Opinion ID: 1969662
Heading Depth: 1
Heading Rank: 7

Heading: Claim of Unconstitutional Taking.

Text: Soo Line argues that the DOT's decision to allow a new crossing results in a taking of its property without just compensation in violation of the United States and Iowa Constitutions. See U.S. Const. amend. V; Iowa Const. art. I, § 18. The taking challenged here is indirect. Soo Line asserts that if the additional crossing is installed and no existing crossings are closed, it will become economically unfeasible for it to run its railroad in the City's downtown area. It claims it will have to relocate. Soo Line classifies this interference with the use of its property as a taking. It wants compensation from the City in the form of reimbursement for its relocation costs. The district court found, and the City argues, that Soo Line did not preserve error on this issue because it did not raise this issue in the initial pleadings before the agency. Before the hearing on this case, the ALJ listed the issues to be resolved as agreed upon by the parties. This list did not include the issue of an unconstitutional taking. Soo Line first raised this issue in its appeal to the director of the DOT. Our review is generally limited to questions raised at or before the hearing held by the agency. Buchholtz v. Iowa Dep't of Public Instruction, 315 N.W.2d 789, 794 (Iowa 1982). There are two reasons for this rule of error preservation. First, fairness requires that an issue be raised while one's opponent still has an opportunity to respond to the issue. Peterson v. Iowa Dep't of Transp., 508 N.W.2d 689, 692 (Iowa 1993). Second, the agency should have an opportunity to consider and rule on the issue. Chicago & N.W. Transp. Co. v. Iowa Transp. Regulation Bd., 322 N.W.2d 273, 276 (Iowa 1982). Consistent with the reasons underlying this rule of error preservation, we have recognized limited exceptions. An issue not raised in the initial pleading before the agency may be preserved for appeal by inclusion in a motion for rehearing if the party could not have raised the issue earlier. Office of Consumer Advocate, 465 N.W.2d at 283. We have also considered an issue on judicial review when it was raised for the first time in an application for rehearing where the opportunity for response by the opponent was adequate at that stage of the proceedings. Peterson, 508 N.W.2d at 692. We do not think that either exception applies here. Soo Line could have raised the issue of an unconstitutional taking in the initial stages of the agency proceeding. Therefore, this issue was not raised at the earliest opportunity. In addition, the resolution of this issue depends upon proof that the allowance of an additional crossing would substantially deprive Soo Line of the use of its property. Easter Lake Estates Inc. v. Polk County, 444 N.W.2d 72, 75 (Iowa 1989). This inquiry is fact intensive. Consequently, the City did not have an adequate opportunity to respond to this issue when raised for the first time after the hearing. We agree with the district court that Soo Line did not preserve this error for judicial review. AFFIRMED.