The first recorded condemnation occurred in about 871 B.C. when Naboth refused to sell his vineyard to King Ahab. The king took Naboth's land but instead of receiving payment, poor Naboth was stoned to death. Fortunately, in the United States we have a Constitution with a Fifth Amendment that states, "No person shall ... be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation." The concepts of condemnation and just compensation have been getting a lot of exposure lately due to the Thomas Roads Improvement Program and the vast number of private properties that will be acquired by government agencies for road improvements.
TRIP is a cooperative effort between the city of Bakersfield, county of Kern, Caltrans and the Kern Council of Governments that was formed to improve regional roadways, stimulate economic growth and development, and reduce travel time in the greater Bakersfield area. There are more than 500 parcels of private property that will be acquired by government agencies. Every parcel of property that is to be acquired, whether in whole or in part, will be appraised and property owners should be aware of their rights and have an understanding of the appraisal process.
Each individual TRIP project has a lead agency. The lead agency for the Centennial Corridor, for example, is Caltrans. Caltrans, either directly or through a designated third party, will contract with an appraiser(s) to value each property that is to be acquired. It is imperative that the appraiser have experience in the local market and experience in condemnation appraisal as this area has its own set of rules and regulations.
State regulations require that the property owner be notified of the decision to appraise and to have the opportunity to meet with the appraiser during the property inspection. I would encourage every property owner to take advantage of this opportunity. This is the perfect time to learn about the appraiser's qualifications, experience and knowledge of the local market. It is also the opportune time to inform the appraiser of any improvements or upgrades that have been made to the property. This will help ensure that you receive a fair offer for your property, or as it is referred to in condemnation proceedings, "just compensation."
But, what is just compensation? In condemnation, just compensation is the amount of loss for which a property owner is compensated when his or her property is taken. Just compensation should put the owner in as good a position as he would have been if the property had not been taken. Critical to the process of determining just compensation is that the appraiser estimate market value as the property legally and physically exists, absent project influence. For example, it has been known for some time that Caltrans has been considering Option B for the Centennial Corridor project, which cuts through the Westpark neighborhood. It is possible that this will negatively influence values in the neighborhood. If values are affected, it would not be fair or just to value property for condemnation using sales in the Westpark neighborhood.
This is one of the reasons it is imperative the appraiser have extensive knowledge of the local market. If comparable sales from a different neighborhood are to be used in valuation, the appraiser needs to know which neighborhoods are most comparable and be able to properly analyze any differences that do exist.
Property owners should also be aware that if they are not satisfied with the offer of compensation they are entitled to obtain their own independent appraisal. The Department of Transportation will reimburse the property owner for actual reasonable costs up to $5,000, subject to certain conditions, which can be found in the California Civil Code of Procedure, Section 1263.025.
We have come a long way since the days of King Ahab and Naboth but property owners still need to be knowledgeable of their rights regarding eminent domain and the condemnation process. Be certain that the appraiser involved is experienced and competent, not only in real property appraisal and condemnation but also in the local market. The process can be confusing, even frightening, but a little knowledge can go a long way in alleviating those fears.
Kyle Estle, MAI , is president of the Central California Chapter of the Appraisal Institute and a principal with the appraisal firm of Dallis Higdon and Associates in Bakersfield.