Hold a public hearing, adopt a Resolution of Necessity to acquire permanent easement interests in a portion of two properties (APN 042-100-015 and APN 042-100-016) by eminent domain for the continued access to and maintenance of the utility facilities (power lines and substation) used for conveyance of electricity generated at the Yolo County Central Landfill for the County Road 28H Public Utility Easement Project, which is part of the Landfill's Gas-to-Energy Facilities, and find that the project is exempt from the California Environmental Quality Act (CEQA). (No general fund impact) (4/5 vote required) (Lindbo/Juhler) (Est. Time: 5 min)

James Fitzgerald Kelly and T. Ross Kelly (Owners) own several parcels located on County Road 28H and in the unincorporated area of the County identified as APNs 042-100-015 and 042-100-016, approximately three miles to the west of the Yolo County Central Landfill ("Landfill"). In September 1992, the Owners granted a 31-year easement via an easement agreement on a portion of their property on APNs 042-100-015 and 042-100-016 for, among other things, the construction, maintenance and operation of a substation and overhead electric power lines beginning at County Road 28H and County Road 102 and continuing down County Road 28H. The power lines and substation carry electricity produced at the Landfill, which is currently sold and distributed to the Sacramento Municipal Utility District (SMUD). 

Landfill Gas-to-Energy Facilities
The electricity generated and distributed using the facilities within the easement area on the Owners' property is part of the Landfill's beneficial gas-to-energy facilities. As with all landfills, gas is generated at the Landfill as part of the anaerobic (without oxygen) decomposition of solid waste that contains methane, which the 2011 Yolo County Climate Action Plan (CAP) recognizes as a potent greenhouse gas and significant contributor to the County’s overall greenhouse gas emissions.  Methane is approximately 23 times more potent as a greenhouse gas than carbon dioxide.  Currently, captured Landfill gas may be combusted or “destroyed” on-site either in power generation units or by simply burning in a flare to avoid emitting the methane into the atmosphere.  The CAP recognized the benefits of generating renewable energy with the Landfill-generated gas, focusing mitigation efforts related to Landfill gas on “destroying the methane component of the landfill gas through combustion, and generating electricity in the process.” (See CAP Measure WR-1.)  As publicly-owned landfill, electricity sales also help lower the disposal cost per ton to all constituents in Davis, West Sacramento, Winters, Woodland, and the unincorporated areas of the County.

Related to these efforts to minimize Landfill methane emissions, the County entered into a Commercial Gas Production Agreement (Lease) in 1985 related to the collection of methane release from the Landfill.  Under the Lease, the County granted rights to Neo Yolo, LLC and MM Yolo Power, LLC’s predecessor in interest to install, operate and maintain a landfill gas-to-energy facility that would collect the methane to generate electricity.  MM Yolo Power, LLC acquired the electric power lines and substation in approximately 1999 and entered into an amendment of the Easement agreement with the Owners addressing the compensation to be paid to the Owners during the term of the Easement, which includes a $6,000 annual base payment ($3,000 to each owner), plus an annual CPI adjustment. The current payment in 2024 is $10,925.

In 2016, the County acquired substantially all of MM Yolo Power, LLC's gas production assets, which include temporary rights to the easements with the overhead power lines and substation, which the County uses to sell and distribute electricity generated from the Landfill's gas-to-energy facilities (the County Road 28H Public Utility Easement Project or “the Project”). The County has made the annual payments required by the easement agreement to the Owners since 2016. However, the easement agreement was temporary and had an expiration date of September 15, 2023. In early 2023, the County began the initial stages of negotiations to purchase the easements permanently from the Kelly brothers to reduce the ongoing cost to the County, and its rate payers, of keeping the easement (yearly payment for access to Easement).

In early 2023, the County partnered with CMD West to have the Owners' property appraised. The County and the Owners agreed to extend the easement agreement term to December 31, 2024 to allow time for the appraisal and negotiation process to occur.  The parties, however, have been unable to reach agreement for the permanent acquisition of the Easements (defined below) and the County must move forward with consideration of a Resolution of Necessity due to the upcoming expiration date.

