From a small northwestern observatory…

Finance and economics generally focused on real estate

Archive for February 9th, 2021

A New Twist on Rails to Trails Takings

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In 2019, the Appraisal Institute, the Appraisal Institute of Canada, and the International Right of Way Association produced Corridor Valuation, an anthology on a complex subject which is surprisingly common in (pipelines, rail lines, power lines, etc.). I had the very real privilege of contributing two chapters, one on telecommunications corridors (fiber optic cable, etc.) and co-authoring the chapter on Rails to Trails corridors with my esteemed colleague, David Matthews.

Each year in America, on average, about 2200 miles of rail lines are abandoned, and often converted to public use, such as hiking/biking trails. However, the legal nuances are a bit more complex than meets the eye. Often, the railroads did not acquire “fee simple title” to the corridor, but rather acquired a perpetual easement with the proviso that if the rail corridor was ever abandoned, the land reverted to the adjacent property owner. “Abandoned” was usually a process over many years, and as these rail lines became effectively abandoned (although perhaps not legally so), the adjacent property owners made use of the land for residential developments. golf courses, and a host of other uses.

Without re-typing our entire book chapter, sufficient to say someone happened upon the idea that converting these “abandoned” rail lines to public use (e.g. — hiking/biking trails) was a good idea. However, there are costs involved. In a case that made its way to the US Supreme Court not too many years ago, it was decided that these adjacent property owners should be compensated not only for the loss of the land (that otherwise would revert to them) but also for “severance damages” which would be the loss of value to their adjacent property for now having a public use in their back yards.

So… I gave you all of that as a prologue to this. There is a really interesting rails-to-trails case coming out of Oregon right now. Many of the adjacent property owners around the US have argued about the loss of security from having hikers/bikers in their back yards. The project in Yamhill County, Oregon (southwest of Portland) spanned farmland. The argument posed by the farmers was that the new Yamhelas-Westsider recreational trail would inhibit the use of pesticides and endanger food safety (along with the common argument that the trail would invite trespassers). Oregon law requires a 100-150 foot exclusion zone depending on the pesticide being sprayed. If a bicyclist or pedestrian passes within that area, apparently the farmer is supposed to stop spraying.

This is a terrifically interesting argument, and I would have been very interested to see this litigated. However, the county’s board of commissioners voted last week to withdraw the land use application, even after spending in excess of $1 million on the project (and probably obligating to pay the state back another $1 million). The phrase “cut our losses” came out of the final commission meeting to end the project. Notably, Oregon’s Land Use Appeals board had blocked the project at least three times, finding that the county did not sufficiently study the impact on farming.

I doubt we’ve seen the end of this. A lot of money has been spent on both sides, and the proponents of the trail have are well organized. This will be a very interesting case if and as it moves forward.

Written by johnkilpatrick

February 9, 2021 at 2:51 pm

Posted in Uncategorized

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