Monthly Archives: March 2016

Threatened by Eminent Domain?

The US News and World Report has provided sound guidance for those threatened by eminent domain.

What to Do When You’re a Homeowner Threatened With Eminent Domain

Take steps to protect your rights as a property owner so you’re not left out in the cold.

You worked hard to become a homeowner, and it’s something you’re proud of. Between mortgage payments and the improvements you’ve always wanted to make, you work even harder to make it the home of your dreams – and to keep it that way.

But in the case of eminent domain, it’s out of your hands. A clause in the Fifth Amendment to the Constitution limits the government’s right to take private property for public use by requiring the property owner be given “just compensation” in return.

Eminent domain and what the government – either federal, state or local – has deemed “public use” has been a hot-button topic for years. While the taking of property in whole to build a highway or in part to help widen a road is largely recognized as standard public use, the condemning of property for redevelopment by private institutions has also been done in the name of eminent domain.

Opposing eminent domain is a hard-fought battle, but don’t let fear or lack of understanding the law keep you from receiving your just compensation or arguing the intended use of the property fails to meet the needs of the public. To better protect your rights as a property owner, follow these guidelines to ensure you understand the process of eminent domain and the resources available to you.

Consult an attorney. To better protect yourself and your property, seek legal advice as soon as you hear your property could potentially be taken for public use, which could come to you in the form of a mailed letter, in-person notice or phone call, depending on the government planning to take the property and its practices. Eminent domain is difficult, and not every lawyer is capable of navigating the details of the law.

“It’s less a real estate transaction and more a lawsuit,” explains Robert McNamara, senior attorney for the Institute for Justice, a nonprofit group that fights eminent domain abuse. “And I think what frequently surprises property owners is that the part of [the process] that really is a lawsuit – the part where you can waive your rights and the part where you get locked into things – happens in many cases long before the actual formal lawsuit begins.”

Even seemingly simple instances of eminent domain, like an easement that allows the government to go onto the property without taking full possession of it or the taking of a few feet from the property line to widen a road, should get a thorough read-through by a professional because there may be some fine print that could affect you down the line.

“When an easement is written by the condemning authority, it’s written by their attorneys, so it’s most likely going to be written in a manner that’s most favorable to their needs and their uses,” says Cathy Newman, executive director of Owners’ Counsel of America, an organization that aims to help private property owners threatened with eminent domain nationwide. “We would recommend an owner have an eminent domain attorney review that easement to ensure that their rights are protected and they’re not held … in a less favorable result afterward.”

An example Newman cites is the easement of a portion of rural property being taken for utility usage. The initial offer may include conditions like regular access to the land for maintenance, but an attorney could recognize the need to negotiate for prior notice to go on the property, not damage fencing and ensure livestock are not able to get loose in the process.

Get a second opinion. To determine what constitutes as “just compensation” for your property, the government will have it appraised to calculate its market value. While all property appraisers should be unbiased, third-party sources, it’s a good idea to get a second opinion from an appraiser of your choosing.

Kurt Kielisch is an appraiser and president of Forensic Appraisal Group Ltd in Neenah, Wisconsin, and he has appraised properties involved in eminent domain cases in as many as 12 states. He explains an appraisal from each party allows for a more thorough look at the property’s value, with the opportunity to negotiate and settle on an amount before litigation may be necessary.

“Usually the appraisals are done to try and get voluntary agreements between the property owner and the condemnor, and if that is unsuccessful, then they have the right – both sides do, actually – to go to court,” Kielisch says.

In Wisconsin, Kielisch says the government is required to pay for the property owner’s second opinion appraisal, without any limits on the cost or who the accredited appraiser is. “The property owner is still the client, but [the government] still takes on the responsibility of paying for the fee,” he says.

Some other states will pay a capped amount of the landowner’s appraisal, like California, which will cover $5,000, but other states, like Illinois, leave it all up to the property owner to come up with the funds. When it comes to legal fees, it depends on your agreement with your attorney and the outcome of the case as to how court costs are determined. Some attorneys may be willing to accept payment only in the event of a successful outcome, and in that case it’s possible a judge rules the government would cover all court costs. But it’s also possible the court could rule against you, and it’s up to you to pay the bill.

Accept, aim for more money or fight. It’s your decision whether you want to accept the initial offer from the government, try to work toward a better deal or fight the taking in its entirety. But regardless of the choice you make, be sure you understand the difficulties you may face with any decision, as well as the resources available to you to help you succeed.

