TO: | Honorable Dennis Bonnen, Chair, House Committee on Land & Resource Management |
FROM: | John S. O'Brien, Director, Legislative Budget Board |
IN RE: | HB4 by Orr (Relating to eminent domain, including certain limitations, procedures, and standards relating to the use of eminent domain.), As Introduced |
SECTION 1 of the bill would amend the Government Code to require a governmental entity to authorize the condemnation at an open meeting by a record vote before proceeding with the condemnation. The bill would also cause an entity's eminent domain authority to expire on September 1, 2011, unless the entity submits to the Comptroller of Public Accounts a letter that identifies the source of the entity's eminent domain authority.
SECTIONS 2 through 11 of the bill would amend the Property Code to require:
• certain appraisal reports be sent by certified mail, return receipt requested;
• the entity’s initial purchase offer to include fair market and damage estimates, including a statement that the owner has the right to request certain information from the entity, including information previously obtained about adjacent property;
• the entity to provide at least two written purchase or lease offers, and to negotiate in good faith;
• the entity, upon the property owner’s request, to procure an appraisal by an appraiser chosen by the owner, at the entity’s expense;
• that a judge appoint a special commission of three real property owners to assess damages, and;
• the entity to resell the property to the owner, his heirs or assigns, at the original price paid if the property is not used after 10 years.
The proposed change in statute would apply only to a condemnation proceeding in which the petition is filed on or after the effective date of the bill. The bill would take effect immediately if it were to receive the required two-thirds vote in each house; otherwise, it would take effect September 1, 2009.
The Legislative Council and the General Land Office reported that the requirements in the bill could be absorbed within existing resources. The Parks and Wildlife Department reported it has the authority to exercise powers of eminent domain, but by policy it does not do so.
The University of Texas System Office reported that if the UT System were to acquire property by eminent domain, that the bill will increase the cost of acquiring the property, although the precise effect depends on the particular property so acquired. Examples of additional cost are $3,000 to $10,000 for an appraisal and approximately 40 staff hours to research files of other properties nearby that were previously acquired or sought to acquire.
Based on the analysis of the Texas Department of Transportation (TxDOT), it is assumed the provisions of the bill would result in increased costs for eminent domain acquisitions. Because the factors considered in determining the number of appraisal requests by landowners and the number of court cases that TxDOT might be found to not negotiate in good faith would vary by case, any additional appraisal or legal costs or negative fiscal implications to the state cannot be determined.
Source Agencies: | 103 Legislative Council, 304 Comptroller of Public Accounts, 305 General Land Office and Veterans' Land Board, 601 Department of Transportation, 720 The University of Texas System Administration, 802 Parks and Wildlife Department
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LBB Staff: | JOB, WK, SD, PJK, TP, DB
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