Fresno starts land condemnations for rail crossing rebuild. Here are businesses impacted

Construction on major changes to a central Fresno railroad crossing won’t begin for about two years, but the city is already turning to the court system to acquire some of the needed property through eminent domain.

Over the past few months, the Fresno City Council has adopted five resolutions officially declaring that particular pieces of land are needed for the $150 million project to rebuild the intersection of Blackstone and McKinley avenues at the BNSF Railway tracks. The streets are each to be lowered by as much as 25 feet to funnel traffic beneath the existing railroad tracks.

The “resolutions of necessity” are the first step in the legal process of taking property through condemnation.

Among the businesses on the targeted properties are the Carl’s Jr. fast-food restaurant at the northwest corner of Blackstone and McKinley; Dutch Bros coffee in a shopping center on the northeast corner of the intersection; a ceramics business; an auto body shop; and an auto smog shop.

How eminent domain will affect Fresno railroad project

Eminent domain, or condemnation, is a legal process in which a government agency can go to court to acquire property for a public project when the agency and property owner cannot agree on price or terms.

The first step is adoption of a resolution of necessity, and then the agency can file an eminent domain lawsuit in the county where the property is located. A judge first decides whether the agency is entitled to the property; in a second phase of the case, a trial determines the fair market value and other “just compensation” due the owner. The verdict can be no lower than the agency’s offer and no higher than the owner’s counteroffer.

The start of the eminent domain process doesn’t mean that negotiations on any of the properties are beyond repair. “The city is willing to continue negotiations with the property owners, but in order to maintain the project’s schedule, this step in determining the necessity of the parcel is critical,” said Nancy Bruno, a supervising real estate agent with the city’s Capital Projects Department.

That was underscored in April by Chief Assistant City Attorney Raj Singh Badesha as the City Council considered one of the first resolutions of necessity on the railroad project. “If the council moves forward with this … it doesn’t mean that the negotiations stop,” Singh Badesha said. “The negotiations are ongoing.”

A search of Fresno County Superior Court’s database indicates that while the resolutions of necessity have been adopted by the Fresno City Council since April, no eminent domain cases have been filed.

Blackstone/McKinley construction timeline

The grade separation of the rail crossing at Blackstone and McKinley has been a priority traffic project for years, for pedestrian and vehicle safety and traffic flow on two of the city’s major thoroughfares. The city reports that four people have died in either train-versus-pedestrian or train-versus-vehicle collisions near the intersection over the past 10 years.

Dozens of trains — both BNSF freight trains and Amtrak passenger trains — pass through the intersection each day, creating an average delay for drivers of nearly three minutes for each train.

Acquiring all of the properties needed for the grade separation is expected to run through the summer of 2025. Engineering designs are expected to be completed by mid- to late 2025, and construction is slated to commence in the spring of 2026 and continue into the spring of 2029.

It’s likely that several dozen properties will be at least partially affected by changes in street elevation for the two roads and the retaining walls needed to shore up the embankments, effectively cutting off street access to the sites.

In the case of Dutch Bros, the popular coffee business, city traffic engineer Alex Gonzalez told the City Council on June 13 that retaining walls along McKinley Avenue and a new driveway into the small shopping center will render inaccessible the exit for the existing drive-through lane.

The owners of at least six properties near the Blackstone/McKinley intersection have agreed to terms to sell their land to the city. Those include a quintet of houses south of McKinley at Glenn Avenue and Calaveras Street, and the owner of a 1.37-acre commercial property that is home to several businesses on the west side of Blackstone Avenue, just north of the Carl’s Jr. restaurant.

Those six purchase agreements add up to a total of more than $4.7 million.

Property owners reluctant to sell

To date, however, the city has been unable to come to terms on other properties, prompting the eminent domain resolutions that have come to the City Council for approval.

In April, A&T Ceramics owner Art Terzian strenuously objected to the plan to take his 0.88-acre property on McKinley Avenue east of Blackstone. His attorney, Benjamin Tagert of Sacramento, argued that there was insufficient proof that it’s necessary to displace Terzian’s business, which has operated there for 30 years.

“The city is proposing to uproot him and a dozen other businesses from where they’ve been operating for years for a temporary road,” said Tagert, referring to a plan to detour traffic during three years of construction. “That’s not right.”

After an appraisal last year, the city submitted an offer to pay Terzian more than $2.25 million for his property. But Terzian said it would cost him closer to $7.5 million to leave his 28,000 square feet of buildings there, relocate his business and inventory to a new site and get fully up and running.

Cassie Scholz, an engineer for the city, said the issues with Terzian’s property are more about the change in street elevation than about a detour around the construction.

“Not only will the footprint of the project conflict with the front face of Mr. Terzian’s building, there will also be a vertical drop between where his driveway currently sits and where the road will be dropped to,” she said. “There will no longer be access available to be maintained to the parcel, the way everything is laid out right now.”

The city provided an offer of $2.1 million for the Dutch Bros property to the owner, Westfield Investments & Associates. A staff memo reports that the company submitted a counteroffer, but that proposal was not substantiated by an appraisal.