Bill Text: TX SB421 | 2019-2020 | 86th Legislature | Comm Sub
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to the acquisition of real property by an entity with eminent domain authority.
Spectrum: Strong Partisan Bill (Republican 41-4)
Status: (Engrossed - Dead) 2019-05-24 - House appoints conferees w/inst-reported [SB421 Detail]
Download: Texas-2019-SB421-Comm_Sub.html
Bill Title: Relating to the acquisition of real property by an entity with eminent domain authority.
Spectrum: Strong Partisan Bill (Republican 41-4)
Status: (Engrossed - Dead) 2019-05-24 - House appoints conferees w/inst-reported [SB421 Detail]
Download: Texas-2019-SB421-Comm_Sub.html
By: Kolkhorst, Perry | S.B. No. 421 | |
(In the Senate - Filed January 23, 2019; February 14, 2019, | ||
read first time and referred to Committee on State Affairs; | ||
March 14, 2019, reported adversely, with favorable Committee | ||
Substitute by the following vote: Yeas 9, Nays 0; March 14, 2019, | ||
sent to printer.) | ||
COMMITTEE SUBSTITUTE FOR S.B. No. 421 | By: Nelson |
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relating to the acquisition of real property by an entity with | ||
eminent domain authority. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 21.0113, Property Code, is amended by | ||
amending Subsection (b) and adding Subsections (c), (d), and (e) to | ||
read as follows: | ||
(b) An entity with eminent domain authority has made a bona | ||
fide offer if: | ||
(1) an initial offer is made in writing to a property | ||
owner that includes: | ||
(A) an offer of compensation in an amount equal | ||
to or greater than 145 percent of the market value of the property | ||
sought to be acquired and damages, if any, to any of the property | ||
owner's remaining property, based on: | ||
(i) an appraisal report on the property by a | ||
certified appraiser; or | ||
(ii) a market study of the property | ||
conducted by a certified appraiser; and | ||
(B) the complete written appraisal report or | ||
market study that forms the basis for the amount of the offer of | ||
compensation under Paragraph (A); | ||
(2) a final offer is made in writing to the property | ||
owner that includes an offer of compensation in an amount equal to | ||
or greater than the amount of the offer of compensation included in | ||
the initial offer; | ||
(3) the final offer is made on or after the 30th day | ||
after the date on which the entity makes a written initial offer to | ||
the property owner; | ||
(4) before making a final offer, the entity obtains a | ||
written appraisal report from a certified appraiser selected or | ||
approved by the property owner of the value of the property being | ||
acquired and the damages, if any, to any of the property owner's | ||
remaining property; | ||
(5) the final offer is equal to or greater than the | ||
amount of the written appraisal report [ |
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(6) the following items are included with the final | ||
offer or have been previously provided to the owner by the entity: | ||
(A) a copy of the written appraisal report; | ||
(B) a copy of the deed, easement, agreement, or | ||
other instrument conveying the property sought to be acquired; and | ||
(C) the landowner's bill of rights statement | ||
prescribed by Section 21.0112; and | ||
(7) the entity provides the property owner with at | ||
least 14 days to respond to the final offer and the property owner | ||
does not agree to the terms of the final offer within that period. | ||
(c) Notwithstanding Subsection (b), a private entity as | ||
defined by Section 21.031 has made a bona fide offer only if the | ||
entity: | ||
(1) satisfies the requirements of Subsection (b); and | ||
(2) includes in the initial offer: | ||
(A) notice of the terms described by Section | ||
21.0114(b) for which the property owner may negotiate to be | ||
included in a deed, easement, agreement, or other instrument of | ||
conveyance relating to the property; and | ||
(B) notice that the property owner will also | ||
receive a final offer accompanied by an appraisal. | ||
(d) Notwithstanding Subsections (b) and (c), a private | ||
entity subject to Subchapter B-1 has made a bona fide offer only if | ||
the entity: | ||
(1) satisfies the requirements of Subsections (b) and | ||
(c); | ||
(2) includes in the initial offer a copy of the notice | ||
of the property owner information meeting required by Section | ||
21.036; and | ||
(3) participates in the meeting in the manner | ||
prescribed by Section 21.038. | ||
(e) A court with jurisdiction of a condemnation proceeding | ||
involving property for which an entity is required to make a bona | ||
fide offer under this section may: | ||
