There have been rumblings about a coming project, and you think it may impact your property. How do you typically find out and what do you do about it?
How do I know that my property is targeted for condemnation?
You may learn months or years ahead of time through the press or public notices that your property is a possible target for taking, especially in the case of large public infrastructure projects. Governmental entities may also post online their near and long-term plans for “capital improvements.”
In any event, you will at some point receive formal notice from the government that it wants to acquire your property and will take it by condemnation if necessary. The notice may come in one or more of several forms:
• The government is required to provide the owner or occupant of the property notice prior to entering onto the property for the purposes of examining and surveying the property. ORS 35.220.
• The government’s appraiser must give the property owner at least 15 days written notice before a desired inspection of the property for appraisal purposes. ORS 35.346(3).
• As a precondition to actually taking the property, the government must also declare by ordinance or resolution the necessity and purpose for which the property is required. ORS 35.235(1). This Declaration of Public Necessity will in most instances require a public hearing for which notices will be published.
• In most situations, the government cannot take property that results in a relocation of the occupant of the property without giving at least 90 days’ notice. ORS 35.505(2).
• Finally, at least 40 days before filing a condemnation action, the government must make a written offer to the property owner to acquire the property. ORS 35.346(1).
What can I do to prepare myself for possible condemnation?
You should always be aware of the possibility of condemnation, especially if your property is near a major thoroughfare, railway, airport, school, or other existing public infrastructure. If you suspect the government may take your property, whether now or sometime in the future, you should consult with an attorney. Your actions or inactions now could greatly affect your interests later.
Leases with tenants and mortgage agreements with lenders may affect the amount of the condemnation proceeds to which you are entitled. Such agreements should be drafted with the possibility of condemnation in mind.
Land use and building approvals can have significant impact on the valuation of real property. You should pursue approvals with these impacts in mind.
Finally, in taking positions regarding the value of property, for example in property tax or estate tax proceedings, you should be mindful of the effects of your positions and statements on condemnation valuation.
What if I have tenants on my property?
Most leases contain a clause setting forth the rights of the landlord and tenant in the event of condemnation of the property. This clause may take into account such issues as the allocation of the condemnation proceeds between the landlord and the tenant, the landlord’s obligation to reconstruct improvements partially taken, and the parties’ lease termination rights in the event of condemnation.
If the tenant is entitled to share in the proceeds of the condemnation, the tenant will likely participate in the negotiations with the condemning authority and will, in the least, be party to allocation proceedings in the court. Aside from any lease terms, a tenant may be entitled to relocation compensation as well.
Can the government enter onto my property before it obtains legal possession or title?
Yes, if a property is targeted for condemnation, and subject to certain requirements, the government may enter onto to the property, examine it, survey it, conduct tests upon it, and take samples from it. The government, however, must first obtain the permission of the property owner or an order of the court to enter onto the property and conduct examination and testing. In addition, the government must pay the property owner reasonable compensation for any damage caused by the entry, examination and testing, and any interference with the use of the property. ORS 35.220.