Chapter 2: State Acquisition by Eminent DomainAnchor: #i1001286
Section 1: Offer Letters
If acquisition by ED becomes necessary, condemnation proceedings must be started by the acquiring agency. Chapter 21 of the Texas Property Code sets forth certain requirements relating to offers made by condemning authorities. These requirements must be met in order to ensure TxDOT has the authority to proceed to condemnation without further delay.
Section 21.0111 of the Property Code requires TxDOT to send the initial offer letter to the landowner by certified mail, return receipt requested. This initial offer letter should also include a copy of all appraisal reports produced or acquired by TxDOT relating to the owner's property and prepared within 10 years preceding the offer. The landowner is entitled to at least 30 days to review the initial offer before TxDOT can send out a final offer.
It is recommended that the Landowner's Bill of Rights as described in Section 21.0112 of the Property Code is included with the initial offer letter. A copy of the most current Landowner's Bill of Rights can be obtained from the Texas Attorney General website or the TxDOT website.Anchor: #i1001294
After (1) the landowner has had at least 30 days to review the initial offer, and (2) it is determined that the property interest needed can not be acquired through negotiation (including administrative settlement), or (3) if there are title problems that can not be resolved, send a formal Form ROW-N-FOL, Final Offer Letter, or the formal form specific to easements, Form ROW-N FOLE, to the owner by regular U.S. mail.
In the caption of the final offer letter, describe the property being taken in such a way that it can easily be identified by the owner.
This final offer must be for the amount previously established as the approved value with the State taking title to any improvements involved. Pursuant to Section 21.0113 of the Property Code, this approved value must be equal to or greater than the amount of the written appraisal obtained by TxDOT upon which the final offer is made. An additional copy of the appraisal upon which the final offer letter is based should be included with the final offer.
The final offer letter should clearly state that the offer is stipulated upon the owner conveying clear title to the State. Section 21.0113 also requires that the final offer include a copy of the deed, easement or other instrument conveying the property sought to be acquired. The final offer letter should include the spouse, even if not identified on the title commitment.
In final offer letters, state that the offer is final, and establish a definite date when the offer expires. Section 21.0113 (b)(7) requires that the landowner is given at least 14 days to respond to the final offer letter. The letter is signed by the Right of Way Manager or designated representative. Send two copies of both the initial and final offer letters to the ROW program office in Austin with the Form ROW-E-49, Request for ED Proceedings.
Do not deviate from the appropriate final offer letter except under special conditions such as unusual splits in ownership, ownership of unproven interests, and multiple ownership. To aid in preparing these letters, the following instructions and examples are guidelines to help eliminate possible misinterpretation of TxDOT's position by property owners.Anchor: #i1001344
Instructions and Examples for Special Circumstances:
- In some cases, more than one person
owns an interest in the property, and each interest can be verified.
A final offer letter may be addressed and mailed to each person individually and must clearly state that the amount being offered is for each person's individual interest. For example, assume that John Doe and Richard Roe each own a proven undivided one-half interest in a parcel valued at $1,000:
A final offer letter may be addressed and mailed to John Doe and should state:
"According to authorization by the Texas Transportation Commission, we hereby offer a total sum of $1,000 for the above captioned tract of land. Our records show that you own an undivided one-half interest in this parcel and, therefore, you are hereby offered the total sum of $500 for your undivided one-half interest.”
A similar letter may be addressed and mailed to Richard Roe.
- Or, send one final offer letter jointly to all the various
owners and forward copies to each one, provided this letter shows
the total amount being offered for the whole property and the amount
being offered for each individual interest. Assume that John Doe
and Richard Roe each own a proven undivided one-half interest in
a parcel valued at $1,000:
One letter may be addressed to all the owners jointly, and a copy sent to each. This letter should state:
"According to authorization by the Texas Transportation Commission, we hereby offer a total sum of $1,000.00 for the above captioned tract of land. Our records show that each of you own an undivided one-half interest in this parcel and, therefore, each of you is hereby offered $500.00 for your undivided one-half interest.”
The latter method may be preferable because all owners know what is being offered to each individual owner.
- In most cases when there is a tenant with a compensable
interest, make the final offer to the fee owner. Occasionally, when
there is a compensable leasehold interest that is negotiated separate from
the fee, and either the fee owner or the lessee refuses to negotiate,
then both interests must be condemned together. The only exception
is the lessee's interest for a billboard that may be purchased separate
from the fee, provided the billboard is acquired simultaneously
with, or prior to, the closing of title.
