Tag Archives: Eminent Domain

Indiana Eminent Domain Relocation Benefits & Compensation


Eminent Domain – Indiana

Indiana Includes Relocation Benefits in Its Eminent Domain and Condemnation Laws

In Indiana, relocation benefits in eminent domain follow the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended.  This is also known as the Uniform Relocation Act, the Uniform Act, or more simply the URA.  These regulations are followed when the State or any other public agency uses eminent domain to purchase new right-of-way for a public project and for the relocation of those occupying the property.  These regulations must be followed when state or federal funds are included in the project. Reference: Indiana Code Title 32 Article 24 (IC 32-24).

About The Federal Uniform Relocation Assistance and Real Property Acquisition Policies Act (URA)

The URA describes the types of costs that are eligible for reimbursement, known as relocation benefits, which are available to those being displaced while relocating from real property being purchased or those otherwise impacted by the new right-of-way for the public project. The URA is required to be followed on projects that include federal funding.  It’s listed relocation benefits are minimum requirements where a state or local agency can enhance the level of benefits, but not reduce them.  Non-federally funded projects may not be required to follow the URA, but many states, as Indiana, choose these guidelines or some version of them for their state and local agencies to follow, while others do not. 

You can find the URA described in full within the United States Code (Title 42 USC Chapter 61) and the Code of Federal Regulations (Tile 49 CFR Part 24). However, reading through the URA regulations can be a bit daunting, so I’ve prepared a brief summary of the URA business relocation benefits to help you. The summary is attached below. Please understand that my summary of listed benefits is abbreviated for your convenience as a quick reference. Many of the relocation benefits have requirements, and/or conditions for the business to qualify or be eligible for the benefit.

Relocation Assistance Advisory Services

The displacing public agency will provide what is called Relocation Assistance Advisory Services to each displaced person. Many property owners and business owners choose to self-plan and perform their relocation using the recommendations provided by the condemning public agency’s designated acquisition agent and relocation agent.  This may be a desirable approach for you if you are not too concerned with the amount of money you will receive for your property acquisition or for your business relocation.  Also, if your property or business is uncomplicated, at times, simple issues only need simple solutions. This method is focused more on simplicity and works well for small businesses such as an insurance or real estate office having only a few employees. If your business is more complex, you may need a more in-depth analysis of your relocation needs and reimbursable relocation benefits. For a more complex business relocation, you may consider assistance from an eminent domain relocation consultant.

Eminent Domain and Relocation Consultant

Business Relocation:

An eminent domain relocation consultant, referred to as a move planner within the URA,  can help you gain an understanding of the relocation issues and how to begin with putting your best foot forward when facing an eminent domain relocation and communicating with the condemning public agency.  Once engaged, the consultant’s fees are generally covered by the relocation benefits within the Uniform Act. The consultant should be skilled with: educating you on how relocation benefits within the URA will help you, and where they will not; they should quickly grasp your business situation and its operations; and be fully versed on construction related activities necessary for relocating your business.  These and other skills are necessary so that the consultant can fully inform you, and help you with your critical decision making on your relocation matters, while allowing you to focus more on your business operations.

To find such a consultant, I suggest an internet search of: Eminent Domain Relocation Benefits, Indiana. However, your search will show several eminent domain attorneys listed who talk about relocation benefits. When an attorney is part of the relocation team, their work is usually at a higher legal level and is hopefully based on the relocation consultant’s work. Usually the two will work together on your situation. If your internet search is not successful for you, feel free to call me to discuss your business relocation.

Eminent Domain and Real Property Acquisition:

Eminent Domain Attorney:

If you are a property owner facing eminent domain and potential condemnation, I encourage you to talk with an attorney who regularly practices in eminent domain in your state.  You can find such an attorney by searching the internet for: Eminent Domain Attorney, Indiana.  If that’s not a successful search for you, feel free to call me for some suggestions on who to contact. We regularly work with eminent domain attorneys around the country.

