&EPA
f
United States Administration And 21M-1006
Environmental Protection Resources Management March 1991
Agency (PM-215)
Relocation Assistance
And Payments Course
NHI Course No. 14112
- HEADQUARTERS LIBRARY
ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
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&EPA
Relocation Assistance
And Payments Course
NHI Course No. 14112
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Relocation Assistance and Payments Course
Table of Contents
Course Introduction
Chapter One
Chapter Two
Chapter Three
Chapter Four
Chapter Five
Chapter Six
Chapter Seven
Chapter Eight
Chapter Nine
Chapter Ten
Chapter Eleven
History and Philosophy of the
Relocation Program
Relocation Planning
Relocation Information and Notices
- The Relocation Agent Communication
and Advisory Services
Replacement Housing Standards
- Residential owner - Occupant Benefits
- Residential Tenant & 90 - 179 day
owner-occupants benefits
- Residential Benefits -
Residental - moves
Replacement Housing of Last Resort
Mobile Homes
- Moving Payments and Related Expenses:
Business including Nonprofit
Organizations and Farms
Chapter Twelve - Appeals
Chapter Thirteen - Relocation Program at the
Construction Stage
Appendices
* Appendix I - Law
* Appendix II - Regulation
* Appendix III - Mortgage Interest Differential
Payment
* Appendix IV - Miscellaneous Items
Case Studies
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INTRODUCTION
RELOCATION ASSISTANCE AND PAYMENTS COURSE
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RELOCATION ASSISTANCE AND PAYMENTS COURSE
COURSE INTRODUCTION
The Relocation Assistance and Payments Course was developed
by the Federal Highway Administration (FHWA) for presentation to
employees of State highway agencies, local public agencies, FHWA,
and other interested local, State and Federal Agencies, who are
subject to the Uniform Relocation and Real Property Acquisition
Policies Act of 1970, as amended in 1987.
The course is designed to broaden the knowledge and to
develop the skills of persons actively engaged in the relocation
of persons displaced as a result of the acquisition of real
property required for a Federal or Federal-Aid project. The
course covers all functional areas of the relocation assistance
program with a primary emphasis on residential displacements and
is based on the Covernmentwide Single Rule for the Uniform
Relocation Assistance and Real property Acquisition Policies Act
of 1970, as amended in 1987.
Objectives of the Course
Upon completion of the course, the participant should be able to:
1. Explain the relocation assistance advisory services and
payments available to eligible displaced persons.
2. Interview displaced persons and determine their needs.
3. Provide advisory services within his/her area of expertise.
4. Identify and arrange for specialized services available
from other agencies.
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5. Complete a decent, safe, and sanitary housing inspection.
6. Compute moving cost payments for both businesses and
residential occupants.
7. Compute and explain replacement housing payments for owners
and tenants.
8. Explain the requirements and procedures of Replacement
Housing of Last Resort.
9. Explain appeal procedures.
All subject areas will be introduced by short lectures and
reinforced with appropriate case studies. Case studies will be
completed in workshop groups and solutions will be presented by
the participants in general discussion sessions following each
assignment. Participants are encouraged to share their
knowledge, experience, and expertise throughout the course for
the benefit of those who may be new to the program. Lectures
will be kept to a minimum to provide time for discussion and
productive learning experience.
The premises taught in this course are based on the
regulations and therefore the law. Because regulations are, of
necessity, written broadly, they do not provide solutions or
answers for every situation that may be encountered on actual
relocation projects. Participants should become aware throughout
this course of the difference between requirements, options, and
best judgement solutions to particular situations. A great deal
of flexibility is allowed to users of the Governmentwide
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(Single Rule) Regulation. Some of the answers given to case
studies used in this course are the solutions that have worked
best in similar situations. Your agency might use another
solution to a similar situation. If both answers comply with the
regulations, they are both correct. Participants should consult
with their supervisors and refer to their agency relocation
manuals when unusual situations are encountered.
The course was developed around an actual highway project
but we shall refer to it as the "Fairmont" Project. The project
concept was selected for several reasons. It provides for a wide
variety of displacement situations in an acquisition setting with
which most of you are familiar. Since we cannot use an actual
project in each geographic location where the course is
presented we have done the next best thing. We have placed a
project in a fictitious setting to serve as the base for the case
studies.
The Fairmont Project
The project is located in a small fictitious city we shall
call Fairmont, Colorado. The names of the displaced persons
have been changed to protect their privacy since most of the case
studies are based on actual situations which were encountered in
various projects.
Area and City Data
Fairmont is a trade and recreation center located in the
north central region of Colorado about 50 miles northwest of
Denver. The city is located in the Colorado River Valley high in
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the Rocky Mountains at an elevation of about 8,000 feet above sea
level. Fairmont attracts many winter visitors because it is
convenient to several popular ski resorts and has several
moderately priced motels.
Fairmont was founded in 1871 as a trading post and supply
center for the "gold rush" trade. Its importance as a gold
producing center has not continued, but with the completion of
the railroad line in 1904 and the establishment of Worthington
Air Base and Fort Cobb in 1942, the city has continued to grow.
Rocky Mountain University is located in the northern part of the
city about 2 miles from the downtown section of Fairmont. The
University has an enrollment of 7,585 students and has attained
considerable stature in research of problems pertaining to the
plant and animal life common to the higher elevations of the
Rocky Mountains. In the vicinity of Fairmont, summer
temperatures range between a low of 50 degrees and a high of 100
degrees with winter temperatures dropping to as low as -38
degrees Fahrenheit.
The Fairmont region is known to have fairly large deposits
of coal and oil shale, but mining of either has never been
pursued extensively due to the high costs involved. Due to a
short growing season, most foods are transported in by truck or
rail.
Employment in the Fairmont area is centered mostly around
recreational services but there is a growing manufacturing and
mining complex. The Sunshine Bakery Company, and Colorado
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Redi-Mix are among the largest companies with employment of
50-100 each. The military installations account for over 8,500
government employees, the most significant source of employment.
One of he larger employers in the area is the Rocky Mountain
University with 375-500 employees. Services and retail trade
account for approximately 5,000 of the 15,000 or so employed in
wage and salaried jobs. Transportation services employ about
1,500 reflecting the City's importance as a recreational and
military center.
The population has increased within the city limits of
Fairmont from 16,000 in 1940 to 38,000 in 1989 while the
metropolitan area has increased from 47,861 in 1960 to 72,900 in
1989. This significant growth, accompanied by extended city
services and new housing construction has made Fairmont one of
the most prosperous communities in the State. Median income in
1988 is $21,500 — higher than Denver — but the cost of living
is also about 20 percent higher than Denver. One of the factors
responsible for the growth during the late 1970's was the renewed
interest in gold mining. The world price of gold caused the
American Smelting, Refining and Mining Company to reactivate its
gold mining operation long closed due to the low price of gold.
This activity had a significant economic impact on the Fairmont
areas but has subsided somewhat with the reductions in the price
of gold during the early 1980's.
The community has enjoyed a rather stable economy despite
the instability of the gold market, however. Employment has been
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relatively steady during the past few years. A new 116-bed
community hospital was completed recently, tourism continues to
grow; $12.5 million for 2 new buildings at the University was
authorized and construction is underway; and a new Federal
building was recently constructed in downtown Fairmont. The
municipal airport has also been expanded to handle the increased
number of tourists.
Real estate values slowed considerably from 1979 thru 1982
due to the recession and high interest rates, however, these
values accelerated from late 1983 to the present time, reflecting
moderating mortgage interest rates and strong indications of
economic recovery. Moderate city growth is expected to continue
indefinitely.
Description of the Project
The project is located on the east side of Fairmont and is a
continuation of an older project recently opened that comes into
Fairmont from the south. The project begins at Mahaffey Road,
runs generally north, crossing the Colorado River and east to the
Jackson Highway. After crossing the Colorado River the project
will generally parallel the existing Jackson Highway to the point
of connection. The project will terminate at this junction and
will provide a free flow of traffic around the Fairmont business
section, thus ending congestion through the city center.
The project, as planned, will be a limited access, 4-lane
expressway with a median separation and a limited number of at-
grade intersections.
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The project has a number of distinctive, fairly homogeneous
neighborhoods that it traverses. Each of these neighborhoods
will be described beginning at the south end of the project.
Mahaffey Road to the Colorado River Section
This section commencing at Mahaffey Road is devoted mostly
to low income residences interspersed with commercial
activities. This area is one of the oldest parts of the city
While many of the structures are frame, log cabin type residences
are very common. Many of the structures are in poor repair.
Modern insulation materials were not available when these old
houses were constructed. Age, the poor quality of building
materials, and flood damage have all combined to render much of
the housing in this area undesirable. The only public utilities
available are electricity and water. Oil-fired floor furnaces,
supplemented by wood stoves, are used for heating. The residents
are a close-knit group with limited income. Utility costs of DSS
replacement housing may place such housing beyond their financial
means.
Colorado River Northeast to the City Limits Section
Northeast of the Colorado River the area traversed by the
project is devoted primarily to residential use, with one large
apartment complex, several duplexes, small apartment buildings,
and numerous single family residences about ten years old. The
neighborhood is stable, and has ready access to Worthington Air
Base and Fort Cobb, two of the major employment centers.
Residents are primarily of the "young married" age group.
