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SENATE BILL 2120
By Bowling
HOUSE BILL 2037
By Hulsey
HB2037
009758
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AN ACT to amend Tennessee Code Annotated, Title 29
and Title 42, relative to the exercise of eminent
domain by airport authorities.
WHEREAS, the framers of the United States Constitution placed limits on forced
property takings by eminent domain, expressing limits on such takings in the Takings Clause of
the 5th Amendment to the United States Constitution, stating, in part, "nor shall private property
be taken for public use, without just compensation"; and
WHEREAS, the definition of "public use" as used in the 5th Amendment has been eroded
by court decisions, including Berman v. Parker, 348 U.S. 26 (1954) and Kelo v. City of New
London, Connecticut, 545 U.S. 469 (2005), and the definition of "public use" has been further
eroded by Tennessee Code Annotated, Section 29-17-102, which allows private property to be
taken by the power of eminent domain for private use, namely takings by airport authorities that
routinely lease property for private, forprofit interests; and
WHEREAS, private property owners whose property is taken by the power of eminent
domain for private use by airport authorities are damaged in multiple ways, including, but not
limited to, loss of all future financial gains in the property, bearing the cost of relocation
expenses, loss of work, disruption of life and family activities, loss of profits from a business,
bearing the cost of having their property appraised, and bearing the cost of attorneys' fees in a
contested taking; and
WHEREAS, property owners that are subjected to property takings by eminent domain
by airport authorities deserve enhanced, just compensation for the taking of their property; now,
therefore,
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
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SECTION 1. This act is known and may be cited as the "Tennessee Just Compensation
for Property Owners Act."
SECTION 2. Tennessee Code Annotated, Title 29, Chapter 16, Part 2, is amended by
adding the following as a new section:
(a)
(1) This section only applies to an eminent domain proceeding initiated
by an airport authority pursuant to § 42-3-109, § 42-4-108, or § 42-5-108.
(2) Notwithstanding this chapter or chapter 17 of this title to the contrary,
to the extent this section conflicts with another provision of this chapter or
chapter 17 of this title, this section governs the determination of damages and
costs owed to a property owner in an eminent domain proceeding initiated by an
airport authority pursuant to § 42-3-109, § 42-4-108, or § 42-5-108.
(b) As used in this section:
(1) "Airport authority" means an airport authority created pursuant to title
42, chapters 3-5; and
(2) "Eminent domain" means the authority conferred upon an airport
authority to condemn and take, in whole or in part, the private property of
another, so long as the property is taken for a legitimate public use in accordance
with the fifth and fourteenth amendments to the United States Constitution and
Article I, § 21 of the Constitution of Tennessee.
(c) Damages based on value of real property.
(1) In an action brought by an airport authority to acquire real property by
eminent domain, the property owner of the subject real property shall select a
certified property appraiser for purposes of assessing the value of the real
property subject to condemnation.
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(2) If the court finds that a second appraisal is needed to accurately and
equitably determine the value of the real property subject to condemnation, then
the court shall appoint an independent certified property appraiser to assess the
value of the real property.
(3) Each appraisal must be based on comparable properties that have
not been depressed in value due to airport authority acquisitions in proximity to
the real property that the airport authority is seeking to acquire.
(4) The court shall order that the costs associated with each appraisal
used in the condemnation proceeding be paid by the airport authority seeking to
acquire the real property.
(5) In determining the value of the subject real property for purposes of
calculating damages, the jury shall base the value of the real property on the
average assessed value of the certified appraisals admitted in the proceeding
and multiplying the average assessed value by one hundred fifty percent (150%).
(d) Damages based on relocation costs.
(1) In an action brought by an airport authority to acquire real property by
eminent domain, the jury shall award reasonable damages to the real property
owner based on the costs to relocate the owner's personal property, if any, that is
located at the subject real property, including, but not limited to, residential and
business personal property and business inventory and fixtures.
(2) To establish such damages, the property owner shall submit not less
than three (3) competitive estimates from contractors to relocate the owner's
personal property.
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(3) The court shall order that the costs, if any, associated with obtaining
each estimate for the relocation of personal property be paid by the airport
authority seeking to acquire the real property.
(e) Damages based on lost wages and profits.
(1) In an action brought by an airport authority to acquire real property by
eminent domain, if the owner of the real property operated a business on the real
property, then the owner of the subject real property may petition the court for
consideration of an award of reasonable damages based on lost wages and
profits, if any, as the result of the relocation of the business.
(2) If the court approves the owner's petition, then the jury may consider
testimony, sworn affidavits, business records, and other evidence at the
discretion of the court.
(f) Damages based on increased interest rate.
(1) In an action brought by an airport authority to acquire real property by
eminent domain, the owner of the subject real property may petition the court for
consideration of an award of reasonable damages based on the difference
between the owner's interest rate for a residential or business loan, if any, in
existence at the time of the initiation of the condemnation proceedings and the
interest rate for a new residential or business loan as a result of the relocation of
the property owner's residence or business.
(2) If the court approves the owner's petition, then the jury must consider
not less than three (3) interest rate estimates or actuarial damage assessments
from or prepared by financial institutions or other qualified financial experts
provided by the owner of the subject real property and any other evidence at the
discretion of the court.
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(3) The jury may base an award of damages only on the estimated
increase in amortized interest over the remaining term of the owner's residential
or business loan in existence at the time the condemnation action was initiated.
(4) The court may award the costs of any estimates or assessments to
the owner of the subject real property.
(g) Attorneys' fees and costs and other damages.
(1) In an action brought by an airport authority to acquire real property by
eminent domain, the court shall award reasonable attorneys' fees and costs to
the owner of the subject real property if the subject real property cannot be
acquired by the airport authority or if the airport authority withdraws its petition to
acquire the real property.
(2) The court may award additional damages to the owner of the subject
real property if the court finds that the award of damages calculated in
accordance with this section is insufficient to make the owner of the real property
financially whole as the result of the property acquisition by eminent domain.
(h) A court shall not finalize an order authorizing an airport authority to take
ownership and possession of real property by eminent domain until the airport has paid
all damages and costs in accordance with this section.
SECTION 3. Tennessee Code Annotated, Section 42-3-109, is amended by deleting the
third sentence and substituting:
An authority that acquires property by eminent domain in accordance with this section
shall pay damages and costs in accordance with SECTION 2.
SECTION 4. Tennessee Code Annotated, Section 42-4-108, is amended by deleting the
third sentence in subsection (b) and substituting:
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An authority that acquires property by eminent domain in accordance with this
subsection (b) shall pay damages and costs in accordance with SECTION 2.
SECTION 5. Tennessee Code Annotated, Section 42-5-108, is amended by deleting
subsection (b) and substituting:
(b) A municipality that acquires property by eminent domain in accordance with
this chapter shall pay damages and costs in accordance with SECTION 2.
SECTION 6. The subsection headings in this act are for reference purposes only and do
not constitute a part of the law enacted by this act. However, the Tennessee Code Commission
is requested to include the subsection headings in any compilation or publication containing this
act.
SECTION 7. This act takes effect July 1, 2026, the public welfare requiring it.