House Bill 64
Eminent domain is one of those topics that always generates concern among farmland owners. That may be part of the reason behind an eminent domain bill sponsored by Representatives Darrell Kick (R-Loudonville) and Rodney Creech (R-W Alexandria), who introduced House Bill 64 in February. According to the sponsors, the bill would “reform current eminent domain laws to provide landowners with more rights and support.” But HB 64 now faces significant resistance and uncertainty.
What HB 64 proposes
Ohio’s Legislative Service Commission summarizes the procedural changes HB 64 proposes as follows:
- Voids appropriations (the taking of property through eminent domain) that do not follow statutorily mandated procedures.
- Increases the taking agency’s (the government or private entity appropriating property) burden of proof in appropriation proceedings.
- Narrows factual presumptions made in favor of taking agencies in appropriations
proceedings. - Prohibits a taking agency from reducing any offer it makes in an effort to acquire
property, if the attempts may result in appropriations proceedings, or subsequently arguing for a lower valuation in an appropriation proceeding. - Expands required attorney fee, cost, and expense awards due to property owners in appropriation actions.
- Allows property owners who allege their property has been appropriated outside of the required judicial process to sue for inverse condemnation.
- Requires courts hearing inverse condemnation cases to award successful property owners’ attorneys’ fees, costs, and expenses.
- Requires court hearing appropriations cases to award property owner damages if the taking agency uses coercive actions.
- Lengthens certain appropriation proceeding deadlines.
In addition to revising eminent domain procedures, HB 64 would also prohibit the use of eminent domain to obtain property for recreational trails and to maintain recreational trails—a controversial issue tracing back to the Mill Creek Metroparks bike trail project in Mahoning County.
Committee hearings on HB 64
HB 64 has yet to pass out of the House Civil Justice Committee since being referred to the committee on February 28. Three parties testified in favor of the bill a hearing on March 14—Ohio Farm Bureau, Ohio Dairy Producers, and Ohio Council of Retail Merchants. The parties commended the additional protections given to landowners facing eminent domain proceedings and stated that the reforms in the bill would “prevent excess and unnecessary use of eminent domain.” Committee members raised several questions about the proposal at that time, and the bill then stalled for two months.
On May 16, the committee accepted a substitute bill that changed several provisions regarding recreational trails, compensation offers and awards, and relocation assistance—all questions raised in the earlier committee hearing. Changes in the substitute bill include:
- A limit the prohibition on using eminent domain for recreational trails, stating that eminent domain could not be used to take property if the primary use of the property would be for a recreational trail and the property is not adjacent to a public road and within a road right of way.
- Restoration of an agency’s authority to reduce a compensation offer amount if it discovers conditions that it could not have discovered when it make the original compensation offer.
- Revised amounts that would be awarded to a landowner if a jury’s award of compensation is higher than an agency’s most recent good faith offer and removes a percentage limit on mandatory cost and expense awards.
Despite the substitute bill revisions, 37 parties representing a wide variety of interests submitted opponent testimony at the fourth hearing for the bill on May 23. Local governments and associations such as the County Commissioners Association of Ohio, County Engineers Association of Ohio, Ohio Municipal League, and Ohio Mayors Alliance testified against the bill. Business interests such as American Electric Power, Ohio Oil and Gas Association, and Ohio Chamber of Commerce also opposed the bill, as did transportation and recreational interests such as Central Ohio Transit Authority, Mid-Ohio Regional Planning Commission, Rails-to-Trails Conservancy, and Ohio Parks and Recreation Association. Several common themes appear in the opponent testimony: that Ohio’s current eminent domain laws are not “broken” but instead effectively balance landowner rights against public needs, that the bill would create negative financial and taxpayer impacts, and that it would hamper economic development and infrastructure and public works projects in Ohio.
What happens next with the eminent domain bill?
The strong resistance to HB 64 certainly signals problems for its adoption and highlights a need for agreement on whether Ohio’s eminent domain law effectively balances public needs and private property rights. Even so, there are several routes the bill could take from this point: the committee chair could schedule a committee vote on the bill, the sponsors could hold further “interested party” meetings with the intent to further revise the bill, a Senate sponsor could introduce a similar bill and try to move it through the Senate, or the bill could simply die an early death.
Civil Justice Committee Chair Brett Hillyer (R-Uhrichsville) did not schedule the bill for a fifth hearing and potential vote for the committee meetings held on June 6 and June 13. Several opponents encouraged additional “interested party” negotiations and further changes to the proposal. Based on the resistance to the bill in its current form, if such discussions don’t take place or are not successful, the bill will likely die that early death or arise in a different form in the future.
Read more about and follow HB 64 on the Ohio Legislature’s website.