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City Limits to the Jackson Road Connection
Beginning near the city limits, the alignment of the new
highway encroaches on the commercial development along and
adjacent to Jackson Highway. Apartments and commercial
properties predominate with some residential housing
interspersed. The residences vary in age from new to 50 years of
age. Some residences have been converted for use as small retail
or craft stores. The apartment vacancies — old or new — are
almost non-existent.
The northern most part of the project is the most rural with
some agricultural activities. Most residences are in connection
with either farming or commercial activities. The only nonprofit
acquisition on the project in this section is a small community
church. Development is occurring along Jackson Highway and new
up-scale residences are being built on bench lands overlooking
Fairmont.
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CHAPTER ONE
HISTORY AND PHILDSPHY OF
THE RELOCATION PROGRAM
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CHAPTER ONE
HISTORY AND PHILOSOPHY OF THE RELOCATION PROGRAM
To set the stage for this course, it is appropriate to look
briefly at some of the factors that contributed to the need for
the relocation program as we know it today. The program evolved
because Congress was attempting to correct problems and
inequities that resulted from acquisition of private lands for
public projects. Passage of the Uniform Relocation Assistance
and Real Property Acquisition Policies Act of 1970 was the
result. To implement its provisions effectively, in accordance
with the spirit and intent of the law, we need to understand the
total acquisition process.
It is the law of this land that private property shall not
be taken for public purposes without payment of "just
compensation." The term "just compensation" as it relates to
eminent domain law originates in Article V of the Bill of Rights
which provides:
"No person shall be held to answer for a capital, or otherwise
infamous crime, unless on a presentment or indictment of a
Grand Jury, except in cases arising in the land or naval forces
or in the Militia, when in actual service in time of war or
public danger; nor shall any person be subject for the same
offense to be twice put in jeopardy of life or.limb; nor shall
be compelled in any criminal case to be a witness against
himself,, nor be deprived of life, liberty or property, without
due process of law; nor shall private property be taken for
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public use, without just compensation."
Article 14, Section 1, of the Bill of Rights also relates to
eminent domain acquisitions. While it is devoid of specific
language relating to the payment of "just compensation," it
provides that" ... nor shall any State deprive any person of
life, liberty, or property, without due process of law...." This
has been interpreted by the Supreme Court to impose similar just
compensation requirements on all States.
It is interesting to note that Article V is basically
"people" (Persona) oriented, whereas the just compensation
clause is "thing" (in rem) oriented. The Supreme Court, in its
1893 decision, Monoqahela Nav. Co. v. United States, 141 U.S.C.
321, in discussing Article V, stated that "just compensation, it
will be noted, is for the property and not for the owner." The
Court went on to say "Every other clause in the Fifth Amendment
is personal." "No person" the Court said, "shall be held to
answer for a capital or otherwise infamous crime...." Instead of
continuing that form of statement and saying that no person shall
be deprived of his property without just compensation, the
personal element was omitted and the Court said "just
compensation is to be the full equivalent for the property
taken." This decision highlights the in rem (thing) nature of
"just compensation."
Neither the Federal nor State constitutions define "just
compensation." They simply require that it be paid. The Courts,
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however, have generally held that "just compensation" is
equivalent to "market value" or "fair market value." If only a
part of a property is to be acquired, just compensation is the
value of the property to be acquired plus the cost of damages
that accrue to the remaining property. Most courts have, with
variations, defined "market value" as:
"The highest price estimated in terms of money which
property will bring if exposed for sale in the open
market allowing a reasonable time to find a purchaser
who buys with knowledge of all uses to which it is
adapted and for which it is capable of being used."
This definition, like the term "just compensation," is
"property" oriented, not people oriented. It addresses itself to
"things" (the property), not to people (the person owning the
property). It measures the value of the property taken and, by
definition, assumes this to be "just compensation." There seems
to be no concern for the value of what the person from whom the
property is taken actually loses. It does not, for example,
compensate a displaced homeowner for added costs of purchasing
replacement housing or moving personal property because these are
not costs which are reflected in open market transactions.
For quite a while the "in rem" concept of "just
compensation" governed the entire acquisition process. There
were exceptions, of course, but they were usually limited to
inequities of such magnitude that they shocked the conscience of
the court.
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In fact the in rem philosophy, while admittedly inadequate
for present day conditions, worked quite well until the late
1940's since "fair market value" was, in fact, usually "just
compensation". However, as public works projects become more
urban and resulted in the large scale displacement of persons,
the traditional in rem concept of "just compensation" was found
to be wanting. A consensus developed for the more equitable
treatment of persons affected by public improvement projects.
Congress, in response to these demands, addressed itself to
the problem by providing special payments on a project or agency
basis. Examples of such actions are as follows:
1. The 1949 Housing Act made it clear that relocation
was a responsibility and required a "feasible method"
for relocating displaced families. The
administrative rules based on this act permitted the
payment of a displaced person's moving expenses and
first month's rent, but only when necessary to move a
family off the site; the total amount for financial
assistance in each project had to be less than the
estimated combined cost of the delays and eviction
proceedings that would result from families refusing
to move. It was not until 1956 that the Housing Act
was amended to cover individuals and business
concerns, and provide relocation payments to all
three categories of displaced persons.
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2. In 1951, Congress authorized the Defense Department,
on specific projects, to pay moving expenses and
other "losses and damages.** In 1952, this
authorization was expanded to cover all public works
projects undertaken by the military departments.
3. In 1958, similar legislation was enacted for the
water conservation and development projects of the
Bureau of Reclamation, Department of Interior.
4. In 1962, Congress authorized the National Aeronautic
and Space Administration to make the same kind of
relocation payments previously authorized for the
Defense Department.
5. Also in 1962, the Federal-Aid Highway Act established
a relocation program which provided for moving cost
payments on a voluntary basis depending on State law.
Some States never passed legislation enabling it to
pay a displaced person's moving cost.
6. In 1968, the Federal-Aid Highway Act broadened
considerably the requirements for Relocation
Assistance and payments and made mandatory compliance
with the law a requirement for State projects
receiving federal aid assistance. Payments were
authorized for moving expenses for businesses, farms,
and residences, either actual costs or on a fixed
payment basis. Replacement housing payments for
homeowners were authorized up to $5,000 and for
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tenants a rental assistance payment was authorized
to $1,500 for 2 years. Relocation Assistance
Advisory services received new emphasis.
While the passage of piece meal legislation helped those
persons directly affected by the particular program covered, it
tended to magnify the problem of unequal and non-uniform
treatment of displaced persons. These laws provided slightly
different benefits and there were instances of acquisition for
projects by different agencies in close proximity where one
person was reimbursed for all moving costs and a neighbor on
the other project received nothing but a notice to move. Some
agencies such as the National Park Service, Fish and Wildlife,
Environmental Protection Agency, and possibly others provided
neither advisory assistance or financial benefits to displaced
persons until passage of the Uniform Act of 1970.
As far back as 1961, it had become clear that stop gap
legislation could not solve the problem, but the wheels of
government frequently roll slowly. A select Subcommittee on all
property acquisition of the House Committee on public works, was
formed in that year for the specific purpose of providing a
comprehensive appraisal of the impact of Federal and Federally
assisted programs on displaced persons. The Committee, under the
chairmanship of Congressman Clifford Davis of Tennessee,
completed its study and issued its staff report in December of
1964. (Committee Print 31, 88th Congress, Second Session, 1964).
This report stands, even today, as the most comprehensive and
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authoritative work on the subject ever undertaken. In addition,
there were several other major studies, all pointing out a need
for national uniform legislation in tune with the needs of
people.
By this time Congress and the Executive Branch were in full
agreement. Something had to be done—but what? One school of
thought centered on changing the eminent domain laws to more
nearly reflect current political, social and economic needs.
This approach, while logical, was not very practical. It did not
fully recognize the almost insurmountable constitutional and
legislative problems involved in trying to change "just
compensation" from a "thing" oriented concept to a "person"
oriented concept. This approach was discarded in favor of the
"add on" approach which, while not quite as logical, was a great
deal more practical. The "add on" approach had one big advantage
which was its unabashed recognition that just compensation,
literally speaking, means more than payment for real property
being acquired. It means that no individual would be left worse
off economically as a result of a project for the benefit of the
public as a whole. No person, either owner or tenant should have
to incur moving costs as a result of being displaced for or by a
Government project.
The first serious attempt at providing Federal legislation
for the uniform and equitable treatment of persons displaced from
real property acquired for a Federally-funded project was Senate
Bill 1681 introduced in 1965 by Senator Muskie in the 89th
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Congress. It was designed to implement many of the
recommendations contained in the Davis Report filed in 1964.
Hearings were held by the Senate Subcommittee on
Intergovernmental Relations, and the bill was adopted unanimously
and sent to the entire Senate. Similar legislation introduced
in the House was not received as enthusiastically; and the
pressures for passage were not great enough to overcome the
problems of inertia, vested interests, and Committee
jurisdictional disputes.
The Senate reintroduced corrective legislation in the 90th
Congress in the form of S-698. Again, it passed the Senate but
failed to pass the House. There was one big difference this
time, however. This time the highway industry switched from
opposing to supporting a more liberal approach to land
acquisition and relocation activities. It supported the 1968
Highway Act which contained what some believed to be "give away"
provisions but others recognized as a major "break through" in
the long and tedious efforts to correct the inequities of the
traditional "in rem" concept of "just compensation".
