Category Archives: Contact Martyn

Join me in San Diego

eminent conferencePlease join me for The Eminent Domain and Land Valuation Litigation conference is taking place January 26-28 in San Diego. I’m looking forward to participating in a full range of cutting-edge issues. My own session, alongside Jill Gelineau and Kelly Walsh from Schwabe Williamson & Wyatt P.C, is entitled Lessons Learned and How to Appeal Under the Uniform Relocation Act and will take place on January 26th at 2:15pm.

For more information, please click here.
There is also a coupon to attend in-person: CY009MK at check out. (Save $150.)

Partial Property Taking: Understanding the Impacts

1When a public entity takes partial property through eminent domain, it’s important to understand the impacts and issues to the remaining property. All too often, the public entity’s proposed cure is flawed, frequently eliminating all but a very small portion of the property’s key needs. The property owner must equip him or herself with experts who understand the pitfalls of partial property taking and will look out for their best interest.

In the case of partial property taking, it’s vital to:

  • Understand the property as it exists before the property taking
  • Understand the property taking
  • Understand the zoning and building codes for the area
  • Understand the State’s proposed cure to the remaining property
  • Identify any missing elements of the agency’s proposed cure
  • Prepare a preliminary design and estimated cost to cure the remaining property, if there are shortcomings in the agency’s proposed cure

As a consultant focused on business and property owners impacted by public agencies taking private property through eminent domain, I have an in-depth understanding of these matters. I apply my extensive experience to help identify the property impacts, provide a reasonable design to solve the impacts, and prepare reasonable costs to construct the necessary changes to the property.

My background includes ownership of a business that performed equipment design/build and installation work, as well as ownership in a general contracting firm that constructed commercial projects,including ownership of a steel fabrication and installation business.

Now, I apply that background to my over 15 years as a consultant working with relocating businesses along with preparing preliminary designs and cost estimates to make remaining properties functional after a partial property taking. This work includes the use of guidelines based on the Federal Uniform Relocation and Acquisition Act.

I use the knowledge gained from this background and apply it to assist my clients who are sometimes private property owners, businesses owners, and frequently public agencies. For those clients, I search for problems created by property takings, develop solutions to those problems, develop the costs for those solutions, and provide those costs and designs to the client and/or representatives of the condemning agency.

My work has included several hundred properties, many of which have been complex takings. Here is an example of a recent case. In my role, I reviewed the impacts and issues to the Company X property in the same light and diligence as with all of my typical private and public agency clients.2

Case Study – Company X – Partial Property Taking

Property as it Exists
The property, as it existed, included two shop buildings of 3,600 square feet each, and two tow yards. Each of the buildings and tow yards had ample access for maneuvering towed and dysfunctional vehicles into and out of each area. The attached drawing, Layout Before Property Taking, shows the maneuvering capabilities for each of the key areas and the uses of the property. Also, noted on the drawing are (5) key elements of the property that relate to the current use, as well as, any likely intended users of these buildings and property, such as an automotive repair shop.

The key elements to this property were as follows:

  • Customer parking adjacent to the office
  • Easy tow vehicle access into the buildings
  • Easy tow vehicle access into the storage yards
  • Convenient parking near shop and office areas
  • Convenient shipping and receiving
  • Convenient parking for work on large vehicles

Property Taking
The property taking was along the northern portion of the entire property. The property line prior to the taking was located sixty-five feet north of the north face of the existing building that was used as an auto body shop. Thirty feet of property was being taken, which placed the new property line thirty feet to the south, which is thirty-five feet north of the building. The driveway entrance was also moved thirty feet south.

Improvements within the area of the property taking included a ten-foot landscape buffer, a paved area used for vehicle maneuvering and parking, a pole sign, and a car canopy.

