Jackson v. United States

In the United States Court of Federal Claims

Nos. 14-397L, 15-194L

(Filed: August 31, 2021)

*****************************

* Fifth Amendment Taking;

GLORIA J. JACKSON, et al., and *

National Trails System Act; 16

MARK FREDERICK GUENTHER, *

U.S.C. § 1247(d); Just

et al., *

* Compensation; Valuation;

Plaintiffs, * Expert Witness Credibility;

* Admissibility of Exhibit After

v. * Trial; Interest Rate Appropriate

* for Just Compensation.

THE UNITED STATES, *

*

Defendant. *

*

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Mark F. (Thor) Hearne, II and Stephen S. Davis, True North Law LLC, 112 South Hanley

Road, Suite 200, St. Louis, MO 63105, for Plaintiffs. James H. Hulme and Laurel LaMontagne,

Arent Fox LLP, 1717 K Street, N.W., Washington, D.C. 20006, for Plaintiffs. Lindsay S.C.

Brinton and Meghan S. Largent, Lewis Rice LLC, 600 Washington Avenue, Suite 2500, St. Louis,

MO 63130, for Plaintiffs.

Jeffrey H. Wood, John C. Cruden, Jean E. Williams, Jeffrey B. Clark, Lucinda Bach, and

Amarveer Brar, United States Department of Justice Environment & Natural Resources Division,

Natural Resources Section, P.O. Box 7611, Washington, D.C. 20004, for Defendant. Craig Keats

and Evelyn Kitay, Surface Transportation Board Office of the General Counsel, 395 E Street,

S.W., Washington, D.C. 20024, Of Counsel.

_____________________________________________________________________________

OPINION AND ORDER

_____________________________________________________________________________

WILLIAMS, Senior Judge.

This Fifth Amendment taking case comes before the Court following a trial on damages.

Plaintiffs, landowners of 59 properties adjacent to a former railroad corridor in Newton County,

Georgia, seek just compensation stemming from the imposition of a recreational trail across their

properties. 1 Because the Government’s liability for the taking was established on summary

1

The Court consolidated this action with Guenther, et al. v. United States, No. 15-194L as

all plaintiffs are landowners in Newton County, Georgia whose takings claims arise out of the

judgment, the only issue before this Court is the quantum of just compensation. Jackson v. United

States, 135 Fed. Cl. 436, 472-73 (2017). Plaintiffs seek $1,410,594, representing $636,311 for the

encumbrance of the trail and $774,292 in severance damages, plus interest. 2 Defendant asserts

that compensation should be $413,051. For the reasons set forth below, the Court adopts the

valuations of Plaintiffs’ expert, making adjustments due to the erroneous pricing of a comparable

property sale that affected 10 properties.

Also at issue is the proper interest rate to provide Plaintiffs with just compensation given

the delay between the date of the taking and the date of payment. Plaintiffs argue that the Moody’s

Composite Index of Yields on Aaa Long Term Corporate Bonds provides the appropriate rate,

while Defendant asks the Court to apply the statutory interest rates in the Declaration of Takings

Act, 40 U.S.C. § 3116. For the reasons explained below, the Court applies the Moody’s Composite

Index interest rate.

Findings of Fact 3

On August 19, 2013, the Surface Transportation Board (“STB”) issued a Public Use

Condition and a Notice of Interim Trail Use (“NITU”) authorizing a “rail-to-trail” conversion of a

14.9-mile railroad right-of-way between Mileposts E 65.80 near Newborn and E 80.70 near

Covington in Newton County, Georgia. Plaintiffs’ land abuts this right of way, and the conversion

same August 19, 2013 Notice of Interim Trail Use. There were initially 63 properties at issue.

The Court stayed this matter as to four properties that were inside the boundaries of the original

NITU, but outside the boundaries of the corrected NITU, pending an appellate ruling. Following

the Federal Circuit’s issuance of Caquelin v. United States, 959 F.3d 1360, 1362 (Fed. Cir. 2020),

the Court lifted the stay, and severed the claims of Plaintiffs Hardeman, Jackson, Hart, and

Sanford. ECF No. 361 at 1; ECF No. 364 at 11, 17-18. The parties subsequently settled the takings

claims of these four Plaintiffs. ECF No. 396.

2

Plaintiffs recognize that there is a $9.00 disparity between their total damages demand and

its two component parts. Plaintiffs explain:

The landowners’ post-trial brief . . . included the correct total compensation of

$1,410,594 but included incorrect component totals for the amount of land value

and severance damages. . . . The correct amount of land value, per [Plaintiffs’

valuation expert, Mr.] Hodge’s appraisals and testimony, is $636,311, and the

correct amount of severance damage is $774,292 . . . Adding land value and

severance results in a total of $1,410,603, which is $9 more than the total referred

to in the landowners’ post-trial briefing of $1,410,594. This $9 difference is due to

a $1 difference in the appraised valuation listed for nine properties.

ECF No. 362 at 2, n.2.

3

These findings of fact are derived from the record developed during a three-day trial on

damages. Prior to trial, the Court conducted a site visit of 13 of the landowners’ properties with

counsel for both parties. Additional findings of fact are in the Discussion section. The Court uses

“PX” and “DX” to designate exhibits admitted during trial and “Tr.” to cite trial testimony. The

Court does not correct grammatical errors in quotations from the record.

2

resulted in a recreational trail easement on Plaintiffs’ properties. No railroad traffic has moved

over this railroad line since 2010. Sec. Am. Compl. Ex. 1 at 7; Tr. 362.

In a Rails-to-Trails case, a taking occurs when “state law reversionary interests are

effectively eliminated in connection with a conversion of a railroad right-of-way to trail use.”

Caldwell v. United States, 391 F.3d 1226, 1228 (Fed. Cir. 2004). “The Trails Act prevents a

common law abandonment from being effected by the conversion of the railroad right-of-way to

an interim trail use, thus precluding state law reversionary interests from vesting.” Rogers v.

United States, 90 Fed. Cl. 418, 428 (2009), aff’d, 814 F.3d 1299 (Fed. Cir. 2015). If standard

abandonment occurred, the right-of-way would revert to the landowner who had granted the

railroad an easement for railroad purposes only. Rogers, 90 Fed. Cl. at 428. By preventing this

reversion and creating a new easement for a new recreational trail, the Government effected a

taking pursuant to the Trails Act. See Preseault v. United States, 100 F.3d 1525, 1550 (Fed. Cir.

1996); Barclay v. United States, 443 F.3d 1368, 1371 (Fed. Cir. 2006).

As the Federal Circuit has explained:

Abandonment is suspended and the reversionary interest is blocked “when the

railroad and trail operator communicate to the STB their intention to negotiate a

trail use agreement and the agency issues an NITU that operates to preclude

abandonment under section 8(d)” of the Trails Act . . . We concluded that “[t]he

issuance of the NITU is the only government action in the railbanking process that

operates to prevent abandonment of the corridor and to preclude the vesting of state

law reversionary interests in the right of way.” . . . Thus, a Trails Act taking begins

and a takings claim accrues, if at all, on issuance of the NITU.

Barclay, 443 F.3d at 1373 (quoting Caldwell, 391 F.3d at 1233-34 (emphasis in original)). Here,

Plaintiffs’ properties were taken when the STB issued the August 19, 2013 NITU converting the

railroad easement to a recreational trail and preventing the property interests from reverting to

Plaintiffs. After the STB authorized the conversion, the railroad tracks and ties were removed. Tr.

363. A portion of the rail corridor was converted into the “Cricket Frog Trail”, a paved concrete

recreational trail measuring approximately eight feet wide. Tr. 38, 375. Other portions of the rail

corridor remain unpaved with a gravel covering. Tr. 117-18.

Landowners whose properties abut the trail testified that noise and traffic increased due to

the trail and reported instances of trespass and property damage. Tr. 39, 41, 81, 105, 120. Plaintiff-

landowner Robert Dew testified that “traffic has certainly picked up, and the noise certainly has

picked up” since the trail was paved. Tr. 41. Plaintiff-landowner James W. Johnson testified that

persons drive automobiles and all-terrain vehicles “all the time” on the trail, despite a posted “Dead

End” sign. Tr. 77. Plaintiff Johnson testified to multiple encounters with trespassers originating

from the trail, and stated “I’ve had many, many threats.” Tr. 81. Plaintiff Johnson detailed a 2015

encounter with a trespasser who brandished a sawed-off shotgun, stating “that’s something you

don’t forget.” Tr. 105-06. James K. Johnson, a forest manager for landowner Mary Dixon, 4

testified that the trail corridor raised concerns of “illegal dumping” and “the opportunity for

4

Mary Dixon passed away after the site visit in this case, and her estate has been substituted

as a party Plaintiff.

3

wildfires.” Tr. 108-09, 119-20.

The 59 subject properties include urban, rural, commercial, residential, agricultural,

improved, and unimproved properties in Newton County, Georgia. PX 217 at 3. 5 Newton County

is located in North-Central Georgia, within the Atlanta-Sandy Springs-Roswell, Georgia

Metropolitan Statistical area, and had a population of 99,958 as of April 2010. PX 1 at 21.

Covington is the county seat and largest city in the county, and its diversified economy includes

tourism, forestry, agriculture, manufacturing, retail, and service industries. Id.; PX 217 at 8. Local

employers include General Mills, Bridgestone Golf, Michelin, and Beaver Manufacturing, and

many area residents commute to Atlanta for work. PX 217 at 8.

Covington has a rich cultural tradition and is a popular location for filming movies and

television shows. PX 1 at 21; Tr. 33-34. Fourteen of the properties are located inside Covington’s

Historic District which features homes pre-dating the Civil War. PX 217 at 14; Tr. 33. Plaintiff

Robert Dew described the Covington Historic District as “just a laidback, I call it beloved

Hooterville, after the old sitcom in the ‘60s . . . it’s just a nice, safe place to raise kids.” Tr. 35.

Discussion

Jurisdiction

The Tucker Act confers jurisdiction on this Court

to render judgment upon any claim against the United States founded either upon

the Constitution, or any Act of Congress or any regulation of an executive

department, or upon any express or implied contract with the United States, or for

liquidated or unliquidated damages in cases not sounding in tort.

28 U.S.C. § 1491(a)(1). Here, Plaintiffs allege takings under the Fifth Amendment of the United

States Constitution, which is a money-mandating provision. Schooner Harbor Ventures, Inc. v.

United States, 569 F.3d 1359, 1362 (Fed. Cir. 2009).

Legal Standards Governing Just Compensation

Just compensation is generally determined by “the fair market value of the property on the

date it is appropriated.” Kirby Forest Indus., Inc. v. United States, 467 U.S. 1, 10 (1984). “Under

this standard, the owner is entitled to receive ‘what a willing buyer would pay in cash to a willing

seller’ at the time of the taking.” Id. (quoting United States v. 564.54 Acres of Land, 441 U.S.

506, 511 (1979)). The landowner “is entitled to be put in as good a position pecuniarily as if his

property had not been taken. He must be made whole but is not entitled to more.” Olson v. United

States, 292 U.S. 246, 255 (1934). “Just compensation should be carefully tailored to the

circumstances of the case, and this determination typically requires expert testimony.” Childers

5

The parties presented the direct testimony of some experts via exhibits. Plaintiffs’ Exhibit

217 is the direct testimony of Mr. Hodge, and Defendant’s Exhibit 94 is the direct testimony of

Mr. Sheppard. Mr. Matthews, Mr. Underwood, and Dr. Neuberger testified at trial, and their

reports were admitted into evidence as exhibits. See PX 144.17 (Matthews); DX 36 (Underwood);

DX 26 (Neuberger).

4

v. United States, 116 Fed. Cl. 486, 497 (2013); Otay Mesa Prop., L.P. v. United States, 670 F.3d

1358, 1368 (Fed. Cir. 2012).

In Rails-to-Trails cases, where the property taken is an easement, “the ‘conventional’

method of valuation is the ‘before-and-after’ method, i.e., ‘the difference between the value of the

property before and after the Government's easement was imposed.’” Otay Mesa, 670 F.3d at

1364 (quoting United States v. Va. Elec. & Power Co., 365 U.S. 624, 632 (1961)). The Uniform

Appraisal Standards for Federal Land Acquisition, also known as the “Yellow Book,” sets forth

the standards and methods to be applied in appraisals of land acquired by the federal government.

Sears v. United States, 132 Fed. Cl. 6, 12 n.8 (2017), aff’d, 726 F. App'x 823 (Fed. Cir. 2018); DX

5. According to the Yellow Book, all claimed damages must be “supported by actual market

evidence,” and the amount of compensation due to each landowner is “measured by the owner's

loss, not the government's gain.” DX 5 at 154, 157.

In addition to the value of the property actually taken, just compensation also includes

severance damages, which is the diminution in value in the owner’s remaining property resulting

from the taking. Hendler v. United States, 175 F.3d 1374, 1383 (Fed. Cir. 1999) (“[J]ust

compensation under the takings clause of the Constitution includes not only the market value of

that part of the tract appropriated, but the damage to the remainder resulting from that taking.”

