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April 19 and 20, 2006
Tibbett Building, Rooms 131 and 132
Eastern Wyoming College, 3200 West "C" Street
Torrington, Wyoming
Senator Gerald E. Geis, Chairman
Representative James C. Hageman, Vice Chairman
Senator Curt Meier
Senator Wayne H. Johnson
Senator Ray Peterson
Senator Bill Vasey
Representative Kermit C. Brown
Representative Kathy Davison
Representative Ross Diercks
Representative Burke Jackson
Representative Layton Morgan
Representative Doug Samuelson
Representative Mick Powers
Representative Mark Semlek
Maxine Weaver, Staff Attorney
Please refer to
Appendix 1 to review the Committee Sign-in Sheet
for a list of other individuals who attended the meeting.
Chairman Geis called the meeting to order at 8:30 am. The following sections summarize the Committee proceedings by topic. The order of the meeting generally followed the prepared agenda [Appendix 2]. Dr. Jack Bottenfield, president of Eastern Wyoming College welcomed the Committee to the college campus.
A panel consisting of Tom Toner, Yonkee & Toner, Matt Micheli, Holland and Hart, Jim Magagna, Wyoming Stock Growers Association (WSGA) and George Parks, Wyoming Association of Municipalities (WAM) set the background on eminent domain for the Committee.
Jim Magagna expressed concern that attempts to acquire property would lead to abuses that are occurring in other areas of country and urged the legislature to restrict the ability to abuse eminent domain rather than wait to correct an abuse [Appendices 3 through 7]. He urged the Committee to consider leveling the playing field between the private landowner and the company wanting the right-of-way and to consider how negotiations are conducted between the parties.
Tom Toner discussed problems in condemnation from companies, stating private companies act like public entities, but they do not have same purpose, they do not have same motives and they do not have the same notice or accountability as public entities. He explained the law is divorced from public policy and that eminent domain is being misused and abused. Mr. Toner urged the Committee to allow the property owner to use the best evidence of value of the property and suggested the condemnor be required to show there is no reasonable alternative to the taking.
Matt Micheli believes the eminent domain statutes are fair and his oil company clients use eminent domain as a last resort to develop the mineral industry by providing the landowner monetary compensation and only allowing condemnation when necessary for public good. He works with landowners to see the landowners get reasonable value for their land taken, but there are circumstantiates where landowners do not take the reasonable amount and ask for more for the value of their property, allowing any landowner to act as a troll under the bridge to halt the project. Mr. Micheli gave a brief overview of various statutes and how he uses them in condemnation. He stated if the legislature takes away the right of eminent domain, there will be no leverage left for the mineral industry and the surplus we enjoy in Wyoming will shrivel up. He further stated any changes would open the door for more litigation and would not guarantee any more protection of landowners while taking away the rights of the mineral industry.
George Parks stated the governmental right of eminent domain exists because Wyoming concluded it needed the right of eminent domain to serve the greater good for the people of Wyoming. For eminent domain, the government has to conclude there is a public necessity of the project, that the property in question is necessary for the project, that it is planned in a manner most compatible with the most public good and the least private injury and consider the range of options before proceeding with condemnation. The public official must be prudent with public money and must consider how much of the public money is used to have the project go forward. With condemnation there is public notice, a public hearing and a public review process. Mr. Parks noted the urban renewal process is not used much and there are only a few urban renewal authorities in Wyoming. He stated the intent of urban renewal is to clean up the hazard and to return the property to private ownership and that with urban renewal there is an economic development tie. The exercise of eminent domain is vary rare but it does happen. Condemnation gets people to table and encourages them to settle out of court. He cautioned against taking action now that may have unintended consequences in those areas.
Marion Loomis, Wyoming Mining Association, asked the Committee to remember mineral rights are private property and the need to protect those rights and said most negotiations are productive without eminent domain, but there is a need to protect the right to use eminent domain.
Eric Barlow from Gillette discussed a power line condemnation stating the issue was not about money, it was about the terms of the agreement [Appendix 8]. He stated condemnation is not about individuals condemning individuals, rather it is about companies condemning individuals and the imbalance of power and ability to address issues at hand. Mr. Barlow stated if condemnation is not the first thing the landowner is told by the company, it is one of the first things on the table. He explained what is going on in the field is a long way from where the statute was meant to be. He further explained that condemnation is costly for the landowner in terms of money and time, that it is emotionally draining and the current practice by companies is an inappropriate use of eminent domain.
