Eminent Domain in Colorado
In Colorado, as in every other state, various government entities have the power of eminent domain. The State of Colorado, as well as incorporated towns and cities, have broad eminent domain powers to take property for any recognized public purpose, with only a few limitations. In addition, special districts are considered government entities for many purposes, including the exercise of the power of eminent domain. Under certain circumstances, private companies and even individuals can initiate condemnation proceedings to acquire property by condemnation, for example, pipeline easements or easements for ingress or egress to property.
Any entity exercising the power of eminent domain is required under applicable statutes to notify the property owner promptly after a decision has been made to take the property. Before filing a petition to condemn any real estate in Colorado, a condemning government authority must enter into good faith negotiations to make an offer to purchase the property. In the event the owner wants to seek his or her own appraisal in order to evaluate the government offer, the law allows the owner to do so, and the condemning authority is charged with the responsibility to pay the reasonable expenses for such an appraisal as long as the property being acquired is worth more than $5000.00. If negotiations are unsuccessful, a condemning authority can initiate a condemnation proceeding by filing a petition in condemnation which is a lawsuit filed in the District Court, like any other civil action.
Once a petition in condemnation is filed, a property owner has several strategic decisions to consider about how to proceed. Most urgently, the owner must promptly determine whether it wants the valuation decision made by a panel of commissioners or a jury. The panel of commissioners typically consists of three individuals, usually with significant real estate or judicial experience, to determine what fair valuation is in the case. These individuals are appointed by a District Court judge, often upon recommendations made by the parties. A trial to commission typically can occur in 6 to 8 months from the date of the filing of the petition. The owner also has the option under Colorado Statute to demand that the valuation issues be decided by a jury of 6 “freeholders” or property owners within the judicial district where the case is brought. The jury trial is presided over by the District Court judge and, therefore, typically takes longer to schedule than a hearing before commissioners. In condemnation proceedings, the District Court judge decides every issue, such as the necessity for the taking, the timing of possession, and the admissibility of evidence, outside the presence of the commission or the jury, and the only issue that is determined at trial is fair valuation for the property interest acquired.
Colorado has constitutional protections of owners to assure that they receive just compensation in eminent domain cases. However, condemnation always takes place at a time at the choosing of the government initiating the action, and government entities are well versed and highly experienced in the procedures and strategies involved in attempting to acquire property. Any property owner is well advised to seek legal advice immediately upon learning that its property is targeted for condemnation or is in the path of likely government use in the future.