Getting a notice that the government intends to take your business property can be one of the most stressful experiences for any Florida business owner. Whether it is for a road widening project, a new public park, or utility expansion projects, the prospect of losing your physical location creates immediate uncertainty about your company’s future.
In Florida, the law provides specific protections and compensation requirements for business owners, but the process is complex and moves quickly. Understanding your rights from the moment you receive that first notice is the best way to protect your livelihood and ensure you receive every dollar you are owed.
What Is Government “Taking” of Property? (Eminent Domain Basics)
Eminent domain is the legal power of the government to take private property for public use. This power is not absolute. Both the United States and Florida Constitutions require the government to provide just compensation to the owner.
For a Florida business owner, a taking can be total or partial. A total taking occurs when the government acquires your entire parcel, requiring relocation. A partial taking involves only a portion of your land, such as a strip of frontage for a sidewalk. Even if you keep your building, a partial taking can significantly impact your business by reducing parking, limiting access for delivery trucks, or destroying your visibility from the road.
Why Your Business Might Be Targeted for Eminent Domain
Florida’s rapid, ongoing growth drives ongoing infrastructure development. Your business might be targeted if your location sits in the path of:
- Transportation Improvements: Expanding highways, adding turn lanes, or building new bridge approaches
- Utility Infrastructure: Installing high-voltage power lines, natural gas pipelines, or water treatment facilities
- Public Safety and Education: Constructing new fire stations, police precincts, or public schools
- Drainage and Environmental Projects: Creating retention ponds or restoring natural waterways to manage flooding
Step-by-Step: What Happens When the Government Plans to Take Your Property
The eminent domain process usually follows a specific sequence in Florida:
- Public Hearing and Necessity: The government agency holds a public hearing to formally determine that taking your property is necessary for a public project.
- The Survey and Appraisal: The government will send surveyors and appraisers to your property to determine its value. You have the right to have your own appraisal conducted.
- The Good Faith Offer: You will receive a written offer based on the government’s appraisal. This is the start of negotiations.
- The Lawsuit (Order of Taking): If you do not reach an agreement, the government files a lawsuit. A judge will hold a hearing to grant the government the Order of Taking, which officially transfers title to the government after it deposits its estimate of value in the court registry.
- Trial on Valuation: If negotiations still fail after the taking, a jury eventually decides the final amount of compensation.
Understanding “Just Compensation” for Business Owners
Just compensation is more than the land’s market value. In Florida, fair market value is generally defined as the property’s fair market value on the date of taking. This should represent what a willing buyer would pay a willing seller in an open market.
However, for a business, value also includes the improvements you have made to the site, such as specialized fixtures, signage, and landscaping. The goal is to put the owner in the same financial position they would have been in if the taking had never occurred.
Business Damages: What Financial Losses Can You Claim?
One of the most important protections under Florida law is the right to recover business damages. This is separate from the real estate’s value. To qualify for business damages, your business must generally have been in operation at that location for at least five years before the taking.
These damages can cover:
- Loss of profits due to the interruption of business
- The cost of adapting your remaining property to continue operations
- Loss of goodwill or blue sky value if the business cannot be successfully relocated
What Happens if You Lease the Property (Commercial Tenant Rights)
If you do not own the land but lease your storefront or office, you still have rights. Most commercial leases contain an eminent domain clause that dictates how a government taking affects the lease and how any compensation is split between the landlord and the tenant.
As a tenant, you may be entitled to compensation for the value of your remaining leasehold interest, the loss of your business fixtures, and relocation costs. It is vital to review your lease early in the process to see if you have waived any of these rights.
The Pre-Suit Negotiation Phase: A Critical Window for Business Owners
Before the government files a lawsuit, there is a pre-suit negotiation period. This is your best opportunity to resolve the matter efficiently. During this time, you can present your own evidence of the property’s value and your business damages.
Engaging with the government early can help you influence the project design. For example, you might persuade engineers to relocate a driveway or adjust a drainage plan to preserve your most valuable parking spaces.
When Negotiation Fails: The Eminent Domain Litigation Process
If the government’s offer remains too low, the case proceeds to court. Eminent domain litigation is unique because the government is typically required to pay for the property owner’s reasonable attorney fees and expert costs if you’re successful. This levels the playing field, allowing small business owners to challenge the government’s valuation without depleting their own resources.
Inverse Condemnation: When the Government “Takes” Without Filing Eminent Domain
Sometimes the government takes or destroys the value of your property without ever filing a formal lawsuit. This is called inverse condemnation. This might happen if a government project permanently blocks all access to your business or causes recurring, permanent flooding that makes your property unusable. In these cases, the business owner must file a lawsuit to force the government to pay compensation.
Relocation Assistance for Businesses
Beyond the value of the land and business damages, the government must often provide relocation assistance. This includes:
- Moving expenses for equipment, inventory, and furniture
- Costs to search for a new location
- Expenses related to re-installing signs and re-printing marketing materials with a new address
Common Mistakes Business Owners Make During the Eminent Domain Process
- Waiting too long to act: The government’s timeline moves forward regardless of your preparation.
- Providing too much information to government appraisers: Anything you say can be used to lower your compensation.
- Assuming the government’s appraisal is correct: Their appraisers work for them; you need an advocate who works for you.
- Ignoring the lease: Tenants often assume they have no rights when they do.
How Jimerson Birr Protects Florida Business Owners During Eminent Domain
Jimerson Birr is a Florida-based law firm that understands the high stakes of property rights. We approach eminent domain matters with a commitment to detail and a results-driven mindset. Our team focuses on:
- Analyzing the highest and best use of your property to maximize valuation
- Working with forensic accountants to accurately calculate business damages
- Ensuring that the government adheres to all procedural requirements to protect your due process rights
Protect Your Business Property Before, During, and After a Government Taking
You do not have to accept the government’s first offer or face their legal team alone. If you have received a notice of a public hearing or a formal offer for your property, now is the time to understand your options.Speak with seasoned Florida eminent domain lawyers today by contacting Jimerson Birr to learn more about your rights.