(internal quotation omitted)); United States v. Grizzard, 219 U.S. 180, 183, (1911) (“When the

part not taken is left in such shape or condition as to be in itself of less value than before, the owner

is entitled to additional damages on that account.”). The Yellow Book states that the United States

must include severance damages in just compensation. DX 5 at 154. “Plaintiff has the burden of

proof with respect to severance damages and must offer evidence that the remainder lost market

value.” Childers, 116 Fed. Cl. at 497 (citing Miller v. United States, 223 Ct. Cl. 352, 383–84

(1980)); see also Hendler, 175 F.3d at 1383.

Appraisals of Subject Properties

Both parties retained appraisers to value the subject properties before and after the taking

and properly used August 19, 2013, the date the STB issued the NITU, as the date of the taking.

PX 217 at 1; DX 94 at 19. However, the appraisers disagreed widely on their appraisals of

Plaintiffs’ properties, both as to appropriate appraisal methodologies and valuation.

Overview of the Expert Opinions

In determining compensation for the appropriated corridor, Plaintiffs’ expert Mr. Douglas

Hodge valued the land encumbered by the easement at 100% of its fee simple value. See, e.g., PX

24 at JACKSON 002474-77. 6 In valuing each corridor, Mr. Hodge used a “sales comparison

6

The Court admitted Mr. Hodge as an expert in real estate appraisal, valuation, and the

method and practice of real estate appraisal. Tr. 169. Mr. Hodge has 34 years of real estate

appraisal experience and is currently employed as a Senior Appraiser at Farmers National

Company. PX 217 at 4. He is also the owner of Capstone Realty Resources, which provides

appraisals and valuation services. Id. at 4. Mr. Hodge has a B.S. in Finance from Ferris State

University, and is designated as a Member of the Appraisal Institute (MAI). Id. at 3-4. He has

been admitted as an expert in federal and state courts, and has provided expert testimony and/or

appraisal services in Rails-to-Trails cases in the Court of Federal Claims, several times on behalf

5

approach,” comparing each individual property with sales of comparable properties and adjusting

for differences. PX 217 at 8-10.

In assessing severance damages to the remainder, Mr. Hodge found that for the majority of

the properties, the remainders had decreased in value between 2 and 45 percent, and that three

properties decreased more due to the trail bisecting the property or preventing assembly with other

residential properties. Id. at 12.

Mr. Andrew Sheppard appraised the subject properties for Defendant. 7 Mr. Sheppard also

used a sales comparison approach in his appraisals and applied the Yellow Book principles. DX

94 at 18-21. Mr. Sheppard valued the land encumbered by the trail easement at 85% of its fee

simple value, based on his opinion that Plaintiffs retain approximately 15% of their fee simple

rights in the trail area because they can use the land for planting and parking. Id. at 176, 184. In

calculating severance damages to the remainder properties, Mr. Sheppard concluded that no

remainder property decreased in value due to the imposition of the trail easement and that no

severance damages were warranted. Id. at 21, 189-209. Mr. Sheppard further found that 22

residential subject properties increased in value by $5,000 as a result of trail adjacency. Id. at 157.

In rebuttal, Defendant presented the expert testimony of Mr. John Underwood, 8 who

opined that Mr. Hodge failed to analyze what rights Plaintiffs retain in their property encumbered

by the easement, failed to support his calculations of severance damages with market evidence,

and failed to adequately verify comparable sales data—as required by the Yellow Book. Tr. 563,

566-67, 585-88. Defendant also presented the testimony of Dr. Jonathan Neuberger, an economist,

of the Government. Id. at 5-6. Mr. Hodge currently holds a certified general appraisal license in

Michigan, and has formerly been licensed as a certified general appraiser in Ohio, Indiana, Illinois,

and Colorado. He obtained a temporary license in Georgia in conjunction with his work in this

case.

7

The Court admitted Mr. Sheppard as an expert in real estate appraisal and valuation. Tr.

412-13. Mr. Sheppard, a longtime Georgia resident, earned a B.A. in real estate from Georgia

State University and is a principal in Pritchett, Ball & Wise, Inc., an Atlanta commercial real estate

appraisal firm. Tr. 406; PX 94 at 10. Mr. Sheppard is a certified general real property appraiser

in Georgia, and is designated as a MAI. PX 94 at 10. He served as the President of the Atlanta-

area chapter of the Appraisal Institute in 2017, and has appraised properties for various private and

public entities. Tr. 410-11, PX 94 at 10, 40.

8

The Court admitted Mr. Underwood as an expert in real estate appraisal and in the Yellow

Book. Tr. 556. Mr. Underwood, a Florida resident since 1948, is a certified general real estate

appraiser in Florida. DX 36 at US_0003282. He is the president and owner of Appraisal &

Acquisition Consultants, Inc., a real estate appraisal and consulting firm which he founded in 1983.

Tr. 549. Mr. Underwood was designated as a MAI in 1982, and in 1984 was certified as a MAI

with Senior Resident Appraisal (SRA) designation, which denotes competence in appraising

single-family and one-to-four unit properties. DX 36 at US_0003282; Tr. 552. Mr. Underwood

currently teaches courses on the Yellow Book for the Appraisal Institute, and has published articles

on real estate appraisal and given expert testimony in state and federal cases. See id. at US

0003279-81.

6

who opined that Mr. Hodge’s failure to adequately verify comparable sales or adjust comparable

sales for changing market conditions, rendered Mr. Hodge’s appraisals unreliable based on

economic conditions immediately before and during the Great Recession. 9 Tr. 620-30; DX 26 at

US_0002647-49.

In rebuttal to Defendant’s appraisal expert Mr. Sheppard, Plaintiffs presented the expert

testimony of Mr. C. David Matthews, 10 who disagreed with Mr. Sheppard’s opinions that Plaintiffs

retain 15% of their fee simple rights in the encumbered land and that 22 properties received a

$5,000 “special benefit” due to trail adjacency. See PX 144.17 at 7.

Evidentiary Issues

The Court Rejects Defendant’s Challenge to Mr. Hodge’s Credibility

Defendant argues that Plaintiffs’ appraiser Mr. Hodge made misrepresentations in his

temporary appraiser license application in Georgia that undermine his credibility. ECF No. 264 at

79-80. 11 Under Georgia law, it is unlawful for anyone to engage in “real estate appraisal activity”

without “first obtaining an appraiser classification.” Ga. Code Ann. § 43-39A-24 (West). The

Georgia code defines “real estate appraisal activity” as “the act or process of valuation of real

estate or real property and preparing an appraisal report.” Ga. Code Ann. § 43-39A-2 (West).

On August 22, 2017, Mr. Hodge signed his initial application for a temporary Georgia

license and submitted it on or about August 30, 2017. DX 46 at HODGES000218-221. On the

application, Mr. Hodge certified “I hereby agree not to engage in, conduct, advertise, or hold

myself out as engaging in or conducting the business of a state real estate property appraiser in

Georgia until I receive my temporary practice permit.” Id. at HODGES000221. Prior to applying

9

The Court admitted Dr. Neuberger as an expert in economics. Tr. 619. Dr. Neuberger

holds a B.S. in International Relations from Georgetown University, and a master’s degree and

Ph.D. in Economics from Johns Hopkins University. Tr. 606. He is a principal at Economists

Inc., a consulting firm providing economic research for litigation and regulatory matters. Tr. 608-

09. Dr. Neuberger has been qualified to give expert testimony in the Court of Federal Claims,

federal district courts, and state courts. Tr. 609-10. He is a member of the American Economics

Association, has published articles and taught courses on economics and finance. Tr. 613-15.

10

The Court admitted as Mr. Matthews as an expert in appraisal practice, appraisal review,

and related land valuation. Tr. 664. Mr. Matthews graduated from the University of Tennessee

with a degree in real estate. Tr. 644-45. He holds the MAI with SRA, CRE (Counselor of Real

Estate), and GRS (general appraisal reviewer) designations from the Appraisal Institute. Tr. 645.

He is the owner and principal of David Matthews Associates, a firm providing appraisals of rural

and urban properties, including easements in several Rails-to-Trails cases. Tr. 647. At the time

of trial, Mr. Matthews was a licensed real estate appraiser in Georgia, Indiana, Kentucky, Iowa,

and Florida. Tr. 649. He has provided expert testimony in the Court of Federal Claims and other

federal and state courts. Tr. 648-49.

11

Defendant filed a motion in limine, arguing that Mr. Hodge’s “material misstatements” in

his original temporary license application warranted exclusion of his appraisal testimony. See

ECF No. 196 at 13-14. The Court denied this motion. ECF No. 217.

7

for or receiving his temporary license, Mr. Hodge had traveled to Newton County from August 9-

11, 2017, where he performed inspections of the subject properties, visited the Newton County

Tax Assessor’s Office, and met with some Plaintiff-landowners in connection with his appraisals

in his case. Tr. 156-57.

On August 31, 2017, the Georgia Real Estate Appraisal Board returned Mr. Hodge’s temporary

license application unprocessed, as the Board had not received Mr. Hodge’s required criminal

background report. See DX 46 at HODGES000218; Tr. 163. The Board asked him to submit his

criminal background report, additional materials, and pay an “incomplete application fee.” DX 46

at HODGES000228. Mr. Hodge resubmitted his application with the requested materials and fee

on September 26, 2017, and received his temporary license in January 2018. Id. at

HODGES000223; Tr. 160, 162, 167. 12 Mr. Hodge’s appraisal reports are dated between

September 2017 and February 2018. See PX 29 at JACKSON 002890 (dated September 18, 2017);

PX 38 at JACKSON 003769 (dated September 19, 2017); PX 43 at JACKSON 004143 (dated

October 3, 2017); PX 9 at JACKSON 0006349 (dated February 1, 2018). Mr. Hodge had his

temporary Georgia real estate appraisal license when he rendered his opinions via his written direct

testimony on April 20, 2018. Tr. 167-69; PX 217 at 1.

At trial, Mr. Hodge was asked whether he understood that he was holding himself out as a

Georgia state real estate appraiser when performing inspections of Plaintiffs’ properties from

August 9-11, 2017, prior to receiving his temporary appraisal license. PX 217 at 4; Tr. 155-61,

167-68. Mr. Hodge testified that he was not engaging in the business of a Georgia state real estate

appraiser because he was rendering opinions in this case -- not working as a Georgia state real

estate appraiser. Specially, Mr. Hodge testified:

MR. HEARNE (COUNSEL FOR PLAINTIFFS): Did you understand that you

were holding yourself out in the context of a real estate transaction in Georgia as a

state real estate appraiser?

MR. HODGE: No.

MR. HEARNE: In this engagement? What did you understand this

engagement to be?

MR. HODGE: This was a – a federal case to determine the damages and the loss in

property value as a result of a federal taking, not a state taking.

MR. HEARNE: Did you understand that it was in connection with any state

real estate transaction in the State of Georgia?

MR. HODGE: There was no state transaction involved.

Tr. 164-65. Defendant’s counsel questioned Mr. Hodge on voir dire about the timing of his license

and his understanding of Georgia state law but did not lodge a formal objection to admitting Mr.

Hodge. The Court found that Mr. Hodge’s interpretation of the Georgia Code did not affect his

12

Mr. Hodge’s criminal background report showed no criminal history. DX 46 at

HODGES000224-26; see Tr. 162.

8

qualifications as a real estate appraiser and admitted Mr. Hodge as an expert.

Defendant argues that Mr. Hodge’s testimony lacked credibility because he inaccurately

certified that he would not engage in the business of a state real estate appraiser in Georgia until

he received his temporary license. Defendant contends that when Mr. Hodge inspected properties

in this case prior to receiving his permit, he was engaging in the business of a George real estate

appraiser.

In this Court’s view, Mr. Hodge reasonably believed that because his work in this case did

not involve any real estate transaction in Georgia -- no actual purchase or sale -- but rather a

valuation for federal litigation purposes, he was not engaging in the business of a state real estate

appraiser in Georgia. While Mr. Hodge’s belief in this regard may have been incorrect, Defendant

has not established that any error in his interpretation of the Georgia Code has impacted his

credibility as an appraiser. 13

The Admissibility of PX 144.18

Although it is late in the game for the Court to be resolving an evidentiary matter, the

parties dispute whether the addendum to Mr. Matthews’ expert report rebutting the opinions of

Mr. Sheppard, PX 144.18, should be in evidence. Plaintiffs did not seek to admit PX 144.18 into

evidence during trial or at the time they filed their post-trial brief. ECF No. 265 at 103, n. 1.

Subsequently, at the beginning of closing arguments, Plaintiffs’ counsel asked the Court to admit

the addendum into evidence, stating that their failure tender the exhibit during trial was an

oversight, and that it was clear at trial that “everybody knew that that exhibit was what Mr.

Matthews was testifying to.” Tr. 805. Defendant objected, arguing that it would be prejudiced by

the admission of the addendum. ECF No. 328.

