I

103D CONGRESS

2D SESSION H. R. 3784

To provide for compensation to owners of property substantially diminished

in value as a consequence of a final decision of any United States agency.

IN THE HOUSE OF REPRESENTATIVES

FEBRUARY 2, 1994

Mr. SMITH of Texas introduced the following bill; which was referred to the

Committee on the Judiciary

A BILL

To provide for compensation to owners of property substantially diminished in value as a consequence of a final

decision of any United States agency.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. COMPENSATION FOR PROPERTY SUBSTAN4 TIALLY DIMINISHED IN VALUE.

5 (a) ELIGIBILITY.—A property owner who, as a con6 sequence of a final decision of any department, agency,

7 or instrumentality of the United States is denied, in writ8 ing, the right to develop or physically alter private prop9 erty owned or held by the property owner which results

10 in the property owner being deprived of the beneficial or
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1 productive use of the property is entitled to receive com2 pensation in accordance with this section.

3 (b) DEADLINE.—Within 90 days after a denial re4 ferred to in subsection (a), the property owner may submit

5 in writing a request to the department, agency, or instru6 mentality head for compensation in accordance with sub7 section (c).

8 (c) DEPARTMENT, AGENCY, OR INSTRUMENTALITY

9 HEAD’S OFFER.—The department, agency, or instrumen10 tality head, within 90 days after the receipt of a request

11 for compensation, shall provide to the property owner—

12 (1) an offer to purchase the affected property

13 of the property owner at a fair market value assum14 ing no use restrictions under the laws or regulations

15 on which the denial referred to in subsection (a) is

16 based; and

17 (2) an offer to compensate the property owner

18 for the difference between the fair market value of

19 the property without those restrictions and the fair

20 market value of the property with those restrictions.

21 (d) PROPERTY OWNER’S RESPONSE.—A property

22 owner shall have 60 days after the date of receipt of the

23 department, agency, or instrumentality head’s offers

24 under subsection (c) to accept one of the two offers or

25 to reject both offers. If the property owner rejects both
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1 offers, the property owner may submit the matter for arbi2 tration to an arbitrator appointed by the department,

3 agency, or instrumentality head from a list of arbitrators

4 submitted to the department, agency, or instrumentality

5 head by the American Arbitration Association. The arbi6 tration shall be conducted in accordance with the real es7 tate valuation arbitration rules of that association. For

8 purposes of this section, an arbitration shall be binding

9 on the department, agency, or instrumentality head and

10 a property owner as to the amount, if any, of compensa11 tion owed to the property owner and whether for purposes

12 of this section the property owner has been substantially

13 deprived of the economically viable use of the affected

14 property.

15 (e) OTHER REMEDIES NOT AFFECTED.—Nothing in

16 this section shall affect the right of a property owner to

17 pursue any other remedy available at law.

18 (f) JUDGMENT.—A denial referred to in subsection

19 (a) is deemed, at the option of the property owner, to be

20 a taking under the Constitution of the United States and

21 a judgment against the United States if the property

22 owner—

23 (1) accepts an offer by the department, agency,

24 or instrumentality head under subsection (d); or

25 (2) submits to arbitration under subsection (d).
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1 (g) PAYMENT.—The department, agency, or instru2 mentality head shall pay a property owner any compensa3 tion required under the terms of an offer of the depart4 ment, agency, or instrumentality head that is accepted by

5 the property owner in accordance with subsection (d), or

6 under a decision of an arbiter under that subsection, by

7 not later than 60 days after the date of the acceptance

8 or the date the issuance of the decision, respectively.

9 (h) DEFINITIONS.—For the purposes of this section:

10 (1) PROPERTY.—The term ‘‘property’’ means—

11 (A) land;

12 (B) any interest in land, including re13 corded liens or other security interests in such

14 land; and

15 (C) any proprietary water right, including

16 any recorded liens on such proprietary water

17 right.

18 (2) PROPERTY OWNER.—The term ‘‘property

19 owner’’ means a person who—

20 (A) owns property referred to in paragraph

21 (1) (A) or (B);

22 (B) holds property referred to in para23 graph (1)(C); or

24 (C) holds a legal, financial, or beneficial in25 terest in property referred to in paragraph (1).
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1 (3) SUBSTANTIALLY DEPRIVED OF THE BENE2 FICIAL OR PRODUCTIVE USE.—The term ‘‘substan3 tially deprived of the beneficial or productive use of

4 private property’’ includes economic loss through di5 minished development rights and the taking of pri6 vate lands that results in a decrease in the fair mar7 ket value of that property.

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