Ask an Edina Realty Lawyer: The State of Minnesota sent a letter that they want to buy my property. Can they do that?

Homeownership can be complicated, but we also think it’s one of the most rewarding ventures out there. In our series Ask an Edina Realty Lawyer, we are hoping to demystify some of the trickier aspects of buying, selling and owning a home.

In this edition, one of our lawyers discusses the government’s authority to take private property, otherwise known as eminent domain.

Dear Edina Realty Legal,

I just received a letter from the State of Minnesota saying that they want to buy my property and that they will take it if I don’t sell. What’s going on here?

It sounds like the state is exercising its power of eminent domain, sometimes also referred to as condemnation. People are often surprised to learn that the government has the authority to take private property. In fact, so long as the taking serves a public purpose or necessity, like to expand a roadway or to construct a public building, property owners generally cannot prevent it from happening.

Facing the government’s use of eminent domain may seem daunting, but there are protections for private property owners. The primary protection, found in the United States Constitution, is that the government cannot take private property without giving the property owner “just compensation.”

How does eminent domain work?

The procedures and requirements for the use of eminent domain vary from state to state. In Minnesota, the process is as follows:

• Once the government decides to proceed with a project and acquire private property, the government must obtain an appraisal of the property.
• The government is required to make an offer to purchase the property directly from you and they must negotiate in good faith. In making the offer, the government must consider their appraisal of the property.
• If you are able to negotiate an acceptable price, you will deed the property to the government and receive payment.
• If you cannot agree on price, the government will initiate eminent domain proceedings in court. Except in unusual cases, the court will grant the government’s petition, leaving only the issue of your right to compensation. The court will submit that issue to a group of three condemnation commissioners who will hear evidence and decide on a value.
• If you or the government disagree with the commissioners’ determination of value, you can appeal the decision in court.

What are your rights as a property owner?

Again, the process varies from state to state, but here are some things you should know about your rights in Minnesota:

• You are not obligated to accept the government’s offer for your property.
• You have a right to a copy of the government’s appraisal. Keep in mind that appraising real estate can be quite subjective and different appraisers may have very different opinions on the value of your property.
• You have a right to obtain your own appraisal. If you do, the law mandates that the government reimburse you for some or all of the expense.
• You have a right to challenge the government’s opinion of value to ensure that you are receiving just compensation for your property.
• In addition to the market value of your property, you may also be entitled to relocation expenses.

If you are informed that the government is planning to use eminent domain, you would be wise to consult with an attorney. This is a fairly specialized area of the law with attorneys who focus on eminent domain. Unlike other areas of real estate law, eminent domain attorneys often work on a contingency fee basis, and under certain circumstances, the government may be required to pay for your attorney’s fees.

The Edina Realty Legal Department serves as in-house counsel for Edina Realty and does not represent private clients. This Insight is not intended to provide legal advice.