PX 144.18 consists in large part of a 29-page Trail Study labeled “Example of Proper

Methodology to Extract Proximity Benefit or Damage Created By A Hiking/Biking Trail In the

Rear of a Single Family Residence” made up of seven analyses of Georgia property sales of

varying age, lot size, and proximity to a trail corridor, occurring from approximately March 2006

to December 2016. PX 144.18 at JACKSON 004810-13. The addendum also includes

approximately 14 pages of graphs and charts synthesizing Mr. Matthew’s analysis of Mr.

Sheppard’s report as well as information about the Case-Shiller Index. Id. at JACKSON 004794-

808.

The description of the Trail Study in the addendum states:

A study was made to determine if the presence of a hiking and biking trail has a

beneficial effect on the market value of abutting single family residential lots; has

13

Whether or not Mr. Hodge actually engaged in the business of a state real estate appraiser

in Georgia by inspecting the properties in this case is a matter within the purview of the Georgia

licensing authorities. There is no evidence suggesting that a representative of the state of Georgia

ever communicated any concerns regarding Mr. Hodge’s representations in his temporary license

application. DX 46 at HODGES000224-26; Tr. 163. If Georgia officials found Mr. Hodge had

materially misrepresented information in his application, they could have suspended or revoked

his permit. Ga. Code Ann. § 43-39A-14(d) (West).

9

no effect; or has a negative effect on market value. The methods used for this study

involved finding sales of residential properties that abut a trail or other

transportation corridor and comparing those sales with sales of similar property that

do not abut a trail or other corridor.

Id. at JACKSON 004810. According to Mr. Matthews, the Trail Proximity Damage Study

provides an example of the proper methodology using seven analyses to extract benefit or damage

created by a trail in the rear of a single-family residence as an alternative to Mr. Sheppard’s

method. Id. at JACKSON 004810-11. The methodology used in this study “involved finding sales

of residential properties that abut the trail or other transportation corridor and comparing those

sales with sales of similar property that do not abut a trail or other corridor.” Id. at JACKSON

004810. No comparable trails were found in Newton County or the surrounding areas. A

comparable trail, the Fall Line Trace Trail, was found in Columbus, Georgia. Five analyses of this

trail were conducted, which collected sales that appear to be arm’s length non-bank foreclosure

sales along and away from the trail. Id. at JACKSON 004810-11.

In the addendum Mr. Matthews opined that “[t]he resulting data indicated some consistent

trends. The overwhelming results were that properties abutting the trail did tend to sell for less

than homes without a trail in their back yard.” Id. at JACKSON 004810. Two additional analyses

included in the Trail Proximity Damages Study were of properties in Covington that abut other

transportation corridors, which “were selected because they suffer loss of privacy in much the

same way as the subject parcels.” Id. at JACKSON 004810. These studies showed that abutment

to a trail or transportation corridor caused the remainder parcels to lose 20.5% to 99% of their

value with an average of 51.8%. Id. at JACKSON 004812. In the addendum to his rebuttal report,

Mr. Matthews opined “that the probable loss to the land value [of single-family residences abutting

a hiking/biking trail] lies within the range of 25% and 50% with my best estimate in the middle of

that range at 33.3% loss.” Id. Mr. Matthews executed a certification for the addendum in PX

144.18 stating that he “made a personal inspection of the subject of the work under review” and

that “no one provided significant appraisal, appraisal review or appraisal consulting assistance” to

him. Id. at JACKSON 004833-34.

Plaintiffs argue that the copy of the addendum used during trial was physically attached to

Mr. Matthew’s rebuttal report, PX 144.17, admitted at trial, but that this addendum was marked as

a separately as Exhibit 144.18 and referenced along with PX 144.17, collectively as “the report.”

ECF No. 329 at 8. The testimony supports Plaintiffs’ position:

MR. HEARNE: Let me give you an exhibit, if I could, it’s Plaintiffs’ Exhibit

144.17. If I may approach, Your Honor?

THE COURT: Certainly.

MR HEARNE: And just, your Honor, if I could.

THE COURT: Yes?

MR. HEARNE: To simplify the process, I may give this witness, if I could,

all of the exhibits I am going to refer to. Just the ones we’ve referenced.

THE COURT: Sure.

10

MR. HEARNE: And ask him to identify these.

MR. MATTHEWS: This is a copy, a complete copy of my review, rebuttal of

appraisal report submitted by Andy Sheppard.

MR HEARNE: And does that have the addendum attached to it?

MR. MATTHEWS: Yes, it does.

Tr. 667-68 (emphasis added). Thus, at trial Plaintiffs’ counsel used a copy of Mr. Matthews’

rebuttal report, PX 144.17, which had the addendum attached to it, instead of referring to the

separately marked addendum in PX 144.18. Due to this erroneous combination of what should

have been two separate exhibits, PX 144.17 and PX 144.18, Plaintiffs’ counsel only sought to

admit PX 144.17 even though counsel referenced both.

Defendant argues that because Plaintiffs did not offer the addendum into evidence at trial,

Defendant’s counsel modified his cross-examination of Mr. Matthews. ECF No. 328 at 4. This

argument lacks merit as counsel for Defendant did cross-examine Mr. Matthews on graphs which

were present only in the addendum, the exhibit that was not admitted. Tr. 737-39. The exchange

between Defendant’s counsel and Mr. Matthews is as follows:

MR. HARRINGTON (COUNSEL FOR DEFENDANT): You have a number of

graphs in your rebuttal report. Are those graphs also illustrative, just the way the

paired sales analysis you referred to was illustrative?

MR. MATTHEWS: They were actually an analysis of Mr. Sheppard’s resulting

value opinions. I’m trying -- I was trying to understand are they reasonable. So

you’ll see a lot of different graphs about his value per acre, his total compensation

estimates, before values, a lot of different graphs for me to help understand or to

understand better what he did and why he did it.

MR. HARRINGTON: But those are not graphs that you used or you could properly

use to come up with alternative numbers?

MR. HODGE: With values, alternative -- no.

MR. HARRINGTON: When you put together the lines on those graphs, you simply

used Excel’s built-in formulas to develop those graphs. Isn’t that right?

MR. MATTHEWS: Yeah. My understanding of the statistics goes no further than

that.

Tr. 737-39 (emphasis added). Defendant’s counsel’s reference to the “number of graphs” in what

he called Mr. Matthews’ “rebuttal report” indicates that, at trial, counsel for Defendant, like

counsel for Plaintiffs, referred to the addendum as “the rebuttal report” and viewed the report and

addendum collectively. There are no graphs in Mr. Matthews’ rebuttal report, the exhibit that was

admitted, PX 144.17. Given that Defendant’s counsel did cross-examine the opposing expert on

11

the graphs in the addendum and had the opportunity to inquire about the Trail Study if he had

chosen to during trial, Defendant will not be prejudiced by admitting the addendum. 14

Taking into account the instances at trial where counsel for both parties and Mr. Matthews

refer to the report and addendum collectively, the fact that the addendum was physically attached

to the rebuttal report at trial, that counsel for Defendant cross-examined Mr. Matthews on graphs

that were present only in the addendum, and counsel for both parties proceeded as though the

addendum was in the record, the Court admits PX 144.18 into the record, nunc pro tunc.

The Property Rights Plaintiffs Retain in the Land Taken by the Easement

In Mr. Hodge’s view, the subject property owners retain virtually no rights in the

encumbered land, and thus each of his “after” valuations assumed the Government had taken a fee

simple interest in the encumbered portion. Tr. 181-82, 219-23. Mr. Hodge reached his conclusion

that the easement extinguished virtually all of Plaintiffs’ property rights in the encumbered parcel

by comparing the trail easement’s impact on the property owners’ ability to use the encumbered

land with impacts caused by other types of easements. Tr. 219-20.

In Mr. Sheppard’s opinion, each Plaintiff retains 15% of the property rights in the

encumbered land, and his appraisals award each owner compensation for 85% of the encumbered

land’s fee simple value. DX 94 at 183-84. In arriving at this conclusion, Mr. Sheppard relied upon

a matrix on easement valuation detailing other types of easements, appearing in an article by Mr.

Donald Sherwood from the May/June 2006 edition of Right of Way magazine, reproduced below:

14

Defendant’s counsel also claims prejudice because he did not call a sur-rebuttal witness,

Dr. Neuberger, once Plaintiffs elected not to introduce the addendum into evidence, stating:

[S]ur-rebuttal expert, Dr. Neuberger, was present in court and prepared to testify in

detail about the inappropriateness of using the Atlanta Case-Shiller Index for

valuation of Newton County real estate; numerous flaws in Mr. Matthews’

“graphical methodology” for purportedly identifying appropriate adjustments for

size and location, as well as in Mr. Matthews’ trail proximity study included in PX

144.18. Because Plaintiffs elected not to introduce PX 144.18, the United States

chose to forego aspects of its planned cross-examination of Mr. Matthews and there

was no reason to call Dr. Neuberger as a sur-rebuttal witness. Consequently, Dr.

Neuberger did not testify at all.

ECF No. 328 at 4. Counsel’s argument that he was poised to call Dr. Neuberger but opted not to

because Plaintiffs had not introduced the addendum into evidence falls flat, as Defendant’s

counsel’s conduct during trial indicated that he believed that the addendum had been admitted. Tr.

737-39.

12

DX 94 at 183.

Mr. Sheppard viewed this matrix as a “general guide for the impact or allocation from fee

simple value a host of typical easement types may have on the total bundle of rights” held by a

property owner. Id. Mr. Sheppard concluded:

As seen on the matrix, a percentage of fee-simple value for the affected easement

area ranges between 75% and 89%, considering the severity of impact on the

surface’s use . . . The trail easement was not considered to be as onerous as overhead

transmission lines, access roads, or railway right-of-way, because there is no

aesthetic quality lost as a result of the trail, vehicles are precluded from using the

trail, and there is no expectation that rail cars will use the trail. I conclude, however,

that an appropriate percentage is toward the higher end of the 75% to 89% range,

at 85%.

Id. at 184.

The Court finds that Mr. Sheppard’s opinion that these Plaintiff owners retain 15% of their

property rights in the land encumbered by the trail is unsupported by the evidence and contrary to

caselaw. At the outset, Defendant failed to establish that the Sherwood matrix is a persuasive

indicator of the owners’ property rights in land encumbered by a Rails-To-Trails easement.

13

Plaintiffs’ expert, Mr. Matthews, articulated the pitfalls of relying on this matrix, stating:

One of [Mr. Sheppard’s] two primary support sources for the 15% remaining value

is a chart an appraiser published in the 2006 publication of the Right of Way

magazine. I subscribe to that magazine as a member of IRWA. I am sure the

author, Don Sherwood, would not approve of an appraiser using his chart to value

dozens of properties in a [Rails-to-Trails] appraisal. Sheppard states this is a

general guide. I disagree with several of Mr. Sherwood's generalizations by

category and value of rights taken based on my extensive experience in appraising

corridor easements acquisitions. While there may be some benefit to appraisers in

helping them better understand the influence of various types of easements, the use

of this as primary valuation support in a condemnation proceeding is inappropriate.

PX 144.17 at JACKSON 004739. Mr. Matthews’ critique of Defendant’s reliance on the

Sherwood matrix is persuasive. Recreational trail easements do not even appear on the matrix.

DX 94 at 183.

But even if the Sherwood matrix could provide some guidance here, it does not support

Mr. Sheppard’s conclusions. Under the Sherwood matrix, access road easements, the most similar

easements to the trail, are considered to have a “severe impact on surface use,” and are assessed a

90-100 “percentage of fee” -- not an 85% of fee. Id. As Mr. Matthews opined, “[f]rom this list of

restrictive easements the top category at 90% to 100% of the fee value fits much better,” as these

easements do not “allow the land owner to use the land for private use.” PX 144.17 at JACKSON

004739. In categorizing trail easements in the Sherwood matrix’s zone of 75-89% of fee value,

along with pipeline, drainage, and flowage easements, Mr. Sheppard ignored the Plaintiff property

owners’ inability to exclude the public from their land. Id.; see Tr. 462-64, 472; Loretto v.

Teleprompter Manhattan CATV Corp., 458 U.S. 419, 435 (1982) (describing the right to exclude

others as “one of the most treasured strands in an owner’s bundle of property rights.”). In listing

the uses that the property owners could still make of the encumbered trail corridor Mr. Sheppard

merely referenced rights enjoyed by the general public such as walking or biking and proximity to

the trail. Tr. 480-81. Rights held by the general public, however, are clearly not rights that define

individual property ownership. See United States v. Craft, 535 U.S. 274, 278 (2002).

Mr. Sheppard’s conclusions that “there is no aesthetic quality lost as a result of the trail”

and “no expectation that rail cars will use the trail,” contradict the testimony of credible witnesses

who observed the impact of the trail firsthand as well as the legal import of rail-banking. DX 94

at 184. Plaintiff Robert Dew testified that noise and traffic had “certainly picked up,” since the

trail was constructed, and Plaintiff James W. Johnson testified that people drive automobiles and

all-terrain vehicles on the trail and cited threats and alarming encounters with trespassers coming

from the trail, including an incident where a trespasser drew a sawed-off shotgun. Tr. 41, 77, 81,

105-06. Mr. James K. Johnson, the forest manager for a deceased Plaintiff, testified that the trail

brought concerns of illegal dumping and increased risk of wildfires:

There’s an ongoing problem of people just backing a truck somewhere in the middle

of the night and dumping stuff. And there’s actually a mattress and a chair we saw

yesterday on the rail corridor and there’s places that could be dumped on [the Dixon

property] just as easily.

