An Easy-to-Understand Breakdown of Utility Easements
When the government is taking your land, there are several different classifications for what they are taking. In the law, we call these “interests in real property.” When you purchased your property, you most likely bought it in “fee simple.” What this means is that you own the property in its entirety. You can grant your mother a life estate, divide the land, sell it, or grant your neighbor an easement.
Easements are complicated bits of law. This blog is the first part in our three-part series on easements. Here, we will cover permanent utility easements.
An Overview of Easements
When the North Carolina Department of Transportation (NCDOT) or another government entity takes your property for a project, they may take a less than a full ownership interest, such as an easement. The North Carolina courts have defined an easement as “a non-possessory right to make limited use of land owned by another without taking a part thereof.”
What this means is you still own the underlying land and can generally do what you want with the property as long as it does not interfere with the easement holder’s use and enjoyment of the easement. On the flip side, the easement holder must use the easement in a manner consistent with the stated purpose of the easement.
Some examples of non-utility easements include granting a driveway easement over your land so your neighbor can have access to his or her property or granting an easement so your friend can come fish on your pond.
Permanent Utility Easements
When the North Carolina Department of Transportation (NCDOT) or another government entity takes your property for a project, they may take right-of-way, which is essentially the government taking permanent, full ownership of the property. Or they may take a less than full interest, such as a Permanent Utility Easement (PUE). A PUE allows the government (and some other entities) to run utility lines across your property.
Utility Easement Examples
Utility easements are often taken when there is a road widening project and a power lines easement is needed to account for existing power lines being pushed onto your property. Some other examples include gas, cable, and telephone pole easements.
Another common example of a PUE is when a city or county is installing sewer or water lines. These can be particularly damaging to a property as they are often engineered without regard to clear spaces, meaning the plans can call for the destruction of fences, trees, and sheds. Sewer lines can be exceptionally frustrating, as they often are not used for the benefit of the property on which they are intruding and, while they are underground, can require above-ground manholes for maintenance and repair access.
Learn More: Pipeline Easements and Takings
What Are North Carolina’s Utility Easement Laws?
The rules governing a utility easement in North Carolina are typically spelled out in a PUE deed. The NCDOT, municipalities, and utility companies may have different wording in their Permanent Utility Easement deed language, but they are usually going to be similar.
Unfortunately, you shouldn’t expect the deed to be in plain English. Below is an example of typical PUE language:
Said Permanent Utility easement in perpetuity is for the installation and maintenance of utilities, and for all purposes for which the [NCDOT] is authorized by law to subject same. The Department and its agents or assigns shall have the right to construct and maintain in a proper manner in, upon and through said premises a utility line or lines with all necessary pipes, poles and appurtenances, together with the right at all times to enter said premises for the purpose of inspecting said utility lines and making all necessary repairs and alterations…
You get the idea. If you just read that and you’re thinking to yourself “what on earth does any of that mean?” you’re not alone. You can easily see how if you simply sign the document without having an attorney review and explain the language, you may be signing away rights that could entitle you to compensation.
Is There a Utility Easement on My Property?
A title search of your property will generally turn up any easements on the land. Even if you didn’t agree to an easement, a previous owner might have agreed to one. Easements typically transfer from one owner to the next.
If you have property with utilities like cable and internet, you can generally assume there’s an easement impacting your property. It’s the price of modern infrastructure. However, it’s important to note that a utility company may not abuse its access by exceeding the easement. Exceeding authorization and permission would be similar to any other trespass onto your private property. In addition, if the utility company negligently destroys unrelated property while exercising their easement, you may be entitled to compensation.
Can the Utility Company Come on My Property?
Yes. When utility lines are damaged or need alteration, utility companies have the right to enter your land in order to perform these services. If there’s a problem with gas, electric, or other utility lines that run through, over, or below your land, the utility company has a right to access and repair them. They may also have the right to set up utility poles or towers on your property.