An eminent domain revisions bill appears to be on hold after its removal from the committee agenda that would have provided the bill a third hearing. House Bill 64 was introduced by sponsors Rep. Darrell Kick (R-Loudonville) and Rep. Rodney Creech (R-W. Alexandria) on February 21. The bill had two hearings before the House Civil Justice Committee on March 7 and 14, but was removed from the committee’s March 21 meeting agenda.
House Bill 64 proposes quite a few major changes to Ohio eminent domain law:
- Voids an appropriation of property if the agency does not follow statutory procedures for the appropriation, such as procedures for appraisal of value, good faith offers of compensation, and negotiation with the landowner. Under the proposal, a landowner could bring a claim against the agency for violating any of these procedures and the appropriation would be invalid. The proposal is the opposite of current law, which states that procedural violations do not affect the validity of an appropriation of property.
- Increases an agency’s burden of proof in showing that a taking is for a public use and is necessary, that the agency has authority to appropriate the property, and that the parties are unable to agree on a voluntary purchase of the property. The agency would have to meet the “clear and convincing evidence” burden of proof rather than the “preponderance of evidence” standard stated in current law.
- Removes two presumptions the law currently makes in favor of an agency. The first is that an appropriation is necessary if the agency adopts a resolution or ordinance declaring its necessity and the second is that an appropriation for a public utility or common carrier is necessary upon the offering of evidence supporting the necessity. Removing these presumptions also affects the burden of proof the agency must meet regarding the necessity of a taking.
- Revises an irrebuttable presumption in current law that an appropriation is necessary if the agency is a common carrier or public utility and a state or federal regulatory authority has approved the appropriation. The proposal would allow a landowner to rebut this presumption and would limit the presumption only to the specific interests reviewed by the regulatory authority.
- Prohibits an agency from reducing or revoking the compensation made in an initial offer to a landowner or from later arguing or presenting evidence for a lower amount. Current law allows an agency to revise an offer if they discover new conditions after making an initial offer.
- Expands attorney fee, cost, and expense awards for landowners. Current law allows attorney fee and cost awards if an agency challenges a landowner’s appraisal and the final compensation awarded is less than 125% of the agency’s first offer. The bill would require reasonable attorney fees, expenses, and costs if an agency appeals and does not prevail, in whole or in part. It also removes a provision requiring a landowner to pay court costs if the landowner denies an agency’s offer and is later awarded less than the offer amount.
- Awards “coercive damages” to landowners who prove by a preponderance of evidence that an agency used coercive actions during the appropriation process. Coercive actions include, but are not limited to, advancing the time of a taking, deferring negotiations, deferring the deposit of funds with the court, and attempting to force an agreement on the compensation award.
- Provides landowners the right to an “inverse condemnation” action, which is a claim that an agency has taken property without filing a court proceeding. In that case, a landowner may file an inverse condemnation lawsuit in the court of common pleas. If the landowner proves by a preponderance of evidence that the agency has taken the property, the court can award the landowner compensation and damages for the taking as well as attorney fees, costs, and expenses. Currently, a landowner must file a “mandamus” action asking the court to order the agency to initiate an eminent domain proceeding and must offer clear and convincing evidence to the court that the agency has taken the property.
- Extends case timelines. The bill increases the minimum number of days for the court to set hearing dates. If a landowner files an answer denying an agency’s authority, the necessity of the taking, or that the parties were unable to agree, the hearing date on those issues would extend from 15 to 30 days after the answer was filed and the compensation hearing date, if the court settles in favor of the agency, would change from at least 60 to at least 90 days after the court settles the issue. If a landowner could have but failed to file an answer to an eminent domain action, the compensation hearing date would be at least 90 days rather than 20 days from the date the answer was due. If an owner appeals a court’s determination on authority, necessity, or inability to agree on an appropriation, the bill prohibits the court from setting a compensation hearing until the appeal is final.
- Removes recreational trails from eminent domain authority. The proposal states that the use of property for a recreational trail is not a valid “public use” for eminent domain purposes. Recreational trails, according to the proposal, are trails used for hiking, bicycling, horseback riding, ski touring, canoeing, or other nonmotorized forms of recreational travel. The proposal also excludes the making or repairing of or access management to shared-use paths, bike paths, or recreational trails from the use of eminent domain for making and repairing roads.
In the March 14 committee hearing, the Ohio Farm Bureau Federation testified in support of the bill. Committee members raised questions about the bill’s recreational trail prohibition, initial offer minimum, coercive action awards, and attorney fee awards. Although the committee chair suggested that a third hearing for opponent testimony would take place in the following week, the bill was later removed from that committee hearing agenda.
Read and follow House Bill 64 on the Ohio General Assembly’s webpage for the bill.
Tags: eminent domain, appropriation, taking, condemnation, House Bill 64, recreational trails
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