In January of the First Session of the 91st congress,
Senator Muskie again introduced his bill in the form of S-l
entitled "The Uniform Relocation Assistance and Real Property
Acquisition Policies Act of 1970." The Senate again passed the
Bill unanimously; The House Committee with its new-found support
for corrective legislation put its own "Uniform Act" - House Bill
14898 in the hopper.
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It was clear to all who had an interest in such matters that
the winds of change were blowing and that Congress would pass
strong uniform legislation. You know the results-Congress passed
and the President signed into law, effective January 2, 1971, the
Uniform Relocation Assistance and Real Property Acquisition
Policies Act of 1970.
It is interesting that even though the Bill passed had the
Muskie title "Uniform Relocation Assistance and Real Property
Acquisition Policies Act of 1970," its provisions were basically
those contained in House Bill 14898. The House Committee on
Public Works prepared a report to accompany S.I identified as
House Report No. 91-1656. Some of you may be familiar with this
document. If not, a copy of the report may be obtained. It
provides good insight into congressional intent of the law in
most of the major areas.
WHAT WERE THE OBJECTIVES OF THIS LANDMARK LEGISLATION? DID IT
REALLY CHANGE ANYTHING?
Our concern, at this point, is not of the technical aspects
of the law as we will spend the rest of the week discussing
those; rather, lets's think of its philosophical and social
aspects.
First. The Uniform Act acknowledged the inequities of piece meal
legislation and decreed that its provisions would be uniformly
applied to all federally aided projects even if there were no
Federal money in the acquisition costs.
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Second, it recognized that the in rem concept of just
compensation, being property oriented, no longer met the needs
of our society and provided for "additive" payments based on
personal considerations.
Third. it adopted the concept that no displaced person should be
left worse off economically than before displacement.
Fourth, it adopted the concept that no individual or family
should be displaced unless decent, safe, and sanitary dwellings,
within the financial means of the displaced person, were
available for immediate occupancy.
Fifth, it encouraged tenants to become homeowners if they should
desire.
Sixth, it provided that all displaced persons be reimbursed for
their actual reasonable moving costs.
Seventh, it provided that no person should be required to move
without at least 90 days written notice.
Eighth, it required that relocation services be provided all
displaced persons; not as a perfunctory activity as was sometimes
the case in the past, but rather, a real service designed to
lessen the emotional and financial impact of displacement.
Ninth, it provided the needed "tools" with which decent, safe,
and sanitary housing could be provided if not otherwise
available.
Tenth, it established uniform land acquisition policies designed
to recognize and protect the rights of those from whom property
was acquired.
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We could continue listing other important aspects of the
Uniform Act for it has many, but the ten listed should be
adequate to emphasize that it was a "people" law. It's intent
was to solve "people" problems and to reimburse "people" costs.
It told the program managers and planners that they were now
required to consider the people first. Then, and only then,
could they proceed with the project.
Now, we have the Uniform Relocation Act Amendments of 1987
to do several additional things:
1. Increase the monetary benefits that are outdated from the
1970 Act.
2. Provide additional benefits for needs unforeseen when the
original act was passed.
3. Provide for a lead agency to issue regulations, coordinate
with other federal agencies, monitor program and project
activities, and report to Congress.
The Department of Transportation is the lead agency and the
Federal Highway Administration has been delegated the
responsibility for lead agency activities. The Amendments were
designed to continue to solve "people" problems with even greater
uniformity than the original Act. The designation of a lead
agency will facilitate this goal, and will help achieve the
uniformity of treatment intended by Congress.
On March 2, 1989, the Federal Highway Administration
published the governmentwide single rule in the Federal Register.
This single rule is for the use of all agencies, entities, and
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persons who acquire real property and displace persons for
Federal and federally assisted programs and projects. A copy of
this rule is included in this manual for your information and
use.
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U.S.
A"
CONSTITUTION
BILL OF RIGHTS
ARTICLE V
"NO PERSON SHALL BE HELD TO ANSWER FOR A CAPITAL, OR OTHER-
WISE INFAMOUS CRIME, UNLESS ON A PRESENTMENT OR INDICTMENT OF
A GRAND JURY EXCEPT IN CASES ARISING IN THE LAND OR NAVAL
FORCES, OR IN THE MILITIA, WHEN IN ACTUAL SERVICE IN TIME OF
WAR OR PUBLIC DANGER; NOR SHALL ANY PERSON BE SUBJECT FOR THE
SAME OFFENCE TO BE TWICE PUT IN JEOPARDY OF LIFE OR LIMB; NOR
SHALL BE COMPELLED IN ANY CRIMINAL CASE TO BE WITNESS AGAINST
HIMSELF, NOR BE DEPRIVED OF LIFE, LIBERTY OR PROPERTY, WITHOUT
DUE PROCESS OF LAW; NOR SHALL PRIVATE PROPERTY BE TAKEN FOR PUBLIC
USE, WITHOUT JUST COMPENSATION,"
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CHAPTER TWO
RELOCATION PLANNING
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CHAPTER TWO
RELOCATION PLANNING
The Uniform Relocation Act Amendments of 1987 recognize the
need for relocation planning. Section 205(a) of the act as
amended requires programs or projects be planned so that the
problems associated with displacements are identified at an early
stage and resolution of those anticipated problems is provided.
Planning is a good management tool used to achieve a
predetermined objective. For relocation, the objective is an
orderly and humane relocation of persons displaced by a project
without adverse impacts or costly delays to the project. The
planning process should be initiated during the early stages of
project development, be continued through the environmental
analysis process and culminate in a relocation study appropriate
for the particular project. The factual information learned
should indicate if orderly relocation can be achieved. If
problems are revealed early in the planning process, various
solutions may be considered such as extension of lead time prior
to construction, undertaking clearly defined mitigation measures,
or increasing personnel resources.
While a formal relocation plan is not now required for
approval of a project to proceed, relocation planning is
required. Therefore, the best way for an agency to document
the planning process is to prepare a relocation study. Study
preparation is not difficult and involves several logical steps:
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1. The preparation of an inventory of characteristics and
needs of individuals, families, businesses and non-profit
organizations and farms to be relocated.
2. A survey of the real estate market to determine if an
adequate supply of comparable replacement housing and
suitable replacement locations for businesses and farms
will be available to meet the needs of the displaced
persons in a timely manner.
3. An analysis of the problems anticipated in the relocation
of the project occupants including any special relocation
advisory services that may be necessary.
4. Proposed solutions for resolving the problems.
The first step in the relocation planning process is to find
out who and what will be displaced by the project. A drive
through the project area and surrounding areas will provide
general information about potential displaced persons, as will
checking with public and private agencies that provide services
to the area. The best way to ascertain who will be displaced and
to learn about potential problems is to conduct personal
interviews with those affected by the project. On small
projects, the information will be more accurate and may be
obtained more quickly than if time were spent surveying
government offices and checking census data. Census data is
usually several years old before it is available, (can be as much
as ten years old), and is based on a square section of the
population, not for a "strip" as is common for highway projects.
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On large projects, personal interviews of a large randomly
selected sample will provide the best data. Before objections
are raised about "stirring up problems" with personal interviews
before a project begins,please be assured that a knock on the
door is far more welcome than a notice in a newspaper or a red-x
on someone's residence on project plans at a public hearing.
Information about the project and the potential relocation
benefits and assurances should also be provided to counteract
rumors or other disinformation.
The survey form designed for obtaining the inventory data
should be adequate to address, as a minimum, family size, owner
or tenant status, income range, special needs (handicapped,
elderly, etc), dwelling size, and number of bedrooms.
Businesses, farms, and non-profit organizations should also be
surveyed to determine the type of operation, number of employees,
and relocation needs. Either a preliminary survey form or an
occupant needs questionnaire can be used to conduct interviews at
this time. If the occupant needs questionnaire is used, only
those items necessary for planning purposes need be completed. A
sample " Occupants Needs Questionnaire" can be found in the
appendix.
After completing the survey, a tabulation can be made of
replacement housing required based on the standards for
comparable replacement housing, including price or rental range,
number of bedrooms required,and size. Other correlation items
should be added as appropriate, A similar tabulation should be
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completed for businesses and farms.
The inventory of characteristics and needs should indicate
possible problem areas and generate thinking about the various
methods to be used in providing the necessary replacement housing
if shortages are discovered.
Survey of Comparable Replace Housing. Businesses and Farm
Properties
It will also be necessary to prepare a survey of available
comparable replacement housing, business and non profit
organization sites, and farm properties. Since we already have
an inventory of housing needs, we know what types of units to
include in a survey of replacement properties.
The survey and subsequent analysis must indicate the
availability of sufficient comparable replacement housing for
those individuals and families to be displaced. Otherwise the
use of Replacement Housing of Last Resort should be considered.
Again, the standards for comparable replacement housing must be
used as the basis for this inventory and the housing selected
must be decent, safe, and sanitary. Listings of currently
available, comparable residential units for sale and for rent in
the general price range and rental range of the properties to be
acquired can be collected from multi-list services, realtors,
newspapers and magazines. The listings should be adequate for
comparison with the needs inventory and should equal or exceed
the number of units being acquired. The determination that an
adequate supply of comparable housing and other required
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properties will be available, should be well-supported. In the
same manner, available businesses and farm properties should be
analyzed.
