? Regarding major utility easement's effect on market value

[Jo Ann Meyer Stratton]

Don't have any market data but a personal prespective. That gasline mentioned by Greg and Neil is my rear property line for 300'. Creates a nice wide alley and puts my neighbor way other there. It stretches from the CA coast to somewhere in TX. In town is a street called El Paso Boulevard that is 200' wide with a 100' wide graveled and curbed area down the middle so that it is a divided street. The homes are generally financed through the USDA or FHA and all the homes sell without any problems. Pipeline has been there for over forty years, quite a few scattered acreages use it for their access road--although that does upset El Paso Gas. Anyway, it has not affected the value in my area. And nobody even gives it a second thought. I guess we all should, but everyone in the county knows that if there was ever a gas smell is in the air to call El Paso immediately.

 

[Donna Williams]

Thanks everyone, you've given us alot of food for thought! I particularly appreciate the links to the past thread and news articles. Jo Ann, I also appreciate your personal perspective, although I'm looking at it from a different viewpoint right now. I'm guessing from the info. I've just read about the age of the El Paso lines that you acquired the property with the easement already in place and knew that it was part of the package up front. With us, it's coming through after we've invested in improving the property and we would have never purchased the property with such an easement.

You guys are very helpful with your knowledge and advice. I truly appreciate your generous spirit.

Donna Williams

 

[Ed Potrafke]

Push for a large settlement. An area of southern Michigan, where I used to do some work, has a large pipeline. Many of the homeowners were able to free gas as part of the settlement. Most of these home sell for a bit more than the homes that do not have the easment.

 

[xmrdfghap]

Many of the homeowners were able to free gas as part of the settlement.

Isn't that a pretty significant concession? Does the free gas run with the property?

 

[Farm Gal]

Greg:

That is a not uncommon concession for both major pipeline and local pipeline easements.

I am watching this features as utility costs increase... I am also observing a definite market reaction to 'free gas'.

The feature does tend to transfer with the property, but I would get that assurance in writing :twisted:

 

[Donna Williams]

That's illuminating information, LeeAnn and Ed! We have posed the suggestion of a "farm tap" but the supervisor of this project says that isn't feasible due to the high level of pressure on the line - 800 psi is average. He says it cannot be reduced enough to feed our home. That really bites, since I have a propane tank on the other side of my house! At one point, one proposed route for the line would have brought it within 50 ft. of my propane tank and I still would not have had access to natural gas. Our area is not even served by this utility or any other. This supervisor said that he was unsure if his company was even assigned the right to serve our area. They're just passing through!

After everyone posted the informative and somewhat eyeopening links above, I did some research. Piedmont Natural Gas, the company that we're facing off with, seems to have an exemplary safety record. I could find no record of any accidents such as those that plague the El Paso Gas Co. That may very well be the way that the odds play out with El Paso being such an extensive network with many aging lines. But, one day this line too will be 50 years old!

In reading about some of the lines and articles outlining opposition to them, I noticed that some lines are required greater scrutiny in the way of environmental studies and regulatory certificates being issued. It appears that lines that are not interstate, crossing state boundaries, do not come under these regulations. That's our case here. Does anyone know if the lines do not cross state lines, does it lie with the state gov. to regulate this usage? Would that be our Dept. of transportation?

Thanks again for your viewpoints and ideas regarding this situation that we find ourselves facing. I just wish I had found this forum earlier!

Donna

 

[Farm Gal]

Donna:
Sorry I did NOT intend to mislead you... The 'tapping' is only applicable to major easments which have in place a local delivery system/subsidiery!

If you are on LP you will likely remain that way .

More frequently the tapping is associated with small acreage landlease situations than majors... but I am aware of some majors that punched through existing rural neighborhoods wherein such was negotiated.

It sounds (from what you have described) that it will be you against the company... Which is at best a Goliath opponency... but with the right stone and a sling :wink:

So carry on with your research, you seldom have to 'settle' for exactly what your neighbors do, particularly if you are informed.

The previous advice of getting 'expert' representation is probably in order, but you may 'give away' some of your 'profit' from this taking in the process. not that you WANTED any :evil:

Too bad you stand in the way of progress

 

[Terrel L. Shields]

Will this easement decrease my overall property value and the resale value of our home?

Likely....remember when they ask you what the value of the easement is to YOU, state clearly a very high number and here is why. A road being widened near me cut about 33% of a man's front yard out. He complained and went to court, jury trial. The state Hwy dept did not even have a formal appraisal but offered about $75. An appraiser for the landowner estimated some $1,800 in loss. But the owner had told the Hwy Dept. that "I wouldn't take less than $3500 for that piece." during negotiations.

The jury awarded them $3,500.

There is also another case reported in the Appraisal Journal some time back where a small easement ended up in Supreme Court over valuation. Basically, the loss was a line of pine trees used by the homeowner to screen his pool, and reduce road noise. Loss of the trees he argued damaged the whole property by thousands of dollars.

 

[Restrain]

Check with a local attorney who deals with eminent domain for how the condemnation commissioners generally rule. In my county, the commissioners are all attorneys who are appointed in return for kissing up to the local judges. Only county I know of where it's done that way. Anyway, they will INVARIABLY split the difference no matter how rediculous the property owner's estimate of value is, and the proof of value can be a letter from a realtor saying, "Well, I think it's this."

Roger

 

[Donna Williams]

Boy, you guys provide a great education! It appears that the majority of the forum members weighing in with their opinions, forecast a decrease in property value overall.

Thanks Terrell, for the warning about what amount to request. Our attorney advised us not to set a top amount ( he has experience in working on both sides of the easement and right of way issues). Rather, to just pump the company rep. for all of the information regarding their valuation, their use of the line and easement and their top offer. This may be why he offered that advise. It was interesting to hear from someone a little closer to where we are located in SC. But if the DOT in Arkansas is so bad as to offer $75 to someone for coming that close to their front porch, I don't know. I know of someone in SC who faced this same situation recently, but he got a little more than that :wink:

And Roger, you may be right about being the only county where the unwritten rule is to split the difference. I understand from our attorney who briefed us on what to expect, that in SC this is a matter for jury trial. We live in an area of combined rural, suburban and urban development where I'm betting that the majority of the jury pool will be homeowners or future homeowners who will feel as incensed as I do over this taking. At least I'm not in Texas with a group of commissioners who are chosen through the good ol' boy system and the El Paso Gas Co. (which seems to have more than it's fair share of problems).

I've also discovered after meeting with the co. rep. today that this line is the first major transfer line to go through our area. All other natural gas supplies come from much smaller and lower pressure service lines and the pressure is lowered at the the Transco distribution sites. I would understand this to mean that there would be few if any comparable properties in this area where the effect of this type of large transmission line on property value could be measured. It appears that the company has allowed it's demand to outstrip it's supply and they're having problems providing enough pressure as the elevation and distance increase. I anticipate the company will claim that the service lines in the area have not been shown to damage property value, therefore this shouldn't either. Would the difference in the lines and the danger of the highly pressurized nature of the fuel be enough to counter this arguement? We also have information from a nearby friend who made a recent settlement with an electrical utility co. He received double what we've been offered for property with less value. Would that be comparable to this easement?