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Private vs. Public Takings: Understanding the Distinctions

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Eminent domain is a legal concept that allows the government to acquire private property for public use, typically with just compensation to the property owner. However, in certain circumstances, private companies may also be granted the power to utilize eminent domain. Learn the differences between private and public takings in eminent domain cases and see why working with an attorney is crucial to defend your rights as a property owner.

What Are the Two Main Requirements for an Eminent Domain Acquisition?

The eminent domain power exercised by the government is not absolute. In order to acquire private property using eminent domain powers, the government must make the case that the acquisition would benefit the public in some way. This is sometimes referred to as public use.

In addition, the property owner must be given fair payment for the property or portions of land being taken. This is referred to as just compensation and, in some cases, can also include additional monetary damages (such as severance damages for uneconomic remnants, i.e., unusable patches of leftover land after a partial taking) and relocation assistance.

What Constitutes Public Use in an Eminent Domain Case?

Public use (or public benefit) in an eminent domain scenario refers to the concept of acquiring private property for a use that benefits the broader community or society as a whole. To meet the requirement of public purpose, the government must demonstrate a direct link between the intended use of the property and its benefit to the community, meaning the acquisition must serve a legitimate public interest, such as building infrastructure, promoting economic development, expanding public services, or enhancing public safety.

The definition of public use can vary from state to state. In some states, a public use project is understood as one that allows the public to gain physical access to the acquired property in some capacity. In other states, the definition of public use is extended to mean “for the benefit of the public” in the sense that the acquired property would indirectly benefit the public even though members of the public would not physically access the property (if, for example, the acquired property is used to build an electric plant to power the city).

Can Private Companies Acquire Land Using Eminent Domain Powers?

The use of eminent domain condemnations by private entities is regulated by local and state laws and also limited by federal statutes. Each state has a variation of the requirements for eminent domain acquisitions by private companies. For example, North Carolina’s eminent domain legislation identifies a list of private condemnors, i.e., private entities that may exercise eminent domain authority. These entities include certain railroad companies, transportation companies, utility companies, school committees, and certain corporations.

North Carolina’s eminent domain laws also specify the conditions and types of projects that private condemnors may execute through eminent domain acquisition. These include infrastructure improvements for public benefit (such as the construction of structures for public water supply), oil pipelines, roads, railroads, and similar projects.

What Should I Do if a Redevelopment Commission Wants to Acquire My Land?

In a few eminent domain cases, a government entity may exercise its power to acquire land through eminent domain and transfer the acquired property to a private company. This is common in situations where a redevelopment commission is working to revitalize a decayed (or blighted) urban area. In some states, this type of transaction is subject to stringent requirements and may result in higher compensation for the landowner.

If you have been notified that a redevelopment commission is planning to take your land, your first step should be to speak with a skilled eminent domain attorney. Your attorney can ensure your rights as a property owner are respected and help you take the proper steps to question the legality of the condemnation, and ensure you receive just compensation if the taking cannot be prevented. At Hansen, Howell & Wilkie, PLLC, our attorneys are well-versed in all aspects of eminent domain laws and can help you understand your options and ensure you do not end up being underpaid for your land. Reach out to our office at 984 205 8453 to learn more.

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