14

Tr. 119; see Tr. 108-09, 119-20.

Mr. Sheppard’s conclusion that there is no expectation that rails cars will ever use the trail

contradicts statute and precedent. Railbanking is a feature of the NITU, and contemplates that the

Trail may be converted to railroad or transit use. See 16 U.S.C. § 1247 (stating that the Trails Act

was enacted “in furtherance of the national policy to preserve established railroad rights-of-way

for future reactivation of rail service”); Caldwell, 391 F.3d at 1229 (stating that the effect of the

NITU is that “the STB retains jurisdiction for possible future railroad use”); Birt v. Surface Transp.

Bd., 90 F.3d 580, 583 (D.C. Cir. 1996) (“The rail line . . . retains the right to reassert control over

the easement at some point in the future if it decides to revive rail service.”). In sum, Mr.

Sheppard’s opinion that the owners retain 15% of fee simple ownership is unpersuasive.

In contrast, Mr. Hodge persuasively opined that the property owners retain virtually no

valuable rights in the encumbered land, warranting compensating Plaintiffs for the full fee simple

value of the encumbered portion of their property. Tr. 219-23. Mr. Hodge explained:

In my appraisal of these properties and in my appraisal of properties in other Trails

Act cases I have conducted numerous interviews of property owners, real estate

agents, and others in the marketplace. While some individuals appreciate the

presence of a public recreational trail in their community, the overwhelming

number of persons I have interviewed all expressed significant concerns about loss

of privacy, greater potential for vandalism and increased public access and traffic

crossing their property. It is also important to distinguish the perception of a benefit

of a public recreational trail in the community from the burden of a trail across a

specific owner's land.

Furthermore, the scope of this new rail-trail corridor easement is not for just a

public recreational trail. The nature of the easement includes the possibility a

railroad could be built across this corridor in the indefinite future. A knowledgeable

buyer purchasing the property in the after-taken condition would pay less for the

property knowing this. Common sense, as well as my experience as an appraiser

and my interviews with owners, all confirm this point. I have never encountered a

situation where a buyer would pay the same amount for home with a railroad right

of- way across a portion of the backyard as for a similar home without a railroad

right-of-way. So too with a public corridor. It has been my experience as an

appraiser that one of the significant features of property (especially residential

property) is privacy and the ability to exclude others. A property encumbered by a

public easement that reduces the owner's ability to exclude the public and shield his

home from an adjoining public corridor is less valuable than a property that is not

encumbered by such an easement.

PX 217 at 12-13.

In Rails-to-Trails cases, the Court has consistently held that the owners of land subject to

a trail easement retain virtually no rights in the encumbered land and awarded the plaintiffs the fee

simple value of the encumbered parcel. In Moore v. United States, 54 Fed. Cl. 747, 751 (2002),

the Court held that “the right of way parcel should be diminished 100% in the ‘after’ analysis

because the landowners had no effective remaining use of the property.” See Howard v. United

15

States, 106 Fed. Cl. 343, 367 (2012) (stating that properties subject to a trail easement “would

appear to be lost to the fee holder for all intents and purposes in perpetuity.”); see also Childers v.

United States, 116 Fed. Cl. 486, 524 (2013); 15 McCann Holdings Ltd. v. United States, 111 Fed.

Cl. 608, 626 (2013).

Based upon the record as a whole, this Court concludes that Plaintiffs retain virtually no

rights in the encumbered land and awards Plaintiffs 100% of the encumbered land’s fee simple

value as part of just compensation for the taking.

The Experts’ Methodologies to Value the Property Interests Taken

The value of the property interest taken in a Rails-to-Trails case is determined using the

“before-and-after” method of valuation. Plaintiffs’ expert Mr. Hodge explained:

The "before-taken" value is the market value of the fee estate assuming the property

was unencumbered by the rail-trail corridor easement and each landowner had the

right to use and possess their property. The "after-taken" value is the market value

of the fee estate as now encumbered by a new easement for public recreational and

a possible railroad in the indefinite future. The difference between the before-taken

and after-taken value is the fair market value of the property rights taken from each

owner.

PX 217 at 6-7. Both Plaintiffs’ and Defendant’s experts used sales comparison analyses to

calculate their before-and-after valuations of the subject properties. Id. at 6-7; DX 94 at 21.

Plaintiffs’ Expert’s Sales Comparison Analysis

Using the sales comparison analysis method prescribed by the treatise The Appraisal of

Real Estate (2013), 16 Mr. Hodge determined the value of the land taken by the easement corridor.

15

In his report for the Government in another Rails-to-Trails case, Childers, an exhibit in this

case, Mr. Underwood opined:

This permanent easement takes most of the bundle of rights on the property, with

the only entitlement remaining that it would be included in the size calculations of

the total site for consideration of density/number of dwelling units that could be

built on the site. As a result, it is my opinion that the permanent easement takes

99% of the value of the area encumbered by the easement.

PX 207.2 at 44-45.

16

The Appraisal of Real Estate is “a treatise on the subject of appraisals published by the

American Institute of Real Estate Appraisers.” Low v. Equity Programs, Ltd., 882 F. Supp. 344,

348 (S.D.N.Y. 1995). It is “the leading real estate appraisal treatise” and is routinely cited as an

authority on matters of real estate valuation. Appraisal Inst. v. Gallagher, No. CIV.A.3:02-CV-

2199-D, 2003 WL 21653861, at *1 (N.D. Tex. Mar. 20, 2003); see McCann Holdings, 111 Fed.

Cl. at 615-16.

16

He first researched recent sales of comparable properties to find properties as similar as possible

to the subject property, considering characteristics such as property type, date of sale, size, physical

condition, location, and constraints on the use of the land. PX 217 at 9. He then verified that the

data obtained was factually accurate and that the transactions reflected arm’s length market

considerations. Id. To determine the terms and conditions of prior sales, Mr. Hodge relied on

qPublic and on the verification process used by the Newton County Tax Assessor’s office. Tr.

192-93, 299.

Next Mr. Hodge selected “the most relevant units of comparison,” such as price per square

foot, to try to “identify a unit of comparison that explains market behavior.” PX 217 at 9. Mr.

Hodge cited “time adjustment/market conditions” as an element of comparison reflecting the

change in value from the date of sale of the comparable property to the date of valuation if there

had been a significant change in market conditions during that timeframe. Id. at 10. The date of

valuation was the August 19, 2013 date of the taking, and the comparable sale dates ranged from

January 31, 2008 to December 11, 2013. Tr. 254-55; PX 27 at JACKSON 002791; PX 38 at

JACKSON 003037. Mr. Hodge did not make market conditions adjustments to the comparable

properties because the country was in the midst of the Great Recession from 2008 to 2013, and

lenders were reluctant to lend money during this period; he concluded that property values had

been relatively stable over the time frame represented by the comparable data. PX 217 at 10.

Mr. Hodge identified the type of ownership (such as fee simple, or a leasehold), property

location, land size and shape, access to the property, and zoning and land use regulations, as other

units of comparison. Id. at 10-11. Then, using those units of comparison, Mr. Hodge adjusted the

prices of comparable properties to account for any differences between the subject and comparable

properties, considering whether adjustments should be made in light of similar, inferior or superior

characteristics. Lastly, Mr. Hodge synthesized “the various value indications produced from the

analysis of comparable sales into a value conclusion.” Id. at 10-11.

The comparable sales Mr. Hodge selected were all for fee simple estates, arm’s length

transactions, and were as similar in size, location, and zoning to the subject property as possible.

Id. at 10-11. After determining the price per square foot of each of the comparable sales, Mr.

Hodge made the adjustments necessary for each individual property in a sales analysis grid. Id. at

11; see, e.g., PX 14 at JACKSON 001761; PX 29 at JACKSON 002928; PX 38 at JACKSON

003806. Then, upon finding the proper range of price per square foot for each of the comparable

sales, Mr. Hodge interpreted the data to determine the proper price per square foot of the Plaintiff

property. See, e.g., PX 14 at JACKSON 001761-1762. 17

Defendant’s Expert’s Sales Comparison Analysis

Mr. Sheppard used a sales comparison analysis to calculate his before-and-after valuations

of the subject properties. Mr. Sheppard researched land sales from an undefined “surrounding

area,” between January 1, 2010 and August 19, 2013, which “yielded over 1,000 recorded

transactions,” and discarded sales he did not deem comparable, such as bank foreclosures, non-

arms-length transactions, or locations “considerably superior or inferior” to the subject properties.

DX 94 at 18-19.

17

In some instances. Mr. Hodge used the price per acre.

17

Ultimately, Mr. Sheppard identified the following comparable sales for different categories

of properties:

DX 94 at 19-20. Mr. Sheppard noted the low number of comparable sales, stating:

Given the scarcity of truly comparable data, due to the rural/suburban nature of the

area and especially in light of a period of low sales volume after the Great

Recession, the adjustment process does not yield a more credible result than

carefully analyzing each subject property within a known array of sales available

by property type, covering a variety of sale-specific, location-specific, physical-

specific differences.

DX 94 at 21.

Mr. Sheppard grouped a subject property with sales of comparable properties of the same

highest and best use, and then performed a “matched-pair” sales analysis, i.e. a comparison of two

sales with similar charactaristics except for one overriding difference, in this case proximity to a

trail corridor. DX 94 at 20-21, 176; Tr. 296. Using the results of the matched-pair analysis, Mr.

Sheppard then adjusted the sale prices.

Defendant’s Challenges to Plaintiffs’ Sales Comparison Methodology

Defendant argues that Mr. Hodge’s comparable sales analysis is “flawed and inaccurate”

because he failed to comply with the Yellow Book’s standards for verifying sales data, and instead

relied on publicly-available data on the Newton County Tax Assessor’s “qPublic” website. ECF

No. 264 at 62, 74, ECF 328 at 9. Defendant claims that for several sales, the qPublic data did not

match the details on the underlying deed or contained typographical errors.

The Yellow Book provides that “all comparable sales used must be confirmed by the buyer,

seller, broker, or other person having knowledge of the price, terms, and conditions of sale.” DX

05 at 25 (emphasis added). Mr. Hodge did not contact individual parties to the comparable sales

to confirm the data’s accuracy and instead relied on the Newton County Tax Assessor’s qPublic

data. Tr. 192-93, 208. Mr. Hodge considered the Tax Assessor’s data to be adequately verified,

as it is derived from documents signed by a party to the transaction or his agent who attests to the

veracity of the information “under penalty of law”. Tr. 192. Mr. Hodge opined that using the Tax

Assessor’s data is more reliable than asking the parties involved, sometimes years later, to recall

the details of a particular transaction. Tr. 302-03.

The Court finds that Mr. Hodge’s reliance upon the qPublic data provided by the Newton

County Tax Assessor comported with uniform appraisal practice standards. The Appraisal

Institute’s Uniform Standards of Professional Appraisal Practice do not require an appraiser to call

18

parties to a transaction to confirm the sale details. THE APPRAISAL FOUND., 2018-2019 UNIFORM

STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE (USPAP) 38 (2018). The source of the

qPublic data is Form PT-61, a formal transfer form, completed by the parties to a sale which is

recorded in the Georgia Superior Court, then entered into the County Tax Appraiser’s database,

and finally entered into the qPublic database.

Georgia regulations require parties to contemporaneously disclose sale data when a

property is transferred, in order to assess the appropriate transfer tax, and such disclosure must be

made on Form PT-61. Ga. Comp. R. & Regs. 560-11-2-.16(1) (2016). Required sales data

includes the seller’s identity, date of sale, buyer’s identity, the intended use of the property, i.e.,

residential, agricultural, commercial, or industrial, as well as a “complete description of the

property being conveyed,” including “the number of acres of property, map and parcel number,

district, land lot and sublot and block,” and the “actual value of the consideration received by the

seller for the real and personal property conveyed to the buyer.” Ga. Comp. R. & Regs. 560-11-

2-.16(1)(a)-(d).

On the Form PT-61, the “seller or seller’s authorized agent” must certify

that all the items of information entered on the transfer form PT-61 are true and

correct (to the best of his knowledge and belief) and that he is aware that the making

of any willful false statement of material facts will subject him to the provision of

the penal law relative to the making and filing of false instruments . . . .

Ga. Comp. R. & Regs. 560-11-2-.16(1)(f).

