What is Just Compensation?

The government of any state has the power to seize private property for public use, this is done using the power of eminent domain. When governments take over private properties for public use, they are required to compensate private owners. A just compensation is the compensation that the government pays to owners of private property. Using the fair market value, the government, whether federal, state or local pay individuals in exchange for using their properties. According to the provision of the United States constitution, the government can exercise eminent domain but at the same time compensate individuals to the use of their property for public purpose.

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When is Just Compensation Required?

When the government exercises eminent domain at the federal, state or local level, many individuals lose their homes. Usually, when eminent domain is being exercised, the government does not need the consent of the owners of private properties before their properties are seized for public use. Just compensation is the fair market value which is a reasonable amount that owners of private properties receive when their homes are seixed for public use. In most cases, the fair market value of properties is not considered before individuals are paid in an eminent domain. Just compensation does not take into account the expenses, time and demands of property owners moving into a new property.

Determining Just Compensation

In a bid to help property owners who lost their properties in an eminent domain resettle, just compensation must be given. There are four important factors that must be considered when determining a just compensation, they are;

• Fair market value of the land: This is the value the land worth in the market. It is the price at which it would have been sold if owners were to voluntarily sell the land.
• Fair Market Value of Improvements on the Land Seized: This is the market value of the structure erected on the land. Improvements of the and are not limited to structures, the natural resources and resources invested by owners on the land must be considered.
• Residue damages to the property: These are damages for changes made to the property to make it fit for public use.
• Benefits on the land or property seized: These are benefits that owners of properties may receive when their properties are taken for public use.

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