Eminent domain changes proposed

Additional regulations for the use of eminent domain were considered Feb. 2 by the Judiciary Committee.

LB1366, introduced by Omaha Sen. John Cavanaugh, would require that an appraisal be shared with property owners during eminent domain negotiations. The appraisal would serve as evidence of good faith negotiations and could be presented when a petition is filed if negotiations are unsuccessful.

The bill defines a good faith negotiation as the making of a reasonable offer of at least fair market value and making a reasonable attempt to convince the owner to accept it.

The proposal also would prevent a political subdivision from using eminent domain to acquire property outside of its boundaries, unless the governing body of the county, city or village where the property is located approves by a majority vote.

Cavanaugh said he conducted an interim study last year to determine ways to provide more transparency and accountability for eminent domain use.

“While I recognize that sometimes eminent domain is a public necessity, I believe that it should be limited in scope and every effort should be made to protect property owners,” Cavanaugh said.

LB1366 also would prohibit private entities from using eminent domain for pipelines without approval from the Nebraska Public Service Commission or the governing body of the county, city or village where the property is located. The bill would provide property owners the right to reclaim their title or interest for the amount of the condemnation award if their property is no longer needed for public use.

Shannon Graves of York County testified in support of the bill. As someone whose property was located in the original Keystone XL Pipeline route, Graves said she has assisted property owners approached about the proposed Summit Carbon Solutions pipeline.

She said the pipeline company looks into financial records and bases easement offers on that information. A resident in Polk County was told by a company representative that they could sign the offered easement or “spend the rest of their life in eminent domain court,” Graves said.

“That is not negotiating in good faith,” she said.

Also testifying in support of LB1366 was Korby Gilbertson, representing the Nebraska Realtors Association. The association has long been protective of property rights, she said, and supports ensuring that property is sold for what it is worth.

Opposing the bill was John McClue, speaking on behalf of the Nebraska Public Power District and Nebraska Power Association. Out of eight NPPD transmission projects undertaken between 2009 and 2019, five were completed through 100% volunteer easements, he said, meaning the use of eminent domain was unnecessary.

McClure said allowing local political subdivisions to approve or deny the use of eminent domain could give a county board, for example, the power to impede a project that could benefit up to a million people.

“We don’t think that’s sound public policy,” he said.

Lash Chaffin, representing the League of Nebraska Municipalities and the Metropolitan Utilities District, also testified against the measure.

Chaffin said city-owned properties like wastewater treatment centers, electric distribution systems and natural gas facilities often are located outside of city limits. Under the bill, county boards, which typically are not involved in municipal project planning, would have the ability to hinder these projects, he said.

The committee took no immediate action on LB1366.