How to Begin Planning Your Business Relocation in Eminent Domain

Eminent domain and business relocations can be rewarding to the business owner by bringing new opportunities to the business with the use of relocation benefits or compensation provided by the public project and its displacing public agency. Unfortunately, too many businesses not only miss key and multiple opportunities, but some even fail to survive, as reported in a federal study in 2005. In my experience, the failures occur because the relocation process and relocation regulations must be understood and closely followed by the business and condemning public agency for the business to receive proper reimbursements of relocation expenses, and those regulations are frequently improperly followed.  Several factors will influence the level of success a business experiences with relocating while following the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA), these include:

Factors Affecting the Level of Success for Business Relocations in Eminent Domain

Several key factors will influence the level of success a business experiences with relocating while following the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA) and the State Relocation Regulations. A few of those include:

  • The particular circumstances of the real property being condemned
  • The circumstances of the business type being displaced
  • The condemning public agency’s approach to relocation
  • The ability to soften or overcome those factors listed above
  • The business owner’s approach to relocating their business.

For this discussion, I’ll focus on the business’s most controllable part of the process, the business owner and their approach to relocating while following the URA or state regulations.

Best Practices for Eminent Domain Business Relocation Planning

For the best relocation outcome, the business owner will want to use the proper approach to the relocation process.  There is a cause and effect science to the relocation process, which we want to control to create the best results. It starts with the business owner’s approach to the relocation. Below is a list of best practices that I recommend while advising business owners through their relocations in eminent domain.

  1. Work with the displacing public agency as much as reasonably possible.  Take advantage of the services they offer you.
  2. Educate yourself on your relocation benefits (see my Indiana Eminent Domain Relocation Compensation Regulations cheat sheet below), determine how best to use them for your situation, know how to qualify for them, and how to not lose them.
  3. Avoid these common mistakes listed below and my Top-10 business relocation mistakes when relocating within eminent domain:
    1. Denying that your business can be relocated.
    2. Denying that a certain item or items you own cannot be relocated.
    3. Not gaining ownership or control of fixtures used in your business
    4. Complaining about the public agency, project, or circumstances that interfere with properly planning your business relocation for its best outcome.
    5. Assuming that you can relocate using normal business best practices and expect to receive proper relocation reimbursements.  You must follow the details of the Uniform Act, no matter how seemingly nonsensical they appear.
  4. Start planning early, start before the displacing public agency starts for you (read more on preplanning your eminent domain relocation). Continue your preplanning into relocation planning for developing an actual relocation plan report. You can use my 11-Step Business Relocation Planning as a guide for you. Start your planning with:
    1. Updating your lease to reflect any improvements you have made to the real property and your right to remove your improvements and trade fixtures.
    2. You will want a current inventory of equipment and other personal property that is owned or controlled by your business. If you are using landlord owned fixtures in your business, this is a good time to consider negotiating a purchase of those items to give you the right to remove them and the right to relocation compensation for those items.
  1. Begin searching for a replacement property as soon as you feel or know that your business will be displaced. However, don’t incur costs or move until you have received a Relocation Benefits Eligibility Letter from the displacing public agency.
  2. Dedicate the time necessary for you and/or key employees to organize, plan, and perform the relocation tasks necessary for the duration of the relocation process, while not sacrificing the necessary time for ongoing business operations.
  3. File relocation claims with the displacing public agency as you incur an obligation to the costs.  File claims early and often.
  4. Relocation claims should be well described and supported.  Don’t dump unorganized costs onto the public agency’s relocation agent and expect them to arrive at the best reimbursement for you. No shoe box relocation claim submittals.
  5. Request any public agency claim denials for relocation benefits to be in writing.  Verbal denials from the public agency’s relocation agent are a frequent cause of misinformation and misunderstanding of benefits causing an unnecessary loss of eligible relocation compensation.
  6. If your business is more complicated than a small insurance or real estate office, or, you feel that you are not being properly treated by the displacing public agency, consider talking with an eminent domain relocation consultant.