RC Zoning and Parking Design Requirements
An exhaustive search of the codes was not performed, but key items were found and described here. The RC zoning allowed auto body shops as a permitted use. There were approximately thirty-six permitted uses listed of which only a few uses would have been practical at this location. This zoning had requirements for eight-foot wide sidewalks placed in all walk areas including through parking and driveways. Also required were covers over sidewalks at building faces. Wrecked motor vehicle compounds were no longer a permitted use, of which there were two on this property that were allowed due to grandfathering.

Parking in the RC zoning was not allowed on the street side of the building and parking had to meet ADA, stormwater, and landscaping requirements. The quantity of parking stalls calculated to ¾ of a stall per 600 square feet of building square footage. This equated to nine stalls for the 7,200 square feet when combining the two buildings on the site. A designated loading area of ten feet by forty feet was also required.

State’s Proposed Cure
The State’s proposed cure of $67,000 included relocating the existing Tow Yard #1 to the east of the existing Tow Yard #2 to make room on the west side of the building for replacement parking. The state included costs to provide asphalt pavement for the parking, and crushed rock and fencing for the relocated tow yard. The State did not include any design for this work, only a highlighted aerial photo indicating the shape or footprint of the proposed areas (see attached drawing, State’s Proposed Cure).

The State also included a drawing, State’s Tow Vehicle Maneuvering, which indicated that a tow truck could maneuver a vehicle into the body shop for repairs. This was an important item for the existing auto body shop, as it would have also been for an automotive repair shop, which was also a permitted use.

State’s Missing Elements
The State did not consider all of the issues related to installing new parking and relocating the tow yard. The attached drawing, State Proposed Cure Expanded for Codes, was based on the State’s proposed cure, but with the added missing elements that were necessary to meet current codes, which were required when adding the State’s new elements such as parking or crushed rock for the tow yard. The drawing also pointed out other missing elements needed for this property to properly function under the State’s proposed cure.

Relocating the parking or the tow yard required the addition of impervious surfaces such as asphalt or crushed rock. Adding impervious surfaces or simply adding new parking required code upgrades such as landscaping, sidewalks, a dedicated loading area, the proper number of parking stalls, and handicapped stalls with ADA access between the parking and the building entrances. Including these required items, as shown on the drawing, required more space than the State showed on their drawing. Including the required sidewalks and landscaping on the street side of the building reduced the existing driveway and parking to a width of fourteen feet, leaving only enough width for a one-way driveway, which left the building nearly useless for its intended use, and most permitted uses. The State’s proposed cure eliminated all but a very small portion of the property’s key needs.

The tow vehicle maneuvering, as shown on the State’s drawing, failed to meet the State’s intentions, and the needs of the property in two areas. The first problem was that the State did not include the ten-foot landscape buffer in their drawing, which would eliminate the ability to maneuver this vehicle as they had shown. The second problem was that the State’s drawing showed a need for at least a sixteen-foot wide building entrance door to maneuver a vehicle into the building. At the time, the building currently had twelve-foot wide doors; adding any wider doors would have required structural changes to the building, which would have triggered major code upgrades to the entire building. Those code upgrades would likely have caused the building to be demolished and rebuilt new, for economic purposes.

3The State’s suggestion of relocating the tow yard had three fatal flaws:

  1. The first flaw was that the tow yards were grandfathered in and were no longer a permitted use within the RC Zoning, therefore, relocating the tow yard would not have been allowed. Necessary permits would not have been issued, which would have resulted in the loss of one tow yard.
  2. Secondly, creating a solid surface, such as crushed rock suggested by the State, would have triggered other code upgrades to the site including landscaping and likely sidewalks. Either of those items would again have narrowed the driveway that connected to the proposed relocated tow yard, as well as, connecting to the remaining Tow Yard #2, and would have resulted in no access to either tow yards.
  3. Additionally, this driveway narrowing eliminated the ability for truck traffic to pass by the existing septic system, again preventing access to the tow yards.

