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Posted: May 17, 2014 10:00 p.m.

Land owners around railroad seek payment

The Norfolk Southern railroad corridor continues to lie in limbo, but regardless of its future, local landowners whose properties the rail line cuts through believe the federal government owes them money for their property.

Prominent national property rights attorney Mark “Thor” Hearne filed a complaint in U.S. claims court May 9 on behalf of multiple Newton County land owners seeking monetary compensation from the federal government for taking control of a portion of their land.

It’s in the past

The rail line hasn’t been used since at least 2010 after losing its last customer, and Norfolk Southern filed to abandon the line in July 2013 believing there was no benefit to maintaining the corridor, which runs 14.9 miles from Covington southeast through Newton County to Newborn and Jasper County.

The Surface Transportation Board (STB), the federal agency that oversees railroads, approved the abandonment request effective Aug. 20; however, nothing has been done to the track, because local nonprofit group Newton Trails has been negotiating with Norfolk Southern to try to acquire – either through purchase or donation – the land to use as a public trail.

The railroad had to at least meet with Newton Trails under federal railbanking laws, and while the initial six-month negotiation period ended Feb. 15, the two groups were given a six-month extension by the STB to negotiate a possible agreement, which now carries through Aug. 14. Newton Trails officials did not immediately respond Friday to messages seeking comment.

Hearne said it’s common for these types of negotiations to drag on for years, and even if the initial negotiations end, another trail group will frequently step in to engage in lengthy negotiations. In fact, Hearne said he’s never seen a situation where the STB did not grant an extension to these types of negotiations.

“STB has essentially said out number one prime directive is to preserve corridors, so we will never take any action that causes a corridor to drop out of jurisdiction,” Hearne said. “They don’t particularly care about trails, they care about preserving future railroad corridors and are happy to extend negotiations perpetually, because as long as it’s there, another railroad corridor exists.”

You owe us

Hearne’s key argument is that as soon as the STB approved the initial abandonment effective Aug. 20 that land under the rail line technically, under Georgia law, reverted back to the adjacent parcels the land was connected to prior to the rail line being established in the late 1800s.

Therefore, when the STB granted a notice of interim trail use – at the time it approved the abandonment – to allow Newton Trails and Norfolk Southern to discuss the future use of the corridor, the federal government essentially re-took possession of the land, according to Hearne.

Since the railroad had declared it no longer intended to use the corridor for a rail line, the corridor is now being preserved for the sole purpose of the ongoing railbanking discussions, Hearne argues. The STB’s notice actually allows Norfolk Southern to pull up the train tracks and cross ties, though it must leave the bridges and trestles in place as they would be necessary for maintaining a connected trail.

In the complaint, Hearne refers to the section of the U.S. Constitution’s Fifth Amendment which states “No person shall be…deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”

He argues the government is using its power of eminent domain and should compensate the owners for their property. If no agreement is reached, the adjacent land owners may still be entitled to rent for the time period their land was held during the railbanking discussions.

Even if no trail use agreement is reached, but the negotiations drag on for multiple years, Hearne said the courts have ruled previously that the government must then pay for the cost of the land outright, because of the length of time it’s already been held. Technically, this would still be an easement - the government would not own the land – but it’s similar to situations involving power lines, where those easements can last for decades.

Who’s the real owner?

And that’s really, one of the cruxes of the issue: does the railroad own the land outright or does it only have an easement?

Norfolk Southern has been trying to sell the 14.9-mile corridor for years to local governments interested in using it either as a trail or corridor to house public infrastructure, such as water lines that could connect the rest of the county to the proposed Bear Creek Reservoir planned to be built in southeast Newton County.

According to previous research by various local officials, it appeared that the railroad did in fact own – as opposed to having a temporary easement – much of the land that constituted the corridor.

However, Hearne said in his experience that argument doesn’t hold up legally in 90 percent of these cases. He said even in cases where the railroad technically owns the land – called a fee simple title – the courts have often ruled that the intent of that land purchase was purely for a railroad.

The argument is that in the late 1800s, the railroad companies weren’t thinking about the future use of the corridor beyond its existence as a rail line – they weren’t worried about trails and hadn’t conceived of technologies like fiber optic cables, Hearne said – and so their interest in the land was purely temporary so long as a corridor held value as a rail line.

Hearne said the court is tasked with determining what the original grantors – the land owners – actually intended to five the railroad.

“Did the owner intend to give (the railroad company) title to the land itself, this thin strips of land, or did (he or she) mean to give (the company) an easement?” Hearne said. “The railroad does not need to own the land and it doesn’t make any economic sense, because it it’s not used for a railroad anymore, it doesn’t have any economic value, so there’s no reason for them to have a fee simple title.”

The process from here

Hearne and another attorney from the firm Arent Fox met with land owners twice last week to go over the issues; he’s been in talks with them since they reached out even before the abandonment notice was filed.

Ricky Mock is one of the land owners affected, and the rail line runs through the middle of about a mile of his property.

“I own on both sides of it, so they took a significant amount of property from me,” Mock said. “I was going to develop it when the rail line was abandoned, but now I still have the (line) going through here. I have to put a surface street on the other side of the line now and have to up 100 feet of my property.”

Hearne said landowners are only entitled to compensation if they file a claim in federal claims court within 6 years of the initial action – which in this case would be the notice of interim trail use given last August. Hearne has already filed a complaint on behalf of multiple land owners.

While the claims court is in Washington D.C., the court will travel to Georgia to hear this case, Hearne said, though no time table has been determined and it could be years before a hearing.

The judge assigned to the case will hear evidence from both sides and, assuming she agrees the adjacent owners are entitled to compensation, she’ll also hear evidence about what each owner’s property is worth and make a separate determination for each parcel.

Hearne said an appraiser will value each separate property and determine what it would be worth if there was no corridor on it and what it’s worth now that there is a corridor on it “controlled by STB and possibly a trail group.”

Hearne said in a similar case in Florida, heard by the same judge assigned to the Newton County case, some property owners’ values were found to be 20 percent less because they had a corridor going by their home.

Hearne said every housing market is different, but he said a number of studies point to home immediately next to a trail are less valuable – depending on factors like how much buffer and landscaping there is between the home and the trail. On the other hand, the properties near, but not on the trail can actually experience a property value increase because of the close proximity of a recreational amenity, Hearne said.

“One thing the court won’t do is undo the railroad, so the litigation in federal court is not something that can change the fact the property had already been taken for a rail corridor. The only thing the court does is compensate the landowners,” Hearne said.

Mock said the law firm would get one third of the settlement, while the landowners would get the remainder – all attorney’s fees would also be paid for by the federal government if the claim is successful.

“We get paid compensation for what our land would be worth plus what the damages are to us to have people using our land. We can’t put driveways across it; we can’t have access to it like we would if we had gotten it back,” Mock said.

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