IV. The Marketization Of Easements
The proposition that a “market for easements” has arisen sounds preposterous. Many would say it is an oxymoron. Others might say it is a legal and professional heresy. Under prevailing eminent domain law, easements are valued as what a property owner lost, not what a property owner can gain from a public project. Nor is there any conventional legal basis for valuing easements predicated on a share of the business enterprise that the easement serves. There are some cases where private easements are negotiated, but normally and historically this has most often occurred in agriculture.
Condemnation of easements by private property owners is sanctioned in some jurisdictions, such as Arizona, but mainly to facilitate appurtenant access easements. Legally, easements are servitudes that grant only limited use of usually a portion of a property. Under eminent domain law, there is no such thing as the “market value” of an easement. While every public project has a budget, and that budget must estimate average right-of-way costs, “easement valuation comparables” are legally impossible. Because the damage from an easement is unique to each property so burdened, it “cannot” serve as an indicator of damage to another property. And even if the foregoing were not true, evidence codes exclude the use of government agency sales as value comparables. Many of the conventional methods historically used to value corridor real estate and fractional property rights therein (“corridors within corridors”) are also beginning to look questionable. They are most certainly inconsistent and probably biased toward the seller/incumbent corridor owner.