Local attorney suggests landowners just say ‘no’ to easement offers
Credit: By DOUG McDONOUGH, Herald Managing Editor, Plainview Daily Herald, www.myplainview.com 20 March 2011 ~~
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At least one local attorney says landowners could benefit by just saying “no” to companies seeking easements for transmission lines designed to carry wind-generated electricity from this region to other parts of the state.
Others involved in the industry caution about taking such dramatic action.
And to help landowners understand the entire process, a meeting has been scheduled at 6 p.m. Monday at the Floyd County Friends Unity Center at Muncy.
Sponsored jointly by the Hale County Farm Bureau and Floyd County Farm Bureau, the session will focus on “The Condemnation Process.”
Judon Fambrough, senior lecturer and an attorney with the Texas Real Estate Center at Texas A&M, will specifically address the issue of what landowners should do when facing condemnation for utility lines and other reasons.
At the heart of the mater is the development of wind farms in the region, and the construction of related infrastructure to transmit the electrical power to other regions.
According to Plainview attorney Brent Hamilton, who circulated a letter to media outlets earlier this month, by the fourth quarter of 2013 approximately 2,400 miles of mega-size transmission lines will be constructed within the state. A majority of the lines will impact the Texas Panhandle and Rolling Plains.
Sharyland Utilities is one of the key players in the construction of those transmission lines.
On Feb. 10, the Texas Public Utilities Commission issued a signed order approving Sharyland Utilities’ preferred route for the Silverton-to-Cottonwood (Dickens County) Competitive Renewable Energy Zone. That calls for a new 345-kilovolt electric transmission line between two new electric power collection stations. One is to be built by Sharyland southwest of Silverton and the other will be constructed by another firm in Dickens County.
That approved route runs through southwest Motley County; southeast and central Floyd County, east of both Floydada and Lockney; and into Briscoe County.
According to information posted on the Texas PUC Web site, the agency issued the CCN final order for the Silverton-to-Telsa (Childress County) route on Jan. 19. The CCN final orders for the Silverton-to-Nazareth and Nazareth-to-Hereford routes are both due April 18, and the CCN final order for the White Deer-to-Silverton route is due May 9.
Sharyland also is scheduled to construct the Hereford-to-White Deer transmission line, which is outside the Herald’s readership area.
In all, Sharyland’s portion of the CREZ Project includes four collection stations and five transmission line segments, covering approximately 250-300 miles through between nine and 13 counties in the Texas Panhandle-South Plains, depending upon which routes the PUC approves.
Sharyland, on its Web site, explained that once the CCN is issued, Sharyland Utilities can then begin the process of acquiring right-of-way and preparing for construction.
That means company representatives will be contacting landowners along the preferred routes in an effort to secure easements for the transmission lines.
In published materials, Sharyland says it “plans to obtain a nominal width of 175 feet for right-of-way. However, some locations may require more or less width due to physical terrain and the type of structures used.”
To compensate landowners for the easements, Sharyland pledges to pay fair market value. “The fair market value will be determined by conducting a market study or an appraisal for the easement to be obtained,” Sharyland said in a Feb. 10 document responding to frequently-asked questions. “A copy of the study of an appraisal report may be provided to the property owner at the time an offer is made to purchase the easement.”
Although it has the power of eminent domain in connection with these projects, “Sharyland Utilities will make every effort to work with landowners through the route selection process to avoid an eminent domain situation,” that document said.
Hamilton, in his letter, suggests landowners should consider eminent domain proceedings as a viable option for gaining higher compensation.
The attorney, who is representing various landowners in the process, wrote, “While most citizens of our region do not oppose the concept of generating electricity to deliver to the major metropolitan areas, all agree that landowners who contribute to the process should be fairly compensated. These landowners will receive a one-time payment intended to compensate them for their property being burdened with this mega-size electric transmission line in perpetuity. Texas condemnation laws require that landowners be compensated for the fair market value of the transmission line easement.”
Hamilton expressed concerns that “landowners who feel forced to accept the transmission companies’ offers are not being adequately compensated.” He said these concerns are well founded, based on what has happened in Runnels County.
He wrote, “These landowners are further along in the process, and the landowners electing to reject the transmission companies’ offers, opting instead for condemnation proceedings, are obtaining compensation awards from 8 to 15 times those amounts being offered.”
The reasons behind those differences, Hamilton said, are “First, there is a significant difference of opinion about value. Second, transmission companies are unwilling to recognize that having this large transmission line on a portion of an owner’s property will have a significant effect on the value of the owner’s adjacent property.”
He said in Runnels County, offers from transmission companies were $3.75 to $4 per linear foot, while landowners who rejected these offers have been awarded $28 to $35 per linear foot through the condemnation proceedings.
“While each property is unique,” he said, “the awards generally indicate that the market value of these types of easements should exceed $150,000 per mile rather than the $18,000 per mile offered by the transmission companies.”
Curtis King and Bob Brunson, two local representatives with Tri-Global Energy which is developing wind farms that will be served by the CREZ transmission project, said landowners shouldn’t automatically reject the overtures and offers from Sharyland and other firms.
Brunson adds that most of the utilities seek to avoid the condemnation process whenever possible because “it results in negative public opinion and poor relations with landowners.
“The utilities are charged with paying the landowners fair market price for the easement crossing the landowners’ property,” Brunson said. “This began with a quite lengthy process of public meetings to get feed back from landowners, then on to hearings at the PUC.
“The price paid will be determined on an individual basis and based on the impact to each landowners’ property,” he said. “Landowners who do not feel that they are being offered a fair price for their easement should seek the advise of legal council. If a case can be made to prove fair market value, the utilities should work with the landowners to reach a settlement.
“Condemnation is not a good option for the utilities or the landowner, it will only result in extremely high legal fees for both parties,” Brunson said. “In the end, the landowner will only receive from the court what they can prove to be fair market value.”
While Brunson is not directly involved in Sharyland’s right-of-way procurements in this area, he speaks highly of Sharyland and its fair dealings with landowners. He also noted that while the PUC has approved the transmission line routes, “until the poles have been set, the actual route can still move several hundred feet to adjust for obstructions and so forth.”
Crosbyton attorney and former State Rep. Joe Heflin, who is representing various landowners in the easement negotiations, encouraged anyone presented with a wind energy or right-of-way easement contract to seek legal council, “because it’s something that will not only effect the rest of your live, but it will effect your children and grandchildren’s lives. In another words, this is a really long-term contract.”
With their legal training, Heflin said, lawyers should be able to review to contracts to determine their exact terms.
Another important thing to consider is who you are dealing with. “Sharyland has been in operation for a long time and is very reputable,” Heflin said. “They are one of the better companies to deal with and will work with you as much as possible.”
When negotiating easements, landowners should consider more factors than just reimbursement, he said. The actual placement of the transmission lines can impact irrigation systems, cropping and land usage patterns and the market value of the rest of the property. “Be very cautious, and don’t let anyone tell you that you have to sign a contract in so many days. Don’t give up any of those rights for a minute without first getting legal representation in place. But remember, if it goes into litigation, you may or may not come out the winner.”
Heflin, as a case in point, told of one client involved in a right-of-way negotiation that had generally worked out an agreement but at the last minute decided to hold out for just a little more. That last bite of the apple proved costly indeed when the company opted to go across the road and successfully acquired the needed easement from the landowner’s neighbor.
Since the transmission line companies will be long-term neighbors or partners with the landowners, most will resort to condemnation suits only as a last resort. “They don’t want to leave a sour taste in people’s mouth,” Heflin said.
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