This summary of best practices will hopefully get you started on the right foot with your business relocation.  Business relocation planning within eminent domain is one of my favorite services I provide and my favorite topic for conversation.  Please feel free to call me to discuss your situation.

Questions and Answers on Eminent Domain and Business Relocations

If you have questions, feel free to contact me for answers while planning your relocation, which may include but not limited to:

  • What do you do next, starting from the point where you are in your relocation process?
  • How do you apply the best practices to your specific business relocation planning?
  • What are your eligible relocation benefits and compensation?
  • How and when do you become eligible for relocation benefits and compensation?
  • How do you prevent a loss of your relocation benefits and compensation?
  • How can you get out of a pickle in your current relocation situation?
  • What do I need to know about the Uniform Relocation Act, relocation advisory services, relocation assistance, and relocation planning?
  • When and why would I want an eminent domain relocation consultant for planning my move? Also, see FAQ of Martyn Daniel.

You can contact me at 425-398-5708 or . There’s no obligation for your contact, it will simply be a good productive conversation. Business owners and their representatives, attorneys, appraisers, and public agency representatives are all welcome to call.

References:

Indiana Department of Transportation (INDOT)

Indiana Code IC 32-24

Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970

United States Code Title 42 USC Chapter 61

Code of Federal Regulations Title 49 CFR Part 24

Indiana Projects

Below is a partial list and links to projects where the Indiana State Department of Transportation (INDOT) will likely be purchasing private property for a project’s new right-of-way under eminent domain and making business relocation payments for business displacements caused by the projects while following the federal Uniform Relocation and Acquisition Act (URA).

I-69 section 6 Project

Mid-States Corridor

If you are aware of other projects or familiar with current events on the above projects, please let us know. We would be pleased to update and share information.

Indiana Eminent Domain Relocation Benefits and Compensation Regulations, Abbreviated

State of Indiana
Indiana Eminent Domain Relocation Compensation Regulations, Abbreviated

ALI-CLE Eminent Domain & Land Valuation Litigation Conference, Palm Springs, CA 2019

You know, every chance that I get, I love to spread the word about the potential benefits for a business going through a complicated relocation. Many folks think that a business relocation is a road to potential ruin and failure, but I’m here to tell you that it doesn’t have to be that way. I’m excited to announce that I will be speaking about my absolute favorite topic of Complicated Relocation Issues, and another topic about Navigating Cultural Conflicts in Mass Relocations.

This will be at the ALI-CLE Eminent Domain and Land Valuation Litigation conference Thursday-Saturday, January 24-26, 2019, in Palm Springs, California.

You may or may not be aware that businesses relocating for public projects receive relocation benefits, which are described in the Federal Uniform Relocation and Acquisition Act (URA). But even with those benefits, many businesses can suffer from huge financial losses, or possibly even failure.

An older Federal Highway Administration study found that business failure rates on multiple projects sampled were between 8% and 25%. Another project showed that 60% of businesses failed. And in another, failure rates were as high as 80%. That’s right, 80% of the relocated businesses failed!

It does not have to be this way. I believe that business failures should be few and far between on these projects. In my experience with over several hundred business relocations, I’ve found that a 99% survival rate can be achieved, with a majority of relocated businesses actually improving their situations and benefiting from the move.

This starts with the proper planning of the relocation and finding all of the opportunities for the business that could come from this move. Usually, those opportunities aren’t immediately recognized by a business and you will need a trained and experienced eye, along with key planning, to find them.

I’ve developed a system that focuses on 11 key steps necessary for properly planning a business relocation. These steps provide what’s necessary to meet the requirements described by the uniform act for the business to receive proper relocation cost reimbursements.

Whether I am working for a business or a public agency, I always follow this system to achieve the best possible results for everyone involved in the project.

