Eminent Domain Report

According to an article by Ken Carlson in the Modesto Bee, "Modesto will try eminent domain," the Modesto City Council this week voted 6-0 in favor of utilizing eminent domain to acquire easements necessary for the widening of Roselle Avenue.  The remaining hold-out properties include part-takes from a seven-acre ranchette and a two-and-a-half acre vacant lot.  The owner of the ranchette, Daniel Nickles, claims the City's survey is flawed, and its $15,000 offer is less than a tenth of fair market value.

The acquisition if Nickles' property includes a 5-foot by 304-foot-long strip of property.  Nickles is quoted as being "so irritated" with the City because apparently no one will listen to him.  Whether this is true or not in this case, a government agency never wants to be painted as not listening to a property owner impacted by eminent domain.  The agency should -- and is required to -- make good faith and reasonable efforts to negotiate before turning to the power of condemnation as a last resort. 

The City's mayor has apparently stated the City is only permitted to pay the appraised value for Nickles' property, as anything more would constitute a "gift of public funds."  We've heard this argument many times, and as we've reported in the past, this is not necessarily the case.  There are many factors that would allow a government agency to pay more than its own appraiser's value.  A few factors an agency could consider in justifying a higher payment include the costs of litigation, the potential to exposure of a much larger award, or the risk of a fight on possession or right to take which could delay or prevent a much needed project.  Many of these potential costs far outweigh what the agency could pay to resolve a matter, and sometimes they should be taken into consideration in deciding whether to settle an eminent domain case at a number above the agency's appraiser's opinion of value.