By: Kolkhorst, et al.	S.B. No. 740
	(In the Senate - Filed February 3, 2017; February 21, 2017,
	read first time and referred to Committee on State Affairs;
	April 27, 2017, reported adversely, with favorable Committee
	Substitute by the following vote:  Yeas 8, Nays 1; April 27, 2017,
	sent to printer.)
Click here to see the committee vote
	COMMITTEE SUBSTITUTE FOR S.B. No. 740	By:  Hughes

	A BILL TO BE ENTITLED
	AN ACT
	relating to the acquisition of property by an entity with eminent
	domain authority.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 402.031(b), Government Code, is amended
	to read as follows:
	(b)  The landowner's bill of rights must notify each property
	owner that the property owner has the right to:
	(1)  receive notice of the proposed acquisition of the
	owner's property;
	(2)  contact and speak directly with an employee of the
	entity proposing to acquire the property who is qualified to
	discuss the acquisition of the property;
	(3)  receive a bona fide offer from, make a
	counteroffer to, and seek to negotiate terms and conditions with
	[good faith effort to negotiate by] the entity proposing to acquire
	the property;
	(4)  consult with a licensed real estate broker or
	sales agent, an attorney, an appraiser, or any other person
	regarding the proposed acquisition, offer of compensation, or other
	related matters at any time;
	(5)  have [(3)] an assessment made of damages to the
	owner that will result from the taking of the property;
	(6)  be provided [(4)] a hearing under Chapter 21,
	Property Code, including a hearing on the assessment of damages;
	[and]
	(7) [(5)  an] appeal [of] a judgment in a condemnation
	proceeding, including to [an] appeal [of] an assessment of damages;
	and
	(8)  contact the office of the attorney general for
	more information regarding a property owner's rights with respect
	to the condemnation process.
	SECTION 2.  Section 1101.501, Occupations Code, is amended
	to read as follows:
	Sec. 1101.501.  CERTIFICATE REQUIRED. (a)  Except as
	provided by Subsection (b), a [A] person may not sell, buy, lease,
	or transfer an easement or right-of-way [for another], for
	compensation or with the expectation of receiving compensation, on
	behalf of an entity with eminent domain authority [for use in
	connection with telecommunication, utility, railroad, or pipeline
	service] unless the person:
	(1)  holds a license issued under this chapter; and
	[or]
	(2)  holds a certificate of registration issued under
	this subchapter.
	(b)  Subsection (a) does not apply to:
	(1)  an entity with eminent domain authority or the
	entity's employee; or
	(2)  an attorney licensed in this state.
	SECTION 3.  Section 1101.502(a), Occupations Code, is
	amended to read as follows:
	(a)  To be eligible to receive a certificate of registration
	[or a renewal certificate] under this subchapter, a person must:
	(1)  hold a license issued under this chapter [be:
	(1)     at least 18 years of age]; and
	(2)  complete a right-of-way agent responsibility
	course approved by the commission under Section 1101.5021 [a
	citizen of the United States or a lawfully admitted alien].
	SECTION 4.  Subchapter K, Chapter 1101, Occupations Code, is
	amended by adding Sections 1101.5021, 1101.5042, and 1101.5043 to
	read as follows:
	Sec. 1101.5021.  RIGHT-OF-WAY AGENT RESPONSIBILITY COURSE.
	(a)  The commission by rule shall approve a right-of-way agent
	responsibility course.
	(b)  A course approved by the commission under this section
	must include at least 15 hours of classroom instruction related to:
	(1)  the law of eminent domain, including the rights of
	property owners;
	(2)  appropriate standards of professionalism in
	contacting and conducting negotiations with property owners; and
	(3)  ethical considerations in the performance of
	easement and right-of-way acquisition services.
	Sec. 1101.5042.  ELIGIBILITY REQUIREMENTS FOR RENEWAL
	CERTIFICATE. To be eligible to receive a renewal certificate under
	this subchapter, a person must:
	(1)  hold a license issued under this chapter; and
	(2)  satisfy the continuing education requirements
	under Section 1101.5043.
	Sec. 1101.5043.  CONTINUING EDUCATION. (a)  The commission
	by rule shall approve a continuing education course for certificate
	holders.