If you are an eminent domain attorney, an appraiser, right-of-way professional, or even a displaced business, I invite you to come to the conference. There, I will explain my 11-step system to you in more detail so you can be a part of a needed solution to the business relocation failures.

I hope you will join me in Palm Springs. I look forward to seeing you there!

Is Your Business Facing Relocation Due to Eminent Domain? Avoid Downtime By…

When a business must move because of a public project displacing it using eminent domain, often there is insufficient time allowed to properly plan, prepare, and perform the move. Typically, a business would never choose or plan to move under the conditions that are dictated by these public projects.

Business downtime can be an unfortunate result of relocating under those conditions. Downtime for many businesses such as those shown in the above photos data centers, metal recycle and metal shredding, dentist, and ready-mix concrete plant, along with other many other business, can cause the displaced business to default on delivery contracts, encounter losses in sales, loss of employees, loss of customers, and allow competitors to encroach on its market share.

There is a solution found within the Uniform Relocation Act (URA). The URA provides the regulations that will likely be followed by the condemning public agency for displacing the business. The URA has a method of claiming relocation cost reimbursements described in a category called Substitution of Personal Property. This category includes some amount of reimbursement for the business to install new, or substituted, equipment at the replacement property. This can result in the continuation of operations at the displacement site while installing modern equipment at the replacement site, thereby eliminating downtime while also improving future operations. The amount of reimbursement will be equal to or less than the estimated cost to move and install the existing equipment.

This category has specific rules which must be followed in order to qualify for the cost reimbursement. Some of the rules may seem non-applicable or even nonsensical. Don’t fall into the trap, as some have, of thinking you can skip any of the rules and still qualify by simply following prudent business practices while relocating your business. It won’t work and you will risk losing the entire reimbursement. I recently saw a substitution claim missing some of the required components causing an agency to deny several million dollars of what could have otherwise been eligible substitution reimbursements.

Substitution is often an integral tool to a successful business relocation. My work, when planning business relocations always considers substitution, nearly always uses it to some extent, and sometimes for most or all of the equipment.

Relocating Due to Eminent Domain? Avoid Business Downtime Using Benefits Within the Uniform Relocation Act (URA)

 

Ready-mix Concrete Plant

When a business must move because of a public project displacing it using eminent domain, often there is insufficient time allowed to properly plan, prepare, and perform the move.  Typically, a business would never choose or plan to move under the conditions dictated by these public projects.

Business downtime can be an unfortunate result of relocating under those conditions. Downtime for many businesses such as a ready-mix concrete plant (shown in the above photo), manufacturing, and many others, can cause the displaced business to default on delivery contracts, encounter losses in sales, loss of employees, and allow competitors to encroach on its market share.

There is a solution found within the Federal Uniform Relocation and Acquisition Act (URA). The URA has a method of claiming relocation cost reimbursements described in a category called Substitution of Personal Property. This category includes some amount of reimbursement for the business to install new, or substituted, equipment at the replacement property. This can result in the continuation of operations at the displacement site while installing modern equipment at the replacement site, thereby eliminating downtime while also improving future operations. The amount of reimbursement will be equal to or less than the estimated cost to move and install the existing equipment.

This category has specific rules which must be followed in order to qualify to receive the cost reimbursement. Some of the rules may seem non-applicable or even nonsensical. Don’t fall into the trap, as some have, of thinking you can skip a specified rule and still qualify by simply following prudent business practices while relocating your business. It won’t work and you will risk losing the entire reimbursement. I recently saw a substitution claim missing some of the required components causing an agency to deny several million dollars of what would have otherwise been eligible substitution reimbursements (unrelated to the above photo).

Substitution is an integral tool in my business relocation planning work. I almost always analyze its use and nearly always use it to some extent.

The best practices when using the substitution method of reimbursement will be discussed another time.

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.)

