Missouri Revises Its Eminent Domain Laws, Protects Property Rights

On June 11, 2022, Missouri’s Governor Michael Parson signed House Bill HB 2005 to reform the State’s eminent domain laws. The new legislation specifically targets use of eminent domain by electrical companies as well as application to farmland being taken.

HB 2005 details that in order to use the power of eminent domain, electrical companies must have a substation or converter station in Missouri that provides an amount of energy proportional to the length of their transmission line within the state. Moreover, if an electrical company acquires property through eminent domain, it must obtain financial commitments necessary to construct a project for which the involuntary easement was needed in the state within seven years of the date the rights taken were recorded, it must return the property rights taken to the former property owner within 60 days and the property owner does not have to return any compensation received. Electrical corporations that operate under a cooperative business plan are exempt from HB 2005’s requirements.

Additionally, HB 2005 laid out new rules for eminent domain proceedings pertaining to farmland. First, like New Jersey eminent domain procedure, Missouri requires a commissioners’ hearing presided by three disinterested commissioners. HB 2005 now requires one of the commissioners, when the property taken is farmland, be a farmer with at least 10 years experience.   Second, when an electrical company utilizes eminent domain powers, just compensation shall be an amount equivalent to fair market value of the property multiplied by one hundred fifty percent. It it the hope that HB 2005 ensures greater protections to Missouri farmland owners.

Governor Parson, a third generation farmer who owns a cattle operation, stated that:

“As a farmer myself, I understand the importance of strong property rights and that no farmer wants to be forced from the family farm by the government or anyone else. That’s why we are signing HB 2005. This legislation provides fair protections for our farm families, tightens the use of eminent domain, and ensures the interests of Missouri farmers are always considered and balanced with the public good.”

HB 2005 only impacts eminent domain proceedings that begin after August 28, 2022. To review HB 2005 in full click here.