The Eminent Domain Process*
- Title Work- If the government has decided it needs your property for a right-of-way project, it will first verify who owns the property, whether there are any tenants, and if there are existing leases. This is very similar to the title search that was performed before you bought the property. It basically identifies you as the property owner and generates a parcel number. If there are leases on the property, all parties are identified in writing.
- Appraisal- Once it is determined that your property is being taken for a public purpose, and that you are the legal owner, the next step the agency will take is to determine the value. They will appoint an appraiser to look at your property. A good appraisal will fairly represent what your property is worth. But an appraiser who fails to look at all the factors and issues will probably undervalue your land and property improvements. This is why you should hire a recognized expert to analyze the appraisal and offer.
- Offer- After the appraisal comes in, the government will present their “offer of just compensation.” In many cases, it is just the amount of the offer, not the details of the appraisal, so you don’t know how they reached those numbers. At this point, you can either accept the offer or negotiate to see if you can get more money. This is when it is helpful to have a third party, preferably an eminent domain consultant, along with an eminent domain appraiser and attorney, to analyze the offer.
- Negotiations- If you are a property owner, you want to be sure someone is on your side, an expert who can analyze the offer and determine what is lacking. If you choose not to accept the offer, you can make a counteroffer, providing your reasoning for a different dollar value. The agency reviews your counteroffer. If a settlement is not reached, the agency files condemnation and requests early possessions and use of the property. When that is granted, the agency will release funds based on their original offer. The next step is mediation.
- Mediation- If mediation does not settle the case, the agency will make a final offer 30 days before the scheduled trial date. If the case goes to trial, attorney fees are only awarded to the property owner if the court settlement is 10% or more over the agency’s final 30-day offer.
- Trial- Hopefully, agreement is reached during the negotiations step. If not, your case goes to trial, at which time you will need to hire an attorney. At this step, the court determines the fair market value of your property. Upon settlement, the agency’s makes the payment to the court for the property owner and the title is transferred.
- Relocation- Eligibility for relocation benefits begins at the time of the offer to the property owner. At that time, tenants are also given a date when they must vacate. The agency’s relocation agent acquires a moving bid for each tenant. It is the tenant’s responsibility to find their new location and relocate. The agency pays eligible relocation benefits. Included in the eligible relocation benefits is your right to hire a relocation consultant to help you through the relocation process which includes planning your relocation. You will want someone representing your interests who can navigate the paperwork and negotiate the best possible business relocation benefits.
* Based on Washington State eminent domain process. Steps may vary depending on your state of residence.