	(b)  A continuing education course approved under Subsection
	(a) by the commission must include at least six hours of classroom
	instruction related to the acquisition of easements and
	rights-of-way under eminent domain authority.
	SECTION 5.  Section 21.0111, Property Code, is amended by
	adding Subsections (a-1) and (a-2) to read as follows:
	(a-1)  After an offer to which Subsection (a) applies is
	made, the entity or the property owner shall disclose to the other
	party any new, amended, or updated appraisal report that is
	produced or acquired by or on behalf of the entity or property owner
	after the offer is made and that is used in determining the entity's
	or the property owner's opinion of value.  A disclosure required by
	this subsection must be made not later than the earlier of:
	(1)  the 10th day after the date the entity or property
	owner receives the appraisal report; or
	(2)  the third business day before the date of a special
	commissioner's hearing if the appraisal report is to be used at the
	hearing.
	(a-2)  A new, amended, or updated appraisal report that is
	not disclosed as required by Subsection (a-1), and any testimony or
	other evidence based on the report, may not be presented in a
	hearing under Section 21.015.
	SECTION 6.  Section 21.0113(b), Property Code, is amended to
	read as follows:
	(b)  An entity with eminent domain authority has made a bona
	fide offer if:
	(1)  an initial offer is made in writing to a property
	owner that includes:
	(A)  a monetary offer in an amount:
	(i)  equal to or greater than 150 percent of
	the market value of the property sought to be acquired, as
	determined on a per acre or per square foot proportionate valuation
	of raw land as reflected in the appraisal of the county taxing
	authority as of the date of the initial offer; or
	(ii)  if an appraisal of the property sought
	to be acquired and any damages to any remaining property has been
	completed by a certified appraiser, equal to or greater than the
	amount provided by the appraisal report;
	(B)  a statement that the entity will not contact
	the property owner sooner than the fourth business day after the
	date of the first personal contact made by the entity after the
	entity sends the initial offer, except to respond to an inquiry from
	the property owner;
	(C)  the name and telephone number of an employee
	of the entity that the property owner may contact with questions
	regarding the initial offer; and
	(D)  a copy of the appraisal report on which the
	offer is based, if applicable;
	(2)  a final offer is made in writing to the property
	owner;
	(3)  the final offer is made on or after the 30th day
	after the date on which the entity makes a written initial offer to
	the property owner;
	(4)  before making a final offer, the entity obtains an
	[a written] appraisal report from a certified appraiser of the
	value of the property being acquired and the damages, if any, to any
	of the property owner's remaining property;
	(5)  the final offer is equal to or greater than the
	amount provided by [of] the [written] appraisal report [obtained by
	the entity];
	(6)  the following items are included with the final
	offer or have been previously provided to the owner by the entity:
	(A)  a copy of the [written] appraisal report;
	(B)  a copy of the deed, easement, or other
	instrument conveying the property sought to be acquired; [and]
	(C)  the landowner's bill of rights statement
	prescribed by Section 21.0112; and
	(D)  a notice, as appropriate, as described by
	Section 21.0114; and
	(7)  the entity provides the property owner with at
	least 14 days to respond to the final offer and the property owner
	does not agree to the terms of the final offer within that period.
	SECTION 7.  Subchapter B, Chapter 21, Property Code, is
	amended by adding Sections 21.0114 and 21.0115 to read as follows:
	Sec. 21.0114.  NOTICE REGARDING PIPELINE AND ELECTRIC
	TRANSMISSION RIGHTS-OF-WAY. (a)  Unless otherwise addressed by
	the easement, the condemning entity shall provide a list of items
	that the landowner may consider when reviewing the offer of the
	condemning entity.
