CHEYENNE — Despite opposition from the energy industry, the Wyoming House on Tuesday voted to approve a bill to require energy companies and others using the power of eminent domain to condemn private property to pay a landowner's legal fees if the courts find they didn't offer a fair price for the land.
The Senate later declined to accept some House amendments and appointed a conference committee to try to reach agreement.
The state commonly uses the power of eminent domain to condemn private lands for highway projects. Private industry also can use the law to get the right to use private land for construction of pipelines and other infrastructure.
Jim Magagna of the Wyoming Stock Growers Association said Tuesday that his group has been "lobbying like heck" for the bill. He said he's seen instances where final offers did not represent fair market value and were significantly less than what others were paying for similar easement.
"I actually think that has the potential to reduce the number of these suits," Magagna said of the bill. He said he expects that companies seeking to condemn property will be more careful about making sure their final offer is based on solid, defensible appraisals, and landowners will know that the appraisals have been more carefully developed.
As approved by the House, the bill would require the entity seeking to condemn a landowner's property to pay the landowner's legal fees and other costs if a judge determined that the fair market value of the land was at least 15 percent higher than the entity's final offer.
The Senate had specified that the condemning entity would pay the landowner's fees if a judge determined the fair market value was 10 percent or more above the final offer.
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Bruce Hinchey, executive director of the Petroleum Association of Wyoming, said he expects passing the bill would lead to long, drawn-out eminent domain cases that take years to resolve.
"It will be very costly," Hinchey said. "And because it's going to take so long, companies may end up going elsewhere to do things because you can't wait four years for a project that you've got ready to start now."
He said he hasn't heard of energy companies giving land owners low-ball offers for easements.
Sen. Ogden Driskill, R-Devils Tower, is the bill's main sponsor. He said private landowners have always understood that eminent domain "is a pretty big fulcrum" when it comes to land dealings.
"It's not an arm's length transaction," Driskill said. "And that threat of eminent domain always puts a cloud on your dealings when you're dealing with somebody."
Driskill said he believes that most companies deal with landowners in good faith.
"But in the bad instances, it does not," Driskill said. "And in those instances, property owners are left to hire legal counsel and do appraisals at their own expense. And when the end result comes, often they get more money than was offered when those guys made a lowball offer to them. But they're left not being whole, because they have to pay their own attorney fees on the thing."