Join Me for Easements and Rights of Way in Montana

easements-and-right-of-wayWhen easements and rights of way are condemned causing an occupant to move or modify the use of personal property, state and federal procedures apply. Learn more about who is eligible for relocation benefits and the top 5 categories of relocation benefits within state regulations and Federal Uniform Act. Find out what you can do as an eminent domain attorney, appraiser, or right-of-way professional that will improve the results of your work.

Please join me The Seminar Group’s upcoming seminar on Easements and Right of Way, Friday, November 18, 2016,  Missoula, MT.  You can register here.

What an Accomplished Eminent Domain Attorney Can’t Live Without

Why can’t one very accomplished eminent domain attorney from Portland live without business relocation services?

When I first encounter an established attorney and I explain my services to them, they naturally feel resistant to the thought of adding new elements to their already successful practice. I was reminded of this common reluctance a few weeks ago when Jill Gelineau, a highly recognized eminent domain attorney with Schwabe, Williamson and Wyatt in Portland, introduced me at the Eminent Domain CLE.

Jill described how when she first met me, she had been successfully practicing eminent domain law for more than 22 years and was sceptical of the need for my services. She went on to say that now, after working with me for 7-8 years, I’ve become indispensable to her cases and she doesn’t know how she ever practiced without me.

A Common Theme
If you’re like many attorneys, you may feel that you have a good understanding of the Uniform Act and its relocation guidelines, and the displacing public agency is likely being very cooperative at this time, in the early stages of the process. As such, you may not see the need for my services. This has been a common theme among many eminent domain attorneys—who are now steady clients.

Your knowledge of the URA and the relocation guidelines is certainly necessary. My work is not meant to replace your knowledge, but instead to enhance it with firsthand experience foreseeing relocation costs that will be incurred, fitting the costs into the URA’s reimbursable categories, and anticipating possible denials of claims to pre-empt denials and gain their approval for reimbursement. These are some aspects of the expertise that I bring to the table.

What an Accomplished Eminent Domain Attorney Can’t Live WithoutConnecting the Dots
Here are several ways that my eminent domain business relocation services can help your practice.

My intimate knowledge of the Uniform Act (URA) and its relocation guidelines are an important part of the relocation process. My role is to connect the dots between all of the relocation issues and the Uniform Act requirements. My work can enhance your knowledge with firsthand experience in using the URA and its processes as a tool for relocation planning.

Planning a relocation before costs are incurred, foreseeing and estimating relocation costs that will be incurred, and estimating their eligibility and non-eligibility for reimbursement based on the URA, are some of the ingredients to a successful relocation. This work is paramount for the owner’s decision making and to develop a relocation plan, which often helps to improve operations at a new location.

Many of my fees for business relocation work are eligible reimbursable costs to the business, unlike attorney fees.

Improved Results
Having worked with attorney Jill Gelineau at Schwabe, Williamson and Wyatt now for 7-8 years and so many other attorneys across the country, I can tell you that while your practice may certainly be successful right now, there is always room for continuous improvement.

As a Business Relocation Consultant I can work alongside your efforts as part of your eminent domain team and enable you to offer unique services that will set you apart from the competition. The partnership can bolster your firm’s equity and potential clients will take notice of the added value. Most practitioners do not provide these services, but the benefits to your clients are extensive. My services allow you to form a more complete package to your clients than any other attorney.

Eminent Domain: When Tenants and Landlords Should Work Together

Eminent Domain When Tenants and Landlords Should Work TogetherThe 202 Loop South Mountain Freeway project in Phoenix, Arizona, provides a poignant example of how Business Relocation Planning Services can help to improve the situation for both landlords and tenants who are being displaced by eminent domain.