If acquisitions and relocations are expected to cover a
significant time span, additional consideration should be given
to properties that would become available over such a time span.
An analysis of the available rental and for sale properties over
a representative period in the past and trending this information
to arrive at an availability in the future may be made. Such
trending would of course give recognition to any known social or
economic impacts that might affect the projection. In developing
these impacts, social or economic occurrences of the recent past
that may have a distorting effect on the present real estate
market should not be overlooked. Problems of today may also
affect the real estate market in the near future. Some examples
to keep in mind are:
1. Industries coming into or leaving the community.
2. Increasing interest rates affecting home purchases.
3. Tight mortgage money.
4. Increasing prime interest rate affecting builders.
5. Tight money for housing contractors.
6. Industrial and business expansion with increasing
employment.
7. Economic recession and increasing unemployment.
8. Economic inflation.
9. Rate of growth or decline of population in the community.
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10. Project area population trends.
11. Out-migration of minority groups from central city to the
suburbs.
12. Building moratoriums.
13. Housing starts and rental vacancy rates.
14. Zoning or other land use plans.
15. Local rent controls.
After a sufficient inventory of currently available
residential units has been collected, the "for sale" and "for
rent" properties should be tabulated to correlate with the
requirements of the displaced persons. For example, one category
of the needs survey may indicate that 28 single family, three
bedroom dwellings between the price range of $75,000 to $80,000
are required. The survey of currently available housing may
indicate that 4.0 units are available in this category. The
tabulation will show 28 required, available 40. The same
procedure will hold true for requirements in other price ranges
and types of residential units. A tabulation of the needs and
availability of rental units should be recorded separately. If
the number of displacements warrant, it may also be appropriate
to tabulate replacement properties for displaced farms,
businesses and non profit organizations, even though this is not
a requirement.
Analysis of Current Government Displacements
Coordination with other Federal, State, and Local governmental
agencies is necessary to learn if any of their current or planned
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programs might also cause displacements or conversely, if there
are programs planned to increase housing availability. Any
planned or concurrent project in the community could have an
effect on the supply and demand for replacement properties and
could be competing. For this reason coordination with other
agencies becomes extremely important.
After the displacement requirements have been compared with
available replacement properties, the study will probably
indicate that the displaced persons on the project can be
relocated in a timely and humane manner. If problems are
discovered or anticipated at this stage of the study, ways to
resolve the problems, including the use of replacement housing of
last resort should be planned.
Analysis of Relocation Problems
At this point in the planning process, a comprehensive
analysis of the anticipated relocation impacts should be
relatively simple to make. The facts have been gathered, the
displaced persons have been identified, the available or
anticipated resources are known, and the factors affecting supply
and demand have been analyzed.
A relocation study can now be written, complete with
recommendations to resolve anticipated problems and a time table
for orderly and humane relocation of the persons to be displaced.
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flB CHAPTER THREE
RELOCATION INFORMATION AND NOTICES
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CHAPTER THREE
RELOCATION INFORMATION AND NOTICES
Relocation Information and Written Notices
Persons who nay be displaced should be informed at the earliest
practical time of the agency's relocation program. This
information shall be furnished in writing in a manner easily
understood. Most frequently, it will be provided in a relocation
brochure published by the Lead agency or the acquiring agency.
As a minimum, the relocation brochure should contain the
information listed below under General Information Notice.
Other written notices will be required as the relocation process
proceeds.
Relocation Program Brochure
Most acquiring agencies will find it beneficial to prepare a
relocation brochure which fully describes the relocation program.
FHWA has a new brochure which is written broadly enough to serve
all Federal-aid & direct Federal programs and projects. Small
numbers of the FHWA brochures can be made available to your
agency or you may elect to borrow the plates to make your own
brochures. The brochure should be made available at all public
hearings to the public-at-large and to all persons scheduled to
be displaced.
Written Notices
1. General Information Notice. As soon as feasible persons to
be displaced must be furnished with a written description of the
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agency's relocation program which provides the following:
a. Informs the person that he or she may be displaced as
a result of project acquisition.
b. Generally describes the relocation payments for which
a displaced person may be eligible, including
elegibility requirements and the procedures for
obtaining relocation services and payments.
c. Assures the potential displaced persons that
reasonable relocation advisory services will be
given, including referrals to replacement properties,
help in filing claim(s) for payments and other
necessary assistance in relocating successfully.
d. Informs the person to be displaced from a residential
dwelling unit that he or she cannot be required to
move permanently unless at least one comparable
replacement dwelling unit has been made available.
e. Inform the person to be displaced that he or she will
not be required to move permanently without at least
90 days advance written notice.
f. Explains the right to appeal the agency's
determination regarding eligibility for assistance,
including but not limited to any relocation benefit
or payment for which the displaced person may be
eligible.
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2. Notice of Relocation Eligibility. The agency shall
promptly notify all persons to be displaced of their eligibility
for applicable relocation benefits. Since their eligibility for
relocation benefits begins on the date negotiations are initiated
for acquisition of the occupied property, this notification
should be given on the same day or as soon as practical
thereafter. The notice in writing, should be delivered in person
to the displaced person if possible within 7-14 days. In our
opinion, a notice issued after this time does not meet the intent
of promptness.
If there is a reason to have the property vacated before the
initiation of negotiations, whether for the convenience of the
Agency or for another appropriate reason, the Agency may issue a
Notice of Intent to Acquire which will serve the same purpose as
the initiation of negotiation for the current occupant of the
property to be acquired. (Notice of Intent to Acquire, See #5
under written notices).
3. Ninety-Day Notice. This is a required written notice. A
lawful occupant cannot be required to move unless he or she has
received a written notice, at least 90 days in advance, of the
date by which he or she may be required to move. The Agency
must comply with the following criteria:
a. Timing of the Notice. The displacing agency may
issue the notice 90 days before it expects the person
to be displaced or earlier. If an occupant has
already moved, there is no need for a notice.
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b. Content of the notice. A choice may be made between
two different types of 90 day notices:
1. The first type is a single notice which will
state a specific date as the earliest date by
which the occupant may be required to move. The
date specified would have to be at least 90 days
after issuance of the notice. If the 90 day
notice is issued before a comparable replacement
dwelling is made available, the notice must
state clearly that the occupant will not have to
move earlier than 90 days after such a dwelling
is made available.
2. The second type is a dual notice procedure.
The first notice would inform the occupant that
he or she would have at least 90 days to
relocate and that a second notice will be sent
stating the specific date by which he or she
will be required to move. The second notice
informing the occupant of the specific date by
which he or she would have to move must be
issued at least 30 days in advance of such a
date. A DSS comparable replacement dwelling
would have to be made available to the displaced
residential occupant at least 90 days prior to
the specified vacate date.
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c. Urgent need. In unusual circumstances, an occupant
may be required to vacate the property with less than
90 days advance written notice if the agency
determines that a 90-day notice is impracticable,
such as when a person's continued occupancy of the
property would constitute danger to the person's
health or safety. A copy of the Agency's
determination shall be included in the applicable
case file.
4. Determination of Relocation Benefits. Although not a
notice as such, the agency is also required to inform an
occupant in writing of the specific comparable replacement
dwelling used in making the determination including its
location, the price or rent used for establishing the
upper limit of the replacement housing payment and the
basis for the determination so that the person is aware of
the maximum replacement housing payment for which he or
she may qualify. If possible, at least three comparable
dwellings should be made available to the occupant. Many
agencies also include the eligibility for moving expenses
in such a letter. Sample letters are in the appendix.
5. Notice of Intent to Acquire. A Notice of Intent to
Acquire may be issued by an agency prior to the initiation
of negotiations. If such a notice is issued, eligibility
for benefits is the same as if negotiations had been
initiated.
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Local Relocation Offices
The decision to establish a local relocation office is the
responsibility of the acquiring agency and an integral part of
the relocation planning process. The decision should be made
prior to the acquisition stage of the project and should be based
on the anticipated volume of work, and the needs and
characteristics of the persons to be displaced. Early opening of
an on-site office usually encourages communication by the project
occupants, is valuable from a public relations standpoint and
facilitates relocation activities on a project.
A relocation office should be located at a convenient site,
readily accessible and preferably near the displaced persons on
the project. If possible, it should be located within walking
distance or convenient to public transportation. The office
hours should be convenient for the project residents and include
evening hours if necessary. It is also a good policy to employ
persons in the local office who are intimately familiar with the
project area and the problems of its residents. Local personnel
can be a tremendous asset to any relocation program.
The following information should be available in a local
relocation office.
1. Current lists of comparable replacement, for sale and
rental dwelling units which are available without regard
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to race, color, religion, sex, age, or national origin.
The listings must be suitable in price and size to fulfill
the needs of the individuals and families being displaced.
2. Current lists of available business and farm properties
for rent or for sale when such properties are being
acquired.
3. Current information regarding security deposits, typical
downpayment requirements, mortgage interests rates and
terms, and average closing costs for residential property
in the area.
4. Multiple listing services, apartment directory services,
neighborhood and metropolitan newspaper advertisements
where available, and various other sources of information
regarding residential dwelling units.
