HF 603 (LSB 2047HV (3) 87)

HOUSE FILE 603

BY  COMMITTEE ON GOVERNMENT OVERSIGHT

(SUCCESSOR TO HSB 184)

(As Amended and Passed by the House 2017-03-28)

A BILL FOR

An Act relating to eminent domain and condemnation, including the authority of acquiring agencies to use eminent domain, the procedures required for the use of eminent domain, and compensation paid to certain property owners and including effective date and applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

DIVISION I
MERCHANT LINES

    Section 1.  Section 6A.21, subsection 1, Code 2017, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  0a.  “Aboveground merchant line” means “merchant line” as defined in section 478.6A, subsection 1, excluding those merchant lines that are underground.
    Sec. 2.  Section 6A.21, subsection 1, paragraph b, Code 2017, is amended to read as follows:
   b.  “Private development purposes” means the construction of, or improvement related to, recreational trails, recreational development paid for primarily with private funds, aboveground merchant lines, housing and residential development, or commercial or industrial enterprise development.
    Sec. 3.  Section 6A.21, subsection 2, Code 2017, is amended to read as follows:
   2.  The limitation on the definition of public use, public purpose, or public improvement does not apply to the establishment, relocation, or improvement of a road pursuant to chapter 306, or to the establishment of a railway under the supervision of the department of transportation as provided in section 327C.2, or to an airport as defined in section 328.1, or to land acquired in order to replace or mitigate land used in a road project when federal law requires replacement or mitigation. This limitation also does not apply to utilities, persons, companies, or corporations under the jurisdiction of the Iowa utilities board in the department of commerce or to any other utility conferred the right by statute to condemn private property or to otherwise exercise the power of eminent domain, except to the extent such purpose includes construction of aboveground merchant lines.
    Sec. 4.  Section 6A.22, subsection 2, paragraph a, subparagraph (2), Code 2017, is amended to read as follows:
   (2)  The acquisition of any interest in property necessary to the function of a public or private utility to the extent such purpose does not include construction of aboveground merchant lines, common carrier, or airport or airport system.
    Sec. 5.  EFFECTIVE UPON ENACTMENT.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 6.  APPLICABILITY.  This division of this Act applies to projects or condemnation proceedings commenced on or after the effective date of this division of this Act.
DIVISION II
LAKE DEVELOPMENT OR CREATION

    Sec. 7.  Section 6A.22, subsection 2, paragraph c, subparagraph (1), subparagraph division (c), subparagraph subdivision (i), Code 2017, is amended to read as follows:
   (i)  For purposes of this subparagraph (1), “number of acres justified as necessary for a surface drinking water source” means according to guidelines of the United States natural resource conservation service and according to analyses of surface drinking water capacity needs conducted by one or more registered licensed professional engineers.
    Sec. 8.  Section 6A.22, subsection 2, paragraph c, subparagraph (1), Code 2017, is amended by adding the following new subparagraph division:
   NEW SUBPARAGRAPH DIVISION.  (d)  For condemnation proceedings for which the application pursuant to section 6B.3 was filed after January 1, 2013, for condemnation of property located in a county with a population of greater than nine thousand two hundred fifty but less than nine thousand three hundred, according to the 2010 federal decennial census, which property sought to be condemned was in whole or in part described in a petition filed under section 6A.24, subsection 2, after January 1, 2013, but before January 1, 2014, regardless of whether the petitioner was determined by a court to not be a proper acquiring agency, the acquiring agency shall not have the authority to condemn private property for the development or creation of a lake as a surface drinking water source unless all of the following have been satisfied:
   (i)  Upon receipt by the acquiring agency of a petition, signed by not less than twenty-five percent of the affected property owners, the acquiring agency shall retain a certified hydrologist to conduct a review and analysis of the proposed development or creation of a lake. However, to be valid the petition must be filed not later than ninety days following the effective date of this division of this Act or ninety days after the filing date of the application under section 6B.3, whichever is later. The certified hydrologist shall be selected by a majority of a committee comprised of all affected property owners and a representative of the acquiring agency. The acquiring agency shall be responsible for paying the fees and expenses of the certified hydrologist. For purposes of this subparagraph (1), “certified hydrologist” means a person certified by the American institute of hydrology. If a valid petition is not filed within the prescribed ninety-day period, the requirements of this subparagraph subdivision (i) shall be deemed satisfied.
   (ii)  Upon receipt by the acquiring agency of a petition signed by not less than twenty-five percent of the affected property owners, the acquiring agency shall retain a licensed professional engineer to conduct an additional independent review and analysis of the determinations made under subparagraph division (c), subparagraph subdivisions (i) and (ii). However, to be valid the petition must be filed not later than ninety days following the effective date of this division of this Act or ninety days after the filing date of the application under section 6B.3, whichever is later. The licensed professional engineer shall be selected by a majority of a committee comprised of all affected property owners and a representative of the acquiring agency. The acquiring agency shall be responsible for paying the fees and expenses of the licensed professional engineer. If a valid petition is not filed within the prescribed ninety-day period, the requirements of this subparagraph subdivision (ii) shall be deemed satisfied.
   (iii)  The United States army corps of engineers has performed an engineering review of the project and approved all required permits and authorizations for completion of the project.
   (iv)  The acquiring agency has acquired at least eighty percent of the land area comprising the proposed water supply pool through voluntary acquisitions or voluntary negotiation and purchases.
    Sec. 9.  EFFECTIVE UPON ENACTMENT.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 10.  APPLICABILITY.  This division of this Act applies to projects or condemnation proceedings pending or commenced on or after the effective date of this division of this Act.
DIVISION III
RELOCATION OF BUSINESSES AND FARM OPERATIONS