The Chief Appraiser for the Newton County Tax Assessor’s Office, Mr. Corneil Marcus

Jordan, testified in deposition that when a property is transferred, a Form PT-61 is typically

completed in the office of the transaction’s closing attorney, then submitted along with the

property’s warranty deed to the Clerk of the Superior Court, who sends the form to the Tax

Assessor’s office where the data from the Form PT-61 is entered into the Newton County Tax

Assessor’s WinGAP software database. DX 95 at 11-12; 34-36, 49. The “information is pulled”

from the Newton County Tax Assessor’s database by a third-party entity and displayed on the

qPublic website. Id. at 16.

Although Mr. Hodge’s reliance upon the Newton County Tax Assessor’s data, complied

with uniform appraisal standards, consideration is appropriate of alleged errors that may have

made their way into the qPublic data. Defendant identified errors in the qPublic data for 10 of Mr.

Hodge’s 37 comparable sales, including errors in the sale price or acreage. ECF No. 264 at 74-

77; PX 217 at 14-41. Upon review of the data and the parties’ arguments, the Court concludes that

one error involving a wrongly priced comparable adversely impacted Mr. Hodge’s valuation.

The qPublic Data Overstated the Sale Price for One Lot in Comparable Sale No. 3 Due to A

Typographical Error

Defendant argued:

Mr. Hodge used comparable sale 3 (9159/9169 Malcolm), in his appraisals of

19

twelve properties.[ 18] Again relying solely on qPublic, he concluded that one lot

sold for $4,800 and the other lot sold for $48,000 – for a total sales price of $52,800.

The underlying deed for the sale shows that both properties in fact sold for $9,600.

The Newton County Tax Assessor’s Office admitted that the $48,000 sales figure

shown on qPublic is simply a typographical error. Thus, Mr. Hodge significantly

overstated the actual sales prices by 60-75%. Tr. 582: 9-583:11; PX 44.

ECF No. 264 at 75.

The qPublic data for 9159 Malcolm Drive, which is 0.11 acres in size, shows a sale price

of $48,000 on December 21, 2010, and the qPublic data for 9169 Malcolm Drive, a property of

0.12 acres in size, shows a sale price of $4,800 on December 21, 2010. PX 44 at JACKSON

004334, 36. Based on his review of the Form PT-61 for the sales of 9159 and 9169 Malcolm

Drive, Mr. Jordan, the Chief Appraiser for the Newton County Tax Assessor’s Office, testified

that the total purchase price for the two lots was $9,600, that each lot had sold for $4,800, and that

the sales price of $48,000 for 9159 Malcolm Drive was “a typo of one too many zeros.” DX 95 at

47, 52, 57, 100, 102. 19

Due to this error, Mr. Hodge used a price per square foot of $5.27 for the 9159/9169

Malcolm comparable sale, which he found by dividing $52,800, the incorrect sale price because it

used $48,000 for 9159 Malcolm, by 10,019 square feet, the size of the combined 9159/9169

Malcolm lots. However, the price per square foot should have been derived by dividing $9,600,

the correct sale price of the combined lots, by 10,019 square feet to yield $0.96 per square foot.

As a result of this error, Mr. Hodge used a price per square foot over five times higher for the

combined lots in comparable 3 than the actual price per square foot.

This error is problematic because Mr. Hodge only used two other comparables in reaching

his valuations, and neither party addressed the error’s effect on valuation. Using the erroneous

comparable which he valued at $5.27 per square foot and two other comparables -- 9179 Malcolm

at $5.44 per square foot, 10173 Dinah Circle at $4.35 per square foot, Mr. Hodge valued 10

properties as follows:

Plaintiffs’ Properties Hodge’s Before Hodge’s After

Valuation Valuation

Reginald Henry $4.00/sq. ft. $3.75/sq. ft.

Property (Parcel 125)

Sherman Smith Property $4.00/sq. ft. $3.75/sq. ft.

(Parcel 132)

18

In its Post-Trial Brief Defendant states that Mr. Hodge used comparable 3 (i.e., 9159/9169

Malcolm) in his appraisals of 12 properties citing the transcript and Mr. Hodge’s appraisal report

for one of those properties. However, Mr. Hodge’s individual appraisal reports indicate that Mr.

Hodge only used this property for 10 properties described below.

19

Mr. Jordan testified that such errors occur in “less than 1 percent” of the data inputted into

qPublic. DX 95 at 102.

20

Winston Munroe $4.50/sq. ft. $4.25/sq. ft.

Property (Parcel 162)

Rentrope Property $4.50/sq. ft $4.25/sq. ft.

(Parcel 164)

Alcide Property (Parcel $4.50/sq. ft. $4.25/sq. ft.

168)

Semador Property $4.50/sq. ft. $4.25/sq. ft.

(Parcel 171)

Lockhart Property $4.00/sq. ft. $3.75/sq. ft.

(Parcel 287)

Joseph Marino Property $3.75/sq. ft. $3.50/sq. ft

(Parcel 105)

City of Covington 40,004 sq. ft. @ $3.10/sq. ft.

Property (Parcel 123) $0.60/sq. ft. and 30,600

sq. ft. @ $3.50/sq. ft.

Leonard Goss, Jr. $4.50/sq. ft $4.25/sq. ft.

Property (Parcel 152)

PX 217 at 66-67; PX 14 at JACKSON 001759-63; PX 15 at JACKSON 001830-34; PX 21 at

JACKSON 002258-62; PX 22 at JACKSON 002329-33; PX 23 at JACKSON 002400-04; PX 24

at JACKSON 00247-75; PX 41 at JACKSON 004035-39; PX 42 at JACKSON 004105-09; PX 43

at JACKSON 004178-82; PX 44 at JACKSON 004315-19.

Defendant asks the Court to conclude that this error along with other errors renders Mr.

Hodge’s valuations unreliable, and Plaintiffs argue that this error would not have affected Mr.

Hodge’s valuation. Neither party attempted to adduce additional evidence or offer meaningful

argument on how the Court should assess this error. See Tr. 858, 962; ECF No. 332 at 15.

Nonetheless, this Court is tasked with awarding Plaintiffs just compensation for the taking

of their properties and must arrive at a reasonable assessment of this error’s impact on damages.

See, e.g., Gadsden Indus. Park, LLC v. United States, 956 F.3d 1362, 1372 (Fed. Cir. 2020)

(affirming the trial court’s holding that it “may award damages, even if [it] does not fully credit

[a] party’s methodology”). The Court has discretion in adopting a methodology that awards just

compensation to a takings plaintiff. See generally Otay Mesa Property, L.P. v. United States, 779

F.3d 1315, 1326 (Fed. Cir. 2015) (“We detect nothing inappropriate with the Court of Federal

Claims looking at the evidence as a whole and using its own methodology to calculate a damages

award.”); Precision Pine & Timber, Inc. v. United States, 596 F.3d 817, 833 (Fed. Cir. 2010)

(concluding that the Claims Court did not abuse its discretion by modifying plaintiff’s

methodology for calculating damages).

21

It is clear here that Plaintiffs have been injured by the taking. It is also clear that the error

in qPublic operated to inflate the valuations of a comparable property used in determining

Plaintiffs’ losses. However, the factors Mr. Hodge applied in valuing each individual property

based on the comparables cannot be quantified or replicated by this Court. 20 Rather, as detailed

above, Mr. Hodge exercised his judgment as an appraiser and considered numerous units of

comparison including location, land size and shape, access to the property, zoning and land use

regulations to adjust the prices of comparables to account for any differences between subject and

comparable properties. PX 217 at 10-11. As such, for the 10 properties that used the erroneously

inflated comparable sale at 9159/9169 Malcolm, the Court adopts Mr. Hodge’s damages

calculation reduced by 5%. The Court reduces Mr. Hodge’s valuation of the land within the

easement for these 10 properties as follows:

Plaintiffs’ Hodge Damages Court Awarded

Properties for Value of Damages of

Land within Value of Land

Easement within Easement

Reginald Henry $17,800 $16,910

Property (Parcel

125)

Sherman Smith $25,700 $24,415

Property (Parcel

132)

Winston Munroe $11,475 $10,901.25

Property (Parcel

162)

Rentrope $11,700 $11,115

Property (Parcel

164)

20

As noted in one treatise:

It is generally held improper to determine market value on the basis of simple

averaging of the sales prices of other properties without any adjustment of such

prices for differences between properties. It seems unlikely, however, that this rule

would prohibit the determination of value by computing the weighted average of

adjusted prices. The latter process requires the exercise of expert judgment both in

adjusting the compared sales prices and in determining the relative weight to be

given to each sale.

5 DANIEL F. SULLIVAN, AM. JUR. PROOF OF FACTS 2d 411, § 8 Determination of value of subject

property (2000) (citing Latham Holding Co. v. State, 209 N.E.2d 542, 543 (N.Y. 1965)).

22

Alcide Property $10,125 $9,618.75

(Parcel 168)

Semador $12,263 $11,649.85

Property (Parcel

171)

Lockhart $20,700 $19,665

Property (Parcel

287)

Joseph Marino $19,688 $18,703.60

Property (Parcel

105)

City of $9,368 $8,899.60

Covington

Property (Parcel

123)

Leonard Goss, $7,875 $7,481.25

Jr. Property

(Parcel 152)

PX 217 at 66-67.

Defendant Has Not Established That Any Other Errors in Comparable Sales Pricing

Require Adjustments to Mr. Hodge’s Valuation

As a claimed second error, Defendant cited comparable sale 1 -- a sale which Mr. Hodge

used in the appraisal of six properties encompassing seven parcels. Defendant argues:

For comparable sale 1 on County Line Road, Mr. Hodge looked only at qPublic

which lists the property’s size as 32 acres (DX 81). The deed shows that 52.28 acres

were sold. Id. Using the correct acreage significantly decreases the per acre sales

price. But Mr. Hodge did not discover the error in the qPublic information because

he did not even review the deed from the sale, much less talk to anyone who could

explain the terms of the sale. Tr. 214:4-19; 215:15-25.

ECF No. 264 at 77 (emphasis added).

The qPublic data for the County Line Road sale shows a January 31, 2008 sale of 32 acres

at 1710 County Line Road, Mansfield Georgia for $193,700 making the price per acre $6,053, but

the warranty deed indicates that this parcel is 52.28 acres. PX 29 at JACKSON 002946; DX 81 at

002. However, the difference in acreage is attributable to the fact that the additional 20.28 acres

comprising this parcel was located in an adjoining county, Jasper County, and not listed with

Newton County’s qPublic data. The sales price for that acreage did not appear on the Newton

County database.

23

As Mr. Hodge explained when Defendant’s counsel asked him about the discrepancy in

acreage between the qPublic data and the warranty deed for the County Line Road property:

Yes. I checked on that, with the assessor’s office yesterday, after being provided

with the deed, and the 32 acres is that portion that’s located in Newton County.

There is an additional acreage located in Jasper County, and as a result, the

$193,700 of the sale price is that portion that’s in Newton County. There is an

additional acreage for an additional $120,000 of property that was located in Jasper

County. So qPublic reflects only that portion that was located in Newton County,

not in the entire transaction.

Tr. 214-15 (emphasis added). In Mr. Hodge’s view, this information “shows the accuracy of the

assessor’s interpretation of the data from Newton County.” Tr. 215. Thus, because an additional

$120,000 was paid for the Jasper County portion of the property -- the 20.28 acres not listed in

Newton County qPublic data -- Mr. Hodge neither understated the total acreage of this comparable

nor “significantly overstated” the price per acre. As such, this claimed error does not warrant

adjusting Mr. Hodge’s appraisals for the six affected properties.

With respect to a claimed third error, Defendant argued:

For the Highway 11 [comparable] sale, Mr. Hodge listed the amount of land sold

as 34.67 acres. The actual acreage was 39. 33 acres, which lowers the price per

acre. Mr. Hodge did not investigate to determine why the sale is listed on qPublic

as “unqualified.” Nor did the fact that the grantor was a bank cause him to question

whether the sale was arms-length. DX 82; Tr. 210:12-212:10; 213:2-4.

ECF No. 264 at 76-77. Mr. Hodge used the Highway 11 transaction as one of three comparable

sales for his appraisals of six properties: three Category 5 properties and three Category 9

properties. Defendant has not established that the error in acreage so inflated Mr. Hodge’s

valuation that a reduction in an award of just compensation is warranted. There is no evidence as

to why the unqualified designation was listed on qPublic or what the import of the bank being the

grantor was on this particular transaction, or what impact these factors may have had on Mr.

Hodge’s analysis or appraisal.

As a claimed fourth error, Defendant argued:

Mr. Hodge used comparable sales 55 (50 Tuscany Drive), and 56 (40 Tuscany

Drive), in his appraisals of eight properties, relying on qPublic, which shows that

both properties sold for $15,500. In fact, sales 55 and 56 were part of a transaction

that included the sale of fourteen lots that varied in size from one acre to 1.8 acres.

DX 93. The County Appraiser’s office just divided the $217,000 sales price for all

lots by 14 to arrive at the $15,500 purported sales price for each lot. DX 95 at 95:18-

96:3. Given the variation in lot sizes, it is highly unlikely that all fourteen sold for

the same price. Moreover, the deed shows that the sale also included common area.

