Code, to indicate
           that if an entire tract or parcel of land is condemned,
           then the landowner is entitled to the greater of the
           local market value at the time of the special
           commissioners' hearing or 70 percent of the appraised
           value of the property determined under Chapter 23, Tax
           Code.

SECTION 2  Amends Section 21.047, Tax Code, by changing Subsection
           (a) to require that if, in condemnation proceedings, the
           special commissioners award damages greater than the
           amount offered before the proceedings began, then the
           condemnor must pay all costs.  If the decision of the
           commissioner's court is appealed by the condemnor, and
           the court awards greater damages than the commissioners,
           then the condemnor shall be liable for the landowner's
           costs and attorney's fees.  If the commissioners' award
           or the court's determination is equal to or lower than
           the amount the condemnor offered before the proceedings
           began, then the landowner must pay the court costs.



           Subsection (b) states that a condemnor must pay initial
           costs of serving notice to property owners.  If the
           property owner is ordered to pay costs in a hearing,
           then the condemnor can recover the costs of serving this
           notice as part of costs.

           Subsection (c) states that a court which presides over
           condemnation proceedings may tax $10 or more as a fee
           for each special commissioner as part of court costs.

SECTION 3  Makes application of this Act prospective only.

SECTION 4  Emergency clause.

COMPARISON OF ORIGINAL TO SUBSTITUTE

In SECTION 1, the substitute clarifies that the bill applies to
condemnations by municipalities or state agencies.  The substitute
also makes technical changes in the organization of the section.

In SECTION 2, the substitute provides that the condemnor can only
be liable for attorney's fees in situations where the condemnor
appeals the commissioners' award, and the court awards greater
damages than the commissioners awarded.  The original bill provided
that the condemnor could be liable for attorney's fees in
situations where the landowner appealed the commissioners' award.

SUMMARY OF COMMITTEE ACTION

H.B. 1357 was considered by the committee in a public hearing on
April 18, 1995.

The following persons testified against the bill:

           Ed Snyder, representing the City of Plano and the Texas
Municipal League; and 
           William Wood, representing the City of San Antonio.

The following person testified neutrally on the bill:

           William Burnett, representing the Texas Department of
Transportation.

The bill was left pending.

H.B. 1357 was considered by the committee in a public hearing on
May 2, 1995.

The bill was left pending.

H.B. 1357 was considered by the committee in a formal meeting on
May 5, 1995.

The committee considered a complete substitute for the bill.  The
substitute was adopted without objection.  

The bill was reported favorably as substituted, with the
recommendation that it do pass and be printed and be sent to the
Committee on Local and Consent Calendars, by a record vote of 6
ayes, 0 nays, 0 pnv, 3 absent.