Texas legislature kills property rights bills

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Texas legislature kills property rights bills
By Terri Hall
News & Analysis
Selous Foundation for Public Policy Research
June 5, 2013

A slate of pro-property rights bills died in the 83rd regular session of the Texas legislature that ended on Memorial Day. Texas politicians love to tout their property rights credentials at election time, but when lawmakers are in session, they've yet to give meaningful protection to landowners in several key areas when it comes time to cast a vote.

Whether it involves proper oversight over granting private entities the power of eminent domain (which most property rights groups vehemently oppose under ANY circumstances) or ensuring condemning entities actually use the land for the purpose for which it was taken in a reasonable period of time, the leadership of the Texas legislature continues to punt rather than lead.

HB 20 (authored by Rep. Lois Kolkhorst) to allow landowners to repurchase property taken by eminent domain if not used for the public use it was taken for within 10 years never even made it out of the House Land and Resource Management Committee. The same language was successfully added to an eminent domain bill in the House during the 82nd session by Kolkhorst, but it was stripped out of the final bill by the senate conference committee. This session, a new Committee Chair, Rep. Joe Deshotel, was appointed by Speaker Joe Straus who delayed even a hearing of the bill until late in the session. Deshotel made certain it was never brought up for a vote, even though Kolkhorst made changes to the bill to placate some of the concerns brought up by special interests. Kolkhorst had the votes to pass it. It was plainly blocked by the Chair.

The same fate faced Rep. James Frank's eminent domain bill, HB 1250, that had similar language to HB 20, and also would have ensured condemning entities had to use the land for the public use for which it was taken. Swapping the use for which private property is forcibly taken through eminent domain is a monumental abuse of the governmental power of eminent domain. If government can take your land, fail to use it for the supposed public necessity for which it was taken, and instead endlessly come up with other uses for it ad nauseum, Texans, nor anyone, truly has any property rights.

SB 507 (authored by Senators Kirk Watson and Kevin Eltife) to put more public protections in place on public private partnerships (or P3s) on government facilities passed the Senate but died in the House. P3s represent eminent domain for private gain and an abuse of property rights, when land is taken in the name of a 'public use,' but in reality it's turned into a private, commercial purpose. Such deals virtually always have public subsidies and monopolistic features without competitive bidding.

A bill passed in the 82nd legislature, SB 1048 pushed by British firm Balfour Beatty, that opened the door to P3s for facilities and other non-road infrastructure, including the operation of public schools and nursing homes. P3s were previously limited to transportation projects. Currently, there is no genuine oversight over the details of such contracts. An entity similar to the Legislative Budget Board made up of appointed legislators by the Lt. Governor and Speaker called the Partnership Advisory Commission may suggest 'recommendations' to be followed, but there is no required reporting mechanism, and no governmental entity has actual veto power, nor are public hearings or input required.

The impetus behind the bill was the consideration by the Texas Facilities Commission of an unsolicited bid by a private firm to develop the Texas Capitol Complex, which included a 47-story mixed-use planetarium building (the tallest building near the Capitol isn't even 20 stories), grocery stores and restaurants, and leveling the only public parking garage to make way for condos.

Watson, former Austin Mayor, sought to put a stop to it, joined by Sen. John Whitmire, who filed a similar bill, SB 894, to ban ANY commercial leasing or development of the Capitol Complex. Whitmire's bill, co-authored by 27 of the 31 state senators, passed and awaits Texas Governor Rick Perry's signature. Perry, who has led the effort to privatize everything that's not nailed down, may just decide to veto the bill. However, since SB 507 failed to pass, all the other P3s for either state or local facilities or infrastructure still lack any oversight.

SB 655 (authored by Sen. Brian Birdwell) was about the only property rights bill that passed, tightening up remaining statutes in the special districts local laws code and the water code to repeal eminent domain for the more general ‘public purpose’ to the stricter ‘public use.’

HB 3459 (authored by Rep. Craig Eiland on behalf of Land Commissioner Jerry Patterson) also passed, but it’s anything but pro-property rights. The legislation guts the Texas Supreme Court decision in favor of property owners along public beaches known as the Severance v. Patterson case.

This bill would force the condemnation of private homes (WITHOUT COMPENSATION) along public beaches if storms or other ‘evulsive’ events move the public beach line onto private property. It violates the Texas Constitution and invites more expensive court battles at landowners’ expense. The Texas Public Policy Foundation and Texans Uniting for Reform and Freedom strongly opposed the bill, but Patterson's version prevailed despite the erosion of property rights and damage to homeowners along Texas beaches who face condemnation without compensation.

Two competing bills, one by Rep. Tryon Lewis, HB 2748, and the other, HB 3547, authored by Rep. Rene Oliveira, to address who determines whether or not a pipeline meets the statutory requirements as a common carrier ‘public use’ pipeline with eminent domain authority, died without any protection for landowners against eminent domain by private pipeline companies outside of expensive court battles. The Texas Supreme Court decision in Texas Rice Land Partners v. Denbury Green Pipeline Company that granted landowners the right to challenge the common carrier status of a company, as well as the Keystone XL Pipeline brought the issue to the forefront of the property rights debate in Texas.

Lewis’ bill was the pipeline industry’s attempt to completely upend the Denbury Green decision by having the three member Railroad Commission (which regulates oil & gas in Texas -- notorious for being too cozy with the industry) make the FINAL determination about common carrier status and hence eminent domain powers, which would prohibit landowners from court challenges.

Even though property rights groups and the senate committee agreed on compromise language (after House passage) that addressed the primary concerns with the bill, the pipeline companies wouldn't agree to ANY compromise so the bill died. Oliveira’s bill would have put the more unbiased State Office of Administrative Hearings in charge of the determination and would still allow landowners their day in court if they disagreed with the decision. So pipeline companies apparently call the shots in Texas, and landowners are left with expensive court challenges as their only recourse for illegal use of eminent domain for private (versus public use) pipelines.

What's ahead?
Perry immediately called back the Texas legislature into a 30-day special session to adopt redistricting maps. He's hinted that he's open to adding more issues to the 'call.' No legislation can be considered in a special session unless the governor specifically adds it to the 'call.' So perhaps there's a way to revive HB 3547 if Perry decides to add it to the call, but knowing Perry's track record of cronyism and putting out the welcome mat for special interests, he's likely to leave property owners hanging.

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