real estate

The Question Should be “Am I Getting the Fairest Offer”

Think about it a Rod is a unit of measure of 16.5 feet. That is linear feet. When an easement is sought by negotiation or by eminent domain, they are not seeking a line. Typically, they are seeking a zone with the rod merely as the middle. For example, a rod with a 50′ easement zone requires 825 square feet. If an easement is 50 rods long, that is almost an acre.

In a recent case, a pipeline company paid some owners $180 per rod and others $767 per rod for the same project. The variance depended greatly upon the use of the property (residential vs. agricultural) and the ability of the owner to negotiate.

An Easement is a Forbidden Zone

The easement prevents you from using your property as you like or need to. For example, it can prevent you from planting trees, shrubs, or placing buildings. It can also forbid you from creating pond, lake or diverting drainage.

An Easement Prevents Development

Aside from normal operations, an easement may render your property unsuitable for certain types of development such as retail, operations expansion, wind farm or other opportunities.

What Will it Cost Them if I Refuse?

Don’t be afraid to say no!

If a company does not have the power of eminent domain, the cost is what is required to go around you?

Even a company with the power of eminent domain will face substantial expenses to obtain court intervention. And they still must pay you.

When and How Will the Easement Terminate?

Pipeline companies want a vague description of when and how an easement will terminate. Whenever possible, the owner should negotiate these terms.

Removal or Abandon in Place?

Easements often allow a company to abandon the pipeline in place. This gives the owner problems later. If the pipeline transported any hazardous materials the cost to remove may be very high.

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Additional Resources: Texas Pipeline Easement Checklist

Navigator SMS Pipeline Project stretching from Calumet in Canadian County, through Kingfisher County and eventually finishing in Cushing in Logan County.  The paperwork describes this as phase 1.  The image is a preliminary plan showing the route.

As with most proposed easements there are onerous terms that can prevent the owner from building ponds, changing grade, planting trees or shrubs.  They also ask the owner to warranty title.  So far, materials have not claimed that Navigator has the right of eminent domain for this project.

As in all such cases, if an agreement is reached, there will be a one-time payment and no opportunity to re-negotiate the terms.

Don’t be Afraid to Say “NO” to the Initial Offer.

In a similar pipeline project, another company paid a range from $180 to $745 per rod with an average of a 50 foot easement. The price obtained depended upon the nature of the property and the negotiation skills of the landowner.

What if They Claim that My Property can be Taken by Eminent Domain?

Even if the company has the ability to to use Eminent Domain, you as the the landowner have the Constitutional Protection under the 5th Amendment for just compensation. Your property cannot be taken without compensation even if you are taken to court.

Often the initial offer is not the best deal in these types of situations.

What is the going price for a rod, Click Here?