Eminent Domain Lets Pipeline Developers Take Land, Pay Little, Say Black Property Owners

This article originally appeared in MLK50, a nonprofit newsroom in Memphis focused on poverty, power and public policy.

Three houses stand on the Owens family land along Tully Road in Southwest Memphis. Joseph Owens lives with his wife in one facing the woods. His sister-in-law rents another that’s a quick walk down the dead-end street, and his son lives in the home down the hill, where Owens grew up. The family has lived on the plot since at least the 1940s.

Owens, who is Black, considers the acre of land a generational inheritance. That’s why he turned down an offer of $3,000 from an oil pipeline company to buy easements on the property, he said. So the company took Owens to court, claimed eminent domain and took the easements anyway.

Owens, 59, is among at least eight Southwest Memphis landowners who have lost or may lose some property rights through eminent domain, a governmental power that has been handed off to a big corporation. The Byhalia Connection Pipeline, a joint venture of oil giants Valero Energy and Plains All American Pipeline, has been taking Shelby County landowners to court since mid-October in a last-ditch effort to obtain easements on land in the path of its proposed pipeline.

‘They Going to Just Do What They Want’

Owens, a security guard, feels defeated.

“That’s why they call it eminent domain; they going to just do what they want,” Owens said.  “They coming anyway, and when you finish with your story, they still coming. That’s the world we live in.”

The company filed on Oct. 12 in Shelby County Circuit Court to condemn the part of Owens’ property it wanted and won Dec. 18. He stands to lose control of almost one-third of his land during the pipeline’s construction. It will be used as a “temporary workspace,” according to the court papers. When construction is complete, Byhalia Pipeline will control nearly 10% of his property through the easement.

“My back (was) against the wall; I can’t afford the cost” of an attorney, Owens said, explaining why he did not fight after the case landed in court. “That’s what’s going on with the poor man. They just taking from the poor, underprivileged and we just a target.”

Owens did consult with a lawyer, who said he didn’t have a good chance of winning, but he could argue for more compensation. Owens had already lost the easements. So, earlier this month, he agreed to accept more than $9,000 from Byhalia Pipeline for compensation, he said.

Formidable Tactic

Owens came face-to-face with a near indomitable power. Eminent domain allows a “government or a governmental entity to take property for a public purpose,” said Dennis Huffer, a coauthor of “Eminent Domain in Tennessee: An Attorney’s Guide,” a publication for the Municipal Technical Advisory Service at the University of Tennessee.

“It’s really a necessary power of government because you have to have eminent domain to provide essential public services like roads, electricity, sewers and so on,” Huffer said. “So it’s a necessary power that governments have to have to provide the services they have to provide to the general public.”

But the power is increasingly being used as a tactic by oil and gas companies to seize land they can’t get through agreements, by claiming their services are for the public good. The Trump administration made the pathway easier by removing barriers and streamlining permit processes. Environmentalists warned such moves would more heavily impact Black communities, along with other decisions that took away environmental protections.

George Nolan, senior attorney for the Southern Environmental Law Center, said such seizures shouldn’t be allowed.

“We do not believe that an out-of-state private crude oil pipeline company should be allowed to trample on the property rights of Memphis landowners and take their land for private business purposes,” Nolan said in a statement. “The pipeline company is not created by, affiliated with or owned by the government, and the general public would have no access to the proposed crude oil pipeline. … So, there is no ‘public use’ justifying the use of the condemnation power as required by Tennessee law.”

Jeff Cosola, public affairs advisor for Plains All American, said in a statement the company’s use of eminent domain is lawful and necessary.

“Byhalia Connection is a common carrier pipeline with the option to use eminent domain under Tennessee and Mississippi law,” Cosola said. “Although it has been necessary to initiate eminent domain proceedings in select situations, we are still working to find mutually beneficial agreements with all remaining landowners.”

Stopping an eminent domain seizure is possible, Huffer said, but would take substantial resources.

‘They Know They Have the Power’

That’s how Byhalia Pipeline is taking advantage of residents like Owens, said Justin J. Pearson, spokesperson for Memphis Community Against the Pipeline.

The company’s leaders “know that they have money, they know they have power, they know they have resources to fight these folks in court,” said Pearson, who grew up in Southwest Memphis and helped organize MCAP late last year. “And they know that they chose this community because (residents) lack some of the legal, social, political and economic power to fight back.”

Studies show hazardous industries are disproportionately located in communities of color. Black people, for instance, are 75% more likely to live near a polluting facility, according to a 2017 report by the NAACP and the Clean Air Task Force. 

A study published in the Journal of the National Cancer Institute in October found that living close to an oil refinery is associated with an increased risk of bladder, lung, colon, and particularly, prostate and breast cancers. The Valero Memphis Refinery is located on West Mallory in Southwest Memphis.

“We do not expect the pipeline to contribute to health issues,” Cosola said. “When the pipeline is in operation, the vast majority will be underground and will not have emissions.”

The company is committed to treating residents with “care and consideration,” he said. “We’ve participated in open houses, community meetings and virtual office hours throughout the past year to listen to resident experiences, understand community expectations and address questions,” he said.

