- Associated Press - Friday, June 10, 2016

RALEIGH, N.C. (AP) - North Carolina government has effectively taken private property through a law restricting what landowners within proposed highway routes could do to improve or sell tracts, so those owners may be compensated, the state Supreme Court ruled Friday.

The ruling, which addresses what’s called the Map Act, was good news for thousands of property owners throughout the state, particularly those along anticipated urban loops around Winston-Salem and Raleigh.

“We have forced the state to do something it didn’t want to do for 20 years,” said Matthew Bryant, a Winston-Salem lawyer representing hundreds of property owners challenging the law. “The government is not a limitless body of power.”

The decision, which upheld a Court of Appeals decision last year, also likely will cost the state a large amount of money to pay tract holders left in limbo for years. State Transportation Secretary Nick Tennyson last year set the potential cost to taxpayers for the lost land value at $200 million or more.

The department has used the 1987 law to control values on property that it anticipated paying for through condemnation for public use when they built a road. Land owners are prohibited from making additions to their homes or subdividing property appearing on maps showing highway routes, although they do get property tax breaks.

In this case, Winston-Salem-area property owners covering the planned Northern Beltway sued when they were stuck with land they couldn’t sell and were at the mercy of the state to take the land or not. The first map laying out a section of the Beltway was filed in 1997.

The Department of Transportation argued that the Map Act was an appropriate use of the state’s police powers to cause orderly, predictable development when highways displace residents and businesses.

Writing for the court, Justice Paul Newby said those policies are admirable but the law’s “indefinite restraint on fundamental property rights is squarely outside the scope of the police power.”

“By recording the corridor maps at issue here, which restricted plaintiffs’ rights to improve, develop, and subdivide their property for an indefinite period of time, NCDOT effectuated a taking of fundamental property rights,” he added. There was no dissenting opinion.

The case now returns to Forsyth County court. Newby said the next step will be determining the monetary value of the lost rights for each land owner by calculating the difference in the property’s value before and after the map was recorded, taking into account other factors such as the effect of the reduced property taxes.

Although the ruling specifically addressed the Winston-Salem matter, it also will apply to similar cases such as the yet-to-be-constructed southern section of Interstate 540 below Raleigh. Bryant said it will also affect property owners in Cleveland, Cumberland, Guilford, Pender and Pitt counties.

Department of Transportation officials were reviewing the ruling Friday, a department spokeswoman said. State attorneys who defended DOT in court will now work with the agency to examine land cases that can be resolved, Department of Justice spokeswoman Noelle Talley said.

The state House last year approved a bill repealing the Map Act. The measure now sits in the Senate.

Paula Smith of Winston-Salem, a plaintiff in an earlier lawsuit involving the Map Act and property owner, said Friday’s ruling should allow her and her husband to finally move as they near retirement. Otherwise, they were worried they would be stuck with the land for at least several more years.

“We’re ecstatic,” she said. “We’re just thrilled.”

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