Understanding Eminent Domain: Rights and Leverage for Ohio Landowners

Ohio landowners regularly face requests from utilities and government agencies seeking easements and rights-of-way across their property. In recent years, major natural gas pipelines originating in southeastern Ohio have crossed large portions of the state. Today, new electric transmission lines are being built to serve expanding manufacturing facilities and data centers. At the same time, new road improvements and roadway projects continue to accommodate Ohio’s growing population and economy. In many of these situations, the utility or government entity possesses the power of eminent domain. What does that mean for landowners, and what rights do they have when their property is targeted for a public project?

Eminent domain is the power of a government agency or utility to acquire private property for a public project. The rationale behind eminent domain is that a single landowner, or a small group of landowners, should not be able to prevent projects that provide a broader public benefit. Both the United States and Ohio Constitutions authorize the use of eminent domain, provided that the property is being taken for a public use and the landowner receives just compensation. While the exercise of eminent domain can be difficult and frustrating for affected landowners, many roads, utility lines, and other public infrastructure projects would likely never be completed without this authority.

Many landowners mistakenly believe that if their property is subject to eminent domain, they have no say in whether a government agency or utility acquires their land. In reality, that is not the case. Government agencies and utilities generally prefer to avoid eminent domain proceedings whenever possible. The process is often time-consuming, expensive, unpredictable, and can generate negative public attention. As a result, these entities are strongly motivated to reach a voluntary agreement with landowners rather than resorting to eminent domain. Landowners should recognize and use this leverage during negotiations.

Landowners should carefully negotiate any proposed easement or property purchase. Like any buyer, a government agency or utility typically seeks to acquire property rights at the lowest reasonable cost. The initial offer is often neither the best offer nor the final offer. In addition to negotiating compensation, landowners should seek terms that protect their property and minimize the project's impact. For example, a landowner in northwest Ohio may want to require that any disturbed drainage tile be repaired to the landowner's satisfaction. Other provisions may address matters such as access routes, restoration obligations, crop damages, fencing, and construction timing. These types of protections can and should be negotiated into easement agreements.

In evaluating compensation, landowners should remember that the value of the property rights acquired is not always limited to the acreage within the easement or right-of-way. Depending on the circumstances, the project may affect the value or use of the remaining property. Impacts to drainage, access, farming operations, future development opportunities, and other aspects of the property should be considered when negotiating compensation.

Proceeding through the eminent domain process may be necessary when a landowner believes the compensation offered by the government agency or utility is insufficient and cannot be resolved through negotiation. The eminent domain process is essentially a legal proceeding in which the government or utility seeks the right to acquire property rights in exchange for compensation. During the proceeding, the government or utility presents evidence supporting its valuation of the property rights being acquired, while the landowner presents evidence demonstrating why greater compensation is warranted. As discussed above, eminent domain proceedings are generally costly, time-consuming, and uncertain for both parties. As a result, negotiated resolutions are often preferable when a fair agreement can be reached. However, when the parties remain far apart on compensation, the process may be necessary to reach a resolution.

Landowners should also understand that eminent domain authority is not unlimited. In some cases, landowners may have legal grounds to challenge whether a proposed acquisition satisfies statutory and constitutional requirements. Simply because a government agency or utility claims it has eminent domain authority does not necessarily mean that it does. As discussed above, eminent domain is generally intended for projects that serve a public use or public purpose. If a landowner believes a proposed taking primarily benefits a limited number of private parties rather than the public at large, the landowner should consult experienced legal counsel to evaluate whether a challenge may be appropriate.

Experienced legal counsel can also be invaluable when negotiating easements and property purchases. Many attorneys specialize in representing landowners in negotiations with government agencies and utilities and are familiar with the unique issues these transactions present. Landowners should strongly consider retaining an attorney with experience in this area. When negotiating an easement or property purchase, the landowner typically has only one opportunity to secure favorable terms. Once an agreement is signed, it generally cannot be modified without the consent of both parties. A poorly negotiated easement can affect the use, value, and marketability of property for decades and may impact future generations of landowners. Taking the time to negotiate appropriate compensation and protective provisions at the outset can help avoid significant problems later.

Eminent domain can be intimidating, but landowners should not assume they are powerless when approached by a government agency or utility. Understanding the eminent domain process, negotiating carefully, and obtaining experienced legal advice can help ensure that landowners receive fair compensation and appropriate protections for their property. While negotiated agreements are preferable, landowners may need to pursue their legal rights through the eminent domain process when a fair agreement cannot be reached.