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CALIFORNIA EMINENT DOMAIN LAW BLOG

California Project News: More Property Being Targeted for Condemnation for High Speed Rail Project

Earlier this month, the State Publics Works Board approved and adopted Resolutions of Necessity (the agency’s decision to take property by eminent domain) for 12 more properties in the San Joaquin Valley required by the California High-Speed Rail Authority (“CHSRA”).

Parcels impacted are in Fresno, Madera, Kings, and Tulare counties. The parcels total 53 acres, but some parcels are as small as a quarter of an acre to as large as ten acres.

Since December 2013, over 270 resolutions covering about 800 acres have been adopted by the State Publics Works Board for the High Speed Rail project.

The Board has also approved site selection of 68 parcels along the rail path in the Valley – a first step before the CHSRA can formally begin to negotiate for the land. The CHSRA will attempt to negotiate the sale of these parcels, but if the owners refuse, CHSRA will almost certainly seek to acquire them through eminent domain where the owners may be forced to sell.

One of the 68 parcels is owned by the Haflich family, which has been caught in limbo wanting to sell, but waiting for the board to approve site selections so they could begin negotiating a sale price.

Properties in Downtown Fresno that are needed for the rail project have been mostly vacated and are being demolished. One such building that has been torn down is the old Paper Plus building.

Despite acquiring a large amount of land and starting construction on the project, the process of buying and acquiring land for the CHSRA has been a slow process. As of the time of this posting, it has the rights of about 300 of the required 1,277 parcels for the Merced-Bakersfield line.

Jeff Morales, the CEO of the rail authority says he does not see this slowing down the timeframe for finishing the rail project. Construction workers will work on the land that has already been acquired. Notwithstanding, Morales says a revised timeline will come out later in the fall.

The first stretch of the rail project, which is estimated to be done by 2017, has only acquired about half of the properties it needs.

Land owners have reported that the CHSRA’s agents are using pressure tactics to acquire the property and are offering lowball values that are well below fair market value. Our firm currently represents several property and business owners along the proposed rail line, and we’ve seen much the same.  Hopefully, folks who are impacted will recognize that they don’t need to just accept what CHSRA offers.  They are entitled to challenge CHSRA’s appraised values and to obtain full fair market value for their properties which are being taken.  Hiring an eminent domain attorney is generally the best way for these owners to ensure they get everything they are entitled to.

CHSRA has deflected the allegations that they are using pressure tactics and making lowball offers for properties. They have said they will make sure to train and re-train staff to make sure the process is streamlined and fair.

 

What does this mean for you?

Despite the fact that land acquisition remains slow, the rail project continues to move forward at an increasing pace. The rail authority continues to acquire more and more land through offers or eminent domain.  If you are in the proposed path of the rail, CHSRA may be knocking on your door sooner than you might think.

We’ll be continuing to follow the progress of the project on our website at www.caledlaw.com. If you are an affected property or business owner, you can learn more about your options by giving us a call at (866) EM-DOMAIN.

California Project News: California May Take 300 Farms by Eminent Domain for Delta Tunnel Project

The state of California has recently disclosed plans to acquire farmland for an unapproved waterway project that intends to divert water from parts of the Sacramento River.

The Delta Waterway Tunnel Project (also known as the “Bay Delta Conservation Plan” or “California Waterfix”) is intended to provide water from Northern California to Southern California. This project has been in the making for about 8 years. Reuters News Agency reports, “it is a pet project of Governor Jerry Brown (D-California).”

If approved, the delta project will directly impact some 300 property owners in the Sacramento-San Joaquin Delta areas, and could indirectly impact many more.

California officials came up with a plan to take over 300 farms and may seize them by eminent domain. Under the property acquisition plan for the project – which is marked “Confidential” and only came to light as a result of a Public Records Act request by project opponents – affected landowners will be approached for a one time offer to sell the property. If owners refuse to sell, the State will proceed to acquire the land through eminent domain and owners will be forced to make a sale.

Opponents of the Delta Tunnel Project say it will cause damage to the wildlife and cause the delta to become salty, which would make farming impossible. Many believe it is an attempt to grab land and water.