How Can I Remove a Utility Easement on My Property?
You probably can’t. Under North Carolina law, a PUE is not a complete taking, but it is generally a permanent taking. A typical PUE will last forever until abandoned by the utility company. When you go to sell your property, each subsequent purchaser will buy the property subject to the easement. We often run into easements that were granted to Carolina Power and Light Company back in the 1950s!
What Are My Utility Easement Rights?
Clients often ask, “How close can you build to a utility easement?” or “Can you build a fence on a public utility easement?” The answer depends on the specific details of your property and the easement.
You are, usually, entitled to some use and enjoyment of the easement area. This is a complicated and contentious point for many homeowners. I often get clients who tell me they don’t want to mow the yard anymore in that area or think the easement area will become a desolate wasteland. Usually, that isn’t the case.
Depending on the type of PUE and the language in the deed, you may be able to put a fence, a garden, small bushes, or other objects that don’t interfere with the easement. The caveat I would give to this is that if the easement holder needs to tear up the land for repairs, they are allowed to do so without providing additional compensation.
Calculating the Value of a Utility Easement
This may be the main reason you have visited our site, to find out: do utility companies pay for easements, and how much might your PUE be worth? In typical lawyer fashion, the answer is: it depends.
When the government is taking right-of-way, they are taking the full rights of the property and therefore the full value. In contrast, when the government is taking an easement such as a PUE, they are taking less than the full value, as the property owner still owns the underlying property – although the use and enjoyment, and therefore value, has been diminished.
I’ll tell you that I have seen some government appraisers give anywhere between 30% and 90% of the full land value for utility easement compensation.*
Miscellaneous Easement Information
Setbacks – Counties and municipalities often have ordinances that regulate setback requirements for construction of improvements (buildings, fences, septic, etc.) within a certain distance of a property line. Most of the time, easements do not count against setback requirements. In other words, if the county requires a 10 foot setback for a new fence, that amount is usually calculated from the property line, not the easement line. Note: If that 10 foot setback ends within the PUE area, you may not be allowed to build the fence in the easement area, but instead, just outside of the PUE area.
Acreage Size – Another area of concern for property owners is how the PUE impacts their acreage size. Both commercial and residential property owners have a keen interest in a larger property size when they want to build on or sell their property. If there is a silver lining to having the government put an easement on your property, it is that it typically does not count against your acreage size. A .25 acre easement usually will not reduce the size of your property from one acre to .75 acres.
Tax Value – This will, of course, vary from county to county, but a change in your property value due to the placement of an easement may allow you to reduce your property value for tax purposes. This is not something that is done automatically, but something the property owner would have the petition the county (or city) to do. It’s unlikely to be something you would want to pursue if the value is minimal, but if the easement is causing a $100,000 reduction to property value, it may very well be worth the time and effort.
What Can a Lawyer Do for Me?
There are steps you should take when the government takes your land, which may include hiring a lawyer. An NC eminent domain lawyer can do two major things for you:
- Interpret legalese. Remember that sample deed language from earlier? Squeezed into the dense language could be an additional Slope Easement and Temporary Construction Easement. When you hire an attorney, you have someone with experience in eminent domain who can catch these hidden clauses.
- Fight for maximum compensation. The government has the right to take easements, but you want to try to make sure they compensate you fully. An attorney can help calculate all the current and future compensation you may be entitled to and make your case with the DOT and, if necessary, the courts.
Grappling With Utility Easements
We hope you have found this information helpful and informative, but this article is not inclusive of all issues you may face if an easement is being placed on your property. If a government project is impacting your land with an easement, we strongly encourage you to contact an attorney. Our team handles eminent domain cases from small residential to complex commercial takings and would be happy to evaluate your case for you. Please reach out to one of our attorneys at the North Carolina Eminent Domain Law Firm by calling (877) 393-4990 or filling out a contact form.
*Prior results do not guarantee similar outcomes because each case is unique and must be evaluated separately.