(1) determine whether the entity has complied with the | ||
requirements of Subsection (b), including whether the entity or the | ||
entity's certified appraiser intentionally omitted damages to the | ||
property owner's remaining property; and | ||
(2) if the court determines that the entity has not | ||
complied with the requirements of Subsection (b): | ||
(A) abate a pending proceeding; and | ||
(B) make an award of such relief as the court | ||
considers appropriate. | ||
SECTION 2. Subchapter B, Chapter 21, Property Code, is | ||
amended by adding Sections 21.0114 and 21.0115 to read as follows: | ||
Sec. 21.0114. REQUIRED TERMS FOR INSTRUMENTS OF CONVEYANCE | ||
BY CERTAIN PRIVATE ENTITIES. (a) Except as provided by | ||
Subsections (c) and (d), a deed, easement, agreement, or other | ||
instrument of conveyance provided to a property owner by a private | ||
entity, as defined by Section 21.031, that has or asserts the power | ||
of eminent domain to acquire the property interest to be conveyed | ||
must include the following terms, as applicable: | ||
(1) if the instrument conveys a pipeline right-of-way | ||
easement: | ||
(A) the maximum number of pipelines that may be | ||
installed in the easement; | ||
(B) the maximum diameter, excluding any | ||
protective coating or wrapping, of each pipeline to be installed in | ||
the easement; | ||
(C) the type or category of substances permitted | ||
to be transported through each pipeline to be installed in the | ||
easement; | ||
(D) a general description of any aboveground | ||
equipment or facility the private entity intends to install, | ||
maintain, or operate on the surface of the easement; | ||
(E) the best available description of the | ||
location of the easement, which may include a metes and bounds or | ||
centerline description, a plat, or an aerial or other map-based | ||
depiction of the location of the easement on the property; | ||
(F) the maximum width of the easement; | ||
(G) the minimum depth at which each pipeline to | ||
be installed in the easement will initially be installed; | ||
(H) a provision identifying whether the private | ||
entity intends to double-ditch areas of the easement that are not | ||
installed by boring or horizontal directional drilling; | ||
(I) a provision limiting the private entity's | ||
right to assign the entity's interest under the deed, easement, | ||
agreement, or other instrument of conveyance without: | ||
(i) written notice to the property owner at | ||
the last known address of the person in whose name the property is | ||
listed on the most recent tax roll of any taxing unit authorized to | ||
levy property taxes against the property; or | ||
(ii) if the assignee, including an assignee | ||
that is an affiliate or subsidiary of or entity otherwise related to | ||
the private entity, will not operate each pipeline installed on the | ||
easement as a common carrier line or gas utility, the express | ||
written consent of the property owner, provided the property owner | ||
does not unreasonably withhold consent; | ||
(J) a provision describing whether the easement | ||
rights are exclusive, nonexclusive, or otherwise limited; | ||
(K) a provision limiting the private entity's | ||
right to grant a third party access to the easement area for a | ||
purpose that is not related to the construction, safety, repair, | ||
maintenance, inspection, replacement, operation, or removal of | ||
each pipeline to be installed in the easement; | ||
(L) a provision regarding the property owner's | ||
right to actual monetary damages arising from the construction and | ||
installation of each pipeline to be installed in the easement, or a | ||
statement that the consideration for the easement includes any | ||
monetary damages arising from the construction and installation of | ||
each pipeline to be installed in the easement; | ||
(M) a provision regarding the property owner's | ||
right after initial construction and installation of each pipeline | ||
to be installed in the easement to actual monetary damages arising | ||
from the repair, maintenance, inspection, replacement, operation, | ||
or removal of each pipeline to be installed in the easement; | ||
(N) a provision regarding the private entity's | ||
rights and obligations regarding the removal, cutting, use, repair, | ||
or replacement of any gates or fences that cross the easement or | ||
will be used by the private entity; | ||
(O) a provision regarding the private entity's | ||
obligation to maintain the easement, including leveling of the | ||
easement, and a provision regarding the entity's obligation to | ||
restore the property owner's property used by the private entity to | ||
