Austin Soars to New Heights in Battle Over South Terminal

  • Eminent domain is the government’s power to seize private property for a public use.
  • The government must pay just compensation to the landowner when doing so.
  • The City of Austin is planning to use the eminent domain power to tear down the South Terminal of the Austin airport.

Well we are back to the airport this week. Our regular readers will know that I have previously written about some of the issues at the Austin airport:

Well this week we had a new development that will throw another wrench into the system. The Austin City Council has given the approval to file eminent domain proceedings and to buy out of the management agreement of the south terminal at the Austin airport (ABIA) as part of the facility’s expansion.

But what does that mean? What is eminent domain? What should you do should you get hit with an eminent domain? And what does it mean for the pending expansion?

Well, that is what we’ll be talking about this week.

What is eminent domain?


If you are following all of the development going on around the State of Texas, you are probably already familiar with eminent domain. You may have even gotten notice that the State or a municipality wants to take your land.

Eminent domain is the inherent power of the state and federal governments to seize private property for a specific public purpose. It was originally granted to the federal government through the Fifth Amendment to the Constitution. The Constitution and local state laws always require the government entity to pay the landowner “just compensation” for the land. Generally this means that the government has to pay the landowner market value for his or her property.

In Texas, the entire process begins with a letter from the condemning authority that it wants to take your land.

What to do when served with eminent domain notice?


So if you are a Texas landlowner, what should you do if you get a demand from a condemning authority? Same thing you should always do – hire a good lawyer. Texas landowners are protected under both the United States Constitution and the Texas Constitution.

There are important limitations and protections on the use of the government’s power. The most important, as discussed above, is the condemning authority has to pay “just compensation” for the property taken.

So, what do you do when you receive an “eminent domain” notice? You don’t panic, that’s what. You call a lawyer.

Your best option will be to enlist the guidance of eminent domain attorneys. They will ensure that the property condemned is being used for public use. And, secondly and most importantly fight to make sure the condemning authority is paying sufficient just compensation.

Is Austin Using Eminent Domain at the Airport?


So that brings us back to ABIA. How does eminent domain fit in there? If you recall, the last time we talked about the airport expansion, the City wanted to tear down the South Terminal. But LoneStar Airport Holdings has a longterm lease to manage the terminal. And was not going to let Austin out of that lease. Austin apparently made an offer to terminate the lease, but LoneStar did not think it was sufficient.

So last week, the City voted to use eminent domain powers to take control of the South Terminal away from LoneStar. The City already owns the land – so it is not seeking to condemn it. But eminent domain can be used to take any property right. So Austin is going to use it to get out of the contract with LoneStar.

I am not an eminent domain lawyer so I did not quite understand how this could work. But luckily, I know a fantastic one – Dan Tobin at McFarland PLLC. According to Dan, using eminent domain to terminate a service contract is unusual in eminent domain in general  – but much more common in the airport world. The tactic has been used previously with airports. And while it used to be pretty clear that a challenge to the City’s powers to avoid a contract with eminent domain would be successful, recently court decisions have started to shift back in favor of property owners. So Dan said he would not be surprised if LoneStar challenges the Austin’s ability to do this. *So I guess we will have to wait and see how this plays out and what the next steps are for the future of the South Terminal.




*And LoneStar – if you read this and need an eminent domain lawyer, I HIGHLY recommend Dan. He’s terrific.

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