Richard Elliot, who grows cherries, pears and other crops on delta land farmed by his family since the 1860s told Associated Press, “What really shocks is we’re fighting this and we’re hoping to win. To find out they’re sitting in a room figuring out this eminent domain makes it sound like they’re going to bully us … and take what they want.”

Officials are so far defending the plan to acquire property.

“Planning for right-of-way needs, that is the key part of your normal planning process,” said Roger Patterson, assistant general manager for the Metropolitan Water District of Southern California, one of the water agencies that would benefit from the twin tunnels.

The project’s environmental review is currently in public comment period, which was set to end August 31st, but after two weeks, it was considered necessary to extend the public comment period another 60 days to October 30th.

How does this impact you?

Right now the project is still under consideration, and may or may not ultimately be approved. If it’s not approved, then you’ll have nothing to worry about. But given that this appears to be a pet project of Governor Brown – and we’ve seen how those tend to get muscled through (i.e., California High Speed Rail) – it seems there is probably a pretty strong likelihood the project will go forward.

We’ll be following the progress of the project on our website at www.caledlaw.com. In the event the project is ultimately approved, and you are an affected owner, you can learn more about your options by giving us a call at (866) EM-DOMAIN.

California Eminent Domain Project News: Initial Segment of High Speed Rail Reduced by 8 Miles

A settlement agreement between the City of Bakersfield and California High Speed Rail Authority (“CHSRA”) has resulted in an eight mile reduction of the initial 130-mile segment of the high speed rail in part of the Central Valley.

Last December, CHSRA and the City of Bakersfield settled a lawsuit brought by Bakersfield city officials concerning the proposed route for the high speed rail running through the city. The 8-mile cut to which CHSRA and the City agreed will cause the rail to stop north of the City of Shafter instead of stopping at the outskirts of Bakersfield. CHSRA spokeswoman, Lisa Marie Alley, stated that the results of the settlement agreement will not cause a construction delay.

The settlement agreement also provides that the city and CHSRA will meet with local business owners, farmers and other stakeholders to consider new routes for the northern part of Bakersfield before the rail connects to the downtown high speed rail station. The deadline to reach an agreement for the new alignment is January 2016 (a date which cannot be extended unless both the city and CHSRA agree to an extension).

Residents and city officials in Bakersfield and Shafter are not the only ones unhappy with proposed high speed rail routes. Cities in California have been voicing their disapproval with certain routes proposed or selected for the high speed rail. Opposition has been on the rise in cities in Southern California as well as the Central Valley. Many of these cities are depending on CEQA in their battle against CHSRA’s selected routes.

Friends of Eel River v. North Coast Railroad Authority – a case currently before the California Supreme Court dealing with federal preemption of the California Environmental Quality Act (CEQA) – could affect the plans for high speed rail. While the case does not directly involve the high speed rail project, because the project could be impacted by the outcome of the case, representatives of the Farm Bureaus in Madera and Merced filed amicus curiae briefs in the case voicing their concerns to the Supreme Court.

Groups like the Farm Bureaus rely on CHSRA compliance with CEQA requirements in order to ensure CHSRA will deliver on the promises made to make up for environmental impacts caused by the construction and operation of the  high speed rail project. CEQA regulations are significantly stricter than federal regulations under the National Environmental Policy Act.  If the California Supreme Court finds that the federal National Environmental Policy Act trumps CEQA, it may allow CHSRA to evade accountability.

CHSRA has asked the Supreme Court for an extension to July 1st in order to file its own amicus brief in the Friends of Eel River v. North Coast Railroad Authority case. Oakland attorney Stuart Flashman, the attorney representing Kings County in a lawsuit against CHSRA, also filed an amicus brief arguing “that a state is not precluded from controlling its own rail project, and in this case, requiring CEQA compliance.”

California Eminent Domain Project News: CHSRA’s Proposed Palmdale to Burbank Routes Get Opposition from Southern California Cities and Residents

Opposition to the California High Speed Rail project is growing as Southern Californians’ concerns appear to be increasing over the proposed routes for the $68 billion bullet train’s Palmdale to Burbank segment. Approximately 300 city officials and residents from various Southern California cities attended California High Speed Rail Authority’s (“CHSRA”) Board meeting on Tuesday in downtown Los Angeles to voice their concerns over proposed alternative routes for the Palmdale to Burbank segment which they believe will be detrimental to their towns.

