Fight Over Texas Bullet Train — and Eminent Domain — Heads to Washington

In the four years Texas Central Railway unveiled plans to link Dallas and Houston with the country's first bullet train, officials with the private company have talked a lot about how quickly the line will whisk travelers between two of the country's largest, fastest-growing urban areas, about how darn Texan the early investors are, about the stellar safety record of the Japanese rail technology they'll be using.

By contrast, the company has talked very little about its planned use of eminent domain, which is the legal term for when a government, or frequently a private company that has the government's endorsement, takes someone's land. When the topic has come up, the company has typically responded by stressing its strong preference for negotiating with landowners to find a mutually agreeable price for their land.

The problem with that response is that it fails to acknowledge some fundamental truths about human beings in general and landowners in the rural areas along the bullet train's proposed route in particular. People, as a rule, don't like having their property sliced in two by large infrastructure projects. People in places like Ellis and Grimes counties really, really don't like having their property sliced in two by a private, Japanese-backed venture whose only benefit for them will be the privilege of marveling at the wondrous bullet-train technology as it zooms by atop a 14-foot berm. If the line is ever going to get built, Texas Central will have to use eminent domain against hundreds, maybe thousands, of landowners.

Texas Central now admits as much. In filings last month with the federal Surface Transportation Board, which regulates the operations of the freight and passenger rail market, the company indicated that it's ready to start acquiring right-of-way for its track.

"In many cases, that involves negotiating agreements with landowners who are willing sellers," the company wrote. "Texas Central is already beginning those negotiations. Inevitably, however, some landowners along the route will not be willing to sell, or even negotiate. If some of those negotiations reach an impasse, Texas Central plans to use its statutory eminent domain powers to establish the properties' condemnation value."

In the weeks since the filling, the Surface Transportation Board has become the site of a pitched battle between Texas Central and its opponents, with powerful surrogates on both sides. Several members of Texas' congressional delegation, and about a dozen state legislators, have waded into the debate. Congressmen Joe Barton of Ennis and Kevin Brady of suburban Houston have filed letters opposing Texas Central while Dallas' Eddie Bernice Johnson and Corpus Christi's Blake Farenthold offering statements of support.

The stakes are high. Texas Central says it needs Surface Transportation Board approval in order to begin using eminent domain under Texas law, an obvious prerequisite for actually building and operating a railroad.That means the Surface Transportation Board represents a regulatory choke point, a rare point where opponents can conceivably derail the project in one fell swoop.

The fight is coming to a head quickly, because Texas Central is in a tremendous hurry. It plans to begin construction next year, with service projected to begin in late 2021. To meet those goals, and to meet timelines agreed to by the company's private backers, Texas Central needs to begin acquiring property "as soon as possible." Which is why, in addition to asking the Surface Transportation Board for authority to construct an operate a railroad, it's also asking for the body's permission to begin eminent domain proceedings — to begin acting like a real, live railroad — well before it is officially designated as a railroad.
Texas Central’s rationale for doing this is straightforward, if highly legalistic. There are two parts to the eminent domain process in Texas. In the first phase, a judge appoints a panel of three property owners in the county to preside over a semi-formal hearing to determine how much a landowner is entitled to be paid for a piece of condemned property.

If the landowner thinks the price is too low, or wants to argue that the company doesn’t have the authority to use eminent domain, they appeal to a judge, triggering the second, judicial phase.

Texas Central argues that the first phase is purely administrative, merely an exercise in deciding how much a piece of property is worth. Because it doesn’t involve actually taking the land, the company says, the administrative piece is not part of the railroad construction process and thus doesn’t require pre-approval by the Surface Transportation Board.

Landowners – some 1,500 of them along the route signed statements objecting to Texas Central’s request — disagree. So does Texans Against High-Speed Rail, the most prominent opposition group, which argues that Texas Central is attempting to circumvent the rights of property owners enshrined in Texas law.

"TCR's request brings to mind the signage found above the desk of many a wizened legal secretary," the group writes in its opposition brief, before dropping in an image of the sign: 

Initiating the eminent domain process before it officially has eminent domain authority — before it's even settled on one of the two remaining possible routes — makes it difficult for landowners to fight. Most don't have the resources to pay an attorney, which means they'll have to find one who will work on contingency, paid based on how much extra compensation the landowner receives over the original offer. With no certainty about when, or even if, the condemnation will be final, landowners will have a difficult time finding effective representation.

Texas Central maintains that it is following the law and "will not take possession of any condemned property until a final certification of a route has been approved."

It also disputes the notion that it's in an undue hurry.

"No evidence has been offered to suggest why a private project adhering to its long-discussed development schedule, which calls for construction to begin late next year, should indicate anything other than the fact that the project is proceeding as planned," it wrote in a statement.

Texans Against High-Speed Rail goes on to accuse Texas Central of a "sneak attack," and it makes a compelling case. Texas Central filed with the Surface Transportation Board on April 19, asking for an expedited endorsement of its request to get a head start on eminent domain proceedings. That gave landowners a three-week window in which to lodge objections.

Plenty ultimately did and probably would have done so much earlier had they been aware of the filings. But Texas Central didn't mention it to them even though it had ample opportunity as its agents were busily negotiating up and down the line for permission to survey property.

Texas Central's first public announcement of the Surface Transportation Board proceedings came on May 4 — 15 days after after the filing and five days before the deadline for comments — when its PR firm issued a press release announcing that the company had "recently" petitioned the Surface Transportation Board to "affirm its jurisdiction of the project and to weigh in on critical next steps that will include construction and operation of the passenger link between North Texas and Houston."

The company issued the press release on the same day that a major landowner along the route, Delta Troy Interests Ltd., filed a request asking the Surface Transportation Board to extend the comment period, which certainly doesn't seem like coincidence.

Texas Central denies allegations that its filings were a "sneak attack." It says it notified state and federal elected officials and that the filings represent "a known and expected step for any railway such as Texas Central" that, in this case, "has been anticipated for more than a year."

In addition, the company notes that it supported landowners' request for an extension of the comment deadline, "once again showing the support for full and open dialogue."
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Eric Nicholson
Contact: Eric Nicholson