5. Maps indicating the location of schools, parks,
playgrounds, shopping areas, places of major employment,
and public transportation routes in the area.
6. Schedules and cost of public transportation.
7. Copies of the agency's brochure.
8. Applications and claim forms for relocation payments.
9. Copies of local housing codes, ordinances, and local
building codes.
10. Consumer education literature on housing, shelter costs,
family budgeting, and other pertinent information useful
to displaced persons.
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11. The project plan sheets illustrating the project and the
surrounding area.
The local relocation office can be beneficial to the displacing
agency as well as the displaced persons if it is supplied with
pertinent relocation personnel. The local office can be a
valuable tool in building confidence in the agency.
If a relocation site office is not established, it is still very
important that the information listed above be made available to
displaced persons. Accordingly, a well prepared relocation agent
will have this type of information on hand and will make it
available to displaced persons on an individual case basis.
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CHAPTER FOUR
THE RELOCATION AGENT
COMMUNICATION AND ADVISORY SERVICES
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CHAPTER FOUR
THE RELOCATION AGENT
An effective relocation agent must understand the functions of
relocation, and possess certain knowledge, skills and attitudes
in working with people to complete the relocation process.
Exercise
The following exercise is divided into three parts to facilitate
answers to the questions. Each workshop group should discuss the
questions and designate a spokesperson to list and present the
agreed upon answers during the general discussion session. The
workshop groups will be given 15 minutes to develop answers to
the questions.
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EXERCISE
FUNCTIONS AND PERSONAL QUALITIES OF A RELOCATION AGENT
DUTIES AND RESPONSIBILITIES OF A RELOCATION AGENT:
SPECIFIC KNOWLEDGE, JOB SKILLS, AND ATTITUDES REQUIRED:
KNOWLEDGE JOB SKILLS ATTITUDES
WHAT KNOWLEDGE, JOB SKILLS AND ATTITUDES DO YOU EXPECT TO ACQUIRE
OR IMPROVE UPON AFTER COMPLETING THE COURSE?
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"COMMUNICATION AND ADVISORY SERVICES"
One of the most important functions of any relocation program is
to provide the services needed by persons being displaced by the
program or project. Every agency engaged in a Federal or
Federal-aid project is required to provide relocation services to
minimize hardships and to carry out an orderly and humane
relocation program. A relocation program will be successful only
if services are provided by the personal contact of an agent who
understands and believes in the relocation program and is willing
to provide the assistance needed by displaced persons to
relocate.
Relocation advisory services are interrelated with all other
program requirements from the preliminary interview to the final
payment of relocation claims. Relocation Services are the
"frame of reference" embracing all program requirements.
ELIGIBILITY REQUIREMENTS: Persons responsible for providing
relocation assistance are required to help or at least offer to
help:
1. All persons occupying property to be acquired.
2. All persons occupying property adjacent to real property
to be acquired when an agency makes the determination that
such persons will be caused substantial economic injury
because of the acquisition.
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3. Any person who, because of the acquisition of real
property used for a business or farm operation, moves from
other real property used for a dwelling, or moves personal
property from such other real property. Such persons are
entitled to relocation assistance advisory services and
may be eligible for moving cost reimbursement. There is
no eligibility, however, for replacement housing payments.
4. Any person who occupies property acquired by an agency,
when such occupancy began subsequent to the acquisition of
the property, and the occupancy is permitted by a short
term rental agreement or an agreement subject to
termination when the property is needed for a program or
project.
ADVISORY SERVICES; Relocation assistance is necessary on all
Federal and Federally-aided projects where displacement will
occur. Relocation assistance is required by the law and has
equal, if not greater importance than payments. The relocation
program must provide, as a minimum, the following services to
persons who will be displaced:
1. Explain the relocation services which are available and
the various types of relocation payments
2. Discuss and explain eligibility requirements necessary to
receive relocation benefits, and determine the eligibility
of each displaced person.
3. Determine the needs of displaced persons for relocation
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advisory services, and make a sincere offer to help in any
way possible.
4. Provide assistance to persons displaced from dwelling
units, businesses including nonprofit organizations and
farm operations.
5. Provide current listings and prices of available and
comparable for sale and rental properties on a continuing
basis. This requirement applies to residential units,
businesses including nonprofit organizations and farm
operations.
6. Provide information concerning Federal and State housing
programs, Federal loan programs and other governmental
programs offering relocation assistance to displaced
persons.
7. Provide any necessary assistance in completing
application and claim forms.
8. Provide relocation advisory services commensurate with the
needs of each displaced person, in order to minimize
hardship associated with adjusting to a new location.
9. Offer to provide transportation for displaced persons to
inspect housing to which they are referred.
Even this minimal amount of assistance will be helpful to those
you are attempting to help. However, in some instances it is
necessary to go beyond these minimum assistance requirements.
Many problems and possibly misunderstandings can be avoided if as
much time as necessary is taken to provide a comprehensive
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explanation of benefits and assistance available.
The relocation brochure is an excellent tool to use in your
presentation and you can mark pertinent sections or paragraphs
for the displaced person as you review the brochure with them.
The brochure can also serve as a check list to keep you from
omitting anything.
To give more than minimum assistance, it is necessary to become
acquainted with the displaced person. After you know the
displaced person you can tailor your assistance to meet his/her
special needs and you can make appropriate referrals when
applicable. By taking some additional time in the beginning, you
will be more effective and, probably, save time and effort.
You cannot provide more than a minimal level of assistance
without conducting a thorough interview with the person to be
displaced. You may need to improve your interviewing skills.
Here are some guidelines:
1. INTERVIEWING SUCCESS DEPENDS HEAVILY ON PREPARATION
a. Decide why you are conducting an interview.
b. Determine what outcome you want - the information you
need and the information you will give.
c. Develop ways to achieve that outcome.
These three items will change as you progress from the
initial interview to each subsequent interview. Each
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tine the outcome should become more specific.
2. DEVELOP AS MUCH INFORMATION ABOUT THE PERSON (SI TO BE
INTERVIEWED AS POSSIBLE BEFORE THE INTERVIEW. USE WRITTEN
BACKGROUND INFORMATION WHEN
a. The parcel file may contain information obtained during
an earlier survey, possibly for relocation planning
purposes .
b. The appraiser, the negotiator, a welfare worker, or any
other person who may have had prior contact with the
potential displaced person will have first hand
information.
c. If the person is a tenant, you may want to talk with the
landlord.
d. If you have interviewed the person previously, You may
want to refresh your memory by reviewing your notes.
3. PIAN THE INTERVIEW CAREFULLY;
a. Determine the purpose of the interview; for example, is
the purpose to give information? (project information,
benefits, eligibility requirements) , or are you
prompting action? For example, some action is required
- the displaced person must move and a decision is
necessary regarding the method to be used, such as a
commercial move or a self move based on a schedule.
b. Identify specific topics to be covered, their order,
and the best method of presentation. An interview form
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will be of assistance.
c. Have a specific time period in mind before you start
the interview. Do not exceed 90 minutes: two shorter
interviews are better than one overly long one. On the
other hand, don't cut off an interview when the
interviewee is fired up and communicating.
d. Do not schedule two interviews so close together that
an extension of the first interview is impossible.
4. ARRANGE THE INTERVIEW PROPERLY:
a. Have the right person request the interview; either you
or another staff person from your agency will generally
be appropriate.
b. Choose the manner of request carefully:
(1) Arouse interest.
(2) Be positive, pleasant and prepared, but flexible.
(3) Explain the purpose of the interview.
(4) Tell who will conduct the interview and why. (Do
not imply that he/she is going to solve all their
problems).
5. INTERVIEWS CAN HAVE MANY PURPOSES;
a. TO BECOME ACQUAINTED WITH THE INTERVIEWEE:
Broad general questions are good at the onset of the
interview to become acquainted.
b. TO COLLECT INFORMATION;
Design questions carefully in advance. Use an interview
form for the initial questions. Needed factual
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information is the least threatening and the most
readily obtainable.
C. TO CONVEY INFORMATION;
(1) Look at the problem from the interviewee's point of
view. He or she is most interested in the direct
effects on his or her self and family. Community
impacts are secondary.
(2) Impart information, requirements, options,
restrictions, and procedures in a way that makes
the interviewee receptive to your point of view.
d. TO GET REACTION AND QUESTIONS;
(1) Develop an atmosphere that will promote reaction
and questions. Be open.
(2) use a presentation method that encourages
participation. Be relaxed and do not appear rushed
even if you are.
(3) Do not overdo written copy, authority, or personal
identification. (Maybe mark paragraphs in brochure
which are the most important.)
e. TO SOLVE A PROBT^M .JOINTLY;
(1) Promote interest and thought.
(2) Get agreement on the nature of the problem.
(3) Get agreement on the importance of the problem.
(4) Minimize your personal involvement. Emphasize you
must do something—I will help.
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f. TO PLANT IDEAS ?
(1) Be subtle.
(2) Consider alternatives (If he should say...then I
might say...11). Help the displaced persons to
think of all of their options.
(3) Flag alternatives that should be avoided.
(4) Help the interviewee to feel he or she played a
major role in the development of the idea.
(5) Be positive, help the interviewee look at the
opportunities in relocation.