DX 93. Because Mr. Hodge did not speak to anyone knowledgeable about the

transaction to confirm the sale, he was unaware of the above discrepancies, which

clearly indicate that his $15,500 price for sales 55 and 56 is inaccurate. Tr. 577: 9-

579:8; 579:15-580:11.

24

ECF No. 264 at 74-75.

None of Defendant’s three experts addressed if, or to what extent, these “discrepancies”

might warrant a reduction in damages, and the record suggests their impact would be de minimis.

The warranty deed executed on April 24, 2009 for the sale of “Lots 1-14, inclusive, of Tuscany

Place” to Ms. Nancy Mock shows a real estate transfer sales tax of $217 paid to the clerk of court,

denoting a total sales price of $217,000 for all 14 lots, and Mr. Jordan agreed that the individual

$15,500 lot prices were reached by dividing $217,000 by 14 lots. DX 93 at US_0003427; DX 95

at 94-96. The deed does not show the size of each individual lot -- only a conglomerate area for

all 14 lots. Nor does it show the area attributable to common space. As such, Defendant has not

demonstrated that Mr. Hodge’s comparable sales prices for 50 and 40 Tuscany Drive were so

flawed as to taint the resulting appraisals.

The remaining four errors that Defendant identified include a sale on Old Atlanta Road

which was part of a series of transactions, sales of two properties on Elks Club Road which

Defendant contended were not arm’s-length transactions, and three sales which were “part of a

bulk sale transaction,” rendering it unclear “how the individual lot prices were derived.” ECF No.

264 at 75-77. However, Defendant did not identify any incorrect qPublic data associated with

these sales and did not demonstrate how these alleged errors may have impacted the appraisals.

As such, the Court does not reduce Mr. Hodge’s appraisals based upon these alleged errors.

Mr. Hodge Properly Considered Adjustments for Market Conditions

Defendant argues that Mr. Hodge’s comparable sales analysis is unreliable because he

failed to properly adjust comparable sale prices to account for changing market conditions,

positing that the Great Recession caused a sharp decline in Newton County housing prices from

2008 to 2012, warranting an adjustment in comparable sale prices to reflect this market shift. ECF

No. 264 at 78-79.

Using the August 19, 2013 date of the NITU issuance as the date of the taking, Mr. Hodge

used comparable sales dating from January 2008 to November 2013. ECF No. 17-3 at 1; PX 217

at 15; ECF No. 265 at 129. Mr. Hodge considered whether a market conditions adjustment was

appropriate, but concluded that it was not, because property values were relatively stable over the

time frame represented by the comparable data. Tr. 180-81, 255; PX 217 at 10. Mr. Hodge

explained:

[T]here was not a sufficient number of sales that you could actually take a look at

and say there has been an increase or decrease [in property values]. We're looking

at, you know, the start of 2008, and through mid 2013, we were in the midst of the

Great Recession, and, you know, property values, when you look at any kind of a

trend during that period of time with the data that I had, there really wasn't any

indication that there was significant increase in property values as a result of the

passage of time.

So I did not make a market conditions adjustment, but it was considered when I

look at how did I come up with my final per-acre value, and, you know, I lean more

towards the upper end because as time went on through into '12 and '13, land values

had recovered, and even though they hadn't significantly increased, there was at

25

least some indication in the market that the market was strengthening. So that was

taken into consideration, not with any empirical evidence, but with judgment and

analysis of the data that I had available to take a look at.

Tr. 254-55.

Six of the comparable sales Mr. Hodge considered occurred in 2008, with the earliest in

January 2008. ECF No. 265 at 129. Defendant argues that Mr. Hodge’s valuations are unreliable

because the 2008 sales occurred at the peak or right after the burst of the housing bubble, and under

much different economic conditions than those existing on the date of the taking, August 29, 2013.

Tr. 628; DX 26 at US_0002650. Citing a chart of Newton County home sales from 1987-2017

prepared by the United States Federal Housing Finance Agency, Defendant’s expert economist,

Dr. Neuberger, testified: “[y]ou can see dramatic declines in the home price index [from 2008 to

2012]. The bottom is reached in 2012, and there's a slight increase in 2013 as the beginnings of a

recovery in housing markets in Newton County started to occur.” Tr. 628; DX 98. Dr. Neuberger

opined that “some of [Mr. Hodge’s comparable sales] transactions, many of those transactions,

occurred under vastly different economic circumstances than those that prevailed around the time

of appraisal date, [August 29, 2013,] and that the failure to make those adjustments reduces and

undermines the reliability of Mr. Hodge’s appraisals.” Tr. 620; see ECF No. 264 at 79.

As Plaintiffs point out, the United States Federal Housing Finance Agency’s chart of

Newton County home sales, on which Dr. Neuberger relies, details home prices, and not land

prices. DX 26 at US_0002650; ECF No. 265 at 130. Dr. Neuberger acknowledged at trial that

Mr. Hodge’s assignment was valuing land prices, not home prices. In addition, he agreed that the

Housing Finance Agency’s chart does not depict all housing sales in Newton County, but only

sales based on federally-backed mortgages. Tr. 635-36, 39. Dr. Neuberger also acknowledged

that the Housing Finance Agency’s county-wide chart did not specifically consider “unique”

housing markets such as the Covington Historic District. Tr. 639-40.

At trial, Mr. Hodge explained there “was insufficient data to develop” reliable conclusions

about changes in the market conditions because there were relatively few sales in the Newton

County and Covington markets. Tr. 261. The trial testimony of Plaintiff-landowner Mr. Dew

supports Mr. Hodge’s conclusion about the scarcity of comparable sales data, especially for homes

in Covington’s Historic District. Mr. Dew testified that “there’s been a few [houses in the Historic

District] that sold and others haven’t sold in 100 years.” Tr. 33.

The Court finds that Mr. Hodge reasonably concluded that the data did not support making

adjustments for market conditions. See PX 217 at 15; see also Tr. 732 (Matthews stating “I can

see where an appraiser could convince himself that [making no adjustments] would be the best

way to handle it, because there’s not enough data to prove one way or the other.”). As stated in

J.D. Eaton’s Real Estate Valuation In Litigation, though appraisers must consider whether

adjustments are necessary, they are not required to make such adjustments if the appraiser deems

it inappropriate based on his study of the market. See REAL ESTATE VALUATION IN LITIGATION

208 (2d ed. 1995); PX 217 at 10, 15; Tr. 254-55.

Based on the record as a whole, the Court adopts the valuations of Plaintiffs’ expert, Mr.

Hodge, adjusting his appraisals of the 10 properties using 9159/9169 Malcolm as a comparable

sale downward by 5%.

26

Damages to the Remainder

In addition to the value of the property actually taken, just compensation for a Fifth

Amendment taking includes severance damages for any diminution in value to the owner’s

remaining property resulting from the taking. Hendler v. United States, 175 F.3d 1374, 1383 (Fed.

Cir. 1999).

Both experts agree that a “paired-sales analysis” is the preferred approach to determine any

diminution in value to the remainder. See PX 217 at 11; DX 94 at 21, 164; 176; Tr. 296 (Hodge)

(“[P]aired sales are basically you’re looking at two sales with one significant difference between

the two sales that you can measure.”). Mr. Hodge found that there was insufficient market data on

comparable properties to conduct a valid paired sales analysis with respect to the remainder

properties. Tr. 190; PX 217 at 11-12. Instead, he considered the “changes in the use and utility of

the remaining property” and made individual determinations of the diminution in value of the

remainder properties based on the properties’ “specific and unique characteristics.” Id. at 12.

Mr. Hodge elaborated with respect to his appraisal of the property of Mr. Dew:

MR. HEARNE (COUNSEL FOR PLAINTIFFS): And, so . . . you concluded

that there was also a diminution in value of the remainder, correct?

MR. HODGE: That is correct. And that’s reflected in the 15-cent per square foot

difference in the value before and after.

THE COURT: And that would be the difference in the value of the property that

remainder, the 50,000 square foot property that remained?

MR. HODGE: That is correct, yes.

Tr. 318-319. Due to the “loss in site area and the impact of having a public trail adjacent to the

property,” Mr. Hodge found that Mr. Dew’s remainder property had decreased in value by $7,586.

DX 5 at JACKSON 001195; PX 217 at 46.

In analyzing the effect of the trail easement on the remainder value of different properties,

Mr. Hodge divided the properties into nine categories:

PX 217 at 3. For all these categories of properties, Mr. Hodge:

determined the percentage valuation by taking into account a variety of factors,

27

including the proximity of the easement to the home, privacy and security concerns,

the topography of the property in relation to the easement, the necessity to fence,

berm, or buffer the private space from the public space, and the increased access

the general public has to the property by reason of the rail-trail corridor easement.

PX 217 at 15. Mr. Hodge also considered “loss of access [to a public road], and the potential for

increased vandalism,” which could “diminish the desirability and marketability of the property.”

Id. at 11.

The majority of Mr. Hodge’s individual assessments of damage to the remainder range

from 2-45% of the subject property’s “before” value: 6-14% for residential properties, 9-26% for

improved commercial properties, 2-45% for vacant commercial properties, and 2-45% for

agricultural properties. PX 217 at 15, 18, 36, 39, 41. There are, however, three outlier properties

where values decreased more dramatically: Parcels 57, 123, and 187. Mr. Hodge found that the

value of Plaintiff Thorpe’s property, Parcel 57 had decreased by 60%; that the City of Covington’s

property, Parcel 123, had decreased by 82%; and that Plaintiff Betty Pickens’ property, Parcel 187,

had decreased by 74%. PX 217 at 15, 18, 20, 44.

Mr. Hodge singled out the deleterious impact to properties bisected by the trail, such as the

Thorpe property, Parcel 57:

Jennifer Thorpe's home was unique because the easement takes a sharp tum south

and travels over her property bisecting it into two separated parcels. The imposition

of the rail-trail corridor easement substantially reduced the value of Jennifer

Thorpe's remaining property. The easement brings the general public to within a

few feet of her home and bisects her backyard. A buyer of the Thorpe property

would likely give no value to the triangular section on the opposite side of the

easement, as there would be no access to it directly from the home or yard without

crossing the rail-trail corridor. And, if the buyer wished to fence the public space

from the private space, it would further render the southwest comer of Ms. Thorpe's

lot completely inaccessible for use as part of the residential yard.

Id. at 15.

Plaintiff Thorpe’s property is depicted below:

28

DX 17C at US_00003178. Mr. Hodge found that the value of the Thorpe property was diminished

by 60 percent because “the rail-trail corridor easement bisected her property causing her to lose

the use of most of her backyard and the existing access from Butler Avenue.” PX 217 at 15.

Mr. Hodge found similar diminution in value to the remainder of Ms. Dixon’s property,

Parcel 186, reasoning:

Ms. Dixon’s property also suffered severance damages because of the same need

to cross the easement in order to access a portion of her property. Ms. Dixon has

six acres of property that is only accessible by crossing the trail. These six acres are

unimproved and had a highest and best use as agricultural land in August 2013.

However, without documented access to those six acres, it is my opinion that a

knowledgeable buyer in August 2013 would have paid about half the market value

of those six acres because of the lack of any guaranteed unlimited and perpetual

access over the easement.

PX 217 at 43.

Mr. Hodge determined that Plaintiff Betty Pickens’ property, Parcel 187, had decreased in

value by 74%. PX 217 at 44. Parcel 187 is now accessible only by crossing the trail easement

from the public road. Id. at 43-44. As Mr. Hodge states in his report, “[i]n the ‘before’ scenario,

Ms. Pickens would not have to worry about her access off of County Road 213 to her residence,

nor would any prospective buyer of the property.” Id. at 44. After the taking, however, the Trail

bisects the majority of her property, where the residence is, from the access point where the

property touches County Road 213. Thus, she cannot guarantee to a potential buyer any access

29

from the property to County Road 213 without having to cross the Trail due to the taking. The

Pickens property is depicted below:

PX 29 at JACKSON 002938.

With respect to the City of Covington’s property, Parcel 123, Mr. Hodge determined that

the value of the remainder was diminished by 82 percent. The trail easement bisects Parcels 57

and 187, and separates Parcel 123 from residential properties which could have potentially

acquired it to enlarge their own properties. Id. at 16, 20; PX 29 at JACKSON 002910. Mr. Hodge

noted that “[d]ue to the lack of access crossing the subject property the southern portion of the site

will no longer be able to be assembled to the adjacent parcels to the west.” PX 43 at JACKSON

004143. He explained: “The City of Covington' s property (123), shown below, loses substantial

value because in the "before" condition it would have been desirable to assemble with the homes

and properties on the other side of the right-of-way. After the taking, the parcel loses much of its

value.” Id. at 20.

30

Id. at 20.

Defendant raises several challenges to Mr. Hodge’s calculations of damages to the

remainder. First, Defendant argues that Mr. Hodge did not support his findings with sales evidence

or other empirical data, or conduct a “study to show causation of damages from proximity to the

trail.” ECF No. 264 at 21, 64-69, 72-73; ECF No. 303 at 63-66. Mr. Hodge acknowledged that a

paired-sales analysis is “the preferred approach to estimate the diminished value of the remainder

parcel due to the effect of the easement.” PX 217 at 11. Mr. Hodge “looked for [comparable]

sales,” but there was “such a limited amount of data available in Newton County for all of these

different property types that it was impossible to do an accurate paired sales analysis.” Tr. 190,

227.

