Landowners awaiting payment following court decision
RALEIGH, N.C. (AP) — Last year the state Supreme Court gave a victory to hundreds of landowners who had spent years fighting a state law known as the Map Act.
The law, passed in 1987, was designed to make it easier and cheaper for the state to build highways by allowing it to designate certain corridors for future roads where landowners would be barred from subdividing or building on their property. As the years dragged on without any offers from the state to buy their property, hundreds of landowners sued, and in June 2016 the Supreme Court agreed that the Map Act amounted to the government taking private property without paying for it.
Sixteen months later, the majority of plaintiffs in the Map Act cases haven’t received a dime. After trial courts in Wake and other counties began ordering the state Department of Transportation to begin the process of determining what the properties are worth last fall, DOT appealed to the state Court of Appeals, which has yet to rule.
The continued legal fight over if and how people should be compensated when their property has been subject to the Map Act adds to years of frustration for landowners.
Walter Simpkins thought the Supreme Court’s decision meant he’d finally be able to sell his home at the end of Joe Leech Road in southern Wake County to the only buyer he’ll ever find, NCDOT. His home on the former family farm appears on the department’s map for the southern leg of Interstate 540, near the middle of the future highway. The state applied the Map Act to a portion of his property in 1997, placing dibs on his home and essentially cutting off access to 10 acres behind it that he had hoped to subdivide into house lots and sell. The law gave NCDOT control over the property until it was ready to buy it and build the road, which 20 years later still hasn’t happened.
“They got you tied up to where you can’t do nothing,” says Simpkins, a retired mechanic and tire store owner who turns 75 next month. “I think they’re hoping that we die first.”
After the Supreme Court’s decision, it’s hard to find a defender of the Map Act in state government. In the General Assembly, where the House voted 114-0 to repeal the law in 2015, legislators approved legislation the same month as the court ruling that rescinded all of the corridor maps created under the act and temporarily barred DOT from issuing new ones. Even NCDOT’s new general counsel, Chuck Watts Jr., says he agrees with the court’s decision.
“We acknowledge the point raised by the Supreme Court,” Watts said in an interview. “We think some of these people might have been injured. And we think they ought to be compensated.”
But Watts says there are still some fundamental legal questions that need to be settled before the state begins writing checks. Does a “taking” under the Map Act amount to a full taking of someone’s property, or is it more like a utility easement, where a property owner is entitled to something less than full value? What if The Map Act applied only to part of someone’s property, or what if other circumstances, such as homeowners association rules, already prevented the owner from developing it?
Watts says NCDOT is looking to the Court of Appeals to set the “rules of the road” that will help the trial courts begin to decide each individual case. Only then, he says, will NCDOT and the property owners know the parameters that will let them reach out-of-court agreements.
“Negotiations happen much easier where the law is settled,” he said. “Because then both sides know what they can get and what they have to pay.”
But Matthew Bryant, a Winston-Salem attorney who represents the majority of Map Act cases now at the Court of Appeals, says the state doesn’t need the court to tell it how to begin compensating landowners.
“The state knows exactly what it took and the harm that it does to property values,” Bryant said. “The state is not prevented from appraising and valuing the rights it took, and making that payment. Just compensation is due the moment the property is taken, not the moment the state conjures up its valuation method.”
David Arnold figures his mother’s home on nearly 20 acres off Lake Wheeler Road was taken 20 years ago when the Map Act was applied to it. Winifred Arnold was 70 then, and she and her family wondered when she would have to leave to make way for I-540.
But it was age, not the highway, that prompted Winifred Arnold, now 91, to move this month, into an addition that her son built on to his house in Wilmington. Meanwhile, David Arnold said, the Map Act precludes developing the property and makes selling the home for anywhere close to its real value impossible.
“We have put ourselves on a financial precipice to help fund what’s had to happen here,” David Arnold said, referring to the addition he built for his mother. “And all the while we’re sitting on all this property and there’s nothing we can do with it. It should be embarrassing to DOT and the governor that some of its taxpayers are being treated like that.”
NCDOT used the Map Act to reserve corridors for 26 future highways across the state. Most of the projects were loop roads or bypasses through fast-growing suburban areas, where the state knew it wanted to build roads but didn’t have the money to buy property or begin construction. The Map Act meant that NCDOT didn’t have to sit back and watch those corridors fill up with houses and other buildings that would ultimately be more expensive to buy and would simply have to be torn down.
Thirteen of the Map Act projects have been completed, and nine are underway. Five are still proposals, including the southern extension of I-540, a planned toll road that will run from Holly Springs east to I-40 south of Garner. NCDOT used the Map Act to place development restrictions on more than 300 pieces of property in the I-540 corridor in 1996 and 1997.
