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Understanding eminent domain basics

The governments -- federal, state and local -- have some rights regarding public land. Specifically, governments have the right to take land from a private citizen or business if that land is required for public use. This power is called eminent domain. Various laws govern how eminent domain can be implemented in certain situations, but most do require that the government make "just compensation" for the property to the property owner.

Many people see eminent domain as a last-resort way for property to be acquired for certain public use needs. First, the way the property will be used usually has to meet specific needs. It must be public in that it provides some benefits to the public. Commonly, these are projects regarding infrastructure or public works, so eminent domain might be used to acquire land for streets or civic centers. Other uses might include hospitals, fire stations or universities.

Owners of land or property are supposed to be paid the fair market value for that property. California law defines this value as the price that a buyer and seller would be likely to come to agreement on at the time if both the buyer and the seller had no urgent need to come to that agreement. In short, it's the market value minus any extenuating factors that might cause a buyer to short sell or a seller to offer more than necessary for a property.

Dealing with issues of eminent domain can be difficult for entities on either side of the transaction. If you are involved in a land development project, consider speaking with a professional regarding your options for land purchases, which might include eminent domain.

Source: League of California Cities, "Property Owner's Information Pamphlet on Use of Eminent Domain in California," accessed July 08, 2016

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