Proposed Legislation Would Allow Challenges to Utility Routes Approved by the MPSC

Private entities like International Transmission Company working through its Michigan entities ITC and METC, Consumers Power, and other utility companies enjoy the power of eminent domain. Under the current standard contained in the Uniform Condemnation Procedures Act (“UCPA”), courts enjoy broad power to review the propriety of eminent domain takings initiated by private agencies unless the project obtained regulatory approval. Certain types of regulatory approval require courts to act deferentially to the extent that the proposed taking is consistent with the approval. Regulatory approval entails identification of the permitted route of the utility line,.  As such challenges to the route are difficult to pursue successfully. However, newly proposed legislation seeks to strike deferential language currently existing in the UCPA and allow trial courts to review the propriety of the utilities’ approved routes.

The existing language of MCL 213.56(3) creates different standards depending on whether the project received regulatory approval. If regulatory approval was not obtained, “the court at the hearing shall determine the public necessity of the acquisition of the particular parcel.” However, “the granting of a permanent or temporary certificate by the public service commission or by a federal agency authorized by federal law to make determinations of public convenience and necessity as to condemnation constitutes a prima facie case that the project in furtherance of which the particular parcel would be acquired is required by the public convenience and necessity. Therefore, “the granting of a certificate of public convenience and necessity by the public service commission pursuant to the electric transmission line certification act… is binding on the court.”

This redline reflects the changes proposed in this subsection, with new language in bold print. 

(3) Except as otherwise provided in this section, an acquisition by a private agency, the court at the hearing shall determine the public necessity of the acquisition of the particular parcel. The granting of a permanent or temporary certificate by a federal agency authorized by federal law to make determinations of public convenience and necessity as to condemnation constitutes a prima facie case that the project in furtherance of which the particular parcel would be acquired is required by the public convenience and necessity. In determining the public necessity of the acquisition of property by an independent transmission company or affiliated transmission company, the court shall determine the acquisition is necessary only if the independent transmission company or affiliated transmission company demonstrates by clear and convincing evidence that the proposed route of the transmission line is more reasonable than other possible routes for the transmission line. In determining if the proposed route of the transmission line is more reasonable than other possible routes for the transmission line, the court shall give priority to all of the following:

(a) Routes within or adjacent to public land.

(b) Routes within or adjacent to current rights-of-way and easements.

(c) Routes adjacent to property boundaries.

This language continues to defer to certificates granted by the federal government. However, the language deferring to the State of Michigan’s Public Service Commission is changed dramatically by eliminating deference and specifying the standards that must be applied.

One may ask why the certain state legislators are addressing this issue now. Many of the sponsoring legislators represent districts being impacted by METC’s Helix Substation to Hipple Substation and Oneida Substation to Nelson Road Substation Projects. I am representing dozens of impacted property owners in both projects. This post discusses issues relating to the project. Their complaints about the proposed routes echo what I have heard for many years. Why can’t METC share right of way with existing Consumer Power lines? Why is METC cutting through the center of their farms instead of straddling property lines? Why isn’t METC placing the route next to established roads?  It hardly seems coincidental that the standards identified by the proposed legislation mirrors property owner complaints that I have heard repeatedly.

At this point, this is merely an introduced bill, not effective legislation.  Most introduced bills are not passed. It will be interesting to watch how this plays out and the extent that METC accelerates its property acquisitions with the hope of avoiding the impact of this potential legislation.

If you face a potential acquisition, please do not hesitate to contact me.