Jim Rogers, rancher from Albany County has two pipeline corridors and a transmission line across his property. He stated he has never been condemned and when a company comes to his table to talk condemnation he knows he doesn’t have the money to fight them and many ranchers are in the same fix. When the person across table has a big club you don’t have a willing buyer and a wiling seller. Mr. Rogers expects another pipeline to approach him this summer and yet another pipeline next summer. They will take the value out of his property, pay a one time fee that he has to live with in perpetuity and if they drop the pipeline, the company will leave the pipeline in the ground. Mr. Rogers explained there is a need to level the playing field, to allow for good faith negotiations on both side of table, to consider the term or to consider other options such as annual payments. The threat of condemnation does affect him and all other landowners.
Gene Hardy, representing himself, thanked the Committee for looking at eminent domain. He has been involved with mineral development but has never been faced with condemnation. He believes the private landowner should be treated no worse than the federal or state landowner. On the federal and state lands, they only grant a term easement while on private lands they want a perpetual easement. He urged the Committee to consider the aesthetic value on lands and the amount easements take away a lot of value from adjacent lands.
Tom Dunn, retired professor previously on the environmental quality council and ranching in Albany county, has three easements across his ranch including an electric transmission line, a gas pipeline and a fiber optic line. He asked the Committee to consider what constitutes public purpose, what is just compensation and to consider a mechanism for leveling the playing field between those who have power for eminent domain and those who do not. Fair market value is usually a transaction between a willing buyer and a willing seller while eminent domain it is a willing buyer and an unwilling seller. He urged the Committee to consider for condemnation if good faith negotiations have been entirely exhausted.
Jerry Dilts, owner of the Bridle Bit ranch, stated the condemnation litigation was not about the money. He urges the Committee to utilize public lands for easements over private lands and to use existing corridors as much as possible [Appendix 9].
Donley Darnell, rancher from Newcastle, urged the committee to limit takings to actual use and not in perpetuity and to prevent an easement holder from selling to a subsequent easement holder. He stressed that when the land is no longer needed for the easement, the land should revert to the landowner and the landowner should have the right to chose the method of payments and the payments should be ongoing as long as the aggravation is there. Mr. Darnell expressed a need for the Committee to tighten up the definition of public use, that any condemnor should have proof of solvency, that eminent domain should not be used as a threat but as a last resort, that there should be a preference for public lands over private lands; that there should be a preference to use existing corridors, and if the taking is done and then dropped before the case gets to court, the condemnor must compensate the landowner for costs [Appendices 10 and 11].
Laurie Urbikit, Wyoming Association of Realtors, limited her comments to governmental entities and urban renewal and urged using comparable value of the property and other costs such as legal and temporary housing and to allow municipalities to clean up blighted areas.
Laurie Goodman, representing Landowners Association of Wyoming, encouraged the Committee to address eminent domain so it is less contentious and more collaborative [Appendices 12 through 19] and landowners have not said there is not a right of eminent domain, but they are saying the process is broken from the landowner perspective as the landowner does not have the same leverage when they sit at the table.
Dave Ditto, representing Associated Legal Group and Kinder Morgan, said the statutes do define what is expected in good faith negotiations and takings on easements are difficult to determine because it is a partial taking. He said taking property is about whether gas and electricity is more important than individual land rights. Regarding annual payments, a lot of coalbed methane companies make annual payments, but on utilities and pipeline companies with thousands and thousands of miles of pipeline it would be difficult administratively to figure all the payments the cost would get passed on to the consumer. Mr. Ditto said if the company trespasses on land before it has right to be there and if the landowner is unhappy with the value and appeals the decision and gets a higher amount from the jury, then the landowner will get attorney fees.
Brenda Johnson, representing the Willadsen ranch, said they have numerous easements and each easement was conducted with the threat of commendation. On land the Willadsens had owned for 125 years, the City of Cheyenne had been planning on building a reservoir since 1999, but the City had never contacted the Willadsens or informed the Willadsens the reservoir would ruin their livelihood. The Willadsens found out about the City's plan for the reservoir in 2005 and after confronting the City about the plans, the City pulled the application for the reservoir. Ms. Johnson stated eminent domain is an easy tool to use against private landowners and there needs to be stronger laws to level playing field because it is discouraging people to own land when it can so easily be taken away.
Nancy Darnell, from Weston County, stated the landowner should be fully compensated for fee simple and the full extent of damages when their property right is taken away [Appendix 20].
Tayler Haynes, representing Western Laramie County Landowners, said to balance the power each party must be able to come to the table and say no. If the little guy can't say no up to a certain point then the companies have more power and that is not the foundation of this nation. Lease arrangements work in all sorts of businesses. He said the eminent domain law as written forces mostly bad deals for little guys trying to make a living. Mr. Haynes urged the Committee to consider statutes to allow progress but not at the expense of the little guy and to make it so property reverts to landowner at the end of the use of the easement [Appendix 21].