Mr. Hodge explained:

The preferred approach to estimate the diminished value of the remainder parcel

due to the effect of the easement would be a paired-sales analysis. But a paired-

sales analysis is only valid if there are a sufficient number of comparable properties

with similar characteristics sufficient to isolate the effect of the presence of the rail-

31

trail corridor on the value of the property, as opposed to other differences between

the properties. To be valid a paired-sales analysis one must have a sufficient number

of arms-length sales of properties that are sufficiently similar. I conducted extensive

research to find sales of a sufficient type and character that could provide a basis to

prepare a valid paired-sales analysis. There were not, however, sufficient sales of

sufficiently similar properties to conduct a valid paired-sales study. There have

been studies completed which, in my mind, are inconclusive. Some of the studies

completed indicate some benefit to property values and others show significant

diminution in value, particularly for properties that are adjacent to the corridor. As

a result, rather than attempting to empirically quantify the loss in value I have

looked at the issue from a more common sense, rather than empirical, recognizing

that a property along the corridor would be negatively affected due to the impact of

the placement of an easement across the property.

PX 217 at 11-12.

Mr. Hodge’s conclusion that there were insufficient comparable sales to perform a valid

paired-sales analysis to determine severance damages is supported by both his own and Mr.

Sheppard’s data. Mr. Sheppard also cited the “scarcity of truly comparable data, due to the

rural/suburban nature of the area and especially in light of a period of low sales volume after the

Great Recession.” DX 94 at 21. The Court finds that in this situation where there is a dearth of

appropriate comparable sales data, Mr. Hodge’s “common sense” approach of assessing changes

in the use and utility of individual remainder properties was reasonable and supported by the

record. Mr. Hodge considered both the physical changes to the remainder post taking and credible

landowner concerns about trespass, loss of privacy, increased noise and traffic, and dumping and

wildfires and lack of security. Id. at 141. 21 Tr. 39, 41, 56, 81, 105, 119-20. One Plaintiff, James

W. Johnson, became emotional when testifying about the negative changes wrought by the trail

easement on his property. Tr. 74-75; 105-06. The Court found this witness credible and his

concerns, genuinely held. 22

Defendant claims that Mr. Hodge failed to support his finding that the trail easement

impeded access to the Pickens and the Mocks’ property. ECF No. 264 at 70-71; ECF No. 303 at

21

Mr. Hodge met directly with 26 landowners and their representatives and conducted one

telephonic interview. Tr. 174; PX 217 at 14, 17, 25, 31, 35, 37-38, 40.

22

The Court recognizes that a witness, Mr. Lamar Maurice Carter, expressed a contrary view

of the Trail and testified that the idea of a trail was appealing for him because his friends could

come and visit from the trail and it made him happy to watch the people walking by. Tr. 373, 377.

Mr. Carter additionally testified that he preferred the idea of a trail to the train, he did not have

security concerns, and he and his wife used the building of the trail as an opportunity to fix their

wall that was in disrepair and build windows into the wall to look out onto the trail. Tr. 360-62,

364-65, 372-73, 376. The Court finds that this witness’s positive view of the trail must be viewed

in the context of his leadership and support of the construction of the trail. Mr. Carter served as

the Chair of the Newton County Trail Path Foundation, the easement-holder in this case, from

2009-2013, donated money for the trail’s construction and testified that he is “kind of proud” of

the trail. Tr. 352-54, 373.

32

66-67. However, Mr. Hodge’s finding that the Mocks and Ms. Pickens must cross the easement

to access their properties is borne out by the record. PX 29 at JACKSON 002897; PX 38 at

JACKSON 003776. As depicted below, the trail easement divides Parcel 276, owned by Plaintiffs

Ricky and Nancy Mock, from the public road, Highway 213:

PX 38 at JACKSON 003812.

In his appraisal report for the Mocks’ property, Parcel 276, Mr. Hodge stated that the

easement runs “between the subject property and Highway 213, effectively diminishing any access

potential from Highway 213 onto the subject property.” Id. at JACKSON 003776, 88. Mr. Hodge

determined that “[d]ue to the inability to cross the former railroad [right-of-way], access to the

property from Hwy. 213 has been eliminated.” Id. at JACKSON 003779. He concluded that the

Mocks’ property was diminished in value by 14% due to the loss of land area and frontage access

along Hwy. 213. Id. at JACKSON 003809.

Defendant makes the curious suggestion that the Mocks could access their property by

walking or driving across the trail from Highway 213, arguing:

Under Georgia law, the owner of a servient estate can make any use of the easement

that does not prevent the easement’s use . . . . Thus, as a matter of law, so long as

crossing the trail does not preclude public trail use, it is permissible. And there is,

of course, no evidence that walking or driving across the trail prevents its use as a

walking/biking trail.

ECF No. 264 at 70. Defendant does not, however, dispute Mr. Hodge’s finding that the Mocks

33

and Mrs. Pickens must cross the easement to access their properties. There is no suggestion that

these landowners had vehicular crossing rights over the Trail. As such, the Court credits Mr.

Hodge’s opinion that a reasonable buyer would be concerned about having to cross a trail easement

to access these properties.

Defendant also faults Mr. Hodge for not analyzing the “cost to cure” the detriments

resulting from the trail easement, such as erecting fences to compensate for loss of privacy or

installing security cameras to counter increased vandalism. ECF No. 264 at 71-72. The cost to

cure—or the cost of mitigating damages caused by the taking—provides an alternative means of

quantifying severance damages, “[w]hen the cost of curing the injury to the remainder is less than

the outright diminution in its value uncured.” United States v. 2.33 Acres of Land, 704 F.2d 728,

730 (4th Cir. 1983) (citing United States v. Dickinson, 152 F.2d 865, 870 (4th Cir.1946), aff’d,

331 U.S. 745, 67 (1947)); Julius L. Sackman, Nichols on Eminent Domain § 14A.04[2][a] (3d ed.

2013). There is, however, no persuasive evidence in the record on what the cost to cure would

have been in the event any damages to the remainder were deemed appropriate and no showing

whether the cost to cure would have been less than the diminution in value to the remainder. As

such, Defendant has failed to establish that Mr. Hodge’s expert opinion is flawed because he failed

to offer an opinion on the cost to cure.

Defendant’s Expert’s Opinion that Adjacency to the Trail Increased the Value of 22

Properties

Mr. Sheppard conducted a paired sales analysis to determine any damages or benefit to the

remainder property, using sales from “other trails in Newton County and in surrounding

submarkets throughout Georgia.” DX 94 at 21, 164. He looked at several subdivisions along other

trails in the area and concluded “that the trail corridor likely commands a negligible/small premium

in certain instances, but not a discount” and opined that buyers paid between $5,000-$5,800 more

for residential properties “abutting trails in Newton County.” DX 94 at 155-57, 164, 168.

Mr. Sheppard referenced three sales of side by side, similar-sized homes in the Highgrove

subdivision in Newton County, Georgia: 10, 30, and 40 Fernhill Court, to opine that “a $5,000±

premium was paid for a home, due solely to its proximity to the concrete-paved Eastside Trail.”

Id. at 157. Mr. Matthews found that “the overall impact of the trail being hidden by trees,” the lot

not actually abutting the Eastside Trail and its location on a curve “would diminish any influence

of the trail [on] the lot’s value in this specific case.” PX 144.17 at JACKSON 004730. Mr.

Sheppard admits that none of the Fernhill Court properties are directly abutting the trail. See Tr.

489-90; DX 21 at US_0002773. In the Court’s view, the Fernhill Court properties are not

sufficiently analogous to provide a useful comparison, as those properties did not abut the trail

were buffered from the trail by some woods and thus did not raise the same negative concerns as

the subject properties. See id. at US_0002774; see also Hardy v. United States, 141 Fed. Cl. 1, 26

(2018).

In addition to the Fernhill Court properties, Mr. Sheppard analyzed 30 residential home

sales fronting the subject corridor in Newton County, between May 1, 2013 and December 7, 2016,

as well as sales of 12 homes in Brookline subdivision in Newton County, which fronted the trail

corridor and of nine homes which did not. DX 94 at 154, 159-60. Based on these sales, Mr.

Sheppard concluded that the average Brookline home off the subject corridor sold for $11.01 per

square foot less than the average Brookline home on the corridor which equated to “an $18,563

34

premium for abutting the subject corridor – prior to considering time aspects.” Id. at 160. In his

market adjustment for the Brookline properties, Mr. Sheppard found that properties on the trail

corridor commanded “a premium of $15,000 for the whole property,” and reduced that premium

due to “the woods-view aspect . . . leading to [an] estimate that a $5,000±premium was attributable

to the underlying land.” Id. at 160-61. The Court finds Mr. Sheppard’s comparable sales analysis

unpersuasive. All but two of the sales he identified occurred after the August 19, 2013 date of the

taking, and all the sales occurred before a portion of the trail was paved in March 2017. See id. at

158, 160; PX 144.17 at JACKSON 004730-32. Such sales fail to aid in determining the impact of

the trail on the value of the subject remainder properties.

Importantly, there is an overarching problem with Mr. Sheppard’s finding that no

remainder property decreased in value at all as a result of the trail easement. DX 94 at 188-209.

In so opining, Mr. Sheppard ignored loss of privacy, accessibility, and increased security concerns

Plaintiffs suffered due to the trail. Mr. Sheppard did not include individual assessments of the

impact of loss of privacy, noise, trash, and security issues. See, e.g., id. at 167; see Tr. 425-26.

Mr. Sheppard’s opinion particularly strains credulity with respect to Plaintiff Jennifer Thorpe’s

property where the trail easement bisects the property. Mr. Sheppard found that the “before” value

of the property was $11,441. DX 17C at US_0003188. Due to the $5,000 “special benefit”

resulting from the property’s trail frontage, Mr. Sheppard found that the Thorpe property increased

in value by $2,840 due to the taking and has an “after” value of $14,281. Id. at US_0003170-71;

see also Tr. 695-97.

Mr. Sheppard applied this identical $5,000 “special benefit” to 22 remainder properties

with “direct access and frontage” on the trail. DX 94 at 157, 200. For each of these 22 properties,

Mr. Sheppard found that this $5,000 increase in the value of the remainder exceeded the lost value

of the property’s encumbered land, that all 22 properties had a net increase in value due to the

imposition of the trail easement, and that the owners were entitled to no compensation. Id. at 200-

09.

Mr. Sheppard’s conclusion that the trail creates a substantial benefit to an adjacent home’s

value is not supported by the record. Based upon the record as a whole, the Court credits Mr.

Hodge’s analysis of the damages to the remainder properties, not Mr. Sheppard’s.

The Appropriate Interest Rate

Also pending before the Court are the parties’ cross-motions for partial summary judgment

as to the appropriate interest rate to provide Plaintiffs just compensation. Plaintiffs argue that

Moody’s Composite Index of Yields on Aaa Long Term Corporate Bonds (“Moody’s rate”) should

be applied because it provides a reliable indicator of the rate of return that a “prudent investor”

would obtain. ECF No. 162 at 4. Defendant contends that the interest rate prescribed in the

Declaration of Takings Act (“DTA”) would appropriately compensate Plaintiffs for the delay in

payment of just compensation. ECF No. 178 at 7. For the reasons explained below, the Court

applies Moody’s rate to calculate delay damages in this case.

The Fifth Amendment mandates that the federal Government pay just compensation when

it takes private property for public use. U.S. CONST. amend. V; United States v. Miller, 317 U.S.

369, 373 (1943). Just compensation is generally determined by “the fair market value of the

property on the date it is appropriated.” Kirby Forest Indus., Inc. v. United States, 467 U.S. 1, 10

35

(1984). In cases where significant time has elapsed between the date of the taking and payment of

just compensation, the Government must apply a sufficient interest rate to put plaintiffs in the same

position as though just compensation had been paid contemporaneously with the taking. See

Tulare Lake Basin Water Storage Dist. v. United States, 61 Fed. Cl. 624, 627 (2004) (citing

Seaboard Air Line Ry. v. United States, 261 U.S. 299, 306 (1923)). As the Supreme Court has

explained:

If the Government pays the owner before or at the time the property is taken, no

interest is due on the award . . . But if disbursement of the award is delayed, the

owner is entitled to interest thereon sufficient to ensure that he is placed in as good

a position pecuniarily as he would have occupied if the payment had coincided with

the appropriation.

Kirby Forest, 467 U.S. at 10 (internal quotations and citations omitted); ITT Corp. v. United States,

17 Cl. Ct. 199, 240 (1989) (stating that “[f]ull compensation, then, requires that a [property owner]

whose award has been delayed be compensated for his inability to utilize his money.”)

