Section 4.6

4.6. Partial Acquisitions. Just compensation must put a landowner “in the same position monetarily as he would have occupied if his property had not been taken.”711 The landowner “must be made whole but is not entitled to more.”712 Under this principle, compensation for a partial acquisitionwhen the United States acquires only part of a unitary holding—must reflect not only the property interest acquired, but also any change in the value of the remainder directly caused by the government’s acquisition or planned use of the part acquired.713 As a result, the federal measure of compensation in partial acquisitions is the difference between the value of the landowner’s property before and after the government’s acquisition.714 Accordingly, appraisers must apply the before and after method of valuation in partial acquisitions under federal law, developing opinions of both (1) the market value of the whole property before the acquisition, and (2) the market value of the remainder property after the acquisition.715 Valuations must analyze and reflect all compensable damages and direct (special) benefits to the value of the remainder property due to the government’s acquisition and disregard all non-compensable damages and indirect (general) benefits.716 

There are important differences between federal and many state laws governing the valuation of partial acquisitions for just compensation purposes.717 Valuations in federal acquisitions must apply the correct valuation method, analyze and consider compensable damages and benefits, and disregard non-compensable damages and benefits in accordance with federal law.718 As discussed below, these critical distinctions are often complex and always require careful analysis. Of course, the overarching goal is to ensure that compensation reflects “the value of what [the landowner] has been deprived of, and no more. To award him less would be unjust to him; to award him more would be unjust to the public.”719

While outside the appraiser’s assignment, it bears noting that landowners are reimbursed for many types of non-compensable damage—such as moving expenses and relocation costs—through the Uniform Act or other federal statutes.720 As the Supreme Court explained, “[s]uch losses may be compensated by legislative authority, not by force of the Constitution alone.”721 These administrative payments for people or businesses affected by federal acquisitions are separate from, and in addition to, just compensation for the property acquired.722 Accordingly, an appraisal that improperly includes non-compensable elements not only would be legally incorrect for just compensation purposes, but also could result in double payment.723 

  • Section 4.6.1 The Federal Rule: Before and After Methodology.The before and after metho...
  • Section 4.6.2 Damage.Just compensation is measured by the owner’s loss, not the gover...
  • Section 4.6.3 Benefits. Federal acquisitions and the projects they serve can also enhan...
  • Section 4.6.4 Exceptions to the Federal Rule.The federal courts’ universal preference...
  • Section 4.6.5 Easement Valuation Issues.In general terms, an easement is a limited righ...