Gottlieb Law, PLC provides this article for informational purposes only. Nothing herein creates an attorney–client relationship. You should not act on any of the information contained without consulting qualified legal counsel. Laws change over time, and you should seek legal advice about your specific situation.
Understanding Eminent Domain in Arizona
If you own property in Arizona or are planning to develop land, it’s important to understand how eminent domain works. In a fast-growing state, governments and certain private entities regularly acquire property for infrastructure, utilities, and other public purposes.
At its core, eminent domain is the power to take private property for a “public use,” so long as the owner is paid “just compensation.” This requirement comes from both the U.S. Constitution (Fifth Amendment) and the Arizona Constitution (Article 2, § 17).
Who Can Exercise Eminent Domain?
While eminent domain is most often associated with city, county, or state governments, Arizona law also authorizes certain private entities to use it when the legislature has granted the power. These include utility companies, railroads, and pipeline operators. The authority comes primarily from Arizona Revised Statutes §§ 12-1111 through 12-1129.
What Protections Do Landowners Have?
Property owners are not powerless. Arizona law sets out strict requirements to ensure fairness:
- Public Use Requirement – The taking must be for a valid public purpose, such as roads, utilities, schools, or other community infrastructure.
- Just Compensation – Owners must be paid fair market value for the property taken, which may include damages for partial takings.
- Procedural Safeguards – Courts oversee the process to ensure compliance with statutory deadlines and constitutional protections.
- Proposition 207 Protections (A.R.S. § 12-1134) – Arizona provides additional protection against “regulatory takings,” where land use restrictions reduce property value without a direct taking.
Why This Matters
Eminent domain is not rare in Arizona — it often arises in highway expansions, light rail projects, and utility easements. Understanding the process, the defenses available, and how compensation is calculated can make the difference between a fair resolution and a costly loss.
The Legal Landscape: What Authorizes Eminent Domain in Arizona?
Eminent domain in Arizona is governed by both the Arizona Constitution and a detailed statutory framework (A.R.S. §§ 12-1111 through 12-1129). These laws specify who may take property, under what circumstances, and what procedures must be followed.
Under the Arizona Constitution (Article II, § 17), property may be taken only for a public use and only if the owner is paid just compensation. Importantly, the Constitution makes clear that it is the courts—not lawmakers or agencies—that decide whether a use truly qualifies as “public.” This means property owners have the right to challenge not only the amount of compensation, but also the very legitimacy of the taking itself.
Arizona law also provides additional protection through the Private Property Rights Protection Act (Proposition 207, codified at A.R.S. § 12-1134). This statute requires compensation if new land-use regulations reduce a property’s fair market value, unless narrow exceptions apply. It also prevents condemnations that primarily benefit private parties.
The Process for Eminent Domain in Arizona
Arizona statutes require condemning authorities to follow a strict, step-by-step process. Any misstep can delay or even invalidate the taking:
- Resolution of Necessity – The government agency (or, in limited cases, a utility or special district) must adopt a formal resolution declaring the need for the property.
- Notice and Offer – The owner receives formal notice, along with a written offer based on an appraisal of fair market value.
- Negotiation – The parties may attempt to settle voluntarily.
- Court Filing – If no agreement is reached, the condemning authority files a complaint in superior court and deposits its estimate of just compensation.
- Early Possession – Once the deposit is made, the authority may take possession of the property before final judgment.
- Trial and Valuation – If unresolved, a jury (unless waived) determines just compensation, including damages for partial takings.
- Two-Year Bar on Refiling – If the case is dismissed before payment, the condemning authority cannot bring a new action for two years.
These safeguards ensure that property owners have multiple opportunities to contest both procedure and valuation.
What Counts as “Public Use” in Arizona?
Arizona’s definition of public use rests on three pillars:
- Arizona Constitution (Art. II, § 17): Prohibits takings for private use and requires judicial review of whether a claimed public purpose is valid.
- Proposition 207 (A.R.S. § 12-1134): Bars condemnations that primarily benefit private entities and provides compensation for certain regulatory takings.
- Arizona Eminent Domain Statutes (A.R.S. §§ 12-1111 et seq.): Establish procedures and reinforce that property may be taken only for authorized public uses.
An important case on this issue is Bailey v. Myers, 206 Ariz. 224, 76 P.3d 898 (App. 2003). There, the Arizona Court of Appeals struck down a proposed condemnation for a private retail redevelopment, holding that public benefits and characteristics must substantially predominate over private interests for a taking to qualify as public use under the Arizona Constitution.
