Senator Craig Estes

Senator Craig Estes

Legislation filed today by Senate Natural Resources and Economic Development Vice-Chair Senator Craig Estes (R-Wichita Falls) would make it easier for property owners to recover damages against governmental entities for regulations affecting the use and value of private property. SB 360 makes a number of changes to Chapter 2007, Government Code, the Private Real Property Rights Preservation Act enacted in 1995 as part of then-Governor George W. Bush’s initial legislative agenda. The Act waives sovereign immunity for certain suits or contested cases initiated by property owners arising from governmental actions that constitute an unlawful “taking” of private property. In addition to compelling the governmental entity to cease or rescind the action, a prevailing property owner can also recover monetary damages, reasonable attorney’s fees, and costs. If the governmental entity prevails in the suit or contested case, however, the property owner must pay the entity’s attorney’s fees and costs.

Currently, the Act’s scope is relatively narrow and exempts most regulatory actions taken by a state agency or local government. A property owner must also bring suit within 180 days after the owner knew or should have known that governmental action limited the owner’s property rights.

SB 360 makes sweeping changes to Chapter 2007. The bill:

—expands the definition of a “taking” to include a series of governmental actions over a 10-year period that are the producing cause of at least a 20% reduction in revenue or income from the sale or use of the affected property;

—eliminates the exception to taking claims for municipal regulations and ordinances and actions by political subdivisions taken to fulfill an obligation mandated by federal or state law;

—tightens the exception for governmental actions taken “out of a reasonable good faith belief that the act is necessary to prevent a grave and immediate threat to life or property” by substituting “reasonable evidence” for “good faith belief”;

—eliminates the exception for government actions to regulate water safety, hunting, fishing, or control of nonindigenous or exotic aquatic resources, as well as actions to regulate construction in a flood plain, onsite sewage facilities, or to prevent waste or protect rights of owners of groundwater

—requires a taking suit or a contested case to be filed on or before the second anniversary date (current law is 180 days) of the later of: (1) the earliest date on which the government action that is the basis of the suit was enforced on the owner’s property; or (2) the earliest date on which the governmental action applied to the owner’s real property with respect to a permit application affecting the real property

—allows a property owner to recover damages for temporary or permanent economic loss sustained while the action was in effect, if the action has been rescinded or otherwise modified;

—allows the prevailing governmental entity to recover attorney’s fees and costs only if the court finds that the owner knew the suit or case had no merit when the owner filed it;

—allows a property owner to file suit to enjoin a governmental action if the entity does not comply with the applicable law and guidelines relating to the preparation of a takings impact assessment.

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