original condition or as near to original condition as is | ||
reasonably practicable or a statement that the private entity will | ||
reimburse the property owner for actual monetary damages incurred | ||
by the property owner that arise from damage to the property caused | ||
by the private entity and not restored; | ||
(P) a provision regarding: | ||
(i) the repair and restoration of areas | ||
used or damaged outside the easement area to their original | ||
condition or better, to the extent reasonably practicable; or | ||
(ii) the payment of actual monetary damages | ||
for areas not restored; and | ||
(Q) a provision describing the private entity's | ||
rights of ingress, egress, entry, and access on, to, over, and | ||
across the easement, including the location where the entity will | ||
access the easement; and | ||
(2) if the instrument conveys an electrical | ||
transmission right-of-way easement: | ||
(A) a general description of any use of the | ||
surface of the easement the entity intends to acquire; | ||
(B) the best available description of the | ||
location of the easement, which may include a metes and bounds or | ||
centerline description, a plat, a map-based depiction of the | ||
location of the easement, or another legally sufficient description | ||
of the location of the easement on the property; | ||
(C) the maximum width of the easement; | ||
(D) the manner in which the entity will access | ||
the easement; | ||
(E) a provision limiting the private entity's | ||
right to grant a third party access to the easement area for a | ||
purpose that is not related to the transmission line's | ||
construction, safety, maintenance, inspection, or operation; | ||
(F) a provision regarding the property owner's | ||
right to actual monetary damages arising from the construction, | ||
maintenance, repair, replacement, or future removal of lines and | ||
support facilities in the easement, or a statement that the | ||
consideration for the easement includes such future damages; | ||
(G) a provision regarding the private entity's | ||
rights and obligations regarding the removal, cutting, use, repair, | ||
or replacement of any gates or fences that cross the easement or | ||
will be used by the entity; | ||
(H) a provision regarding the entity's | ||
obligation to maintain the easement and restore the easement to the | ||
easement's original contours and grades and a provision regarding | ||
the entity's obligation to restore the easement following any | ||
future damages caused by the private entity or a statement that the | ||
consideration for the easement includes such future damages; | ||
(I) a provision regarding: | ||
(i) the repair and restoration of areas | ||
used or damaged outside the easement area to their original | ||
condition or better, to the extent reasonably practicable; or | ||
(ii) the payment of actual monetary damages | ||
for areas not restored; | ||
(J) a provision describing whether the easement | ||
rights are exclusive, nonexclusive, or otherwise limited; and | ||
(K) a prohibition against the assignment of the | ||
entity's interest in the property to an assignee, including an | ||
assignee that is an affiliate or subsidiary of or entity otherwise | ||
related to the private entity, that will not operate as a utility | ||
subject to the jurisdiction of the Public Utility Commission of | ||
Texas or the Federal Energy Regulatory Commission without: | ||
(i) written notice to the property owner at | ||
the last known address of the person in whose name the property is | ||
listed on the most recent tax roll of any taxing unit authorized to | ||
levy property taxes against the property; and | ||
(ii) the express written consent of the | ||
property owner or record owner on the tax records. | ||
(b) A property owner may negotiate for the following terms | ||
to be included in a deed, easement, agreement, or other instrument | ||
of conveyance described by Subsection (a): | ||
(1) a provision regarding the property owner's right | ||
to negotiate to recover damages for tree loss and the income loss | ||
from disruption of agricultural production or hunting; | ||
(2) a prohibition against any use of the property | ||
being conveyed, other than a use stated in the deed, easement, | ||
agreement, or other instrument of conveyance, without the express | ||
written consent of the property owner; | ||
(3) a provision: | ||
(A) requiring the private entity to maintain at | ||
all times while the private entity uses the easement, including | ||
during construction and operations on the easement, liability | ||
insurance: | ||
(i) issued by an insurer authorized to | ||
issue liability insurance in this state; and | ||
