In Texas, it’s not only government entities that have the power of eminent domain. This is the power to take private property through a process called “condemnation” so that the property can be put to public use. Texas has delegated its power of eminent domain to certain energy companies that are engaged as “common carriers.”
Common carriers are companies that own, operate or manage pipelines for the public. They can be involved in:
- Oil
- Coal
- Hydrogen
- Carbon dioxide
- Products of carbon gasification
However, if a government entity or common carrier wants to take part of your land, you are entitled to just compensation. This is true even when the entity or common carrier only wants an easement on your property. An easement is basically a legal right to use part of your property that cannot be taken away by the landowner.
The first step in the process is a land survey. You should be aware that pipeline companies have the right to determine the route of the proposed pipeline without your input or oversight by the government. Once they have set the preferred route, they will send out an acquisition firm to begin obtaining easements from the affected landowners. At this point, they request a survey of your land.
Do you have to allow the survey? Generally, yes, if the company has eminent domain authority. However, you don’t have to sign the company’s form requesting entry to your land in order to complete the survey. Instead, you should have your own attorney evaluate the request because it is likely to be overbroad and in the company’s interest instead of yours.
After the survey is complete, the company will come back with a bona fide offer. This is the starting point for negotiations. Now, keep in mind that the energy company or government typically does have the right to force the sale. These negotiations are to calculate just compensation for you and to determine the terms of the easement.
You have at least 30 days to consider the bona fide offer. You should assume that the company/government is willing to pay more than their initial offer.
After the consideration period has passed, the company or government entity will present a final offer. This must be equal to or greater than the appraised value, but it may actually be lower than the initial offer. At this point, the company or government has to wait at least two weeks before initiating condemnation proceedings.
The existence of a final offer does not mean the negotiations have broken down. Even the filing of condemnation paperwork does not mean the negotiations have broken down, although it may. You should assume the company/government is interested in negotiations even once the condemnation paperwork has been filed.
Once condemnation paperwork has been filed, three Special Commissioners are appointed. These commissioners have the duty of determining a fair amount in compensation for the landowner.
Even after the commissioners make an award, you can still negotiate, and you can object to the award. If you do object, the case goes to trial for a determination of just compensation. If this trial does not end with an acceptable result, you can even appeal.
There are many issues you may want to consider when seeking just compensation for an easement, and money may be the least of them. You will also want to make sure the easement is as narrowly tailored as possible to protect your rights.
If you have been contacted about an energy easement on your land, immediately contact an attorney with experience negotiating energy leases.
