Legislature(2001 - 2002)
02/27/2002 01:33 PM Senate CRA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 278-TAKING PROPERTY BY EMINENT DOMAIN
KIM OGNISTY, Staff to Senator Torgerson, read the following
sponsor's statement into the record:
SB 278 is concerned with the eminent domain and
declaration of taking proceedings in Alaska statute.
The bill introduces a "reasonable and diligent effort"
clause that attempts to place the condemner of land and
the private landholder in an equal negotiating
position. The bill is not trying to remove the
authority of the state to acquire land by eminent
domain or in any way complicate existing proceedings.
Currently, Alaska law does not require the state to
engage in a good faith effort to negotiate with private
landowners. Without an incentive to negotiate, state
officials are free to make only an unreasonable offer
or none at all. They can end discussions at their
caprice and they are under no obligation to take the
landowner seriously. Initiating communication from an
equitable bargaining position will promote productive
negotiations, facilitate dialog over reasonable
concerns and encourage suggestions from all parties
involved. The phrase, "reasonable and diligent effort"
or similar language has been adopted by at least 23
other states. This clause will reduce the amount of
litigation by encouraging more cases to be settled up
front thereby promoting expediency in government.
PHIL EVANS testified via teleconference as the representative and
president of the Northgate Square Mall in Fairbanks. He wanted to
tell about his experience with land taking and then his reaction
to SB 278. He read the following into the record:
The State of Alaska, Department of Transportation
recently took a portion of my commercial property to
use for a road construction project. I would like to
make you aware of the experience I had with them. Prior
to condemnation being filed, the person representing
the state was courteous but misleading in attempting to
convince me to accept the settlement that was
completely unfair. Also prior to the condemnation being
filed, the state appraiser provided no meaningful
information. She was quite insistent about her
authority to be on my property and utilized a space in
a business in the mall for her office. She was
deceptively courteous and misleading in her attempt to
promote an unfair evaluation of the property.
The state did not provide me with a copy of her
completed appraisal record and market data book. I was
unable to settle with the state, based on that
appraisal, because of the compensation being inadequate
and unfair. The appraisal did not fairly set forth the
value of the taking and the consequences to the
remainder property. In the appraisal of my property,
the "before the taking" value was based on the current
use of the property rather than the highest and best
use of that property. The following items were not
fairly considered when analyzing the affects of the
right-of-way taking on my property: loss of parking,
change in highest and best use, decline in market
appeal, change in business use of the property, decline
in market value. But when it became apparent the state
was misleading and unfair in their attempts to reach
settlement, I hired an attorney and an appraiser to
provide me accurate and fair counsel. The state
appraiser concluded that just compensation for the
property taken and damages was $80,000. The appraiser
for Northgate Square and myself concluded the just
compensation for the property taken and damages was
$676,000, eight times more than the state's appraisal.
As a consequence, we proceeded to hearing. Frank King,
an appraiser, was appointed by the state to preside
over the masters hearing. At the conclusion of the
hearing, Mr. King rendered a decision awarding $324,000
for property taken and damages. Although this was
approximately half of the amount sought, I decided
rather than continue with litigation, I would settle.
The state subsequently appealed. The state's decision
to appeal will significantly increase costs not only
for me, but also for the state.
2:05 p.m.
He said SB 278 is encouraging, but he would like to see more
change. He feels the state is able to totally take over private
property with no respect or concern for the rights of the owner.
RON WOLF, Sealaska Corporation Corporate Forester, testified in
favor of the bill. They had some suggestions on the language
concerning how the bill defines "reasonable and diligent effort"
but it could be brought up in the Judiciary Committee.
CHAIRMAN TORGERSON agreed.
There was no further testimony.
SENATOR KELLY made a motion to move SB 278 from committee with
individual recommendations.
There being no objection, SB 278 moved from committee.
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