Nuclear Project being the largest such venture to date. Economic imperatives are behind this trend. Texas utilities were hit hard by recent oil and gas price increases because of their dependence on these fuels: 88 percent of the state’s electricity came from natural gas in 1975 as compared to 33 percent elsewhere in the U.S. New restrictions on use of gas as a boiler fuel have added to the pressure for hasty development of alternative fuel sources. With private companiesTexas Utilities in particularin the lead, the state’s power suppliers have turned to large-scale coal and nuclear projects, but the switch requires enormous capital outlays. Capital costs which averaged $100 to $200 per kilowatt for traditional oil and gas plants are now $350 to $500 for coal or lignite and $500 to $1,000 for nuclear. Moreover, these cost estimates are notoriously subject to upward revision, and the quest for economies of scale requires facilities three to six times as large as older plants. The result is that public utilities which used to be able to raise the capital for oil and gas plants by themselves are now saddled with old bonded indebtedness and faced with enormous new capital commitments subject to public debate. Private power companies are in a similar bind, confronting investors reluctant to put their money in utilities. Thus both private and public agencies are looking for new ways to cover their capital needs. One way is to pool resources and planning. The first joint action legislation passed in Texas was a direct outcome of this situation. In 1973, the Texas Legislature passed a law allowing public and private entities to become co-owners or cotenants of power plants. The act granted power companies very broad powers of eminent domain for “any facilities necessary or incidental to the generation of electric power or the transmission thereof.” Then in 1975, there came what seemed to be a logical extension of this actan amendment allowing public entities, such as cities, to join together to create a separate power agency. A power agency formed under this amendment has certain governmental powers, including the right to issue taxfree revenue bonds. The bonds are backed by the agreement of member cities to purchase the electricity but there is no necessity for voter approval. Thanks to its status as a municipal corporation, the agency is not subject to Public Utility Commission regulation, and the legislation puts no geographical limits on its area of operation. By definition, its assets and operations are tax-exempt. It is a finance manager’s dream, and TMPA is the first such agency in Texas. The municipal power agencies amendment passed through the Legislature so quickly that few people knew about it. It was drafted by officials from Denton, Garland, Greenville and Bryan, together with attorneys for Brazos Electric Coop in Waco and a consortium of engineers, Dallas bond lawyers and private financial firms \(First Southwest Company of Dallas and Kuhn Loeb & the bill, presented it as a measure enabling the four cities to stay in the public power business by buying into Texas Utilities’ Comanche Peak nuclear plant ply: “Know who y’all give this power to.” Butaud’s reproach was well-founded, for the typical legislator has no idea how freely this substantial power has been given away in the past. Today more than 170 types of public and private entities, each with a different set of procedures and a different statutory authorization, can appropriate private property for their own use. This power now belongs not only to cities, counties, special districts and state agencies, but also to private corporations that can condemn land for such enterprises as causeways, railroads, pipelines, telephone systems and cemeteries. The power to condemn people’s land is usually conferred upon an entitysay, a hospital districtas a matter of routine. This sort of special district bill receives minimal legislative attention, because it passes into law on the consent calendar, where obscure, unopposed measures are enacted en masse. There have been attempts to make up for this legislative negligence by recodifying the Texas law of eminent domain to make condemnation procedures uniform, but recodification has been thwarted by those with a vested interest in the current helter-skelter arrangement. The last time it was tried was nearly ten years ago, when Sen. Don Kennard of Fort Worth and several col leagues managed to get a uniform emi nent domain bill out of committee only to be greeted by an ultimatum from Lt. Gov. Ben Barnes. According to Les King, who lobbied for the measure on behalf of the Texas Landowners’ Association, Barnes did his bit for the status quo by telling Kennard he could forget about passing any other legislation that session unless he let the bill go back to committee. The recodification bill subsequently died. Recodification remains the ultimate goal of any reform effort aimed at restoring the time-honored rights of landowners. But in the meantime, measures short of recodification can improve the situation by making eminent domain procedures conform to fundamental principles of fair play and respect for the people whose land is being taken away. These reforms should, among other things: Include the tenant in all eminent do main proceedings, including negotiations, and in the award of compensation. Provide prior notice of entry to the landowner. Include “intrinsic value” as well as “market value” in calculating the amount of compensation due to a landowner and tenant. Provide for public notice and a public hearing to delineate the entire area subject to condemnation and to disclose the specific parcels to be taken. Give all interested parties the right to negotiate with the condemnor and the right to a negotiated settlement without having to go to court. Prohibit the condemnor from taking possession of the property until all appeals are settled. The point of these reforms is to remedy the bias in favor of the condemnor that pervades current eminent domain procedures. The parties involved in a condemnation hearing are rarely of equal power and influence; an individual is certainly no match for the mass of legal experts that a government agency or a big corporation can muster. It’s no wonder that landowners have felt ill will, if not outright contempt, for condemnors of every kind over the years. Legislation along the lines described above won’t make individual landowners the equals before the law of public and private entities endowed by the Legislature with the power of eminent domain. But it will give them a measure of control over the way that power is exercised. . And that is what Russell Butaud really had in mind when he admonished legislators last month to “know who y’all give this power to.” Bill Keese is a member of the Texas House of Representatives from Somerville. His district includes Grimes County. THE TEXAS OBSERVER
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