Prior to the board meeting, Los Angeles County Mayor Michael D. Antonovich, Los Angeles County Supervisor Sheila Kuehl, and Los Angeles City Councilmember Felipe Fuentes sent a letter to CHSRA asking the Authority to recognize the impacts the proposed routes can cause to communities in the path of the bullet train. The trio jointly sent the letter in an effort to urge CHSRA “to expedite the process by which it will be able to remove or put underground alternatives that are causing our communities great concern for their houses, businesses, equestrian facilities, churches, and quality of life.” The officials are hoping that by working with CHSRA, they can find the safest route with the least impact for the community.

The board meeting included an informational presentation on the proposed alternatives for the Palmdale to Burbank Project section and discussed updates on the progress in the corridor. The approximately 300 attendees made clear that they have serious concerns regarding the proposed alternatives.

San Fernando residents and officials, for example, were vocal in their concerns about the impacts the high speed rail will create for their “first city in the Valley.” San Fernando city officials and residents fear that if the high speed rail cuts through the city, it would cause the city to lose as much as $1.3 million a year in tax revenue. Mayor Pro Tem Sylvia Ballin stated that the proposed route through San Fernando is “the worst imaginable plan…It will more than likely bankrupt our city.” The worry is that the bullet train and the 20 foot sound walls it will require will cause the city to be cut in half. Even though San Fernando has been divided by train tracks for quite some time, the high speed rail would also reduce the number of crossing points across the tracks from four to two. Many San Fernando residents are concerned about these traffic changes and potential loss of businesses.

Other alternatives proposed by CHSRA for the Palmdale to Burbank section include three routes all involving tunneling under the Angeles National Forest. Environmentalists, equestrians, residents and activists are concerned with the environmental impact these alternatives would cause to the surrounding area. Environmentalists, for example, are concerned that running the high speed rail through the Angeles National Forest may result in pollution and endangerment of the San Fernando Groundwater Basin’s water supply. Equestrians in the area fear that the high speed rail could spook horses, disrupt wildlife and put an end to rural living in the area. Formal environmental reviews of the proposed routes have not yet begun. A draft environmental study is expected next summer and the final report is to be completed by December 2017.

Ultimately, CHSRA made no decisions at the meeting. Presumably, they will take into account the various concerns expressed, and move forward from here as they see fit. What is clear from the concerns expressed is that there is no alternative on the table at this point that satisfies everyone – nor is there likely to be.

 

Rebirth of Redevelopment in California: Impairing Private Property Rights or Revitalization?

In a 63-13 vote, Assembly Bill 2, authored by Assemblyman Luis Alejo, D-Salinas, passed in the California State Assembly last week. The bill allows for so-called “Community Revitalization Investment Authorities” – essentially redevelopment agencies with a different title – to acquire private property through eminent domain and make it available to big developers with the intent to build grand-scale housing or commercial and retail centers.

Back in 2011, Gov. Jerry Brown shut down redevelopment agencies as part of an attempt to balance the state budget. Now, the rebirth of redevelopment agencies puts many private property advocates in fear of Kelo-style outcomes where big developers and big investing companies back out of the redevelopment plan leaving acres of land vacant and the city in debt.

Howard Ahmanson, Jr., a private property advocate, cautioned that the bill “brings back the right of governments to exercise eminent domain against some private parties in order to resell their property to other private parties.”

Alejo’s reasoning for the rebirth of redevelopment differs greatly from those who oppose it. Alejo argues that the bill is a stepping stone towards revitalization for blighted, lower income neighborhoods where development is needed. He states that when a Community Revitalization Investment Authority is created by a city, county or special district, certain prerequisite conditions must be met. First, redevelopment plans must focus on high unemployment, low income and high crime rate areas. Additionally, one of the following four criteria must also be met:

  • Unemployment is at least 3% higher that statewide median unemployment rate
  • Crime rate is 5% higher than statewide median crime rate
  • Deteriorated or inadequate infrastructures like streets, sidewalks, water supply, sewer treatment or processing, and parks
  • Deteriorated commercial or residential structures

While this may look good on its face to some, Ahmanson argues – and we believe rightly so – that the property rights for the lower middle class and poor would be infringed while “only new and wealthy suburbs would be potentially spared from ‘redevelopment.’”