Accepting an offer will of course move the process along faster, but be sure you have consulted the right professionals to determine if it’s a fair deal. Even if you’re strapped for cash and are afraid of the cost of a big legal fight, getting a lower-than-fair payout could leave you with bigger problems in the future. A bit more work and money upfront can result in a much better deal for you as the owner losing their property, explains Jamie Fisher, an attorney specializing in eminent domain and a partner at Fisher & Talwar in Los Angeles.

“My experience is business and property owners do best by going through the whole process and generally not just taking what’s offered upfront, or what can be accomplished at a pre-litigation settlement,” Fisher says. “It’s not to say you can’t do well with that, but it happens less frequently.”

If negotiations don’t yield the outcome you want and you decide to pursue litigation for a court to decide on just compensation, be sure you have a firm grasp on the local housing market. Fisher says a significant amount of time between the initial offer and court case can have an impact on the value of your home.

“I’ve had cases where just sitting on them for a year the property shoots up in value, and the date of value gets set later in the case – then the property’s worth more,” Fisher says.

But it can have the opposite effect as well. If the government knows the neighborhood is losing property value, they won’t necessarily try to rush an opposition to the eminent domain taking, knowing they might be able to pay less later.

If you believe the government is abusing power of eminent domain for gain outside of public use, you can choose to fight the taking outright – but be ready for a rough road ahead. The Kelo v. New London decision ruled in favor of the city to take private property in favor of new development. In the case, a number of residents in New London, Connecticut, sued the city for seizing their properties through eminent domain for the purpose of selling them to a private developer. While the residents argued the sale for private development did not constitute as public use, but both the Connecticut Supreme Court and the U.S. Supreme Court disagreed. The 2005 decision set the precedent for many cases of potential eminent domain abuse, and it was criticized by the public and many legislators for giving too much freedom to government agencies, under the argument that the government could now use eminent domain for the purpose of economic gain.

While the case was a blow to property owner’s rights in eminent domain cases, the public outrage following the decision lead many state legislatures to try to curb the potential for eminent domain abuse.

The Institute for Justice takes on cases nationwide that appear to be instances of abuse of eminent domain. “It’s important to remember that it’s not just a legal fight, it’s a political fight. Many of the projects that the Institute for Justice stops, we don’t stop through litigation, we stop through political activism,” McNamara says.

Written by: By Devon Thorsby | U.S. News and World Report
Photo credit: U.S. News and World Report

By |March 30th, 2016|Categories: Condemnation, Eminent domain, Pipeline Construction, Property Rights|

Strong Grassroots Opposition to Natural Gas Pipelines

The Lebanon Pipeline Awareness Coalition continues to work effectively in educating many on the problems with proposed pipelines.

Activists: Don’t stop fighting pipelines

Grassroots opposition is making a difference, panelists say

It is possible for an organized grassroots effort to thwart or at least impact the plans of two companies hoping to build natural gas pipelines through Lebanon County, experts say.

Those experts are panelists with knowledge of pipeline issues speaking to about 50 area residents during a forum at the Lebanon county courthouse Monday night.

“I know it’s been a long haul for you folks, and it may well be a long haul for another year or two, but you’re accomplishing a lot,” said Lynda Farrell, executive director of the Pipeline Safety Coalition.

The event, organized by anti-pipeline groups Lebanon Pipeline Awareness and Concerned Citizens of Lebanon County, featured four panelists from state and national organizations. Clean Air Council attorney Alex Bomstein cited the Federal Energy Regulatory Commission’s rejection last Friday of the Jordan Cove pipeline in Oregon as evidence that natural gas pipelines can be stopped given sufficient public opposition.

A dose of hope in fighting pipeline corporations was exactly what Sharon Bikle and her daughter Shannon Watson needed to hear. Watson lives near Hershey and is trying to prevent Sunoco from acquiring a new pipeline easement on her property, but has had difficulty convincing her neighbors that the pipeline can be stopped.

“To me, it’s unfair. I think it’s unconstitutional.” Bikle said. “No one cares about common people anymore. It’s all about big business, and I’m sick of it.”

Fueled by Pennsylvania’s Marcellus Shale fracking boom, two separate companies are planning to build new natural gas pipelines through Lebanon County. The Mariner East 2 pipeline, owned by Sunoco Logistics, would take natural gas liquids from western Pennsylvania, Ohio and West Virginia to the Marcus Hook complex near Philadelphia, crossing southern Lebanon County from west to east in the process.

The Atlantic Sunrise pipeline — owned by Tulsa, Okla.-based Williams — would bisect western Lebanon County from north to south, transporting natural gas (not natural gas liquids) from northeastern Pennsylvania to the Pennsylvania-Maryland border, where it would connect with the approximately 10,000-mile Transcontinental Pipeline.