Steve Adami, landowner from Johnson County, said the current law is not working, that there is abuse going on and condemnation is an emotional toll being taken on families. Mr. Adami said he never had verbal contact from company – his first contact was a take it or leave it letter. He is only asking for what is economical, practical and allowed under Wyoming law and asked the Committee to look at when private land can be taken by a private company.
Ken Hamilton, Wyoming Farm Bureau, asked the Committee to define good faith negotiation and public use. He further stated if a company condemns property for a certain use, then there should be a time limit on when the property is put to the intended use. If after a period of time the company doesn't build and instead uses other property, then the original landowner should get his property back.
Bruce Hinchey, Petroleum Association of Wyoming, expressed concerns about how a company could get to landlocked minerals. Only about 20% of minerals are owned by private owners. For an annual payment or renewal of lease there may be problem with Federal Energy Regulatory Commission because of the requirement for uninterrupted flow of the commodity.
Bob Tarantola, Pacificorp, stated it is a rare occasion when eminent domain is invoked because they work with landowners early in easement process and his company has a good relationship with the vast majority of landowners and said his company has paid above market value of rights-of-way for transmission and distribution lines and that it would be an administrative nightmare to handle ongoing payments. Mr. Tarantola said BLM can provide perpetual easements and currently the state easement is for 35 years. Under new federal regulations, power lines will be there for a long time while pipelines will be used for a short time. If they can’t deal with a landowner, then they mention eminent domain and the landowner settles.
The Legislative Service Office (LSO) provided additional handouts to the Committee Appendices 22 through 25].
Senator Meier moved to draft a bill on eminent domain on the public sector to address good faith negotiations, length of term, public purpose, just compensation to make the condemnee whole, burden of proof on condemnor, limit to original use and other comments the Committee gets to LSO staff for the Committee to consider at the September meeting. Representative Davison seconded the motion and the motion passed.
Senator Meier moved to draft a bill on eminent domain on the private sector to address good faith negotiations, length of term, public purpose, just compensation to make the condemnee whole, burden of proof on condemnor, limit to original use and other comments the Committee gets to LSO staff for the Committee to consider at the September meeting. Representative Brown seconded the motion and the motion passed.
Jim Schwartz, Deputy Director of the Wyoming Department of Agriculture (WDA), provided general comments on the department and the Board of Agriculture [Appendices 26 and 27]. The Board of Agriculture wants to increase the board to thirteen members, have no more than six members from the same political party, make the youth leadership members permanent members of the board, increase the term to six years and increase the salary and per diem of the board.
Senator Meier moved to draft a bill on the Board of Agriculture pending information from the Department of Agriculture. Senator Vasey seconded the motion.
Emily Horton, David Largent, Dalin Winters and Patrick Zimmerer, Youth Members of the Board of Agriculture and Scott Zimmerman, Rocky Mountain Farmers Union (RMFU), spoke in favor of changes to the current board structure. Following discussion, the motion passed.
Keith Kennedy, Executive Director of the Wheat Commission, explained the activities of the commission and requested a bill to decrease the membership to five members.
Senator Meier moved to resurrect the bill from last session and reduce the commission to five people. After a second, the motion passed.
Jim Schwartz, Keith Kennedy and Dale Heggem, Department of Agriculture, discussed the National Grain and Feed Mills, including the audit and trace back requirements [Appendix 28]. The National Grain and Feed Association is working on a model law for feed mills that may be out by the end of the year. Roger Huckfeldt and Russ Zimmer asked for clarification of the proposed plan.
Jim Swartz, Hank Uhden, WDA, Slade Franklin, WDA, Keith Kennedy, Gene Hardy, Board of Agriculture and chairman of state predator management board, and Stan McNamee, Weed and Pest District, updated the Committee regarding weeds, pests, fertilizers and predators and explained there may be a need to revise the law to tighten tolerances on the seed laws.
Senator Meier moved to draft a bill to update the seed certification lab and the motion was seconded. Bryce Reese, Executive Vice-President of Wyoming Wool Growers Association (WWGA), expressed concern between the declared and designated list and the programs being carried on by counties. Following discussion, the motion passed.
Cheryl Miller, United States Geological Service and Ken Hamilton presented information on groundwater findings around the state [Appendix 29] and how the groundwater is monitored.
Scott Zimmerman, Bob Malander, Director of Rocky Mountain Farmers Union Cooperative Development Center, Charlie Rife, Jeff Probst and Shawn Rafferty with Blue Sun, and Jim Kintz with Wyoming Bio-diesel, presented information regarding bio-diesel incentives [Appendices 30 through 33] and explained how producing bio-diesel could be used as an alternative crop for producers in their operations. Production, refining and marketing were also discussed.
