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CONDEMNATION SYMPOSIUM May 26, 2010

CONDEMNATION SYMPOSIUM May 26, 2010. Subsurface Utilities-Easements (Deep tunnels to Aerial crossings) Appraisal Issues – Dennis Stefanik (MMSD) Legal Issues – Ben Southwick. Presentation Overview. Acquisition Process and the Appraiser Types of Subsurface Easements

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CONDEMNATION SYMPOSIUM May 26, 2010

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  1. CONDEMNATION SYMPOSIUMMay 26, 2010 Subsurface Utilities-Easements (Deep tunnels to Aerial crossings) Appraisal Issues – Dennis Stefanik (MMSD) Legal Issues – Ben Southwick

  2. Presentation Overview • Acquisition Process and the Appraiser • Types of Subsurface Easements • Subsurface Construction Methods • Easement Valuation Issues • Easement Stigma • Easement Status after Street or Highway Discontinuance • Easement vs Fee

  3. But 1st - A Little Bit About Sewers (Sanitary Sewer & Combined)

  4. MIS is the Freeway of Sewers(Metropolitan Interceptor Sewers) Limited Access and High Capacity Don’t Assume Property Can Hook Up Need local hook up (if feasible) Many sizes 36” to 120” (diameter) Deep Tunnels are 24-30 feet in diameter 250-300’ deep 10” local line can serve an entire subdivision Gravity (limited pump stations) ?? How District manages wet weather flows

  5. EMINENT DOMAIN PROCESSBen and Dennis Wisconsin Statues Chapter 32 32.05 (Highways, Streets, Sewers, Watercourses, Alleys, Airports, and Mass Transit) 32.06 (Condemnation in all matters except under s. 32.05 etc.) Public Necessity Declared-Relocation Order Acquisition Plat Need for Appraisal(s) Appraisal differences 32.05 vs 32.06

  6. 1st Steps in Appraisal Process • Evaluate the appraisal issues & negotiate your fee (Gov. or Owner’s appraisal) • Gather data: Const Plans, Esmt sample, title and survey info from acquiring agency • Envision easement (during construction and after construction with Permanent Easement Rights)…loss of uses • Is Highest and Best Use affected ??

  7. Types of Subsurface Easements(with/without surface rights) • Deep Tunnel (250’-300’ deep) • Work shafts, blasting, ground water, collector sewers • Tunnel with access rights • Lutheran College (Underwood Creek) • Hansen Golf Course • Subsurface and Surface (limited rights) (Open Cut) • Aqueducts near Milwaukee River • Oak Creek Interceptor • Temporary Construction • Expires when project complete • Conservation Easements

  8. Life Cycle of a Sewer Easement(For the Appraiser to Consider) Birth Acquisition Plat (32.05 procedure) Appraisal (District) (Owner’s appraisal) Negotiation Acquisition (Easement or Award) (Appraiser consider-terms) Construction Loss of Use (annual rate or monthly) Restoration The Aftermath-Forever (or until ??) Allowed Uses Maintenance, repair, reconstruction, access

  9. Other Potential Appraisal Issues • Soil Borings • Contamination (prior to const project) • Work in existing R/W • Street Vacations (esmt rights reserved) • Water Table & Monitoring Wells

  10. Other Appraisal Considerations • Restoration – “In Kind” • Maybe need expert special circumstances • Timing for Construction Phase • Annual amount can be applied • Temp from Perm • Hold Harmless (Ben)

  11. VALUATION TECHNIQUES • Before and After Values • Hunt for Comps • Part of the Whole • % of bundle of rights • What can you not do After that you could Before • Cost to Cure

  12. Status of Underground Utility Easement in Highway Right-of Way after Highway Has Been Discounted or Vacated • Wisconsin Statutes, section 66.1005 • Former Right of Way Reverts to Abutters • Easements for underground utilities in discounted Hwy R/W shall continue unless • No use or written consent

  13. Admissibility of Fear and Stigma Evidence • 2 Fairly Recent Court of Appeals Decisions • Generalized Evidence • Not by itself • Must be related to fair Mkt Value of property • Wisconsin Statutes, Sec 907.03 • Admission of Evidence • Relied upon by Appraisers • Considered by prospective buyers

  14. Top 10 Reasons to Purchase Fee Simple and Not an Easement • 10-You pay for it (restrictive esmt) • 9-Owners have no clue about uses • 8-Maintenance same cost (access issues) • 7-Muni ownership common in most cases • 6-Uses & Encroachments not an issue • 5-Owner can grant other easements which might conflict

  15. Top 10 Reasons (cont’d) • 4-No Hold Harmless clause like esmt • 3-Liability exposure (environmental/general) same • 2-Ownership is clear, no terms and conditions to interpret • 1-TOTAL CONTROL

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