Road work and repairs are common projects that many government entities undertake. However, when the work costs you business opportunities, you might look for a way to recover those losses.
When does restricted access require compensation?
Not every access change requires the government to compensate you. Minnesota protects your right to reach the public street or highway bordering your property, but officials may alter driveways, turning routes and traffic patterns if you retain a reasonable way to enter and leave.
You may have a claim if a public project takes away that right or leaves the property without an entrance suitable for its commercial use. A blocked left turn, longer route or similar inconvenience usually is not enough by itself.
How is lost revenue calculated?
State law uses two 51% thresholds for certain driveway closures. The public project must permanently eliminate at least 51% of your driveway access. Your revenue after subtracting the cost of goods sold must also decrease by at least 51%.
Officials calculate the decline by comparing the average for the three years before construction with the result for the year after completion. The maximum compensation cannot exceed your total revenue for the three years before the project, minus the cost of goods sold during that period. You must file the claim within one year after completion.
Which evidence proves your losses?
Because a court measures the loss against how the site worked earlier, the file you build before the equipment arrives often decides how far a claim goes. Helpful evidence includes:
- Photographs and site plans showing curb cuts, turning movements and parking before construction
- Point-of-sale reports for the three years before the project and the year after it ended
- Delivery logs or carrier statements showing which trucks can no longer enter the site
An appraiser or court can use these records to connect the project to a specific decline in property value or business revenue. They also help separate the effect of restricted access from changes tied to diverted traffic, seasonal demand or competition.
Should you act before construction?
Reviewing the project before work begins gives you time to understand how the finished design could affect your property. Design meetings and public hearings offer a chance to study the plans, clarify how customers and deliveries will reach the site and raise possible adjustments while officials are still considering the layout.
After a road authority files a condemnation petition, the court appoints three commissioners to inspect the property and determine compensation. Either side has 40 days from the filing of the award to appeal to district court.
For a qualifying commercial property appraisal, the acquiring authority must reimburse reasonable costs up to $10,000. To receive that payment, you need to provide the report and required reimbursement information at least five days before the commissioners’ hearing. Separately, the commissioners have discretion to award up to $5,000 in appraisal fees unless those fees were already reimbursed.