	(b)  If the property is to be acquired for purposes of a
	pipeline right-of-way, the notice must include:
	(1)  the approximate number of pipelines that may be
	installed in the right-of-way;
	(2)  the type or category of each product to be
	transported through the pipelines to be installed in the
	right-of-way;
	(3)  the depth of the pipeline and the amount of cover;
	(4)  a reasonable description of any use the entity
	intends to make of the surface of the right-of-way;
	(5)  a metes and bounds or center line description of
	the location of the right-of-way;
	(6)  the width of the right-of-way;
	(7)  whether the proposed easement is exclusive,
	nonexclusive, or otherwise limited and the terms and conditions of
	any proposed limitation on the property owner's right to use or
	grant additional easements to other parties;
	(8)  the manner in which the entity will access the
	right-of-way, other than in case of an emergency;
	(9)  a statement:
	(A)  regarding the property owner's right to
	recover actual damages arising from the construction, maintenance,
	repair, replacement, or future removal of a pipeline in the
	right-of-way, including any actual damages to growing crops or
	livestock; or
	(B)  if applicable, that the initial offer
	includes damages described by Paragraph (A);
	(10)  a statement that the entity will agree to
	coordinate with the property owner regarding the treatment of all
	gates and fences; and
	(11)  a statement that the entity will agree to:
	(A)  restore to original or better condition any
	areas outside the right-of-way that are used or damaged by the
	entity, to the extent reasonably practicable; or
	(B)  pay actual damages for any of those areas the
	entity does not restore.
	(c)  If the property is to be acquired for purposes of an
	electric transmission right-of-way, the notice must include:
	(1)  a copy of any Public Utility Commission of Texas
	order or other regulatory order relevant with respect to initial
	construction;
	(2)  a reasonable description of any use the entity
	intends to make of the surface of the right-of-way;
	(3)  a metes and bounds or center line description of
	the location of the right-of-way;
	(4)  the width of the right-of-way;
	(5)  the type, spacing, and maximum number of poles,
	towers, or other support apparatus that will be used to carry
	electrical lines over the easement;
	(6)  whether the proposed easement is exclusive,
	nonexclusive, or otherwise limited and the terms and conditions of
	any proposed limitation on the property owner's right to use or
	grant additional easements to other parties;
	(7)  the manner in which the entity will access the
	right-of-way, other than in the case of emergency;
	(8)  a statement:
	(A)  regarding the property owner's right to
	recover actual damages arising from the construction, maintenance,
	repair, replacement, or future removal of lines and support
	apparatus in the right-of-way, including any actual damages to
	growing crops or livestock; or
	(B)  if applicable, that the initial offer
	includes damages described by Paragraph (A);
	(9)  a statement that the entity will agree to
	coordinate with the property owner regarding the treatment of all
	gates and fences; and
	(10)  a statement that the entity will agree to:
	(A)  restore to original or better condition any
	areas outside the right-of-way that are used or damaged by the
	entity, to the extent reasonably practicable; or
	(B)  pay actual damages for any of those areas the
	entity does not restore.
	(d)  A property owner and the entity may agree to terms other
	than those required to be included in the notice required under this
	section.
	(e)  If an entity does not have sufficient information to
	include in a notice required under this section an item listed in
	Subsection (c) or (d), as applicable, the entity shall:
	(1)  in the notice:
	(A)  indicate the item that is not included; and
	(B)  state that information regarding the item
	will be provided to the property owner in an amended notice when
	known; and
	(2)  as soon as practicable after the entity obtains
	the information, provide the information to the property owner in
	an amended notice.
	Sec. 21.0115.  LIMITATION OF PROPERTY OWNER LIABILITY. A
	property owner is not liable to a condemning entity, the entity's
	agents, employees, or contractors, including the contractor's
	subcontractors of any tier, or a third party for personal injury,
	death, or property damage:
	(1)  arising from the use by a person other than the
	property owner of property, including for a right-of-way, acquired
	from the property owner by condemnation; and
	(2)  not caused by the property owner's negligence or
	intentional conduct.
	SECTION 8.  Section 21.041, Property Code, is amended to
	read as follows:
	Sec. 21.041.  EVIDENCE. (a)  As the basis for assessing
	actual damages to a property owner from a condemnation, the special
	commissioners shall admit evidence on:
	(1)  the value of the property being condemned;
	(2)  the injury to the property owner;
	(3)  the benefit to the property owner's remaining
	property; and
	(4)  the use of the property for the purpose of the
	condemnation.
	(b)  The special commissioners may admit evidence on the
	price paid for pipeline or electrical line rights-of-way in
	privately negotiated transactions made in the absence of a
	potential, actual, or threatened condemnation.