Address the final offer letter only to the fee owners and include the total amount of the approved value. The letter should state that (1) the amount being offered is the total amount for all interests acquired, and (2) for the fee owner to accept the offer, he must directly negotiate and obtain the release of all other property interests.
- Sometimes, it is impossible to break down the interests
to make an offer in a specific amount for each interest.
Address the final offer letter jointly to all persons having an interest, and mail a copy to each person. The letter should show that (1) the amount offered is a joint offer for the full amount of the interests acquired, and (2) the offer must be accepted by all parties. For example, the following applies when John Doe and Richard Roe each own some interest that can not be broken down in a parcel valued at $1,000:
Address the letter to both John Doe and Richard Roe at their individual addresses (with a copy mailed to each) stating: "According to authorization by the Texas Transportation Commission, both of you are offered jointly the total sum of $1,000 for the entire property. For there to be effective acceptance of this offer, each of you must communicate acceptance to this office."
- Mail a copy of the final offer letter to each person known
to hold fee title to the interest being acquired regardless of their
legal status. If the person is a minor, mail a final offer letter
to the person whether or not a guardianship exists. If a guardianship
exists, also send a copy of the final offer letter to the guardian.
Follow the same procedure in cases where the owner of the interest to be acquired was legally declared mentally incompetent (or non compos mentis), or in any other situation where a guardianship exists.
- The final offer letter should point out that the final
offer depends on TxDOT receiving clear title.
For example, assume that the owner of a property interest valued at $1,000 lacks capacity to convey title to the property because the owner is a minor with no guardian. Address and mail the final offer letter to the minor. The letter should state: "You are hereby offered the total sum of $1,000 for clear title to your property and property rights."
- If the property owner has provided written verification of legal representation, and TxDOT has been instructed by the legal representative not to communicate with the owner, send the final offer letter to the property owner in care of the attorney.
- If the property owner has indicated he/she has legal representation, but has not provided written verification, send the final offer letter to the property owner and copy the attorney.
Written Offers to Unknown or Unlocated Owners
To satisfy the requirement of making a written offer when the record owner (owners or their heirs) are unknown or can not be located after due diligence, address the initial offer letter to the record owner at the record owner's last known address, as shown by local tax rolls. Send a copy of this letter to the address of the subject property, if the address is different from the last known address. In the letter, state that it is the last known means of trying to locate the record owner, or the owner's heirs, and describe the efforts made to find the owner. Such letters should have the notation under TxDOT's return address: "Forwarding and Address Correction Requested.”
Suggested sources for locating people include:
- area phone books and local directories;
- directories on the internet;
- neighbors at last known address;
- neighbors of the subject property interest;
- local utility companies;
- post office for forwarding address;
- driver's license;
- probate records;
- property records;
- marriage license;
- voters' registration;
- civil or criminal court records; and
- witnesses or attorneys shown on any legal documents found.
Follow the procedure described above when a person without legal claim to a property interest (a "squatter," a mere possessor, or an unperfected adverse possessor) is occupying or using the premises. However, when the ED proceedings are filed, make this person without legal claim a party to the proceedings as an adverse possessor even if the owners are found.Anchor: #i1001523
Persons/Entities in BankruptcyAnchor: #i1001541
Title Update for Eminent Domain
Title for all property interests must be searched before making the initial offer. After the need for ED proceedings is determined, update the search for title information affecting the property interest.
If title insurance is involved, and upon the submission of Form ROW-E-49 to the ROW program office in Austin, notify the title company (1) that the property interest will be acquired by ED and (2) that an updated title report is requested. The title company must provide the department with an updated industry-standard title commitment. See Department of Insurance Form T-20, Owner Title Policy Commitment and Form ROW-N-71, Owner Title Policy Commitment.
If title insurance is not involved, the department must update title data on Form ROW-N-ACA, Attorney's Certificate "A", Initial Certificate for Negotiated Parcels to ensure that the State will secure clear title to the property through the condemnation process. See Attorney's Certificates in Volume 2.
Send two copies of Form ROW-E-SubCheck, Eminent Domain Submission Checklist , including updated title information, to the ROW program office in Austin with the Form ROW-E-49, Request for ED Proceedings. The issue date of the commitment must be within 90 days of the date that the ROW program office in Austin receives the submission.