‘Pennies and Peanuts’ 

Byhalia Pipeline unveiled plans in 2019 to stretch the pipeline 45 miles from Valero Memphis Refinery to a Valero facility in Marshall County, Mississippi. The proposed route cuts through the 38109 ZIP code in Memphis. This includes parts of the predominantly Black communities of Boxtown, Westwood and Whitehaven.

The project’s land seizures began in DeSoto County. By mid-October, the company had filed eminent domain claims against at least 14 landowners there, according to the DeSoto County Circuit Court Clerk’s Office.

The company already owns at least 34 easements in Shelby County through agreements with landowners, property records show, but it’s unclear how many more the company needs. Cosola said the company has 93% of the land rights the plan requires, including parcels in Mississippi.

Byhalia Pipeline filed its first eminent domain claims in Memphis Oct. 12. 

But Owens was first approached by a land agent for the company in November 2018, he said. The agent informed him his property was in the path of a coming pipeline, and Owens should sell the company easements or it would take them through eminent domain.

Owens felt anger and anxiety when he heard that, but knew they would have to pay him for it, so he held out for more money.

The company offered $3,000 for his easements, “pennies and peanuts” Owens called it. After a couple of months the company went to $6,000, then $9,000, but still not enough for Owens to accept. Then he got a letter saying Byhalia Pipeline was taking him to court, he said.

Landowner Jeffrey Alexander also rejected the company’s offers and has a case filed against him in Circuit Court. A hearing date has not been set.

The 54-year-old City of Memphis maintenance worker purchased the acre of land in 2018 to build a home. The company initially offered $4,700, Alexander said, for a 6,598-square-foot easement along Weaver Road. 

Alexander, who has lived in 38109 his entire life, paid $7,000 for the plot and has about $30,000 invested, including the cost of clearing trees, brush and debris.

“I didn’t think it (the offer) was enough for me to consider getting married to them,” Alexander said. “That’s a permanent easement. … In the paperwork, it says once you accept that agreement, anything you do on that land has to be approved by them.”

The permanent easement gives Byhalia Pipeline permission for “constructing, laying, maintaining, operating, inspecting, altering, replacing, reconstructing, patrolling (by surface or air), protecting, or removing a liquid hydrocarbon.” And owners are “prohibited from altering or changing the grade within any Permanent Easement, or constructing any improvements or excavating within said Permanent Easement, or interfering with pipeline operation or integrity in any way.”

A Nice Place to Retire

Alexander chose the plot because he wanted country-like space in the city, he said. “It was supposed to be a nice country-style home to retire, when I got ready to retire, for me and my wife and for my family to have a nice time, you know — create some good memories there.

“Kids playing in the front yard, you know, just sitting on the porch looking out across the front yard, stuff like that,” Alexander said.

He worries the pipeline could expose his family to a health hazard should it leak and that his property value would drop. He also is concerned about the cost of fighting it: an attorney wants a $5,000 retainer to take the case. 

“If I had known that it (the pipeline project) was being thought of, I wouldn’t have bought the land,” Alexander said.

Seeking Fast-track to Approval

Cosola said the pipeline project has three phases: permitting and easement acquisition, construction, and operation. The company’s target is to begin construction early this year and have the pipeline running after nine months.

The pipeline project still needs a key permit — known as a Nationwide 12 permit — from the U.S. Army Corps of Engineers. It allows companies to get a single federal permit for water crossings, rather than seek individual permits for each. It does not require the company to produce an environmental impact statement or notify the public, Sierra Club attorney Doug Hayes has said.

U.S. Rep. Steve Cohen met with the Army Corps last month to learn more about the permit and express his concern. Last week, he sent a letter asking the agency not to “fast-track” the permit’s approval and to consider environmental justice in their decision.

Cohen said the pipeline doesn’t take a direct route to its destination, and in the instance of Desoto County, “clearly avoids some of the more prominent, upper-class neighborhoods.”

“For communities that have already been unfairly burdened from decades of environmental injustice, it is troubling that an oil pipeline with severe potential consequences could be built without adequate environmental review,” Cohen said.

The SELC also has asked the Army Corps to deny the permit. The environmental law firm argued in a December letter that the pipeline is routed through a Memphis Light Gas and Water Division wellfield and therefore violates the permit’s guidelines.

Roger Allan, deputy chief of the regulatory division of the Corps, said the agency is working on answers for Cohen’s questions and can’t provide an update on the status of the permit at this time.

The SELC also sent a letter to MLGW Jan. 7 asking the utility to enforce its protection zone around the wellfield and join efforts against the pipeline.

MLGW Communications Specialist Stacey Greenberg declined to comment for this story and declined comment for a previous story.

MCAP, however, will continue to be vocal because a lot is at stake, Pearson said.

“It’s even more than just the loss of land, it’s the process and the theft that’s occurring that is also very degrading and painful for the people in this community,” he said. “They have spent their lives caring for and building a sense of place. And for an almost all-white leadership of a company to come and take it is a type of violence that permeates into people’s spirits. That can’t be quantified by the cost of a piece of land.”