The Atlantic Sunrise pipeline is currently in the midst of the FERC review process. Farrell encouraged local residents concerned about the project to provide the reasons for their opposition in comments to FERC, particularly regarding specific local environmental, historical or other community impacts of which FERC might not be aware.

Also participating in the panel was Karen Gentile of the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration. Two men who had traveled from Delaware County to attend the event heightened tensions by questioning Gentile about what they perceive as lax oversight of pipelines by the agency.

Panelist and former state geologist Jay Parish warned of the possible sinkholes that could occur because of placing a pipeline in limestone-rich Lebanon County. He said that disturbing the sinkhole-prone Epler formation that crosses the southern part of the county is a “disaster waiting to happen.”

If residents are inclined to sign pipeline easements, panelists encouraged them to read the details of their easement and negotiate the best terms possible with pipeline companies. Bomstein said he’s seen easements property owners signed without critically examining them and “you’ve basically given up your first born.”

Lebanon County is already a location where pipelines are meeting determined opposition. Sunoco is embroiled in two cases pending before the Lebanon County Court of Common Pleas: the consolidated cases of three Heidelberg Township landowners challenging its assertion of eminent domain, and a lawsuit filed by Concerned Citizens regarding the construction of a pump station. Williams Partners is not as far along in the eminent domain process, but Annville and South Londonderry townships have passed resolutions opposing the pipeline.

Sunoco recently admitted that the Mariner East 2 pipeline would not come online until 2017, a delay due to complications with obtaining permits. However, Sunoco also announced last week that its repurposed Mariner East 1 pipeline it is now transporting both ethane and propane.

Pipeline companies have said pipelines are the safest and most efficient way to transport natural gas, and insist history demonstrates that natural gas can be transported successfully. Pipeline opponents frequently cite concerns about the environmental impacts of natural gas, the possibility of pipeline explosions, and the potential impact of pipelines on property values.

Sunoco and Williams were both invited to the event but chose not to attend, Ann Pinca of Lebanon Pipeline Awareness said.

This article is part of a content-sharing partnership between Lebanon Daily News and WITF.

Written by Daniel Walmer | Lebanon Daily News
Photo: Michael K. Dakota, Lebanon Daily News

Photo Caption: A pipeline public forum. “Your Safety, Your Rights” was held Monday, Mar. 14, at the Lebanon Municipal County Building discussed pipeline safety, landowner rights, as well as pipeline economics.

By |March 23rd, 2016|Categories: Condemnation, Eminent domain, Pipeline Construction, Property Rights|

Commonwealth Court Hears First Appeal of Eminent Domain Decision

On March 9, 2016 the full Commonwealth Court heard oral argument on the first appeal of a decision on the Sunoco Pipeline Mariner East 2 pipeline(s). The arguments focused on exclusive Federal jurisdiction as precluding Pennsylvania PUC regulation. The consolidated three cases remain on an expedited schedule and could reach a decision within one to three months.

Court weighs eminent domain in N. Middleton pipeline fight

A Cumberland County judge was wrong when he ruled that Sunoco Logistics can invoke eminent domain to seize land for its proposed Mariner East II pipeline, a lawyer for the owners of three targeted properties told a state appeals court panel Wednesday.

Judge Edward E. Guido found in his October decision that Sunoco had authority under state law for condemnations. But his logic was faulty because construction of the pipeline falls under federal authority, which does not allow the use of eminent domain for such projects, the landowners’ attorney, Michael Faherty, told Commonwealth Court judges hearing the appeal of Guido’s ruling.

Sunoco lawyers Alan Boynton and Christopher Lewis countered that the pipeline project, from Ohio through West Virginia and Pennsylvania into Delaware, has federal approval and that of the Pennsylvania Public Utility Commission. That PUC sanction allows the firm to condemn land for the pipeline, they argued.

North Middleton Twp. residents Pamela and R. Scott Martin, Douglas and Lyndsey Fitzgerald, and Harvey and Anna Nickey challenged Sunoco’s bid to take their land for the pipeline, which Faherty said would carry mostly “hazardous” liquid byproducts of natural gas production, materials used for the production of plastics.

Guido concluded that Sunoco has eminent-domain power to secure easements for the pipeline because the project would provide for the delivery of propane, ethane and other products in Pennsylvania. Since the PUC regulates such products, Sunoco is a public utility with property-seizure power, Guido found.