Assemblywoman Melissa Melendez, R-Lake Elsinore, agrees. As one of the 13 voters against the bill she believes that while she understands her colleagues’ interest in redevelopment as an effort to counter blighted neighborhoods, she refuses to support legislation that trumps private property rights.

Alejo is persistent in arguing that the bill is needed for disadvantaged communities. Opponents argue that although disadvantaged neighborhoods need to combat such issues as blight (deteriorated residential and commercial areas), there are other avenues the State can take in order to achieve revitalization. The question is whether it is necessary to use eminent domain and leave open the possibility of eminent domain abuse.

California High Speed Rail Project: Relocation Considerations for Displaced Businesses, Farms and Non-Profits

The California High Speed Rail project has been slowly, but surely, picking up its pace of property acquisition in the Central Valley. So far, the State Public Works Board has adopted 192 resolutions of necessity declaring the CHSRA’s intent to file eminent domain actions in court to acquire properties.  Last month alone, CHSRA approved resolutions of necessity for 16 more parcels and approval was pending for 14 more parcels. This month, the State Public Works Board considered the adoption of resolutions for 23 more parcels.

Although CHSRA has a long way to go in acquiring the bulk of the land it requires in the Central Valley, many Central Valley residents and businesses are currently facing acquisition and relocation, and are entitled to seek compensation for both. For acquisition of commercial property, including farms and nonprofit organizations, owners may be challenged with relocating their businesses, including equipment and personal property connected to the functionality of the business.

In an effort to aid in the process of relocation CHSRA has created two programs for businesses, farms and nonprofit organizations. The first program, the Relocation Advisory Assistance Program, is to aid commercial property owners in finding suitable replacements for their property. The second program, the Relocation Payments Program, is intended to aid in getting commercial property owners reimbursement for certain costs such as moving and related expenses, reestablishment expenses, and in lieu payments.

The relocation program may pay for actual reasonable moving expenses and related expenses, with limitations, that can include:

  • transportation of personal property
  • packing and unpacking
  • disconnecting and reconnecting personal property related to the operation of the business
  • temporary storage
  • expenses related to finding a replacement location
  • license, permits and fees required for the replacement location
  • some professional services used in the relocation process

However, difficulties can arise for commercial business owners who have equipment or other personal property which is complicated or impossible to either move or replace. In a recent article in Right of Way magazine, relocation expert Darryl Root explained the importance of understanding the regulatory authority of the Code of Federal Regulation part 24 which governs Uniform Relocation Assistance and Real Property Acquisition programs. CRF §24.301(g)(3) reads:

Eligible actual moving expenses. Disconnecting, dismantling, removing, reassembling, and reinstalling relocated household appliances and other personal property. For businesses, farms or nonprofit organizations this includes machinery, equipment, substitute personal property, and connections to utilities available within the building; it also includes modifications to the personal property, including those mandated by Federal, State or local law, code or ordinance, necessary to adapt it to the replacement structure, the replacement site, or the utilities at the replacement site, and modifications necessary to adapt the utilities at the replacement site to the personal property.

Root emphasizes that relocation professionals should be attentive to appraisals that include the value of equipment or other personal property as part of the real property. Some personal property, however, does not add overall value to real property and it may be a disservice to the business owner to include the personal property as part of the real estate value. It should be noted that this may not apply to properties where the highest and best use of that property is the existing business. In these situations Root states that the fair market value of the property may properly include the personal property as part of the real property. Therefore, if the displaced business sells its property to the displacing agency with the determination that the highest and best use of the property is the existing business, and personal property is included as part of the real property appraisal, then some relocation payments may not require to be paid to the displacee.