Adding the code-required elements to the State’s design for curing the remaining property left the design unworkable for making the remaining property functional after the property taking. Tow truck access to the building would have been eliminated, one tow yard would have been eliminated, the other tow yard would not have been accessible, and critical locations for customer parking would have been completely lost.

Attempts to correct or solve these shortcomings of the State’s design proved unattainable because of the remaining narrow driveway, which could not be expanded. Therefore, an alternative design was prepared and discussed in more detail below.

Alternative Design
Alternative to the State’s design and shown on the attached drawing, Alternative Proposed Cure, depicts a design that replaced the minimum needed functions of the remaining property after the property taking. This design took into consideration the RC zoning and the needs and functions for many of the permitted uses listed for the RC zoning.

This design included the removal of the existing Shop #1 and replacement with a new building located to the east. A circular driveway was included of a standard width to allow reasonable traffic flow for all vehicles and combinations of vehicles. Parking was placed in proper locations and in proper quantities. The remaining site was brought up to current codes as required with sidewalks, ADA access, landscaping, and stormwater systems. (This was a preliminary or basic design, in that an exhaustive review for the best design or a design meeting all required codes had not yet been performed.)

The cost for this project was estimated at $1,118,186. The estimate included work and costs from the beginning to the end of the project including, design, permitting, construction, and taxes.  The costs were prepared from preliminary quotes from various local contractors and vendors, as well as with the use of in-house costs from similar projects.

The State’s design was not complete enough to show how it would cure the needed elements for the remaining property after the property taking.
Expanding that design to include the code required items showed that the State’s design did not cure the elements needed for the remaining property to remain functional in its after condition.

The proposed alternative design took into consideration the necessary elements for meeting current codes and included the minimum needed elements for the remaining property to properly function. Based on this alternative design and estimated costs, the cost to cure the remainder property was estimated at $1,118,186.

I created the alternative design and its estimated costs. It was my expert opinion – now justified – of what would be necessary to cure the functions of the remainder property after the property taking.

If you have any questions regarding partial property taking and would like an opinion regarding understanding the impacts, please don’t hesitate to get in touch.

City of St. Louis bid to the National Geospatial-Intelligence Agency: Eminent Domain Recommendations

City of St. Louis bid to the National Geospatial-Intelligence Agency Eminent Domain RecommendationsI have been following the eminent domain case for the City of St. Louis bid to the National Geospatial-Intelligence Agency and have some comments in response to the Paul Berry III Congressional Exploratory Committee statement that was released November 2nd, 2015.

Mr. Berry makes an excellent point of gaining support by the effected property owners and tenants for the NGA project.

To gain that support, I recommend going a few steps further than he suggests. I recommend that the City implement the Federal Uniform Relocation and Acquisition Act (URA). The URA provides guidelines for relocating residents and businesses on federally funded projects and many other projects without federal funding, while using eminent domain to acquire the property.

The URA sets rules and guidelines for the government, as well as for the displaced person to follow, creating fairness and reasonableness for each side during the relocation process. The guidelines make it fairer for the displaced person than many other methods used. However, the URA does not necessarily make the displaced person whole after their relocation, particularly if the guidelines are not properly implemented.

For the City to come closer to this goal of fairness without sacrificing reasonableness and controls, the City could enhance certain parts of the guidelines, as many public agencies and states have successfully done through properly setting up its implementation.

Offering an enhanced version of the URA relocation guidelines for this project will go a long way toward gaining the support of the effected property owners and tenants needed while controlling the process. This would shed a good light of fairness on this project location to enhance the likeliness of the NGA choosing this site.

I am available to assist with recommendations for enhancements to the URA and the proper procedures for its implementation to support Mr. Berry’s recommendation.

An Overview of Capped Actual Cost Items for Business Owners Affected by Eminent Domain

In my last blog post entitled, “Would You Choose Lump Sum or Actual Cost Relocation Reimbursement? I discussed two reimbursement options available to business owners who must relocated due to eminent domain; lump sum and actual cost.

