Opinion ID: 2571591
Heading Depth: 1
Heading Rank: 2

Heading: Expert Valuations

Text: Two experts testified regarding the valuation of the Sextons' property. Ken Wooten, a certified Kansas appraiser and president and owner of a real estate appraisal company in Prairie Village, Kansas, testified on behalf of the Sextons. Wooten did not perform an actual appraisal of the property, but he testified that the fair market value of the Sextons' property before the temporary takings was $3,954,900, and the estimated total damages after the taking were $480,000. Wooten evaluated the effect of the City's easements on the remainder of the Sextons' property and opined that heavy construction equipment would cause damage to trees outside of the easement areas. He also testified that the property's view was diminished by the construction equipment, workmen, orange fencing, and mulch. According to Wooten, the City's project negatively affected access to the property outside the easements for lawn maintenance. On another note, Wooten observed that the City's construction easement was located only 30 yards from the Sextons' master bedroom. This led him to conclude that the Sextons would have to invest in additional security measures, such as increased outside lighting, digital cameras, protective fences, and 24-hour security personnel during the active construction periods. Wooten also considered noise and pollution factors in his estimation of damages. As for loss in marketability, Wooten estimated that it was reasonable to expect a 10, 12, or 15 percent adjustment in the sales price of the Sextons' property for a willing buyer in the marketplace on August 5, 2005. Bernie Shaner, a professional appraiser in Overland Park, Kansas, testified on behalf of the City. He testified that he performed a limited scope appraisal on the land because, in his opinion, the house and the Sextons' property outside of the easement area were not impacted by the taking. Also, the parties agreed that Shaner would not appraise the Sextons' home and, instead, would use the value from certain county tax records. To calculate the value of the Sextons' property immediately before the taking, Shaner first estimated the value of the land separate from the improvements. To do so, he used a comparable sales approach and performed a bare ground appraisal of vacant lots in Mission Hills, using six properties that had been purchased for the purpose of tearing down existing improvements and constructing new improvements. Shaner explained that he selected six properties that were among the most comparable to the Sextons' property and were recent in time and fairly similar in location and size. Because the properties were not identical to the Sextons' property, he made adjustments to the sales prices for differences in location and size. With these adjusted sales, Shaner estimated that the land value of the Sextons' property as of the date of the taking was $22 per square foot or $2,195,500 for the lot. He then used the value of the Sextons' home from the county tax records, $1,759,430, and added that amount to his estimated land value. Shaner concluded that the total value of the Sextons' property immediately before the taking was rounded to $3,954,900. On the question of the value of the property immediately after the taking, Shaner first assigned a fair rental value to the easements taken by the City. He estimated that each temporary easement was rented at a 10 percent annual rate of return, so $2.20 per foot was the fair rental value of the easements for 1 year. Then, Shaner multiplied the area of each temporary easement by $22 per square foot times an annual rate of return of 9.48 percent. (Shaner explained that 9.48 percent was the 10 percent rate based on one lump sum rental payment paid in advance.) Under this formula, the rental value of the access easement was $8,306, and the construction easement rental value was $2,625, with a rounded-down total equaling $10,900. Shaner calculated the value of the Sextons' property immediately after the taking by subtracting the value of the land ($2,195,500) from the rental value of the temporary easements ($8,306 and $2,625) and then adding to that figure the value of the improvements ($1,759,430). This totaled $3,943,999, which Shaner rounded up to $3,944,000. In Shaner's opinion, the amount of just compensation for the takings was $10,900, which was the difference between his calculated value of the Sextons' property before and after the taking. The jury ultimately returned a verdict of $10,900 as just compensation to the Sextons for the City's taking of the two easements on their property. The Sextons filed a motion for a new trial which was denied by the trial court.