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March 6th, 2013 — By — In News & Events

Montana Legislature May Repeal 2011 Law Giving Private Utility Companies Eminent Domain Powers

Last week the Montana Senate passed a bill repealing a 2011 law that provided the power of eminent domain to private utility companies constructing merchant transmission lines. Senate Bill 180, sponsored by Senator Debby Barrett (Rep.), passed the Senate with a vote of 28-22 and was sent to the House on February 27.

SB 180 would roll back the provisions in HB 198 passed during the 2011 legislative session that gave private utility companies the power to condemn private property for the construction of private merchant transmission lines provided the company obtain a Major Facility Siting Certificate.    A merchant transmission line is neither financed, built nor operated by a public utility, rather it is constructed by a private company for the purpose of transporting power from the point of generation to the distribution market.  Because merchant transmission lines are used only to transport power, there is arguably a lack of public use or benefit achieved by those in the areas the line travels.

Historically, Montana public utilities have used the power of eminent domain to take private property for public utility projects.  HB 198 was championed through the 2011 Montana legislative session for the purpose of allowing Canadian-based Tonbridge Power to acquire the private property necessary for the construction of the Montana Alberta Tie-Line (MATL) and NorthWestern Energy to take property for the Mountain States Transmission Inter-tie (MSTI).  The end market users or beneficiaries of the power to be transported by both MATL and MSTI are not in Montana, yet, Montana landowners would feel the burden of the lines across their properties.

The Montana Alberta Tie-Line is a 300-megawatt (MW) 230-kilovolt (KV) electrical transmission line allowing movement of power between Montana and Alberta, Canada. Photo from www.enbridge.com.

The Montana Alberta Tie-Line is a 300-megawatt (MW) 230-kilovolt (KV) electrical transmission line allowing movement of power between Montana and Alberta, Canada. Photo from www.enbridge.com.

SB 180 has moved to the Montana House where a separate measure was recently endorsed that adds an additional negotiating step to the eminent domain process.  House Bill 417, passed its final reading in the House with a 94-4 vote.  HB 417 would require that a final written offer be rejected before condemnation proceedings may be filed with the court.  The bill would further require that the just compensation value claimed in condemnation complaint by the taking authority be equal to its final written offer.  Both provisions work to level the playing field for property owners and provide specific rules the process must follow.  Given no specific provisions such as these sought in HB 417, the benefit of formal negotiations may not be afforded to property owners.  HB 417 has been referred to the Senate.

Stay tuned, we’ll be watching both of these measures closely.