California voters defeat eminent domain ballot initiative

San Francisco (Platts)--8Nov2006

A measure on California's November 7 ballot that would have restricted
the use of eminent domain by the state's public utilities and government
agencies was defeated.

According to figures released by the California Secretary of State, the
proposition received 3,073,677 votes, or 47.5%, in favor, and 3,394,145 votes,
or 52.5%, opposed.

Under Proposition 90, property owners would be paid for the highest and
best use of property instead of the current fair market value.

State regulators have expressed alarm that the measure would complicate
the already difficult process of citing critically needed electric
transmission facilities.

But supporters have maintained the proposition is needed to protect
citizens from government acquisitions of private property and unfair loss of
property value resulting from unfair government decisions.

Private property could be taken only when just compensation, determined
by a jury unless waived, has been paid to property owners. Property owners
would not need to pay legal fees for the litigation, according to analysis by
the California Public Utilities Commission's legal division.

The proposition was sparked at least in part by a controversial 2005 US
Supreme Court decision upholding a town in Connecticut's right to seize land
for economic development by private developers. Oregon passed a similar
measure in 2004.

California Governor Arnold Schwarzenegger weighed in against Proposition
90 last week, saying in a statement that the measure was so broad and poorly
drafted that it will "result in a barrage of frivolous lawsuits from
individuals and property owners who claim the most rudimentary new laws have
caused them economic harm."

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