(ii) insuring the property owner against | ||
liability for personal injuries and property damage sustained by | ||
any person caused by the use of the easement by the private entity | ||
or the private entity's agents or contractors; or | ||
(B) if the private entity is subject to the | ||
jurisdiction of the Public Utility Commission of Texas or has a net | ||
worth of at least $25 million, requiring the private entity to | ||
indemnify the property owner against liability for personal | ||
injuries and property damage sustained by any person caused by the | ||
use of the easement by the private entity or the private entity's | ||
agents or contractors; and | ||
(4) a provision that the terms of the deed, easement, | ||
agreement, or other instrument of conveyance will bind the | ||
successors and assigns of the property owner and private entity. | ||
(c) A private entity, as defined by Section 21.031, or the | ||
property owner may: | ||
(1) negotiate for and agree to terms and conditions | ||
not required by Subsection (a) or provided by Subsection (b), | ||
including terms and conditions not included in a subsequent | ||
condemnation petition; and | ||
(2) agree to a deed, easement, agreement, or other | ||
instrument of conveyance that does not include the terms required | ||
by Subsection (a). | ||
(d) Except as provided by this subsection, this section does | ||
not prohibit a private entity from amending the terms required by | ||
Subsection (a) after the private entity makes an initial offer or | ||
final offer to a property owner as required by Section 21.0113. A | ||
private entity that changes the terms required by Subsection (a) | ||
must provide a copy of the amended deed, easement, agreement, or | ||
other instrument of conveyance to the property owner not later than | ||
the 14th day before the date the private entity files a condemnation | ||
petition relating to the property. | ||
(e) A private entity that amends a deed, easement, | ||
agreement, or other instrument of conveyance after the initial | ||
offer or final offer is not required to satisfy again any | ||
requirement of that section that the private entity has previously | ||
satisfied. | ||
(f) A court with jurisdiction of a condemnation proceeding | ||
involving property the acquisition of which is subject to the | ||
requirements of this section may: | ||
(1) determine whether the private entity has complied | ||
with the requirements of this section; and | ||
(2) if the court determines that the private entity | ||
has not provided to a property owner a deed, easement, agreement, or | ||
other instrument of conveyance that complies with the requirements | ||
of this section: | ||
(A) abate a pending proceeding; | ||
(B) order the private entity to provide to the | ||
property owner a deed, easement, agreement, or other instrument of | ||
conveyance that complies with the requirements of this section; and | ||
(C) order the private entity to pay to the | ||
property owner: | ||
(i) all costs related to the private | ||
entity's failure to comply with this section; and | ||
(ii) any reasonable attorney's fees and | ||
other professional fees incurred by the property owner that are | ||
directly related to the private entity's failure to comply with | ||
this section. | ||
Sec. 21.0115. EX PARTE COMMUNICATION. (a) A private | ||
entity, as defined by Section 21.031, that wants to acquire real | ||
property for a public use, the entity's representative, or the | ||
owner of the real property may not, without first attempting to | ||
include the property owner or the entity, as applicable, engage in | ||
ex parte communication concerning the merits of the condemnation | ||
with: | ||
(1) a court that has jurisdiction of a condemnation | ||
proceeding involving the property; or | ||
(2) a special commissioner appointed in the | ||
condemnation proceeding. | ||
(b) A private entity shall provide written notice to a | ||
property owner of any communication between the entity and a court | ||
or special commissioner described by Subsection (a) for which the | ||
property owner is not present. | ||
(c) For the purposes of this section, "private entity" | ||
includes: | ||
(1) the entity's attorney; and | ||
(2) any third-party contractor of the entity, | ||
including a right-of-way agent. | ||
SECTION 3. Section 21.012, Property Code, is amended by | ||
adding Subsection (b-1) to read as follows: | ||
(b-1) In addition to the contents prescribed by Subsection | ||
(b), a petition filed by a private entity as defined by Section | ||
21.031 must state the terms to be included in the instrument of | ||
conveyance under Section 21.0114. | ||
SECTION 4. Chapter 21, Property Code, is amended by adding | ||