The Committee recessed until 8:00 a.m. Thursday morning.
Vice-Chairman Hageman called the meeting back to order at 8:00 a.m.
State Engineer Pat Tyrrell and Lisa Lindemann, Ground Water Division Administrator, discussed water well drilling and recommended making the current volunteer program mandatory [Appendices 34 through 38].
Sherry Newton, Charles Newton Drilling, Dave Newton, Dave Newton Drilling and Albert Newton with Steve Newton Drilling spoke against the need to make the well drilling program mandatory.
Mike Havely, Wyoming Water Well Association and Scott Blakely, President of the Wyoming Water Well Association spoke in favor of making the water well drilling program mandatory.
Bruce Asay, representing Shawn and Linda Hendricks, spoke in favor of making the program mandatory [Appendix 39]. The Hendricks lost their son, Ryan by electrocution when he tried to get a drink of water from a well that had not been properly grounded.
Chairman Geis moved to draft a bill to make the program mandatory. Senator Vasey seconded the motion. The motion passed.
Pat Tyrrell, Mike Besson Director of the Wyoming Water Development Office, Laurie Goodman, Trout Unlimited and Ken Hamilton discussed the issue of water needs by the Town of Pinedale and the associated storage and in-stream flow issues [Appendix 40]. Mr. Besson stressed the need to build more storage projects. Mr. Tyrrell discussed several options where instream flows could be developed without changes to statutes.
Laurie Goodman, Trout Unlimited, gave background on the Pinedale issue, provided a letter from Jason Marsden with Wyoming Conservation Voters [Appendix 41] and spoke in favor of instream flow for Pinedale.
Ken Hamilton urged caution in dealing with instream flow rights because they are different from other water rights traditionally used in Wyoming, explaining there are many issues to address, such as when an abandonment could be exercised.
Margo Sabec, representing Devon Energy, asked the Committee to consider unintended consequences and to consider the competing jurisdictions between the State Engineer's Office and the Department of Environmental Quality.
Mr. Magagna explained the Pinedale situation is different from previous situations considered and asked the Committee to consider the term to be considered.
Representative Brown moved to draft a bill to recognize the Pinedale water situation as a pilot project for five years to permit Pinedale to use the stored water for instream flow from the point of release to a point one mile downstream from the municipality limits and to prevent injury to any other diverter in the creek. Senator Vasey seconded the motion and the motion passed.
Kay Hawker, United States Department of Agriculture, Farm Service Agency, Pat Tyrrell and Keith Kennedy presented information regarding the conservation reserve enhancement program, discussed how it could be used in Wyoming [Appendices 42 and 43] and how it could potentially affect water rights. Bobbie Frank, Wyoming Association of Conservation Districts, explained how various conservation districts have been involved in this program. Bryce Reese urged caution in approaching a water lease statute based on Wyoming's current water right program.
Mike Besson, Director of the Wyoming Water Development Office explained smaller water projects and how the smaller projects would benefit Wyoming [Appendices 44 and 45]. Bryce Reese spoke in favor of developing small water projects.
Mike Besson and Lon Eisenbarth, President of the Horse Creek Conservation District (District) provided an update on the issues with the District and the efforts toward resolution with the various parties. They will bring a separate bill to the Select Water Committee.
Dr. Dwayne Oldham, State Veterinarian, updated the Committee on livestock and wildlife diseases and other issues affecting the Livestock Board
Lee Romsa, State Brand Commissioner, updated the Committee on the status of the Brand Task Force and announced all the Task Force members. The report from the Task Force is due to this Committee by October 30, 2006.
Jim Magagna, WSGA presented concerns from leaseholders regarding issues in determining fair market value of state lands when there are conflicting bids on the property and in considering contributory values of the leases. Mr. Magagna asked for further guidance from the legislature on these issues [Appendix 46].
Lynne Boomgaarden, Director of the Office of State Lands and Investments explained how her office handles contributory values and said in approximately 30 years, there has not been a need to use this as the parties have been able to work out any conflict. She explained there is litigation ongoing now involving a lease near Chugwater regarding who would be the better lessee and value of the lease.
Ms. Boomgaarden updated the Committee on the progress of the State Lands Task Force. The report from the Task Force is due to the Committee by June 1, 2006 and any recommendations and statutory changes are due to the Committee by September 1, 2006.
The Committee voted to have a follow-up meeting on Eminent Domain in Cheyenne on September 18, 2006 and the fall meeting in Sundance, Wyoming on October 26 and 27, 2006. Additional handouts provided to the Committee from LSO are Appendices 47 through 49. There being no further business, the meeting was adjourned at 3:25 p.m.
Respectfully submitted,
Senator Gerald E. Geis, Chairman