Easements to be Acquired
The proposed acquisition comprises a 118,969 square-foot (2.731 acres) permanent public utility easement and a 16,591 square-foot (0.381 acre) permanent access easement. Most of the affected parcels (APNs 042-100-015 and 042-100-016) are encumbered with an existing drainage easement. (See Exhibits 1 and 2 to the Resolution of Necessity (Attachment A).)  An aerial of the affected and parcel map showing the affected parcels is provided as Attachment B for reference.  The Owners also own a large agricultural parcel to the north of the Easement parcels on the other side of CR 28H (APN 042-100-013), which is not affected by this proposed Resolution of Necessity as the County is not seeking to acquire any interest in that parcel.

The Resolution of Necessity

The adoption of a Resolution of Necessity is a necessary step in the process of acquiring property by eminent domain. See Code of Civil Procedure (CCP) § 1245.220. Notices advising the Owners of the intent to adopt a Resolution of Necessity were mailed on August 30, 2024 and September 9, 2024, which are incorporated herein by reference and available for review. Adoption of the Resolution of Necessity requires the Board of Supervisors to make the following findings:

The amount of compensation the County ultimately pays to acquire the easement interests is not at issue in the Resolution of Necessity, only whether the County approves the filing of an eminent domain action to acquire the easements. The amount of compensation will be determined by settlement of the parties or in a jury trial following the adoption of the Resolution of Necessity. To pass, the Resolution of Necessity requires a vote of two-thirds of all the members of the governing body, or 4 of 5 Supervisors. CCP § 1245.240.

Here, the Project and the proposed acquisition of the Easements satisfy all the conditions required for the Board to make the necessary findings described above. 

Finding 1: Public Interest and Necessity Require the Project
The public interest and necessity require acquisition of the Easements for the Project. The purpose of the Project is to establish a permanent easement for the continued operation and maintenance of the Landfill’s gas-to-energy electric facilities along the Project alignment, which currently supply renewable power and reduce the global warming potential of the Landfill’s gas emissions.  The Landfill’s gas-to-energy facility generates approximately 20,000 kWh per year and eliminates more than 90% of methane emissions generated by the Landfill.  The County utilizes the overhead power lines along County Road 28H to transmit renewable electricity generated by the Landfill’s gas-to-energy facilities. Without the required easements, the County cannot continue the operation and maintenance of the Project for its gas-to-energy facilities.

Finding 2: Greatest Public Good and Least Private Injury
The affected APNs, which are to the south of CR 28H, are vacant except for the existing utility poles and substation and largely encumbered by an existing drainage easement and used as a drainage area for the Willow Slough Bypass. The drainage easement and slough will not be impacted by the County's acquisition, nor will the Easements impact the Owners' agricultural parcel to the north of CR 28H. The Project is planned and located in the manner that will be most compatible with the greatest public good and the least private injury because the proposed easement acquisitions are similar to the County's existing utility easements on these properties and are further limited in scope to what is necessary for the construction of the Project and the long-term operation and maintenance of the Landfill's gas-to-energy facilities. 

Finding 3: The Easements to be Acquired are Necessary for the Project
As discussed above, the Easements are necessary for the Project to accommodate the County's electric utilities, such as the existing overhead power lines along County Road 28H, and other utility facilities required to transmit renewable electricity generated by the Landfill’s gas-to-energy facilities and reduce the global warming potential of the Landfill’s gas emissions.

Finding 4: Offer Made to Owner Pursuant to Gov. Code § 7267.2
In accordance with state and federal requirements for property acquisition, just compensation for the Easements was established by the County based on independent appraisals prepared by certified appraisers, Noah Kauffman, MAI,R/W-AC, and Kevin Ziegenmeyer, MAI, with Intergra Realty Resources.  Additionally, an offer was delivered to the Owners on or about March 1, 2024, which included a copy of Integra Realty's appraisal and notified the Owners' of their right to be reimbursed up to $5,000 for obtaining their own independent appraisal pursuant to Code of Civil Procedure (CCP) section 1263.025.  Since that time, staff has been in contact with the Owners but have been unable to reach an agreement to date. The written offer package and correspondence with the Owners are available for review.