Subchapter B-1 to read as follows: | ||
SUBCHAPTER B-1. ACQUISITION OF PROPERTY BY CERTAIN PRIVATE | ||
ENTITIES | ||
Sec. 21.031. DEFINITION. In this subchapter, "private | ||
entity": | ||
(1) includes: | ||
(A) a corporation authorized to exercise the | ||
power of eminent domain to acquire private property for public use; | ||
and | ||
(B) any affiliate or subsidiary of or entity | ||
related to a corporation described by Paragraph (A), including a | ||
corporation organized under Chapter 67, Water Code, if the | ||
affiliate, subsidiary, or other entity was formed for purposes of a | ||
project for which property may be acquired through eminent domain; | ||
and | ||
(2) does not include a railroad operating in this | ||
state on or before January 1, 2019. | ||
Sec. 21.032. APPLICABILITY OF SUBCHAPTER. This subchapter | ||
applies only to a private entity that wants to acquire for the same | ||
public use one or more tracts or parcels of real property: | ||
(1) located entirely in one county; and | ||
(2) owned by at least four property owners. | ||
Sec. 21.033. NOTICE OF INTENT. (a) Not later than the 45th | ||
day before the date a private entity makes an initial offer to | ||
acquire real property under this chapter, the entity must send a | ||
written notice of intent to a court that would have jurisdiction of | ||
a condemnation proceeding involving the property. | ||
(b) A notice sent under Subsection (a) must: | ||
(1) state the private entity's intent to acquire real | ||
property for public use; | ||
(2) specify the public use; | ||
(3) identify the real property the entity intends to | ||
acquire and the owners of the property; and | ||
(4) disclose the date by which the entity will make the | ||
initial offer. | ||
Sec. 21.034. PROPERTY OWNER INFORMATION MEETING. (a) Not | ||
later than the 30th day after the date a court receives a notice of | ||
intent required by Section 21.033, the private entity shall select | ||
the date on which a public meeting regarding the proposed | ||
acquisition will be held. | ||
(b) The meeting described by Subsection (a): | ||
(1) must take place: | ||
(A) in a public location appropriate to the size | ||
and nature of the meeting in the county in which the real property | ||
is located; and | ||
(B) at a time when the property owners identified | ||
by the private entity under Section 21.033 may reasonably be able to | ||
attend; and | ||
(2) may not take place earlier than the 14th day after | ||
the date a private entity makes an initial offer to a property owner | ||
identified in the notice of intent under Section 21.033. | ||
Sec. 21.035. PERSONS AUTHORIZED TO ATTEND PROPERTY OWNER | ||
INFORMATION MEETING. In addition to the property owner and the | ||
private entity, the following individuals may attend a meeting held | ||
under Section 21.034: | ||
(1) an individual invited by the property owner who is | ||
related to the property owner within the third degree by | ||
consanguinity or affinity, as determined under Chapter 573, | ||
Government Code; | ||
(2) an attorney or appraiser representing the property | ||
owner; | ||
(3) any individual with a real property interest in | ||
the property subject to the initial offer under Section 21.0113; | ||
and | ||
(4) any public official. | ||
Sec. 21.036. NOTICE OF PROPERTY OWNER INFORMATION MEETING | ||
IN INITIAL OFFER. A private entity that gives a notice of intent | ||
under Section 21.033 must include with the entity's initial offer | ||
notice of the meeting to be held under Section 21.034, including the | ||
date, time, and location of the meeting. | ||
Sec. 21.037. PARTICIPATION BY PRIVATE ENTITY REQUIRED. A | ||
representative of the private entity that gives a notice of intent | ||
under Section 21.033 shall: | ||
(1) attend the meeting; and | ||
(2) participate in the meeting in the manner | ||
prescribed by Section 21.038. | ||
Sec. 21.038. PROPERTY OWNER INFORMATION MEETING AGENDA. At | ||
a meeting scheduled under Section 21.034: | ||
(1) the private entity shall present: | ||
(A) the information contained in the landowner's | ||
bill of rights statement required to be provided to a property owner | ||
under Section 21.0112; | ||
(B) a description of the public use for which the | ||
entity wants to acquire the real property, including technical | ||
details; | ||
(C) if applicable, a statement of the terms | ||
required under Section 21.0114 to be included in a deed, easement, | ||
agreement, or other instrument of conveyance provided by the entity | ||
to the property owner; | ||
(D) the method and factors used by the entity to | ||
calculate the entity's initial offer, including: | ||
(i) how damages to remaining property were | ||