6. INTERVIEW THE RIGHT PERSON:
a. Interview the person most likely to have the answers
to your questions, and who will need the answers that
you can provide.
b. Interview the person to whom specific information is to
be imparted. All adult family members should be present
if possible or in the case of an elderly single person,
a trusted son or daughter or close personal friend may
be present during the interview if he or she desires or
if they obviously need assistance.
GROUP INTERVIEWS MAY BE APPROPRIATE IN SOME INSTANCES,
ESPECIALLY WHEN YOU WANT TO:
(1) Obtain interrelated information.
(2) Convey information of interest to all parties, e.g.,
the relocation agent, the displaced person and a
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moving company representative.
(3) Sample reactions.
(4) Develop solutions to general problems.
(5) Generate group interest and identification.
7. USE MORE THAN ONE PERSON TO CONDUCT THE INTERVIEW WHEN
APPROPRIATE:
a. Be sure each interviewer pursues the same objective and
develops consistent data.
b. Have a dlear direction and role assignment before hand.
(One to interview, and one to takes notes).
c. Be careful not to overwhelm the interviewee(s). (Avoid
machine gun questioning.)
8. CONDUCT THE INTERVIEW SENSITIVELY:
a. Dress appropriately. Attire affects first impressions.
Be neutral.
b. Be on time.
c. State the purpose of the interview and the topics to be
discussed. This will eliminate possible fear or
distrust.
d. Be courteous, friendly, and interested in the people and
in their home.
e. Be warm and responsive to the interviewee's problems and
point of view. Do not be defensive. Develop a trust
worthy relationship.
f. Move from general to specific information, and from
least sensitive to most sensitive subjects.
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g. Try to identify the reasons for the respondent's
opposition, if it exists:
(1) Fear, ignorance, suspicion, rumor.
(2) Clash of objectives.
(3) Clash of personalities—if you are dealing with an
obviously hostile person, you may want to suggest
that you will make arrangements for someone else
to handle the relocation if the displaced person
prefers.
(4) Lack of interest—doubts displacement will occur.
(5) Advice of others—spouse, relatives, other
displaced person., etc.
h. Tactfully point out unworkable alternatives before they
get out of hand.
i. Do not be overly concerned about silences -silences
usually are not as long as they seem and are often
necessary for the interviewee to formulate his/her
thoughts into a logical reply. During periods of
silence, the interviewer should think about: "What is
he or she really trying to tell me?"
j. Select your pattern of speech carefully. Avoid jargon,
i.e., RHP for replacement housing payment or DSS for
decent, safe, and sanitary. Do not talk down to a
displaced person, but keep your explanations as simple
as possible.
k. Create an impression of competence. Know the program
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and be able to answer questions with authority.
1. Decide when to let the person present his/her point of
view, when and how to get the interview back on course,
and know what useful information or reactions you may
lose if you do this too soon.
m. Repeat your understanding of what the person has said,
at key points use restatement: "you mean that"..."What
I hear you saying is"...etc.
n. When necessary use examples to clarify certain
information the displaced person is presenting. All
that may be necessary is to say: "Will you please
explain that a little more."
o. Use listening responses frequently, (nod, smile,
expectant pause, uh-huh, mmm, I see, echo (last few
words repeated), mirror (you feel you have been treated
unfairly), brief summary (let's see if I have this
right — you...)
p. Be prepared to delete or modify the content or sequence
of the interview as the person reacts in unforeseen
ways.
q. Take notes, as appropriate, but do not let the note
taking get in the way of the interview process. Be
selective, brief, and clear in what you write down, and
keep your attention on the other person.
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9. BECOME A BETTER LISTENER:
a. Keep your mind open; null your emotional filters.
remember, we often hear what we wish to hear. Bear in
mind, one's own attitudes and biases affect the
information we receive in an interview.
b. Organize the person's remarks in your mind:
(1) What are his main points?
(2) Arguments vs. facts.
(3) Group facts around arguments.
c. Anticipate the next point.
d. Evaluate the person's evidence.
e. Look for nonverbal clues. Useful visual barometers of
an unduly high anxiety level are such things as:
(1) Color of face
(2) Erractic body movements
(3) Varying eye contact
(4) Dryness of mouth
(5) Pitch of the voice
f. Resist distractions and concentrate on what is being
said. However, sometimes it may be necessary to ask the
interviewee to turn off the TV or , if it is possible,
for someone to mind the baby.
g. Stay alert. Do not daydream if a person's delivery is
slow. If your thoughts run ahead of his/her words, use
the time to evaluate, anticipate and review.
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10. IN SUMMARY:
a. A thoughtful, thorough presentation is a prerequisite of
a truly successful interview.
b. During the interview, center your attention on the other
person; be sensitive to his/her reactions, and show your
sympathetic interest in his/her comments.
THE NEXT STEP IS TO PROVIDE RELOCATION ASSISTANCE:
Now that you know something about your client, you are ready to
provide assistance. Not all of your clients will need your
assistance and some will need only a minimum amount of
assistance. You can expect to spend most of your time and effort
with only a small number of those persons in your relocation
workload. It is important, therefore, to know where to go to get
special help. The list of agencies which provide "Social
Services" and other forms of assistance is long. However, this
list is very basic and applies to all displaced persons, whether
owners or tenants, of residential, business, and farm properties.
The services are to be offered to occupants of expensive homes as
well as to occupants of substandard homes and to large businesses
as well as to small businesses. There should be no assumptions
made about the need for services and the services should never be
restricted to location of replacement sites. In many instances,
it will be necessary to go beyond the minimum requirements in
order to complete relocation successfully. The only way to
determine what advisory services will be needed is to become
acquainted with the displaced persons during personal interviews.
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SERVICES AVAILABLE FROM PUBLIC AND PRIVATE SOURCES:
COUNTY WELFARE DEPARTMENTS
County welfare departments administer public assistance programs.
Their major programs are:
1. FINANCIAL SERVICES: The principal types of financial
services are: (1) Aid to Families with Dependent Children
(AFDC), (2) General Relief (GR), (3) Supplemental Security
Income (SSI), and Medical Assistance (MA).
a. AFDC:
(1) Provides cash assistance to families in which
dependent children have been deprived of support of
a parent—until 18 years of age (21 if a student).
(2) AFDC families can also get help with rent
coverages, utility bills, furniture needs, etc.
b. GR:
(1) Offered to those poor who do not qualify for other
welfare department assistance programs.
(2) Usually individuals or childless couples.
(3) A transitional program, with States trying to move
recipients to other forms of assistance shared by
federal government, or to the labor market if
feasible.
c. SSI (Supplemental Security Income):
(1) A minimum assistance payment for those eligible who
do not have other resources.
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(2) Direct income maintenance payments to aged, to
blind and to disabled persons based on a national
uniform standard as well as uniform eligibility
criteria and incentives for States to supplement
this federal floor.
(3) The SSI recipient receives cash payments from the
federal government, but the State usually provides
him or her with social services, medical services,
and food stamps.
d. MA:
Medicaid is available to AFDC and SSI recipients, and
the "medically needy", who are not eligible for direct
cash assistance from the welfare department, are aided
in paying their medical costs. "Medically needy" is
defined as those with medical expenses that would reduce
their income after they pay their bills to less than
welfare standards.
SOCIAL SERVICES:
a. Social services are provided not only to public
assistance recipients but also to others in need.
b. Social services are provided directly by the welfare
department or purchased from private agencies and
institutions, or from foster parents.
c. There are three principal service categories:
(1) The care and maintenance of children which includes:
(a) day care services
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(b) social services to children in crisis, and
(c) protective services for children
(2) The family planning program is another service category
and this includes budgeting, development of parental
teaching and supervisory skills, and birth control
assistance.
(3) The third service category is social service to the
elderly and disabled—this is mainly homemaker and chore
services.
3. FOOD STAMPS:
The eligibility formula balances income and assets against
a range of deductions for shelter cost, child care, medical
expenditures, educational expenses and other special fees
and liabilities.
Welfare recipients are automatically eligible for food
stamps and must only prepare an affidavit listing income and
resources to determine their allotment of food stamps.
SERVICES AVAILABLE FROM OTHER PUBLIC AND PRIVATE SOURCES:
1. County Health Departments May Provide;
a. Clinics and a variety of health services.
b. Public Health Nurse—home visitation for the sick and
for newborns.
c. Nutrition counseling.
2. The Social Security Administration Provides:
a. Retirement benefits.
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b. Survivor's benefits.
c. Supplemental Security Income Benefits (SSI)
d. Aid to Families with Dependent Children.
e. Rehabilitation services.
f. Medicare.
There are many other private and public agencies that may be
able to help, including:
Community Service Organizations (United Fund)
Programs for Senior Citizens
Big Brother and Bio Sister Organizations
Meals on Wheels (For elderly and shut-ins)
Visiting Nurse Association (volunteers)
Volunteer Families
Charitable Organizations
(Food, Clothing, Furniture, Financial Assistance)
Credit Counseling Services
The Legal Aid Society
Centers for Alcoholism and Drug Abuse
Religious Social Service Programs
State Employment Office
(Job Placement, Vocational Counseling and Training)
The Federal Housing Administration
The Veteran's Administration
The Farmer's Home Administration
The Small Business Administration
State Housing Development Authorities
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As you can readily see, there are many places to go for help when
the services needed are beyond the scope or expertise of the
relocation staff. Relocation specialists should not hesitate to
contact local service agencies and become familiar with their
organizations and the nature of the services they provide.