Root suggests that it is important to speak to a relocation professional to understand all of the consequences, regulations and financial impacts of relocating a business and personal property related to the operation of the business. We’ll take it a step further. The various items of compensation to which property or business owners are entitled in acquisitions under threat of eminent domain are complex and interrelated. It is a potential minefield, and trying to deal with CHSRA (or any other government agency threatening eminent domain for that matter) without full knowledge and understanding of the laws and regulations governing such acquisitions can put owners in the position of potentially leaving tens of thousands an even hundreds of thousands of dollars on the table. At California Eminent Domain Law Group, we are experts in understanding these laws and regulations, and putting them to work for owners rather than against them, to maximize the overall compensation to which property and business owners are entitled. We can be reached for a free initial consultation at (559) 697-6779, or see our website at www.caledlaw.com.

California Eminent Domain Project News: CHSRA Updates State Legislature on the Bullet Train Project

California High-Speed RailThis week, the California High Speed Rail Authority issued its biannual Project Update Report to the State Legislature.  The report provides a synopsis of the Authority’s funding, environmental review, land acquisition (eminent domain), and construction activities for the California High Speed Rail Project.  

 

Of note, the Authority advises that the Project’s first operating segment is scheduled to commence operations in 2022 (from Madera to the San Fernando Valley/Burbank), and full operations between San Francisco and Los Angeles are scheduled to start in 2029.  In the report the Authority acknowledges that several risks and challenges remain, but describes efforts to manage and mitigate any risks.

 

Recognizing that its schedule has been delayed because of the slow pace of property acquisitions, the Authority contends that the pace should move quicker now because, “the majority of the learning curve and teething issues have been worked through . . .”  For the initial construction segments of the Merced to Fresno Section (Construction Packages 1A and 1B), the Authority reports that as of March 1, 2015 they’ve acquired 105 of necessary parcels (28%), and that Resolutions of Necessity have been adopted for another 118 parcels (authorizing the filing of eminent domain lawsuits).  And, of the 141 parcels required for Construction Package 1C, the Authority has made initial written offers to 112 of these parcels.  The Authority also notes that Caltrans has also begun acquisition for the related Highway 99 Realignment Project between Ashlan Avenue to Clinton Avenue.

 

The Authority advises that some initial construction work, including utility relocations and demolition of existing structures, has begun on CP1A and 1B.  However, the Authority reports that while design for these segments is progressing (with the contractor completing 60% – 90% design plans), major construction activities have been delayed because of the slow pace of property acquisition.

 

For the next phase of construction, the Fresno to Bakersfield Section, the Authority reports that it is proceeding with Construction Package 2 – 3 after obtaining the necessary environmental approvals.  This is an approximately 65 mile section beginning at American Avenue in Fresno traveling southerly toward the Tulare-Kern County line.  The Authority has identified 545 parcels for acquisition in Construction Package 2-3, and advises that nearly 500 parcels have been appraised.  With the appraisals complete, the Authority expects to proceed with making offers and seeking acquisition of the necessary parcels.

 

After many years of planning, debate and litigation, construction of the California High Speed Rail Project is now moving forward.  In Fresno and beyond, many property and business owners in High Speed Rail’s path are relying on the attorneys at California Eminent Domain Law Group to ensure they are paid maximum compensation.

California Eminent Domain Project News: Crenshaw/LAX Transit Project, Updates and Current Issues

Construction of the Crenshaw/LAX green line has been underway for many months now. The project is planned to connect the north-south Crenshaw Line and the east-west Green Line into a monorail system that extends towards the LAX.  This 8.5 mile light-rail line will include 8 stations between the Expo Line on Exposition Boulevard and the Metro Green Line with both aerial and below-grade segments.

The construction, however, has been creating issues for merchants along Crenshaw. Recent street closures and blocked sidewalks have made it difficult for patrons and clients to get to some of the businesses. Shop owners had concerns regarding the gradual decline of regular patrons and the outcome it would have during the holiday season. Los Angeles County Metropolitan Transportation Agency has agreed to give shop owners who qualify up to $50,000 each year until the work, which has compromised their business, is done. However, that money is not available until this upcoming year.

For frequent updates on the Crenshaw/LAX Transit Project, and other California projects, visit our blog and look for “California Eminent Domain Project News” for the latest information. Also Like us on Facebook and follow us on Twitter.

California Eminent Domain Project News: California High Speed Rail Settles Lawsuit with Bakersfield

Last month, the U.S. Surface Transportation Board held that the California Environmental Quality Act, or CEQA, is pre-empted by federal environmental law relative to the Fresno-Bakersfield route of the proposed high speed rail.