The Loop 202 freeway, also known as the South Mountain Freeway, is part of a new freeway system being constructed in Phoenix. Businesses being displaced by the project include industries with very specific relocation demands such as cold storage, truck repair, truck services, manufacturing, and warehousing. I recently drove the North end of 59th and saw that the effected businesses were still in place.  This presented a good opportunity for pre-planning services for their eventual relocation. My article, 6 Benefits of Preplanning your Eminent Domain Relocation, will offer some insights into these services and the value that they bring to an eminent domain team.  The article explains that by the time a business has been made eligible for relocation benefits, it’s often times more difficult to prevail in non-standard or complex relocation situations.

I soon learned that the owners of many of the properties in question lease their buildings and properties to unrelated third party tenants. As a result, the owners were not encouraging their tenants to move. Naturally, the landlords want their tenants to remain for as long as possible. This is a common situation and follows the standard practice of dealing with landlord/tenant situations.  However, there are some alternatives to the standard practice that can be of substantial benefit to both parties.

When landlords and tenants work together, there are many advantages for both parties. I have extensive experience working with both sides of the fence—with both the displaced businesses and also with the displacing public agencies—and many times cooperation between the landlord and the tenant can benefit both parties.  This is often related to the method of treatment of fixtures and working with the displacing public agency.

I have encountered situations where, following the standard practice, each party made separate plans with no attempt to explore strategic cooperation. This can make a difference of millions of dollars. In one instance, this led to lost rent for the landlord and loss of tenant relocation benefits of more than $2.5 million dollars. Strategic planning and cooperation between the two parties could have brought additional rental income to the landlord and maintained the tenant’s eligibility for the $2.5 million in relocation benefits.

Tenants are typically obligated to pay their rent through the end of the lease term or until the time of the actual property taking, whichever occurs first.  Long-term and month-to-month tenants will lose their relocation benefits if they move prior to the agency’s real property purchase offer to the property owner, which encourages the tenants to stay at least until that time.

The landlords will have less leverage to hold on to month-to-month tenants after the State has made its offer. It’s far more strategic for the landlord and tenant to have a plan in place before the time of the offer.

I’ve had excellent results obtaining improved relocation benefits or cost-to-cure payments for landlords and tenants who work together. I specialize in conducting preliminary relocation planning services for businesses that will be displaced by a public project.  Utilizing our preplanning services for business relocation while following relocation guidelines based on the Uniform Act nearly always improves the outcome of the relocation.

Attorneys may wonder how this scenario applies to them and to their clients. Attorneys who have extended these services to their owner or tenant clients have found that they are able to recover more funds for the real property acquisition and relocation of their clients.  They have also been able to improve client acquisitions and client satisfaction.

photo credit: Jeroen van Oostrom via FreeDigitalPhotos.net

 

Make Way for the California Bullet Train: Relocation Preplanning

Make Way for the California Bullet Train Relocation PreplanningHave you heard about the new California Bullet Train? The California High-Speed Rail Authority is acquiring thousands of acres of land in the Central Valley of California to make way for the new train.

Its an area with high unemployment rates and for some owners, the financial opportunity to settle and move on is a welcome one. But for many others, its a challenging time and an emotional process. Some of the local Fresno business owners are finding the initial offers to be extremely low and nowhere near the replacement value.

Relocation preplanning is of the utmost importance in this situation. The businesses being displaced by the train will become eligible to incur and receive reimbursements for relocation costs, but only after the public agency has completed their analysis. At that time, they determine each business eligibility for relocation benefits.

Theres a big problem with this; its not until the public agency has completed their analysis that they actually explain the relocation benefits to the business owners. As a result, most businesses dont begin planning their relocation until the analysis is complete. By that time, the businesses are usually either obliged to plan their relocation around what the public agency has already determined, or they have to appeal those decisions.

From the point of view of a well-trained eye, it appears that the people in the path of the high-speed rail are in a perfect position to preplan their relocation. It seems that only a few property owners have been contacted by the public agency so far, but that the rail path is well defined.