    Sec. 11.  Section 6B.26, subsection 1, Code 2017, is amended to read as follows:
   1.  A landowner shall not be dispossessed under condemnation proceedings of the landowner’s residence, dwelling house, outbuildings if the residence or dwelling house is also acquired, business, farm operation, orchard, or garden, until the damages thereto have been finally determined and paid. However, if the property described in this subsection is condemned for highway purposes by the state department of transportation, the condemning authority may take possession of the property either after the damages have been finally determined and paid or one hundred eighty days after the compensation commission has determined and filed its award, in which event all of the appraisement of damages shall be paid to the property owner before the dispossession can take place. This subsection shall not apply to condemnation proceedings for drainage or levee improvements, or for public school purposes. For the purposes of this subsection, “outbuildings” means structures and improvements located in proximity to the landowner’s residence.
    Sec. 12.  NEW SECTION.  316.6A  Replacement property payment to certain businesses and farm operations.
   1.  In addition to payments otherwise authorized by this chapter, the displacing agency shall make a payment to a displaced person who is displaced from the person’s place of business or farm operation if the displaced person owned the real property on which the business was conducted or where the farm operation was located for at least one year prior to the date of initiation of negotiations for the acquisition of the real property and if the displaced person purchases comparable replacement real property to conduct the displaced person’s business or farm operation within eighteen months following the date the displaced person vacates the real property or receives payment from the displacing agency under another provision of this chapter, whichever is later. The additional payment shall include the following amounts:
   a.  An amount that when added to the acquisition cost of the real property acquired by the displacing agency, excluding any dwelling on the property, equals the reasonable cost of comparable real property for the displaced person’s business or farm operation, as determined by an appraiser selected by the displacing agency. In the absence of available replacement real property, the amount of the payment under this paragraph shall be the difference between the acquisition cost of the real property acquired by the displacing agency and the sum of the estimated cost of comparable land and the estimated cost of constructing comparable improvements on the land necessary for the displaced person to conduct the person’s business or farm operation. If the displaced person disagrees with the amount determined by the appraiser selected by the displacing agency, the displaced person may, at the expense of the displacing agency, select an independent appraiser to determine the amounts required under this paragraph. If the amount determined by the appraiser selected by the displaced person and the amount determined by the appraiser selected by the displacing agency are not equal and the displacing agency and the displaced person cannot agree on an appropriate amount, the amount under this paragraph shall be the average of such amounts determined by the appraisers.
   b.  An amount that compensates the displaced person for any increased interest costs and other debt service costs that the displaced person is required to pay for financing the acquisition of comparable replacement real property. The amount shall be paid only if the real property acquired by the displacing agency was encumbered by a bona fide mortgage or land contract creating a valid lien on the real property, excluding the dwelling, or on the dwelling, for not less than one year immediately prior to the initiation of negotiations for the acquisition of the real property.
   c.  The amount of actual, reasonable, and necessary expenses incurred by the displaced person for evidence of title, recording fees, and other costs incident to the purchase of comparable replacement real property, but not including prepaid expenses.
   2.  In addition to payments otherwise authorized by this chapter, the displacing agency shall make a payment to a displaced person or a person who is displaced from the person’s place of business or farm operation as an indirect result of the acquisition of real property by the displacing agency if the person in whole or in part owns the business or farm operation, the person leased the real property upon which the business was conducted or where the farm operation was located for at least one year prior to the date of initiation of negotiations for the acquisition of the real property, and the person leases or purchases comparable replacement real property to conduct the displaced person’s business or farm operation within eighteen months of the date the person vacates the real property or receives payment from the displacing agency under another provision of this chapter, whichever is later. The displacing agency shall determine whether a displacement described in this subsection has occurred. The additional payment shall include the following amounts:
   a.  If the person leases comparable real property, the difference between the average monthly amount of the lease of the comparable real property and the average monthly amount of the lease for the real property acquired by the displacing agency, multiplied by forty-two.
   b.  If the person purchases comparable real property to conduct the person’s business or operate the person’s farm, an amount calculated consistent with the provisions of subsection 1, paragraphs “a” and “c”.
   3.  All determinations to carry out this section shall be made in accordance with administrative rules adopted by the department.
    Sec. 13.  EFFECTIVE UPON ENACTMENT.  This division of this Act, being deemed of immediate importance, takes effect upon enactment.
    Sec. 14.  APPLICABILITY.  This division of this Act applies to programs or projects or condemnation proceedings pending or commenced on or after the effective date of this division of this Act.