New Eminent Domain Rules take effect in Texas

Since Justice Stevens told the states in Kelo v. City of New London (2005) that they were free to provide additional eminent domain restrictions through state law, policy groups and lawmakers in Texas have been trying to take him up. There were a few small measures to come through the past three (biennial) legislative sessions, but nothing too meaty. Governor Rick Perry even vetoed an eminent domain reform bill in 2007. But this spring after an "emergency" session, Gov. Perry signed Senate Bill 18--"An act relating to the use of eminent domain authority." And today, eminent domain reform became law in Texas.

September 1, 2001 is the day that dozens of laws passed in the spring 2011 legislative session take effect. The eminent domain reform--which is now codified in the Property Code, the Local Government Code, and various other statutes--basically makes it harder for entities to exercise eminent domain, and gives landowners more procedural protections:

• It requires that eminent domain can only be exercised for "public use," and replaces all statutory references (apparently there were many!) to "public purpose." "Public use" is still undefined, so while the legislature's intent is to restrict economic development and other types of takings, this one will probably end up in the courts.
• It adds public hearing and notice requirements and voting mandates to any use of eminent domain authority; it also adds certain requirements for bona fide written offers to purchase.
• It requires all public or private entities who think they have eminent domain power to submit a letter to the state comptroller for review by the legislature.
• It gives landowners additional statutory rights to repurchase property not actually used for the "public use."

We'll have to see if this law has substantive effects on the use of eminent domain, but at minimum it seems to provide some procedural protections. Yesterday at my daughter's soccer practice--i.e., the last day before the new law took effect--one of the other parents told me that his firm filed hundreds of lawsuits that day, related to ongoing projects. So at least there will be a lot of work for the lawyers!

Matt Festa