	SECTION 9.  Section 21.063, Property Code, is amended by
	adding Subsections (c) and (d) to read as follows:
	(c)  As a condition of appealing the final judgment of a
	trial court in a condemnation proceeding, a nongovernmental
	condemnor shall:
	(1)  deposit with the trial court the amount of the
	final judgment, less the amount of any monetary deposit made and any
	bonds posted by the condemnor under Sections 21.021(a)(2) and (3),
	subject to the order of the court of appeals; or
	(2)  post a surety bond, issued by a surety company
	authorized to engage in business in this state and conditioned to
	secure the payment of the final judgment, in the amount of the final
	judgment, less the amount of any monetary deposit made and any bonds
	posted by the condemnor under Sections 21.021(a)(2) and (3).
	(d)  If the property owner moves to enforce Subsection (c)
	and the nongovernmental condemnor fails to comply with that
	subsection before the 30th day after the date the trial court grants
	the motion:
	(1)  the court of appeals shall dismiss the appeal with
	prejudice and order enforcement of the final judgment; and
	(2)  the property owner is entitled to all reasonable
	and necessary fees for attorneys hired in relation to the
	condemnation.
	SECTION 10.  Section 26.11(a), Tax Code, is amended to read
	as follows:
	(a)  If the federal government, the state, or a political
	subdivision of the state acquires the right to possession of
	taxable property under a court order issued in condemnation
	proceedings, assumes possession of taxable property under a
	possession and use agreement, or a similar agreement, that is
	entered into under threat of condemnation, or acquires title to
	taxable property, the amount of the tax due on the property is
	calculated by multiplying the amount of taxes imposed on the
	property for the entire year as determined as provided by Section
	26.09 of this code by a fraction, the denominator of which is 365
	and the numerator of which is the number of days that elapsed prior
	to the date of the conveyance, the effective date of the agreement,
	or the date of the order granting the right of possession, as
	applicable.
	SECTION 11.  The office of the attorney general shall make
	the landowner's bill of rights statement required by Section
	402.031, Government Code, as amended by this Act, available on the
	attorney general's Internet website not later than January 1, 2018.
	SECTION 12.  Not later than January 1, 2018, the Texas Real
	Estate Commission shall adopt rules to implement Subchapter K,
	Chapter 1101, Occupations Code, as amended by this Act.
	SECTION 13.  (a)  Sections 21.0111 and 21.0113, Property
	Code, as amended by this Act, and Sections 21.0114 and 21.0115,
	Property Code, as added by this Act, apply only to the acquisition
	of real property in connection with an initial offer made under
	Section 21.0113, Property Code, on or after the effective date of
	this Act. An acquisition of real property in connection with an
	initial offer made under Section 21.0113, Property Code, before the
	effective date of this Act is governed by the law applicable to the
	acquisition immediately before the effective date of this Act, and
	that law is continued in effect for that purpose.
	(b)  Section 21.041, Property Code, as amended by this Act,
	applies only to an eminent domain proceeding commenced on or after
	the effective date of this Act. An eminent domain proceeding
	commenced before the effective date of this Act is governed by the
	law applicable to the proceeding immediately before the effective
	date of this Act, and that law is continued in effect for that
	purpose.
	(c)  Section 21.063, Property Code, as amended by this Act,
	applies only to an appeal commenced on or after the effective date
	of this Act. An appeal commenced before the effective date of this
	Act is governed by the law applicable to the appeal immediately
	before the effective date of this Act, and that law is continued in
	effect for that purpose.
	(d)  Section 26.11, Tax Code, as amended by this Act, applies
	only to an agreement entered into on or after the effective date of
	this Act. An agreement entered into before the effective date of
	this Act is governed by the law applicable to the agreement
	immediately before the effective date of this Act, and that law is
	continued in effect for that purpose.
	SECTION 14.  (a)  Except as provided by Subsection (b) of
	this section, this Act takes effect September 1, 2017.
	(b)  Sections 1101.501 and 1101.502, Occupations Code, as
	amended by this Act, and Section 1101.5042, Occupations Code, as
	added by this Act, take effect March 1, 2018.
	* * * * *