The law in California allows owners to charge the state up to $5,000 for their own property appraisal after receiving the state’s initial offer. If the business owners wait for the states offer, it becomes too late to pre-plan the relocation. Waiting uses up unnecessary time and resources and the results of waiting are uncertain. When you wait, the only remaining option is to attempt to undo what would likely have been prevented with preplanning.

Preplanning creates an increased amount of time for evaluating and making critical decisions. It gives business owners a chance to properly evaluate potential replacement properties, and understand how relocation benefits will and will not assist with making a potential replacement property functional for the business.

During an eminent domain process like the California bullet train, there can be a lot of misleading information or assumptions made about what the relocation benefits will and will not provide. With the right preplanning, you can avoid the misinformation that usually causes the process to derail and veer off in a direction that can be costly to your business. It will help you ensure that your decisions will be made based on the actual facts of the relocation benefits. Preplanning grants more time and knowledge of the process, which opens up more business relocation options.

Proper preplanning sets the stage for your actual relocation, saving you out of pocket expenses because of a rushed move, lack of choices, and excessive key employee time spent on the relocation. Its the best way to formulate a plan and make use of relocation benefits to minimize business downtime.

Most importantly, preplanning gives a business the opportunity to guide the public agencys decision-making process as they determine the eligible relocation benefits. Preplanning a business relocation refers to planning before the business has received their notice of eligibility for relocation benefits and before the public agencys offer has been made on the real property.

For businesses and individuals located in the path of the train line who have not yet been contacted, the preplanning window is open and now is the time to act. This is a fleeting opportunity for businesses. Preplanning empowers business owners with informed knowledge that will enable them to take positive action. The difference between taking advantage of the preplanning stage and missing that opportunity can be the difference between real business savings of both money and efficiency vs. expensive business hardship and stress.

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Eminent Domain and the Bryn Mawr Breakfast Club

Eminent Domain and the Bryn Mawr Breakfast ClubThe people of Chicago have been wondering what’s going to happen to the Bryn Mawr Breakfast Club restaurant?

Bryn Mawr is the historic district in Chicago, Illinois that’s on the lakefront of the Edgewater neighborhood far north of the city. Northeastern Illinois University has acquired land along Bryn Mawr Avenue that includes the building that houses the Bryn Mawr Breakfast Club. The land was acquired by eminent domain.

Apparently the owner was aware that NEIU had an interest in the land but the idea seemed far off and he signed a lease anyways. The restaurant quickly became very popular with locals. Then, in August 2014, NEIU began the eminent domain proceedings with the intention to build student housing.

Many problems occur in cases of eminent domain because relocation benefits are not always offered. That appears to be the case for the Bryn Mawr Breakfast Club. Kitchen equipment, furniture, and decorations can be moved, but any upgrades that the owners made to the property may be a lost investment.

Ideally, the owners would be able to find a new location that was previously housed by a restaurant with an existing commercial kitchen. However, if such a replacement property is unavailable, a new kitchen installation could cost $30-$40k.

If federal funds were used in this project, or if state law required relocation benefits to be offered when using eminent domain, NEIU would be required to follow the federal Uniform Relocation and Acquisition Policy Act (URA). The URA provides regulations that offer a fair and equitable treatment of persons displaced. It includes regulations that allow certain relocation costs to be reimbursed to the tenant. Unfortunately, under many projects, as with NEIU’s project, relocation costs go unpaid and the business tenants end up baring a disproportionate amount of the burden of a project that benefits the public.

In the absence of providing required relocation benefits, such as with the URA, and to reduce the burden placed on business tenants, a relocation package should be negotiated where the business occupant will be entitled to relocation benefits for moving personal property and reconfiguring their operations because of the property taking. It’s valuable to have qualified people analyze the issues and facts, and prepare the necessary reports and documentation.

Professionals should be brought in who understand the facts so that they can perform a proper analysis and sort items into the proper categories in hopes that the business can prevail in an acquisition or relocation dispute.

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