The relocation specialist should keep the following in mind:
a. It is a good idea to keep a list with names and telephone
numbers of local service agencies and identified contact
persons.
b. You may encourage the displaced person to call the service
agency, but you should place the calls, make appointments,
and provide transportation when necessary.
Below is a list of some of the "people problem" areas often faced
by relocation specialists. Local service agencies may be able to
provide the necessary assistance to help the displaced person
adjust to a new neighborhood and/or cope with an existing
problem.
The elderly
The handicapped
Low-income families
Large families
Serious or terminal illness in a family
Emotional and mental problems (the Screamer)
Alcoholics and drug addicts
Eccentric People
The recluse and the hoarder
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The owner of many animals
The person with poor credit
Language barriers
The incompetent
The mentally retarded
The plain uncooperative displaced person
The displaced person who is slow to move
The case of discrimination in housing
Problem children
The unemployed family head
Welfare families
Families with no automobile
Businessmen in need of financial and management help
Dislocated farmers
Acquisition of a church property
Etc., etc.
To relocate some of the persons mentioned presents a considerable
challenge to any relocation advisor. Often relocation advisors
face problems for which there seem to be no solutions.
Inexperienced relocation personnel soon learn that it is not
always necessary to reinvent the wheel and that coworkers,
supervisors and other knowledgeable persons may be able to offer
helpful suggestions or approaches to a problem. However, in the
end the relocation advisor is expected to bring the relocation to
a successful conclusion.
Although the emphasis in this chapter has centered on the
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residential displaced person, you should also be concerned about:
businesses, including non profit organizations, and farms. Their
needs are just as many, and, sometimes, just as acute. They also
need to think through what is best for their business throughout
the relocation process, need to plan ahead and need to locate
adequate replacement sites. The Chapter on moving payments and
related expenses for non-residential moves will address these
issues in greater detail.
BENEFITS AND SERVICES AVAILABLE FROM OTHER AGENCIES
Following is a list of agencies available in most communities,
including a description of the services and benefits provided
under their respective programs. Most communities have
an " Information and Referral" service which will lead the
relocation agent to appropriate public or private agencies. A
local publication usually entitled, "Directory of Community
Services" can also be found in many communities across the
country. The information provided by the following agencies may
also be helpful to you.
WELFARE DEPARTMENTS
(Also known in some areas as Departments of Human Resources,
Department of Social Services, etc.)
1. Financial Assistance is provided to needy persons in the
form of a welfare check funded by Federal, State, and local
governments. This is presently known as Supplemental
Security Income(SSI).
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2. Medicaid is also financed jointly by Federal and State
governments and is administered by State, county, or city
welfare agencies. People who cannot afford to pay the
Medicare gaps can generally receive medical assistance
through Medicaid. Medicaid is usually free to people on
SSI and other public assistance programs. A needy person
is not required to be on welfare to be eligible for
Medicaid provided his or her income is low. The State sets
its own limits and eligibility requirements, so check with
your local welfare office for specific information.
3. Foster Child Care is usually available for neglected or
abandoned children. Foster parents are provided a payment
to provide care for these children.
4. Day Care Centers are available for working mothers of
preschool-aged children in many communities. These centers
often charge according to the parents' ability to pay.
5. Aid to Dependent Children living in the home of a parent or
other relative, or the payment on behalf of a child to an
individual or institution is almost always available. Money
for this benefit comes from State and Federal Funds. To be
eligible, a child must usually be deprived of parental
support or care because of a parent's death, a parent's
continued absence from the home, or a parent's physical or
mental incapacity.
6. Nursing Homes have been established by many local
jurisdictions for the ongoing care of welfare recipients and
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others, check on the availability and eligibility
requirements in your area.
7. Family Planning services are available in many communities
for individuals of childbearing age who wish to determine
the number and spacing of their children.
8. Food Stamps Although this is a federally funded program,
local welfare departments administer the program for the
USDA for low-income households. The amount of food stamps a
family may be eligible for varies with the size of the
household and the monthly income.
COUNTY HEALTH DEPARTMENTS PROVIDE;
1. Clinics for medical and dental care. A variety of
health services may be offered but the services vary
from area-to-area. Contact the Health Department in
your area for specific services available for county
residents and eligibility requirements.
2. Public Health Nurses for home visitations to the sick or
those needing health supervision and education. Contact
your Health Department for availability of this service
and eligibility requirements.
3. Nutrition Counseling is provided by some Health
Departments for persons with dietary problems resulting
from certain illnesses.
COMMUNITY SERVICE ORGANIZATIONS/UNITED FUND ORGANIZATIONS
Most communities have a network of voluntary human care
service organizations which provide a variety of social
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services to assist the sick and needy. Perhaps one of the
following agencies may be of assistance to one of your
displaced persons.
NATIONAL HEALTH AGENCIES conduct research and provide
treatment for a variety of ailments as well as
rehabilitation and educational services: United Cerebral
Palsy Association, American Heart Association, Arthritis
Foundation, March of Dimes Birth Defects, National Kidney
Foundation, Easter Seal Societies for Crippled Children and
Adults, the National Multiple Sclerosis Society, and the
National Red Cross.
Local Agencies;
1. Neighborhood Centers provide educational, recreational,
cultural, and social activities A great variety of
services are offered by neighborhood centers from day-
care to drug education. Check with your local centers
for specific services available.
2. Senior Citizens Centers provide a variety of services
for the elderly, however, they are primarily a central
point offering contact with other people of that age
group. They usually provide social and recreational
activities, educational programs, health services or
information, employment service or job registry,
transportation programs, etc. A national nutrition
program for older needy Americans known as Group Meals
Services is a program usually administered by senior
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citizen's centers. Older persons are eligible who need
improved nutrition for a variety of reasons, such as
lack of knowledge of proper nutrition, inadequate
facilities for preparing meals, difficulty in shopping,
etc.
3. Volunteer Families are available in some communities to
be of aid and assistance to families receiving public
assistance. They are well briefed on the community
services available and'may be of assistance to a
displaced family receiving public assistance.
4. Meals on Wheels is a program that usually provides two
nutritious meals a day to persons at home. Eligibility
varies but the program is designed to solve the
nutrition problems of the aged, the disabled, and the
convalescents who cannot purchase or prepare adequate
meals for themselves. Home delivered meals are provided
under many organizational auspices, and charges are
usually based upon ability to pay. The program should
be listed in your telephone directory.
5. The Visiting Nurse Association provides in the home
nurse visitations, visits to day-care centers, senior-
citizens and low-income housing projects. The visiting
nurse provides health-aid care, special therapies,
guidance,and counseling under the direction of the
recipient's physician. The United Fund, Medicaid,
Medicare, and several health plans will reimburse the
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Association whose fee is based on the actual cost of the
visit when the patient cannot afford the cost of the
service.
6. Big Brother and Big Sister Organizations serve
fatherless boys and motherless girls due to death,
divorce, desertion, separation, imprisonment, or
illegitimacy. This service provides the child
meaningful adult companionship and with opportunities
to participate in recreation and social experiences.
Some organizations work directly with the juvenile court
to fulfill the need for this service.
7. The Mental Health Association provides information,
referral service, and assistance to families confronted
with the mental illness of one of the family members.
The association, in many areas, sponsors social centers
for individuals who need ongoing and positive
socializing experience. The Association provides
treatment for mentally ill or emotionally disturbed
children as well as adults.
8. Drug Abuse Centers are available in most communities and
all metropolitan areas. The centers provide information
and counseling services for drug users and their
families. The centers quite often offer a therapeutic
community to which drug-dependent persons are admitted
on a live-in basis. The program is usually one of total
abstinence with no use of substitute drugs, thus
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providing the addict an opportunity to withdraw from
both physical and mental drug dependence through
comprehensive rehabilitation services and backup care.
9. Alcohol Abuse Programs include a variety of services
pertaining to alcohol abuse and rehabilitation of the
alcoholic. "Alcoholics Anonymous" participates in this
program. It offers counseling, sharing, and
understanding of the problems of the alcoholic on a
one-to-one basis. The organization assists in locating
doctors, hospital care, and financial resources for
alcoholics. The service is available to both child and
adult, and group service is available for family members
of alcoholics.
10. Credit Counseling Services are available in most
communities to help individuals and families solve their
financial problems. Professional counseling is provided
for budgeting, money management, and the intelligent use
of credit. In cases of overextension, a program is
initiated for dept repayment acceptable to creditors and
debtors. Credit counseling centers are often financed
by voluntary fees from creditors as well as the client.
Credit ratings can often be restored or improved to the
point where the formerly poor credit risk may qualify
for a mortgage loan insured by one of the Federal
agencies such as VA, FHA, or FmHA.
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11. Family Services are available in most areas providing
marital counseling, premarital counseling, and
counseling for one-parent families, unmarried mothers,
older adults, parent-child problems, school adjustment
problems, budgeting, and family life education. Various
other services may be available, so check with your
local family service organization.
12. Religious Social Service Organizations such as Catholic
Charities, Jewish Social Service Agencies, and the
Lutheran Social Services are active in many communities.