In return for the development restrictions, owners could seek property tax breaks on their land and buildings.
Kelley Wingo and her husband Earl bought 13 acres off Sauls Road in late 1996, only to have part of the property placed in a Map Act corridor for I-540 a few months later. The couple loved the land and decided they couldn’t afford to sit on it and went ahead with plans to build their house and later a barn, Kelley Wingo said. But only where DOT said they could.
“They determined where we could build our house on our lot,” Wingo said. “On 13 acres, they told us where the house could go.”
Wingo said the couple, both 55, asked DOT to buy the 4 1/2 acres that was covered by the Map Act but that the department said no. When the Supreme Court decision came down, the couple figured it would soon be time to move and they did, to a home a few miles away. Now their daughter lives in the home off Sauls Road while they wait for NCDOT to make an offer.
“It would be nice if they would just pay people a fair value for their home and let people move on,” Wingo said.
Property owners say the Map Act casts a shadow that goes beyond the restrictions written into the law.
They say the character of a neighborhood changes as owner-occupied homes become rentals, when owners move out but can’t find buyers for a house that DOT could take in a few years. Since the Map Act was applied to a part of a small mobile home park the Arnold family developed off Lake Wheeler Road, the number of tenants has declined from eight to two, David Arnold said.
“You can’t hardly give away a space, because no one wants to put a trailer into something that’s getting ready to be bulldozed,” he said.
Adding to the sense of injustice among some landowners is the fact that NCDOT has purchased about 320 acres in the southern I-540 corridor over the years, accounting for at least a third of the land that will eventually be needed. The Map Act includes a hardship provision, where someone facing a medical or serious financial crisis could ask to be bought early.
But there were other cases, too, where it appeared that the state bought property in the corridor from developers.
The state paid $800,000 to the heirs of Chevrolet dealership owner Bobby Murray Sr. in 2005 for 17.42 acres covered by the Map Act off Sauls Road. Similarly, the state paid $2.8 million to the developers of the Woodcreek subdivision near Holly Springs for 32.6 acres off Sunset Lake Road in two transactions in 2010 and 2011.
In the case of the Murray property, the family requested a variance from the corridor restrictions in 2002 so it could build houses, and it was not granted, said NCDOT spokesman Steve Abbott. Under the Map Act, the state then had three years to either lift the restrictions or buy the property, Abbott said.
For people who had the means to draw up development plans they knew would not get approved, this was a way under the law to force NCDOT’s hand.
Abbott said most variance requests - 51 out of 66 in the I-540 corridor - were approved because they were for small things, like building a garage, that would not significantly add to the expense of acquiring the property in the future. Bryant says those variances highlight the goal of the law to prevent people from increasing the value of their property and notes that the courts have not considered variances enough to make up for what property owners have lost.
As for the developers of the Woodcreek subdivision, Abbott said the state simply chose to buy the property through what he called a “protective purchase” to “prevent imminent development and subsequent greater acquisition costs,” the same aims as the Map Act.
The Supreme Court decision declaring the Map Act unconstitutional has forced the question of what to do about land in future highway corridors back on the General Assembly.
When it rescinded the Map Act maps last year, the legislature asked NCDOT for ideas on how to reserve road corridors in a way that balances the interests of landowners and taxpayers. It gave the department until July 1 to make its recommendations to the Joint Legislative Transportation Oversight Committee. The department asked for an extension, to Feb. 1, in hopes it will have some more clarity from the Court of Appeals by then.
“Policy is long term,” Watts said. “And I think we want to be well-informed before we start helping the legislature think about these issues.”
Sen. Jim Davis, a Republican from Franklin and one of four co-chairmen of the oversight committee, said he doesn’t know what legislators will do to protect highway corridors in the future. But he agrees the Map Act was unfair in addition to being unconstitutional and says the state will have to come up with a new approach, rather than simply tweak the act.
“It’s a mess,” Davis said. “And we need to figure a way out of it that’s fair to all parties.”
But Mike Fox, the chairman of the State Board of Transportation, said he doesn’t think North Carolina will need a Map Act in the future. NCDOT now bases its decisions on where and when to build roads on data, taking much of the politics out of the process, and that is allowing it to avoid projects that languish on a map for decades, Fox said.
“Our goal is to be able to deliver the projects in a 5- to 7-year time frame,” he said. “And if we can do that, I don’t think anyone thinks that we’ll need a map act.”
That’s cold comfort to the landowners who have been fighting the Map Act in court - and thought they had won last summer.
“We really do feel like we’ve been abandoned,” said David Arnold. “If (Gov.) Roy Cooper had his mom’s place held up for 21 years, you’d better believe that something would have happened by now.”
Information from: The News & Observer, http://www.newsobserver.com