Constitutional Foundation: Article II § 17
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- “No Private Use” Rule
- Arizona’s Constitution provides some of the strongest property protections in the country. Article II, § 17 flatly prohibits taking private property for private use, except in narrow cases such as private ways of necessity or mining ditches. It also requires just compensation in money before a taking is effective. For corporate condemnors (other than municipal corporations), compensation must be paid in full, without offsets for “benefits” from the project.
- “No Private Use” Rule
- Judicial Review Requirement
- The final sentence of Article II, § 17 makes Arizona unique: “Whenever an attempt is made to take private property for a use alleged to be public, the question whether the contemplated use be really public shall be a judicial question, and determined as such without regard to any legislative assertion that the use is public.”
- This means courts, not legislatures or agencies, decide whether a use is truly public. Judicial review is independent and cannot be bypassed by legislative declarations. This principle was central in Bailey v. Myers, where the Arizona Court of Appeals invalidated a retail redevelopment taking because public benefits did not “substantially predominate” over private interests.
- Historical Context
- Arizona adopted this provision at statehood in 1912, reflecting deep mistrust of unchecked eminent domain power. Early cases such as Inspiration Consol. Copper Co. v. New Keystone Copper Co., 16 Ariz. 257, 144 P. 277 (1914), confirmed that Article II, § 17 must be read strictly to protect landowners, limiting private takings to the narrow exceptions expressly listed in the Constitution.
Statutory Safeguards
These constitutional limits are reinforced in Arizona’s eminent domain statutes (A.R.S. §§ 12-1111 to 12-1129). The statutes:
- Define the permissible categories of public use;
- Require a resolution of necessity before filing;
- Allow early possession upon deposit of estimated compensation; and
- Impose a two-year bar on refiling if a case is dismissed before compensation is paid.
Together, the Constitution and statutes create one of the most property-owner-protective eminent domain frameworks in the country.
Proposition 207: The Private Property Rights Protection Act (2006)
In 2006, Arizona voters approved Proposition 207 in response to Kelo v. City of New London (2005). Codified at A.R.S. § 12-1134, it provides that:
- Takings for economic development are not public use. The statute expressly excludes general economic benefits such as higher tax revenue or jobs from qualifying as “public use.”
- Regulatory takings are compensable. Landowners are entitled to just compensation if a new land use law reduces their property’s fair market value, unless the government issues a waiver or the regulation falls within limited exceptions (e.g., public health, safety, nuisance abatement).
This reform made Arizona’s eminent domain protections among the strongest in the nation.
Federal Precedents and Arizona’s Response
In Kelo v. City of New London, 545 U.S. 469 (2005), the U.S. Supreme Court held that a city may use eminent domain for a comprehensive economic-development plan, treating “public use” as a broad public-purpose inquiry with strong deference to legislative judgments. Arizona voters reacted swiftly: Proposition 207 (2006)—codified at A.R.S. §§ 12-1131–1138—explicitly excludes ‘public benefits of economic development’ from qualifying (see A.R.S. § 12-1136(5)).
For regulatory takings, Arizona courts primarily apply Ariz. Const. art. II, § 17 and A.R.S. § 12-1134, while federal precedents remain informative.
Practical Takeaways for Property Owners and Developers
- For Property Owners: If a proposed taking primarily benefits a private developer, you may challenge it under Article II, § 17 and A.R.S. § 12-1134(A)(4). Early legal review of the condemnor’s “resolution of necessity” and appraisals can expose weaknesses in the public-use rationale.
- For Developers and Municipalities: Ensure any project tied to condemnation has a clear public-use component (road, park, safety improvement). Where possible, rely on voluntary acquisitions (contracts, options) to avoid litigation risk.
- For Land-Use Planning: Developers should evaluate potential Prop 207 regulatory-takings risks before launch. Municipalities can mitigate liability by offering waivers or variances rather than imposing regulations that reduce property values.
Valuation: What Counts as “Just Compensation”?
In Arizona, just compensation means the fair market value of your property on the date of the taking:
- Fair Market Value: What a willing buyer would pay a willing seller in an open market.
- Highest and Best Use: Compensation must reflect the most profitable legal use of the property, even if you’re not currently using it that way.
- Project Influence Rule: The value cannot be inflated (or reduced) by the very project causing the taking.
- Partial Takings: If only part of your land is taken, you may also recover severance damages—the loss in value to the remainder of your property.
Government appraisals often come in low. Property owners have the right to present their own expert valuations, and juries—not agencies—decide the final number if the case goes to trial.