Faherty argued Wednesday that the pipeline is an interstate project that falls under federal law, which bars the use of eminent domain for pipelines that transmit the material to be shipped through Mariner East II. Sunoco can reroute the pipeline around the property of owners who don’t want to sell, he said.

Boynton and Lewis countered that the pipeline project falls under federal and state authority and so has a PUC grant of eminent domain power.

A ruling by the state judges likely would be appealed to the state Supreme Court.

Written by: Matt Miller for Patriot News

By |March 11th, 2016|Categories: Condemnation, Eminent domain, Pipeline Construction, Property Rights|

Pennsylvanians vs. FERC

A group of Pennsylvania residents have challenged the operations of the Federal Energy Regulation Commission (FERC). The suit may push FERC to improved responsiveness to its obligation to regulate for safety. One correction of the following story is suggested. The article states that each time FERC approves a pipeline, the project is automatically granted eminent domain power. That is true for the natural gas pipelines per the Natural Gas Act. By contrast, FERC also approves hazardous liquids pipelines. These pipelines are not eligible for FERC eminent domain power, because that power is not contained in the controlling Interstate Commerce Act. The Sunoco Pipeline Mariner East 2 is one such hazardous liquids pipeline which was approved by FERC without eminent domain power.

Suit claims bias toward industry

A court filing contends a federal agency whose funding is based on the flow of gas is controlled by the companies it oversees.

104 pipelines have been approved across the U.S. in the last five years.

34 of those pipelines were in Pennsylvania.

20 percent of the Federal Energy Regulatory Commission’s budget comes from pipelines and the natural gas industry.

A federal agency that receives all of its funding from the energy industry it regulates has never rejected a pipeline plan, demonstrating bias and corruption, a lawsuit contends.

The Federal Energy Regulatory Commission, designed to be self-funded, independent and nonpartisan, receives its money from fees paid by the companies it oversees. One of those fees is based on the volume of gas moving through a pipeline. The more gas that flows, the more money the commission receives.

Some Pennsylvania residents say they believe that’s why the agency has approved dozens of pipeline projects stretching through the state  and has approved every pipeline application it received in the past 30 years. Those decisions have angered several state landowners who are fighting plans that allow pipelines to tunnel through their backyards.

About 20 percent of the commission’s budget comes from pipelines and the natural gas industry. The rest comes from electricity, hydropower and oil companies.

Each time the federal agency approves a pipeline, the pipeline project is automatically granted eminent domain status. The commission does not have authority to grant eminent domain status. That power comes from the Natural Gas Act. The act says if an easement can’t be negotiated for a project the agency has authorized, the pipeline builder has the right of eminent domain.

In the last five years, the commission approved 104 pipelines across the country, including 34 in Pennsylvania, according to a PennLive/The Patriot-News analysis.

Before the Marcellus Shale boom, the agency approved two to four a year in the state. Once drillers unlocked a stockpile of natural resources, that number climbed to five to 10 a year, as numerous pipelines were planned to move oil and gas to market. With each new pipeline, company negotiators show up at Pennsylvania homes, ask- ing landowners to accept an easement, which is a one-time payment for the pipeline on their properties.

Landowners can negotiate the price, but they can’t challenge eminent domain.

Commission decisions aren’t reviewed by Congress or the president, according to the agency’s budget language. The decisions can be challenged only in federal court, which would require money that many Pennsylvania residents say they don’t have.

A lawsuit filed last week in U.S. District Court in Washington, D.C., challenges the commission’s relationship with industry. It accuses the commission of regulatory capture, a situation in which corporations control regulators.

“Pipelines have a 100 percent approval rate with FERC. There’s bias and corruption,” said Maya van Rossum, the Delaware riverkeeper and leader of the Delaware Riverkeeper Network. She and the network filed the lawsuit against the commission, calling it a “corrupt, rogue agency.” They took issue with the PennEast Pipeline, a 114-mile line planned for Pennsylvania and New Jersey.

A commission spokeswoman said the agency would not comment on the lawsuit or any claims made in association with it.

The agency evaluates the need for a project based on market demand and then looks at environmental and safety aspects, Commissioner Cheryl La-Fleur said last year.

The agency is designed to be nonpartisan and independent, but it rarely seems to work that way in practice, almost always following the president’s agenda.

No more than three of the five commissioners, who are nominated by the president and approved by the Senate, can be from the same political party. But much like the Supreme Court, their decisions can appear in line with political ideology.

