The bullet train and your business: Your rights when you face eminent domain
In the past year, many business owners have faced the loss of their land through eminent domain actions by the California High-Speed Rail Authority, and with new developments in the California Legislature regarding this project, we suspect many more will in the future.
Members of the Senate recently announced that they are planning hearings to accelerate the Bullet Train’s construction. This comes after the estimated cost increased by the millions and the state failed to obtain the land parcels it needed to complete the first stage from Burbank to Merced. To obtain those parcels, the state has started eminent domain proceedings against landowners in the path of the planned construction. As one supporter noted in 2015, “Eminent domain is the last resort, but if that’s what it takes to get construction to accelerate, so be it.” (Robert Cruikshank, “Eminent Domain Process Gears Up,” California High Speed Rail Blog, Jul. 13, 2015.)
That is a harsh sentiment if your business is the one facing possible closure. If the government has approached you about appropriating your property – or you suspect that it will – it is vital that you understand your rights under the law.
Constitutionally, when the state has a public use argument to take private property, it must pay you, the landowner, the fair market value of not only the land and buildings, but also any improvements you have made to the property and any damage to your business’ goodwill (such as your ability to attract customers based on your location). The definition of fair market value favors the landowner and requires the state to pay you the highest price you would receive were you to sell your property on the open market.
Unfortunately, while the law is clear, the government will still low ball its offer, sending appraisers that will use tactics to save the government money and give you the short end of the stick. That is why it is important to work with experts, including an attorney and forensic appraiser, experienced in California eminent domain actions.
Remember: This rail project isn’t new, and it isn’t the first time the state has taken property through eminent domain. The state has a team of very experienced experts that are out to protect the state’s money and the Rail Authority’s interests. They know that most people wait to speak with a lawyer until the government acts, and that many will simply accept their offer, assuming the government has their best interests in mind. Most people can get more than the government offers if they are willing to assert their rights.
If you believe your property is at risk, talk to an attorney as soon as possible about your rights and the actions you should take to protect those rights.