Opinion: Potential eminent domains trend may favor landlords

During the 2022 legislative session, the Missouri General Assembly passed an act amending Missouri’s prominent estate laws in a manner that provides greater protection to private farm property owners. House Bill 2005, which was delivered to Governor Mike Parson on May 18, requires, among other things, that power companies relying on eminent domain to erect power lines on private farmland compensate the owner land for 150% of the fair market value of the easement on the land.

As a legal doctrine, eminent domain gives the state and its political subdivisions, as well as limited categories of private entities, the ability to take private property for public use in return for fair compensation. . Most commonly, eminent domain is invoked to use private land for transportation, utilities, power lines, etc.

In practice, and with respect to HB 2005, power companies rely on eminent domain actions (also commonly referred to as condemnation actions) in Missouri courts to obtain easements needed to build power lines on private property, when they are unable to agree on the terms. with an owner. Such was the case with northern Missouri farmers who became involved in eminent domain proceedings following the Grain Belt Express project, which some lawmakers cite as the inspiration for the amendments contained in HB 2005.

Eminent domain lawsuits are subject to and governed by Missouri law and extensive case law, which strives to balance the significant competing interests at stake.

On the one hand, Missouri law establishes a mechanism for providers of public goods and services to obtain the right to access and use private property, if necessary. At the same time, however, the applicable law imposes a number of jurisdictional requirements and prerequisites, which clearly recognize the fundamental importance of private property rights.

Not surprisingly, determining the amount of compensation for property taken by eminent domain often leads to disputes between the landowner and the sentencing party, embroiling the parties in litigation and increasing costs for everyone involved.

Through HB 2005, which will likely be enacted, the Missouri General Assembly has taken steps to ease the financial burden of power line condemnation proceedings on farm owners. Among other changes, HB 2005 makes the following amendments to the existing law governing eminent domain proceedings instituted by power companies for agricultural properties in Missouri:

  • Private owners of farmland in eminent domain proceedings for power lines should be compensated up to 150% of the fair market value of the property;
  • Judicial boards determining the fair market value of condemned land in eminent domain proceedings must include at least one farmer who has lived in the county where the property is located for at least 10 years; and
  • The sentencing authority must begin commissioning the easement within seven years from the date of registration of the easement rights or must return the easement to the private owner without reimbursement of compensation paid to the private owner.

By increasing landowners’ base compensation and including agricultural professionals on land value boards, the bill ensures that eminent domain procedures will become more costly for power companies, if and when they come into effect. . This, coupled with the “use it or lose it” obligation for the utility to bring the easement into service within seven years of obtaining ownership, requires the utility to commit to careful planning and due diligence before initiating eminent domain actions.

These changes will be important to private agricultural landowners in Missouri, and they will hint at a potential trend toward greater protection for landowners in eminent domain proceedings. Following the passage of HB 2005, Missouri lawmakers called for broader reforms to laws governing eminent domain, including portions of eminent domain law affecting nonfarm property.

Based on the language of HB 2005, it is fair to expect that future amendments to Missouri’s eminent domain statutes will take similar steps to benefit private property owners and increase costs for sentencing authorities.

Alec Martinez is an attorney for Spencer Fane LLP. He can be reached at
[email protected].