For example, President Barack Obama made natural gas development a part of his Clean Power Plan to fight climate change and reduce carbon emissions. Similarly, in 1983, President Ronald Reagan wanted to deregulate the natural gas industry, saying American consumers were being hurt by government regulations that created higher gas bills.

Then commission Chairman C.M. Butler III told the Senate Energy and Natural Resources Committee there would be “a disaster in the gas market” if the rules weren’t changed, according to a March 1983 Associated Press report.

With prices fixed by law instead of the free market, producers would lose customers and possibly go bankrupt, he said.

At the time, there were artificially high prices during the 1980s gas glut, while the simultaneous oil glut offered low prices. Butler told the Senate that consumers would switch to the cheaper energy “and the result will be a disaster in the gas market.” The commission largely supported Reagan’s proposal, saying it would reduce prices because “the price of gas follows the price of oil.”

Article written by Candy Woodall |

By |March 9th, 2016|Categories: Eminent domain, News, Pipeline Construction, Property Rights|

Three Property Owners in Cumberland County Wait for Court’s Ruling

Mike Faherty presented a Cumberland County Judge with Memorandums of Law before a second day of trial.

Cumberland County property owners to find out soon if pipeline can run through land

Three Cumberland County property owners will have to wait until at least next month to find out if their arguments against a pipeline, proposed to run beneath their land, will stand up in court.

Monday was the second day of testimony in Cumberland County Court in the case of Upper Frankford Township property owners Rolfe Blume, John Perry and Alan Walters, who are arguing Sunoco Pipeline does not have the authority to take a portion of their land to build the underground pipeline that will ship liquid natural gas across the state.

After the hearing, Cumberland County Judge M.L. Ebert asked both parties to submit briefs with the court before he makes his ruling as to whether or not Sunoco Pipeline is authorized to exercise the power of eminent domain to take a portion of their land for the Mariner East II pipeline project.

The parties have until March 31 to submit their arguments with the court.

While the property owners say the company does not have that power, Sunoco Pipeline officials pointed out three other judges have already ruled in the company’s favor in similar cases.

Through the two days of testimony held on Feb. 8 and on Monday, Mike Faherty, the attorney representing the property owners, argued that under state law, eminent domain cannot be used for private enterprise, even if there is an element of public use, which he said is the situation here.

The pipeline will move liquid natural gas from Ohio through Pennsylvania to the Delaware River for shipment overseas, making it subject to federal regulations and not the state regulations that allow for eminent domain, he said.

The jobs that Marcus Hook lost when the refiner shutdown will not be coming back in a wave. But once again there is optimism.

But judges in Huntingdon and Washington counties, as well in another Cumberland County case with different property owners, have sided with Sunoco Pipeline and ruled it is indeed a public utility with the power exercise eminent domain.

And nothing has changed in the pipeline plans since Cumberland County Judge Edward Guido ruled in Sunoco’s favor last year, Sunoco Pipeline vice president of business development Aaron Alexander testified, backing the company’s argument that Ebert should rule the same way.

Alexander testified Sunoco Pipeline has been recognized as a public utility and the state’s Public Utility Commission has recognized a public need for the pipeline to ship its supply of liquid natural gas.

The public necessity became apparent after the polar vortex of 2013 and 2014 brought frigid temperatures and a statewide shortage of propane, he said.

The current Mariner East pipeline does not have the necessary capacity, making the new pipeline a public need that benefits the people of Pennsylvania, Alexander said.

And pipelines are safer and cheaper than shipping by highway or railroad, he added. It would take 500 trucks daily to ship the proposed pipeline’s capacity of 275,000 barrels per day at a cost of 20 to 30 cents per barrel, compared to 7 cents per barrel via pipeline.

But Fahrety argued the contracts currently in place for the Mariner East II are for shipment overseas and not in Pennsylvania, making this an interstate pipeline rather than an intrastate pipeline – thus not subject to the use of eminent domain.

Alexander countered the pipeline has the capability of loading and off loading the product in Pennsylvania to meet the demand here.

“It’s like the highway system with on ramps and off ramps in the state and out of the state,” he said.

Additional testimony came from Sunoco Pipeline land-project manager Bart Mitchell, who said that bonds will be put up so that any damage done to the property while installing the pipeline will be paid for by the company.

And the pipeline will run underground, allowing the property owners to continue to use their land just about any way they want.

“They can farm on it, hunt on it and play on it,” he said. “They just can’t build a house on it.”

Written by: Steve Marroni |
Graphic by: Sunoco Logistics –  This map shows the path the proposed Mariner East II pipeline will take through the state.

By |March 7th, 2016|Categories: Uncategorized|