PATH Real Estate Impacts – A Case Study

One of my local contacts sent me information about a currently active case in Upshur County.  A couple has sued AEP/FE’s PATH front companies and an Upshur County real estate developer claiming that the PATH power line has made their real estate purchase worthless.

Public court filings reveal some interesting issues and facts.  I have copied one of those filings, not because the filing itself is particularly noteworthy, but because the attachments with the file provide interesting deposition testimony concerning PATH’s destruction of real estate values in the area.  Here is a link to the plantiffs’ response to AEP/FE’s attempt to get the case thrown out.

The pleading itself has some interesting items in it, but I am not really concerned with the ins and outs of the parties’ arguments in the case.  The exhibits at the end of the pleading make the most interesting reading.  Exhibit A on the 15th page of the document is the deed to the plaintiffs of 55 acres they purchased in Upshur County.  Note that the deed was signed on May 20, 2009.  Those of you who have followed the PATH case should recognize that date as being five days after AEP/Allegheny (now FirstEnergy) filed their application for a certificate of need on the PATH line.

Exhibit A also includes part of testimony by the land owner in a deposition in the case.  Here is the section from the land owner’s deposition where he discusses his attempts to sell his 55 acres once he realized that PATH had filed its application for a CoN:

Q. Okay. Have you had anybody look at it or give
you any inquiries since the first time you listed it?
A. Yes. There has been some — some people that
have looked, but quite frankly the agent had said
initially, when she disclosed PATH, that put an end to
it. And so, you know. there’s been a few lookers but
no one that — that was interested. And we’ve dropped
the purchase price. And I don’t know what it is right
now. But I know we had already dropped 15,000 on
it–
Q. Okay,
A. — and have been unable to move it.

The land owners not only sued the power companies, they sued the real estate development firm from which they purchased their property.  Sections of the depositions from the partners in this real estate company are included as Exhibits B and C.  Here is a section from one of the partners’ depositions where he discusses PATH’s impact on sales of lots in his subdivision:

Q. Okay. I asked you briefly, and I think we I’ve
alluded to the effect that this PATH project has had.
And if I understand your testimony, once you became
aware of a planned PATH line you had no interest in
people buying lots — people to buy lots?
A. It wasn’t that I had no interest in people
buying lots. I would have loved to continue to sell
lots, and in fact, we continue to market lots.
Q. Uh-huh.
A. However — and Mr. Woody [the other partner] may be able to
testify to this better than I can.
Q. Okay.
A. However, I know at least on one occasion,
maybe two or three occasions, people came in,
expressed interest in looking at the lots, looked at
it, liked it, and wanted to purchase a lot. I know on
the one instance where it went to contract, meaninq
that a purchase agreement was being filled out, I
insisted that there be a line on there indicating that
there is a proposed poyer line coming through the
property. And once that occurred, we never heard
anything more from the people wanting to purchase the
lot.
Q. So it had an effect on —
A. It had an effect on that person, definitely.
Q. Yeah.
A. Did we sell any lots or sell any property? I
don’t believe we did. We may have sold one out parcel
that was never contemplated on being in the
subdivision.

The plaintiff’s testimony in Exhibit A also includes an account of PATH land contractors using veiled threats of eminent domain to get the plaintiffs to settle with AEP/FE for less than the $325,000 that they paid for their property.  This is a dishonest and misleading tactic AEP/FE land agents used throughout the PATH process.

Whether or not the land owner and the developers were damaged will ultimately be up to the court in this case.  It is clear from the testimony, however, that these parties believe that they were damaged as a result of their personal experience.

Of course, Jackson Kelly’s Phil Melick is representing AEP/FE in this case.  You can deduce from Mr. Melick’s questions in the depositions that he is attempting to illustrate that while the PATH case was active at the PSC, there may have been some impact on real estate values, but now that the CoN application has withdrawn, there should be no more impacts, because there is no more threat of condemnation.  The dishonesty of this approach is stunning.

While AEP/FE crow to the media about how PATH is coming back and it is just temporarily “in abeyance,” Mr. Melick has the nerve to insinuate in this Upshur County case that PATH is going away and will have no impact on real estate values.  I haven’t read Mr. Melick’s other pleadings in this case, but if he actually tries to make this argument, beyond the insinuations in his deposition questions, it would be an astonishing event.

Both the land owner and the real estate developers testify that they did not know PATH was coming through Upshur County when the deed was executed in May 2009.  This is the real lesson for WV property owners.

We need to understand that all private property in our state is under constant threat from out of state corporate interests.  It could be Ohio power companies that want our land to get their electricity to higher priced markets or Oklahoma drilling companies that want our surface for their drilling operations.  Whatever the case, we now have to be extremely vigilant to protect our rights to our property.  We can no longer ignore potential schemes that involve taking our property away from us.  We have to be aware and watchful.

One of the most pathetic aspects of the testimony in this case was the attempt by the land owners and real estate developers to have PATH routed around their property.  They didn’t realize that there is no real final route until a high voltage transmission line is actually built.  They were willing to believe whatever AEP/Allegheny’s land agents told them about where PATH would end up, because they had no idea how the PSC process was stacked against private property in our state.

3 thoughts on “PATH Real Estate Impacts – A Case Study

  1. Heh… the PATH Companies are being sued. The crowd of flies circling the carcass is growing…

    Now, if Stalnaker is successful, who will pay the award? Of course, the check will come from the PATH Companies, but they’ll probably turn right around and stuff it into the ratebase, where electric consumers will re-pay them for the award, plus 12.4% interest, year after year. A $325,000 award will earn the PATH Companies around 40 grand a year. Suh-weeeeeeet!

    But… how much of this case may hinge upon PATH’s violation of its own “Code of Conduct”? Or other shady business practices, such as their attempts to keep landowners in the dark until a land agent is knocking on their door? Remember how they claimed that notifying landowners was such a “burden,” and then it turned out that they had a list that they paid Commonwealth Associates to prepare very early in the planning stages of their little project, well before their dog & pony “Open House” shows? So, why should ratepayers be financially responsible for the willful misbehavior of the power companies and the shenanigans of their lawyer clowns?

    Oh, the smelly stuff just keeps piling up…. Melick couldn’t argue his way out of a paper bag. Narcissist. I hear “It’s an English word.”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s