Eminent domain refers to the US government’s legal power to take private land for public use, provided the owner receives fair compensation. This power comes from the Fifth Amendment of the US Constitution.
The government usually uses eminent domain for infrastructure projects, such as roads, railroads and other public works. Property owners can contest the acquisition in court if they want to keep their land or receive better compensation.
Determining fair compensation can become an issue at times, as it usually relies on the property’s market value and any related losses or benefits. Property owners might file claims for inverse condemnation if they believe that government actions have decreased their property’s value.
What Eminent Domain Means
For many years, the US federal government has used its eminent domain authority to acquire private land for public projects. This authority is seen as a fundamental power of a government.
The US Constitution’s Fifth Amendment limits this power by prohibiting the taking of private property for public purposes without providing fair compensation. The owner of private property must be fairly compensated if it is seized for public use.
Even if it goes against the owner’s interests, the purchase process must adhere to proper protocols. It is considered a constitutional need to receive compensation. As a result, when the government uses eminent domain to obtain property, it is legally required to pay the owner according to the property’s fair market worth.
Property Types Under Eminent Domain
Private property is generally acquired through condemnation proceedings, a legal process that allows owners to challenge both the legality of the seizure and the offered compensation. Land and buildings taken for public infrastructure projects are the most common examples.
Eminent domain, however, can also be used for land-related natural resources, such as airspace, water, soil, timber and minerals required for building and development. Contract rights, patents and other types of intellectual property are also examples of eminent domain that go beyond financial and tangible property.
How Property Can Be Acquired
Acquiring property under eminent domain can take various forms, each impacting owners in different ways. These include complete takings, partial takings, temporary takings and regulatory takings.
Complete acquisition: When the government acquires the entire property, it’s known as a complete taking. This usually happens in case of large-scale utility or infrastructure projects where complete land control is required. Many property owners nevertheless view this as unfair, as it requires them to give up ownership completely, even in cases where compensation equals the maximum fair market value.
Partial acquisition: Under this, the government takes possession of only a section of the property. As it is more difficult to value a portion of a property than the entire property, this process is more complex. Here, compensation usually consists of two parts. One is the value of the part that’s been acquired. The other is the decreased value of the remaining property, often referred to as damage to the remainder.
Temporary acquisition: This happens when the government uses the property temporarily. The government can acquire property temporarily during projects for easements or temporary access. Compensation usually reflects the rental value of the land for the duration of use. If the temporary use limits access to other parts of the property, compensation may also include those areas.
Regulatory taking: When government regulations limit the use of a property, it’s known as regulatory taking. Rules render the property practically useless in a thorough regulatory taking. The property may still be used in a partial regulatory taking, but the limitations greatly diminish its value or usability.
How Compensation Is Calculated
Just compensation refers to the payment a property owner receives when their property is acquired through eminent domain. The amount is generally based on the fair market value of the property. But exact calculation can vary depending on the type of acquisition involved.
Fair market value assumes a normal sale scenario, one where the seller is not under pressure to sell and the buyer is willing, but not forced, to purchase.
Many elements can influence the final compensation amount. These may include the value of improvements made to the land, any reduction in value to the remaining property after partial acquisition and, in some cases, benefits.
What Eminent Domain Means For Property Owners
Eminent domain gives federal, state and local governments the authority to acquire private property for public use. These acquisitions can take several forms, including complete, partial, temporary or regulatory takings. In all cases, property owners are legally entitled to fair compensation and often challenge acquisitions if they believe the payment offered is inadequate.
While completely stopping an eminent domain action is extremely difficult, property owners may still have room to negotiate for better compensation. For property owners, understanding how eminent domain works, including their legal rights and compensation options, is essential to navigating the process and protecting their interests.