Defenses Against Eminent Domain in Arizona
Landowners are not powerless. Arizona law gives you multiple avenues to fight back:
- Challenge Public Use: Under Article II, § 17 and A.R.S. § 12-1134, courts—not agencies—decide whether a taking is truly for public use.
- Question Necessity: You can argue the project could be built elsewhere or that the scope of land being taken is excessive.
- Contest Valuation: You may reject the government’s deposit and demand a jury trial on just compensation.
- Enforce Procedure: If the condemnor skips a statutory step—like notice, deposit, or a resolution of necessity—you may move to dismiss the action.
Strong procedural safeguards mean missteps by condemning authorities can delay or derail the taking entirely.
Examples of Eminent Domain in Arizona
Eminent domain shows up in many contexts:
- Transportation: ADOT’s I-17 and Loop 202 expansions have required taking residential and commercial parcels.
- Utilities: Water, electric, and gas corridors often affect rural and suburban landowners.
- Flood Control: Maricopa County has condemned land for retention basins, levees, and emergency access.
These takings affect not only land, but also business operations, farming, and access rights, which can significantly increase compensation claims.
Why This Matters
By understanding valuation rules and defenses, landowners can avoid leaving money on the table and ensure condemnors meet every legal obligation.
What Developers and Investors Should Know
Eminent domain can sometimes play a role in making large-scale development possible—for example, when a city needs to build new roads, utilities, or drainage improvements tied to a project. But the law requires that the primary benefit remain with the public, not private investors. Developers should:
- Structure carefully: Ensure the government—not the private project—is the direct beneficiary of any condemnation.
- Avoid private-benefit takings: Lobbying for condemnations that primarily benefit a private project risks invalidation under the Arizona Constitution and the Private Property Rights Protection Act.
- Plan for costs and delays: Appraisal disputes, court deposits, and potential challenges can affect project timelines.
- Evaluate land-use risk: New overlays, rezonings, or infrastructure funding measures may trigger regulatory-takings claims under Proposition 207.
Early legal guidance can help developers reduce these risks and keep projects compliant.
Regulatory Takings: The Private Property Rights Protection Act
Eminent domain is not the only way property rights are impacted. Arizona’s Private Property Rights Protection Act (Proposition 207, 2006; A.R.S. § 12-1134) also protects owners from certain land-use regulations:
- Compensation Right: If a newly enacted regulation reduces the property’s fair market value, the owner may demand compensation.
- Waiver Alternative: Instead of paying, the government can grant a waiver, allowing the property to be used under prior rules.
- 90-Day Response: After a property owner submits a written demand for compensation, the government has 90 days to either pay, repeal/amend the law, or issue a waiver. If the regulation still applies after 90 days, the owner may file suit
Limits: Some regulations are exempt, such as those addressing public health, safety, or nuisances, and owners must file within 90 days of the law’s enactment or application.
How Gottlieb Law Supports Clients
Whether defending against condemnation or structuring a complex development, Gottlieb Law’s attorneys can provide targeted counsel across Arizona real estate law.
- For Property Owners: Guidance from early strategy through trial and appeal, ensuring just compensation and strict enforcement of procedural protections.
- For Developers and Investors: Advice on public-private partnerships, land-use compliance, condemnation risks, and Proposition 207 assessments to keep projects on track.
The firm also handles zoning and leasing legal issues and offers comprehensive support for Arizona real estate clients.
Protect Your Arizona Property: Why You Need Skilled Eminent Domain Attorneys
Eminent domain and regulatory takings aren’t abstract legal issues—they affect homes, investments, and development projects across Arizona. The state’s Constitution and statutes give landowners unusually strong protections, but those protections only matter if you know how to assert them. From contesting whether a taking is truly for public use to challenging undervalued appraisals, every detail counts.
At Gottlieb Law, our attorneys focus on Arizona real estate and property law. We guide clients through Arizona real estate issues, which can include condemnation threats, valuation disputes, and regulatory takings claims, combining deep knowledge of Arizona’s real estate landscape with hands-on courtroom experience. Whether you’re facing a government demand or planning a project that could trigger land-use disputes, we help you protect your rights and move forward confidently.
Call Gottlieb Law today at 602-899-8188 or use our Contact Us page here to schedule your initial consultation.
This article is provided by Gottlieb Law, PLC for informational purposes only and does not create an attorney–client relationship. You should not rely on the information contained herein without first consulting qualified legal counsel regarding your specific situation. Laws change over time, and the application of law varies based on individual facts. For advice tailored to your circumstances, please seek guidance from a licensed attorney.