In fashioning an award of just compensation, the appropriate inquiry is what has the owner

lost, not what has the taker gained. Bos. Chamber of Com. v. City of Boston, 217 U.S. 189, 195

(1910). The Prudent Investor Rule, a guideline to determine what landowners lost by not having

the use of funds between the date of taking and the date of payment, calculates the appropriate

interest rate “not on an assessment of how a particular plaintiff would have invested any recovery,

but rather on how ‘a reasonably prudent person’ would have invested the funds to ‘produce a

reasonable return while maintaining safety of principal.’” Tulare, 61 Fed. Cl. at 627 (quoting

United States v. 429.59 Acres of Land, 612 F.2d 459, 464-65 (9th Cir. 1980).

As Plaintiffs argue, Moody’s rate “provides a consistent, reliable indicator of the rate of

return that would be obtained by a ‘prudent investor’ given the economic circumstances prevailing

during the time between when their property was taken and when the government finally pays

them.” ECF No. 162 at 4 (citing Miller v. United States, 620 F.2d 712 (Ct. Cl. 1980); Pitcairn v.

United States, 547 F.2d 1106 (Ct. Cl. 1976); Tektronic, Inc. v. United States, 575 F.2d 832 (Ct.

Cl. 1978), cert. denied, 439 U.S. 1048; Ga. Pac. v. United States, 640 F.2d 328 (Ct. Cl. 1980)).

“[T]his court has already recognized the Moody’s Index as ‘an indicator of broad trends and

relative levels of investment yields or interest rates’ and as an instrument that ‘cover[s] the broadest

segment of the interest rate spectrum.’” Sears v. United States, 124 Fed. Cl. 730, 736 (2016)

(quoting Pitcairn, 547 F.2d at 1124).

Defendant contends that Moody’s rate would provide Plaintiffs an inappropriate windfall

and urges the Court to apply the statutory interest rates in the Declaration of Takings Act (“DTA”),

40 U.S.C. § 3116. ECF No. 178 at 1. Defendant argues that the statutory rate set forth in the DTA

applies in direct condemnations and that this same rate should be applied in inverse condemnation

cases. There are, however, two critical distinctions between direct and inverse condemnation

proceedings that make the DTA rate inadequate for Rails-to-Trails cases. First, in inverse

condemnation situations, there is often a much longer time period between the taking of the

landowner’s property and the payment of just compensation. See generally United States v.

Clarke, 445 U.S. 253, 257 (1980). In an inverse condemnation action, the landowner is “an

involuntary lender to a debtor he would often prefer not to have,” and “the risk of any difference

between the rates the government would normally pay, and those the condemnee could have

36

achieved by prudent participation in the broader market, should fall on the former.” Tulare, 61

Fed. Cl. at 630 (citing Redevelopment Agency v. Gilmore, 38 Cal. 3d 790 (1985) and Miller, 620

F.2d at 839). “The DTA, which was enacted to give the government ‘immediate possession’ of

property while providing ‘immediate cash compensation’ to the former owner . . . does not

contemplate such delays.” Tech. Coll. of the Low Country v. United States, 147 Fed. Cl. 364, 369

(2020) (citing United States v. Miller, 317 U.S. 369, 381 (1943)). It is during this intervening time

that the landowner “faces a loss of liquidity foreign to the direct condemnation process.” Id.

Second, “the DTA rate contemplates an award of just compensation from the perspective

of the government’s cost of borrowing rather than the perspective of the claimant’s rate of return.”

Id. (citing Tulare, 61 Fed. Cl. at 630) (internal quotation marks omitted); see Oral Arg. Tr. 37-38.

But “[t]his [gain-to-the-Government] approach is improper -- in fact, just compensation requires

the exact opposite” -- determining what the landowner has lost. Tech. Coll. of the Low Country,

147 Fed. Cl. at 369; see generally Sears, 124 Fed. Cl. at 734 n.3 (stating that the Declaration of

Taking Act applies to condemnation cases and that its “provisions are not binding on other types

of Fifth Amendment takings cases, such as the present rails-to-trails case.” (internal citations

omitted)).

The majority of recent Court of Federal Claims decisions have applied the Prudent Investor

Rule and Moody’s rate in fashioning the proper interest rate necessary to achieve just

compensation. See, e.g., Ideker Farms, Inc. v. United States, 151 Fed. Cl. 560, 608-10 (Fed. Cl.

2020) (using the Prudent Investor Rule as a “guiding principle” and finding that Moody’s rate is

the appropriate measure of interest); Tech. Coll. of the Low Country, 147 Fed. Cl. at 367-68

(finding that the Prudent Investor Rule applies and Moody’s rate properly measures damages);

Hardy v. United States, 138 Fed. Cl. at 357; Love Terminal Partners v. United States, 126 Fed. Cl.

389, 439 (2016), rev’d on other grounds, 889 F.3d 1331 (Fed. Cir. 2018); Sears, 124 Fed. Cl. at

736-37. The Prudent Investor Rule also promotes establishing a uniform rate of interest applicable

to condemnation cases and avoids discrimination among litigants. Tech. Coll. of the Low Country,

147 Fed. Cl. at 367 (citing Miller, 620 F.2d at 838.). 23

Finally, Plaintiffs argue that just compensation requires annual compounding because

Plaintiffs would have been able to earn compound interest if they had been paid at the time of the

taking. While “compound interest ordinarily does not run against the government without its

consent, this prohibition on [compound] interest against the government does not apply in fifth

amendment takings cases.” Bowles v. United States, 31 Fed. Cl. 37, 52 (1994) (citing Whitney

Benefits, Inc. v. United States, 30 Fed. Cl. 411, 414-15 (1994)).

In cases with a long delay since the date of the taking, “the award of compound interest is

23

This Court recognizes that the DTA rate has been applied in a few recent inverse

condemnation decisions. E.g. Liebman v. United States, 139 Fed. Cl. 653, 664 (2018) (applying

the DTA because “[n]either party provided an argument for the use of a particular interest rate”);

Waverly View Invs., LLC v. United States, 136 Fed. Cl. 593, 596-97 (2018); St. Bernard Parish

Gov. v. United States, 126 Fed. Cl. 707, 728 (2016), rev’d on other grounds, 887 F.3d 1354 (2018);

Textainer Equip. Mgmt. Ltd v. United States, 99 Fed. Cl. 211, 223 (2011) (applying the DTA rate

because plaintiffs had presented no evidence supporting the application of Moody’s rate).

However, this Court finds that Moody’s rate better achieves the goal of arriving at just

compensation for landowners.

37

not only proper, but its denial would effectively undercut the protections of the fifth amendment

to our Constitution.” Whitney Benefits, 30 Fed. Cl. at 415; see also Ideker Farms, 151 Fed. Cl. at

609 (compounding interest annually); Biery v. United States, Nos. 07-693L and 07-675L, 2012

WL 5914521, at *4 (Fed. Cl. Nov. 27, 2012) (finding that compounding annually “may be

necessary to accomplish completed justice under the Just Compensation Clause (internal quotation

marks omitted)); Textainer Equip. Mgmt. Ltd. v. United States, No. 08-610C, 2014 WL 2938452,

at *3 (Fed. Cl. June 30, 2014) (applying Moody’s rate compounded annually). The delay in

Plaintiffs’ compensation for the 2013 taking entitles these Plaintiffs to interest compounded

annually.

Conclusion

The Court adopts the valuations of Plaintiffs’ expert, Mr. Hodge, with the reductions noted

above, and awards just compensation as shown in the Table in Appendix I.

Plaintiffs are entitled to interest representing delay damages between the date of the taking

and the date of payment at an interest rate equivalent to the Moody’s rate, compounded annually.

Accordingly, the Court GRANTS Plaintiffs’ motion for partial summary judgment and DENIES

Defendant’s cross-motion.

The parties shall file a joint status report by September 30, 2021, proposing the judgment

that should be entered in this case pursuant to Rule 54(b). The parties shall specify how much of

the proposed amount is attributable to delay damages, assuming the judgment will be paid on

October 29, 2021. Additionally, the parties shall indicate the specific numerical interest rate that

applies for future delay damages, if any, beyond October 29, 2021.

s/Mary Ellen Coster Williams

MARY ELLEN COSTER WILLIAMS

Senior Judge

38

Appendix I

Claim Full Name Land within Severance Total Award

ID the Easement Damages to the

Damages Remainder

140 Alcantara, David $3,967 $2,898 $6,865

168 Alcide, Sheylah $9,618.75 $4,774 $14,392.75

47 Carter, Gail W. $3,017 $1,761 $4,778

175 Castleberry, Lester $3,063 $3,422 $6,485

177 M. and Connie M.

123 City of Covington $8.899.60 $54,775 $63,674.60

141 City of Covington $10,120.50 $8,695 $18,815.50

34 City of Covington $47,073 $27,770 $74,842

35 City of Covington $21,175 $5,499 $26,674

55 City of Covington $3,620 $7,406 $11,025

7 Clark’s Grove, LLC $83,490 $64,293 $147,783

202 Crawford, William $2,360 $1,355 $3,715

R., III and Patricia E.

44 Dew, Robert C., Jr. $4,023 $7,586 $11,609

and Pamela M.

186 Dixon, Mary Jane $15,398 $73,944 $89,342

42 Faulkner, Robert L., $3,915 $8,053 $11,968

Jr.

36 First Baptist Church $22,380 $37,741 $60,121

38 of Covington

39

Appendix I

Claim Full Name Land within Severance Total Award

ID the Easement Damages to the

Damages Remainder

37 First Baptist Church $18,076 $3,267 $21,343

of Covington

284 Fowler Newton $22,068 0 $22,068

Properties, LLC

152 Goss, Leonard, Jr. $7,481.25 $1,701 $9,182.25

61 Gossett Properties, $4,752 $2,483 $7,235

LLC

41 Greyland Real Estate $2,850 $1,930 $4,780

Investments

43 Greyland Real Estate $6,777 $4,547 $11,324

Investments

115 Guenther, Mark $3,300 $4,965 $8,265

Frederick

197 Hackett, Ricky Joe $945 $5,035 $5,980

and Phyllis S.

188 Hankins, Wendy M $3,379 $1,186 $4,565

and Robert L.

142 Hay, Sam B., Jr. and $12,781 $49,252 $62,033

Dearing, John J.

125 Henry, Reginald F. $16,910 $5,314 $22,224

and Yvonne I.

45 Hooten, Dennis R. $2,685 $1,413 $4,098

and Judy M.

88 Huguelet, Marcia A. $5,888 $3,354 $9,241

40

Appendix I

Claim Full Name Land within Severance Total Award

ID the Easement Damages to the

Damages Remainder

184 Johnson, James W. $12,798 $15,810 $28,608

28 Jones, Bradford and $4,760 $1,765 $6,525

Robert

236 Jones, Catherine Ann $1,776 $1,204 $2,980

196 Karen James d/b/a $6,272 $4,588 $10,860

Windy Hill Tree

Farm

287 Lockhart, Larry and $19,665 $5,787 $25,452

Collete B.

239 Lunsford, Perry $1,030 $1,395 $2,425

Charles

105 Marino, Joseph J. $18,703.60 $4,973 $23,676.60

135 Mastin, Willard $1,012 $1,900 $2,912

275 Mock, Ricky and $9,608 $72,885 $82,565

276 Nancy

277

216 Mock, W.D. Ballard $2,764 $2,936 $5,700

and Nancy

162 Munroe, Winston and $10,901.25 $3,414 $14,315.25

Patricia

210 Newton County $7,965 $11,646 $19,611

211 Board of

Commissioners

124 Newton County $5,184 $13,010 $18,194

Board of

Commissioners

276 Newton County $20,025 $24,307 $44,332

Board of

Commissioners

41

Appendix I

Full Name Land within Severance Total Award

the Easement Damages to the

Damages Remainder

182 Newton County $9,856 $30,848 $40,704

183 Board of

Commissioners

187 Pickens, Betty Jean $15,613.20 $88,013 $103,626.20

280 Pulliam, Elaine H. $15,745 $5,651 $21,396

164 Rentrope, Jacinda M. $11,115 $3,386 $14,501

54 Restivo, John, III and $6,042 $4,051 $10,093

Marion

285 Robin Fowler $4,936 $981 $5,917

Properties

29 Robin Fowler $12,999 $7,188 $20,187

286 Properties

171 Semador, Isaac $11,649.85 $3,658 $15,307.85

155 Smith, A. Randall and $1,085 $940 $2,025

Katherine P.

132 Smith, Sherman E. $24,415 $4,396 $28,811

48 Stone, Edward Phillip $2,613 $5,141 $7,753

68 Tabb, Robert Y. and $6,413 $2,152 $8,564

Darcel K.

57 Thorpe, Jennifer H. $4,161 $11,713 $15,874

25 ULKAFAW $10,125 $14,288 $24,413

Corporation

42

Appendix I

Claim Full Name Land within Severance Total Award

ID the Easement Damages to the

Damages Remainder

288 ULKAFAW $10,072 $25,184 $35,256

Corporation

193 Zenko, Robert M. $1,332 $2,663 $3,995

43