If a business owner chooses to be reimbursed using actual cost as the basis for the claims, some expenses are capped.

Capped Expenses: Reestablishment (maximum $10,000):

Note that the $10,000 cap mentioned above is the minimum set by the Federal Relocation Guidelines. Some states have higher amounts, some are at $50k or higher, and a few are unlimited. Link to a state-by-state relocation listing here.

1. Repairs or improvement to the replacement property as required by law or code

2. Modification to the replacement property to enable the business to operate

3. Construction and installation of new signage to advertise the business

4. Redecoration or replacement of soiled or worn surfaces such as carpeting, paint, paneling

5. Advertisement of the replacement location

6. Increased cost of operations for two years

7. Other items considered essential to the reestablishment of the business

Since an eminent domain and business relocation consultant’s services are an eligible cost when opting for the actual cost for a planned relocation, the capped items listed above are where a consultant’s expertise is important.

For example, #2 – capped within the $10,000 (depending on your state or location) is ‘modification to the replacement property to enable the business to operate’.  A consultant with construction experience can suggest modifications which are contained within that reimbursement amount.

On the other hand, a business owner may simply look at a replacement property (if he even has the time to search for properties) and believe that hefty modifications leading to out-of-pocket expenses is the only solution to enable the business to operate.

Can you see why an eminent domain and business relocation consultant’s services are absolutely necessary to the seamless transition in an eminent domain move?

In my next blog post, I will compare actual cost estimates for relocation for small businesses versus acceptance of the lump sum.

Do you have any questions about the capped amount in your state?

Would You Choose Lump Sum or Actual Cost Relocation Reimbursement?

Under Relocation Guidelines featured on my site by state, business owners who must relocate due to eminent domain can choose to receive benefits from the government agency one of two ways.

1) Lump Sum Payment – up to $20,000 based on income

2) Actual Cost Relocation – based on actual eligible costs, some of which are capped.

Lump Sum Payment

Business owners can receive a lump sum or a fixed payment of up to $20,000 and call it a day.  The business owner will move themselves and no other claims can be submitted to the agency for reimbursement.

So if it costs the business owner $300,000 to relocate machinery, office equipment, parts, furniture for example, along with setting up of computers, telephones, heating and air conditioning, the business owner will pay-out-of-pocket for anything over and above the $20,000 amount.

In this example this amount would be $280,000.

In a cash-strapped economy, any out-of-pocket expenses could make or break a business.

Actual Cost Relocation

The following expenses can be reimbursed to the business owner based on the individual and actual costs of the move.

Moving (no maximum amount with one exception):

1. Transportation of Personal Property

2. Packing, crating, unpacking, uncrating of Personal Property

3. Disconnecting, dismantling, removing, reassembling, and reinstalling equipment, machinery, and other personal property

4. Storage of personal property up to 12 months

5. Insurance for the replacement value of personal property during the move and necessary storage

6. Any license, permit, or certification required at the replacement site, which the business had at the displacement location

7. Replacement value of property lost, stolen, or damaged during the move

8. Professional services for planning, moving, and reinstalling the personal property

9. Re-lettering signs and replacing printed materials made obsolete by the move

  • Stationery
  • Notification of the move

10. Actual direct loss of tangible personal property

11. Reasonable cost incurred trying to sell and item that is not to be relocated

12. Purchase of substitute personal property.

13. Searching for a replacement location (Maximum $2,500)

14. Costs to secure professional move bids

15. Low Value/High Bulk

16. Disposal of personal property and hazardous materials

If a business owner does not opt for the lump sum payment and chooses to be reimbursed via actual costs, there are a few expenses which are capped. My next blog will explain and list these items.

If your company has to move due to eminent domain, which option would you choose? Contact Martyn Daniel, Eminent Domain and Business Relocation Consultant to help you answer that question.