STB stated in their opinion that CEQA could delay or eliminate a rail project even after a federal board, such as the STB, has authorized the project. This decision expressly pre-empts any state law from attempting to regulate the rail construction project. This means that a California state court cannot issue injunctions to stop the high-speed rail projects filed under CEQA.

The decision led to a recent settlement between California High Speed Rail Authority (CHSRA) and the City of Bakersfield. The City of Bakersfield had filed the lawsuit in June challenging CHSRA’s Final Environmental Impact Report/Environmental Impact Statement, stating that the CHSRA violated CEQA. According to CHSRA’s Jeff Morales, the settlement was a representation of the Authority’s continuous effort to “resolve issues in a constructive manner.” The ultimate goal for CHSRA is to “maximize benefits” while “minimizing the impact.”

The settlement included the dismissal of the city’s lawsuit, CHSRA’s commitment to study a new alignment in Bakersfield and a new location for the Bakersfield station. The new alignment is claimed to decrease the number of houses and businesses affected by the high speed rail project.

Six other lawsuits still remain.  However, the viability of those lawsuits is in doubt.

For frequent updates on the California High Speed Rail project, visit our blog and look for “California Eminent Domain Project News.” You can also stay informed by following us on Twitter and liking us on Facebook.

 

 

Claremonts Ready for Golden State Water System Takeover

In early November of this year, Claremont resident voters backed a measure that gave the city the ability to borrow as much as $135 million dollars to acquire Golden State Water Co., a private water company servicing the City of Claremont. Claremont’s desire to take over the private water company has been at issue since early this year, however, residents have been lobbying for the acquisition for many years now.

More than 11,000 customers of Golden State Water Co. have allegedly been gouged by the company with increasing water rates and higher rates than neighboring communities. Although negotiations between the City and Golden State Water have been ongoing for some time now, no agreement has been reached. The cost for the acquisition has been the subject of significant dispute. Claremont has appraised the water system at $55 million while Golden State Water Co. released a report claiming the value is $222 million. As in any other eminent domain matter, if the parties can’t reach an agreement, the price of the acquisition will be determined by a jury.

The thought of Claremont using its power of eminent domain to acquire the company is not a farfetched idea and seems to be the most likely route for Claremont.  Earlier this month, the city unanimously approved a resolution of necessity to begin eminent domain process and later filed the suit. The City had published two proposals to the issue of rising water cost with respect to Golden State Water Co. The first proposal was to acquire the water system within the city limits. And the second was to acquire the water system outside the city. Per the City, the acquisition of the Claremont system would result in the most benefit for the city residents.

So far the city has invested $1.5 million on consultants and legal fees for the acquisition and has estimated another $2 million in litigation fees to exercise eminent domain. But the most important question is how much will residents save? Claremont claims that if the system is purchased under $80 million it will be able to generate enough revenue to pay for the bond. However, many are skeptical about how much it will actually cost the city to acquire the water system.

In the past, similar acquisitions of water systems have yielded much higher purchasing prices than the original estimates. In a similar acquisition in San Lorenzo Valley Water District, the estimated the price at $5.3 million, it was ultimately acquired for $13.4 million, 250 percent more than the original valuation price. Similarly in Big Bear Lake, the District there estimated the price at $15.7 million, while the final acquisition price ended up being $35 million. Given this history and the parties’ disparate opinions at value, the fear that the actual acquisition price for the Golden State Water Co water system may rise way beyond the $55 million appraisal value is a legitimate concern.

Past acquisitions of private water systems purportedly do show that the city residents did save annually on their water costs. How much the residents of Claremont will save, if anything is uncertain. But it seems as if the community of Claremont has come together to voice their discontent with private utilities raising costs. And their devised plan of using eminent domain to remedy the problem will soon come into play.

By: A.J. Hazarabedian

To learn more about A.J. Hazarabedian, the managing partner at California Eminent Domain Law Group, visit http://www.eminentdomainlaw.net/aboutAJH.php

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COPYRIGHT © 2010 Arthur J. Hazarabedian, Esq.