The Eminent Domain Process
Should the Board decide to adopt the Resolutions of Necessity, the County’s attorneys would file complaints in eminent domain in Yolo Superior Court and serve a summons and complaint on all persons having an interest in the respective real properties that the County seeks to acquire. See CCP §§ 1250.110, 1250.120. To avoid any disruption to the existing utility facilities and continued operation of the Project, the County anticipates filing a motion for prejudgment possession soon after filing and serving the complaint to allow the County to take possession of the various easements and commence construction while the parties continue to try and resolve the amount of just compensation owed to the property owners. CCP § 1255.410. A hearing will then be scheduled before the court approximately 60 days after the motion for prejudgment possession is filed. CCP § 1255.410. Prior to filing the motion for prejudgment possession, the County would need to deposit the full amount of the County’s appraisal with the Treasurer of the State of California. See CCP § 1255.010. If the Superior Court grants the County’s motion for possession, the property owners may withdraw the County’s deposit of probable compensation. Following resolution of the motion for possession, the case would be set for trial. Prior to the trial, the parties would depose each other’s appraisal witnesses to learn what evidence each party intends to present at the trial. The Court would then hold a final settlement conference. If the parties are unable to reach a settlement, there would be a trial to determine the amount of just compensation for the Easements. However, as stated above, commencement of litigation will not end the County’s efforts to reach a negotiated agreement.

Environmental Review
The Landfill's Gas-to-Energy project was the subject of review pursuant to the California Environmental Quality Act (CEQA) in 1986 with the approval of a Negative Declaration. Staff have considered whether the commitment to pursue acquisition of the Easements will have any environmental impacts for purposes of the California Environmental Quality Act (CEQA) and determined that the County’s purchase of the Easements for continued utility purposes related to the Landfill's Gas-to-Energy facilities is exempt from CEQA and a Notice of Exemption is appropriate. As discussed above, the Easements are being acquired to replace expiring easements for the same purposes for existing utility facilities, namely overhead electric utility poles and the substation, for the continued operation, repair, and maintenance of existing utility facilities and are thus categorically exempt from CEQA.  (See CEQA Guidelines, Cal. Code Regs. tit. 14, sec. 15301.)  Because the acquisitions for the existing utility facilities involves negligible or no expansion of use or impact on existing uses, it can further be seen with certainty that there is no possibility of significant environmental effects and acquisition of the Easements is further exempt under the CEQA Guidelines Section 15061(b)(3).  A CEQA Notice of Exemption is included as Attachment C for the Board's consideration and approval on the grounds described therein.

The Easements are located on parcels of property subject to a Land Conservation Contract with the County pursuant to section 51200, et seq., of the California Government Code (Williamson Act).  As a result, though the Office of the County Counsel does not believe additional findings are legally required, staff nonetheless recommends that the Board find that: (a) the location of the easements to be acquired is not based primarily on a consideration of the lower cost of acquiring land in an agricultural preserve; and (b) there is no other land within or outside the agricultural preserve on which it is reasonably feasible to locate the proposed Project.  As referenced above, the easement area location has been in use for many years.  Consequently, the location has no relation to the lower cost of acquiring land in an agricultural preserve.  Because existing facilities are already located in the proposed easement area, it is not reasonably feasible to relocate the public utility easement and improvements to different location.  

Documents Incorporated Into This Report
First Written Offer Package
Correspondence with Property Owners
Notices of Resolution of Necessity Hearing, dated August 30, 2024
Amended Notice of Resolution of Necessity Hearing, dated September 9, 2024
Notice of Exemption

The County collaborated with CMD West and County Counsel's Office on this item.