I Received an Eminent Domain Offer in California

What the agency must give you with its offer

Government Code sections 7267.1 and 7267.2 require a public agency to establish an amount it believes is just compensation and to offer that full amount in writing before it begins negotiations. The offer must come with a written summary of the basis for the amount. The agency may not offer less than its own approved appraisal.

Read the summary before the number. It tells you what the appraiser measured, what comparable sales were used, and, on a partial take, whether damages to the remainder were considered at all.

How the number was built

Fair market value in California is the price a willing buyer and a willing seller would agree on, neither under compulsion, both fully informed, with the property exposed to the market for a reasonable time. On a partial acquisition the appraisal has two parts.

• Value of the part taken. Measured as though the part taken were sold on its own.
• Damages to the remainder. The loss in value to the land you keep, caused by the take or by the construction of the project.
• Benefits. Any increase in the value of the remainder that the project confers, which the agency may offset against damages.

What offers commonly leave out

Offers are prepared to a schedule and a budget. The items most often thin or absent are the ones an owner knows best.

• Loss of business goodwill, which California compensates under Code of Civil Procedure section 1263.510 and which most states do not.
• Fixtures and equipment attached to the realty.
• Loss or change of access, and the effect of a new median, wall or grade.
• Damage to the remainder from construction, drainage, noise or a changed configuration.
• Relocation assistance under the California Relocation Assistance Act, Government Code sections 7260 to 7277, which is separate from just compensation.

What accepting does and does not do

Accepting the offer resolves the acquisition. It also ends the negotiation over items the offer did not include, so check the summary against the list above before you sign. Relocation benefits are handled separately and are not waived by settling the value of the property.