evaluated; and | ||
(ii) if the entity used a property | ||
appraisal report or market value study, the name of the person that | ||
performed the appraisal or study; | ||
(E) the entity's justification for the proposed | ||
public use, including any materials used by the entity to obtain a | ||
determination that the project is a public use; | ||
(F) the legal and factual basis for the entity's | ||
exercise of its eminent domain authority; | ||
(G) the name and contact information of any | ||
third-party contractor to be used by the entity to acquire the land | ||
or undertake the project; and | ||
(H) a description of any regulatory process | ||
required for approval of the project, including any evaluation of | ||
the project's necessity, and information about how a property owner | ||
may participate in the process; and | ||
(2) each property owner identified by the private | ||
entity under Section 21.033 or the property owner's designee, must | ||
be given an opportunity to ask questions and make comments | ||
regarding: | ||
(A) the rights of the property owners; | ||
(B) the proposed public use; and | ||
(C) terms required under Section 21.0114 to be | ||
included in a deed, easement, agreement, or other instrument of | ||
conveyance provided by the entity to a property owner. | ||
Sec. 21.039. CONTACT AFTER PROPERTY OWNER INFORMATION | ||
MEETING. A private entity may not contact a property owner to whom | ||
the entity has made an initial offer before the seventh day after | ||
the date of the meeting held under Section 21.034. | ||
Sec. 21.0391. CERTIFICATION OF ENTITY PARTICIPATION IN | ||
PROPERTY OWNER INFORMATION MEETING REQUIRED. (a) After a private | ||
entity participates in a meeting held under Section 21.034, the | ||
entity shall submit evidence documenting its participation to the | ||
court to which the entity gave notice of intent under Section | ||
21.033. The court shall review the evidence submitted by the entity | ||
and, if the court determines that the entity has satisfied the | ||
requirements of this subchapter, shall certify that the entity has | ||
satisfied the requirements of this subchapter. | ||
(b) In this subsection, "electric utility" means an entity | ||
subject to Chapter 37, Utilities Code, and this subchapter. | ||
Notwithstanding any other provision of this subchapter, a court | ||
shall certify that an electric utility has satisfied the | ||
requirements of this subchapter if the electric utility | ||
participates in a hearing under Chapter 37, Utilities Code, that | ||
also complies with the requirements of this subchapter. | ||
(c) A private entity may not acquire property to which this | ||
subchapter applies unless the entity receives a certification under | ||
Subsection (a) or (b) with respect to the property. | ||
Sec. 21.0392. PUBLICATION AND PROVISION OF CERTAIN | ||
MATERIALS. A private entity shall: | ||
(1) publish on an Internet website any materials | ||
presented under Section 21.038(1)(E); and | ||
(2) provide to property owners identified by the | ||
entity under Section 21.033 any materials presented under Section | ||
21.038(1)(E). | ||
SECTION 5. Section 21.042, Property Code, is amended by | ||
adding Subsection (d-1) to read as follows: | ||
(d-1) In estimating injury or benefit under Subsection (c) | ||
in a condemnation proceeding relating to the acquisition of real | ||
property by an entity subject to Subchapter B-1, the special | ||
commissioners shall consider, in addition to the considerations | ||
required under Subsection (d), an injury or benefit to the | ||
remaining property as a result of: | ||
(1) the characteristics of any infrastructure on the | ||
condemned property, including the size or visibility of the | ||
infrastructure or the pressure or voltage range provided by the | ||
infrastructure; | ||
(2) any limitation of future expansion of the | ||
remaining property; and | ||
(3) terms of the easement acquired in connection with, | ||
or the alignment of an easement in connection with, the | ||
condemnation. | ||
SECTION 6. The changes in law made by this Act apply only to | ||
the acquisition of real property in connection with an initial | ||
offer made under Chapter 21, Property Code, on or after the | ||
effective date of this Act. An acquisition of real property in | ||
connection with an initial offer made under Chapter 21, Property | ||
Code, before the effective date of this Act is governed by the law | ||
applicable to the acquisition immediately before the effective date | ||
of this Act, and that law is continued in effect for that purpose. | ||
SECTION 7. This Act takes effect September 1, 2019. | ||
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