Such organizations provide marital, family, and
individual counseling as previously discussed under
"Family Services." Foster home care, day-care centers,
^^ adoption services, child guidance services, and other
such services are provided by religious organizations.
These services are often duplications of services
provided by other community organizations, but it may be
the only way some families may be reached.
13. Charitable Organizations can be found in most
communities across the country, the best known being
"Goodwill" Industries." Such organizations collect
furniture, appliances, shoes, clothing, bedding, etc.,
and refurbish the items when possible. Distribution is
made to needy families for a nominal sum or by donation
to indigent families. This is an excellent source of
help for low income displaced persons who are in need of
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clothing and furniture. Charitable organizations also
provide emergency financial assistance on a temporary
basis to persons in need.
The "Salvation Army" is another charitable organization
which is active in most communities. This dedicated
organization provides emergency finances, shelter, food,
and clothing. It also provides social services for the
aged, shut-ins, and problem children. Community centers
provide family life education, group recreation
services, counseling, physical education, and athletics.
Disaster relief is also one of its many services.
OTHER PUBLIC AGENCIES
1. Public Housing can be found in many communities across
the country. The Department of Housing and Urban
Development (HUD) provides assistance in the form of
project grants for low rent housing which is
administered by a Local Housing Authority. The purpose
of the program is to provide decent, safe,and sanitary
housing for low income families at rents they can
afford. The law provides that rents shall not exceed 30
percent of the adjusted family income. To be eligible
for public housing, a prospective tenant must meet
specified income limits established by the Local Housing
Authority.
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The applicant must also meet the definition of a
"family" or be a single person at least 62 years of
age, disabled, or handicapped. Persons displaced by
urban renewal, other government projects, or natural
disaster may also be eligible. Applicants must meet
other standards and priorities adopted by the Local
Housing Authority, so it is important that you develop
this information at the local level in order that you
may know if any of your displaced pers"ons are eligible
for public housing.
2. The Department of Housing and Urban Development (HUD)
insures lenders against losses and guarantees the
mortgage lender that, in the event of default by the
purchaser, HUD will honor the lender's claim after the
mortgage is foreclosed and the property conveyed to HUD.
To be eligible for a HUD insured loan, a borrower must
have an acceptable credit record and enough income to
make the monthly payments, in addition to other
recurring bills and family needs. (Mobil homes are
included as well as residential units). The agency also
maintains a list of HUD-owned properties which may be an
additional source of available housing. Check with the
nearest local HUD office for information on their
current housing assistance programs.
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Title VIII - Civil Rights Act of 1968 (Fair Housing), as
amended by Housing and Community Development Act of 1974
Equal Opportunity in Housing
Objectives: To provide fair housing throughout the United
States. The law provides individuals the
right to choose housing suited to their needs
and financial ability in the area in which
they desire to live without discrimination
because of race, color, religion, sex, or
national origin.
Assistance: The Secretary of HUD was made responsible for
administering the fair housing provisions of
the law, so HUD renders assistance by
investigating complaints. Complaints may be
sent to any HUD Regional or Area Office, any
HUD Service Office, or the HUD's Washington
Office. However, complaints must be filed
within 180 days of the alleged violation.
HUD will investigate discrimination in
housing complaints, if requested, and will
attempt to resolve the complaints, or refer
complaints to the State or the local agency
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that administers a fair housing law locally.
If HUD or the State or local agency is unable
to obtain voluntary compliance, the
complainant may file suit in the appropriate
U.S. District Court. The Court can grant
injunctive relief, award actual damages, and
punitive damages up to $1,000.
3. The Veterans Administration (VA) guarantees mortgage loans
for qualified veterans. The VA guarantees the lender
against any loss (the dollar amount is stipulated by law),
or 60 percent of the loan, whichever is less. The VA also
makes direct loans for the purchase of a home in areas where
private financing is not generally available. To qualify
for either an insured loan or direct loan, the veteran's
income must be sufficient to meet the monthly mortgage
payment and cover his/her other obligations and family
expenses. The veteran must also be a satisfactory credit
risk.
The VA will guarantee loans made by private lenders to
veterans for financing the purchase of mobile homes, lot
acquisition, and site preparation as well as homes.
4. The Farmers Home Administration (FmHA^ of the U.S.
Department of Agriculture guarantees mortgage loans made by
private lenders and also provides for direct loans through
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the agency. The FmHA County Supervisor usually determines
the eligibility of the applicants. One of the eligibility
requirements is the inability of the applicant to obtain a
loan from a private lender on terms and conditions that
he/she can reasonably be expected to meet. Loans may be
made for the value of the property as determined by the FmHA
appraisal and approved by the Federal Housing Administration
or VA. The FmHA has several rural programs available,
including business and industrial loans but the two basic
types of loans are farm ownership loans and low-to-moderate
income housing loans. For more specific information, check
with your FmHA County Agent.
The Small Business Administration (SBA) provides loans for
displaced small businesses that have suffered substantial
economic injury as a result of displacement or being located
adjacent to a federally aided project, including State and
local projects. Owners of apartment houses or other real
estate held primarily for rental income are not eligible,
nor are farm operations and nonprofit organizations.
There is no maximum loan amount for displaced business
loans. Direct loans are available when bank participation
on a guarantee basis is not available. The SBA also offers
training and management assistance to help the displaced
small businessman reestablish and continue his/her business.
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6. Minority Business Development Agency (MBDA). Department of
Commerce, provides leadership to promote the establishment
of and assist in the expansion of minority-owned
businesses. Advisory services and counseling are available
at no cost and include all forms of counsel, guidance, and
advice on the establishment and operation of a business
enterprise. No assistance is available to finance a
business venture by MBDA, however.
7. The Social Security Administration fSSA) provides a variety
of services and benefits nationwide. The SSA administers
three nationwide Federal programs:
a. Retirement Benefits begin at age 65 or age 62 on a
reduced basis (widows at 60) for retired workers
covered by Social Security.
Survivor's Benefits may be paid to the family of a
deceased worker who was covered by social security.
Payments can be made to unmarried children under 18,
a widow under 60 if she is caring for the worker's
'children, a widow or dependent widower 60 or older,
and dependent parents 62 or older.
Disability Benefits may be paid to disabled workers
and their families who are covered by social
security. The worker must be unable to work. After
a 5-month waiting period, a disabled worker and
his/her family will receive the same amount as would
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be paid on retirement.
b. Medicare - The SSA is responsible for administering
the Medicare program which provides hospital and
medical insurance protection for persons who are
covered by Social Security and are 65 years of age
and over.
c. Supplemental Security Income - The SSA also
participates in monthly "SSI" payments to people in
financial need who are 65 or older, blind, or
disabled. For these three groups, the basic
conditions of eligibility are specified levels of
income and resources. In 1973 the aged, blind, and
disabled people receiving public assistance payments
from the State were converted to SSI rolls. This is
not the same as Social Security even though the SSA
administers the program through State Welfare
Agencies. The money comes from general funds of the
U.S. Treasury with participation by State local
governments.
8. State Employment Office is a public employment service for
all grades of workers and employees, providing service
without charge. Services to employees usually include
recruitment, screening and referral, job analysis,
evaluation, specifications, and skill inventories required.
Vocational counseling and job placement is always part of
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the service. Training programs for prospective employees
are often available. This office also administers
unemployment compensation for qualified men and women.
The above list is not intended to be a comprehensive list of all
public and private agencies providing service and financial
assistance. Rather, it is a compilation of benefits which are
available in most communities. It may be used as a reference
guide by personnel involved in the relocation program and should
be expanded to include local information for future use.
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CHAPTER FIVE
REPLACEMENT HOUSING STANDARDS
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CHAPTER FIVE
REPLACEMENT HOUSING STANDARDS
A basic requirement of the relocation program is that the
replacement housing made available to displaced persons meet
certain qualitative standards. These standards are embodied in
the terms "decent, safe, and sanitary housing" and "comparable
replacement housing."
There are three general objectives of the standards:
1. To assure a safe and healthy living environment.
2. To satisfy basic housing and related living needs.
3. To provide the opportunity to occupy a dwelling which is
functionally equivalent to the displacement dwelling.
The first objective is fairly clear. It relates to compliance
with standards that are generally found in local housing and
occupancy codes. The significant content of these codes will be
discussed under the heading, "decent, safe, and sanitary
housing."
The second objective recognizes that housing choices are never
made in isolation from other basic living needs such as
employment, shopping, medical care and schools. Also, the
housing needs of families are frequently based on age, life
style, family size, and disabilities. In implementing the
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relocation program, we accept an obligation to refer displaced
persons to housing that will accommodate the housing needs of the
family and is reasonably close to their employment, public and
commercial facilities, and utilities. This raises questions.
What health or disability limitations are important to consider
in relocation? Are there family size criteria for determining
housing needs? What is "reasonable" proximity to employment and
public and commercial facilities? These important questions will
be considered in this chapter.
The third objective, functional equivalency, is an acknowledgment
that fair treatment of displaced persons requires that we offer a
dwelling which is at least reasonably similar to the displacement
dwelling with particular attention to its principal features and
the style of living which they support. While this may seem to
be a routine task, there are many practical problems. What is
reasonably similar in a housing market in which dwellings are
dissimilar in some major respect? How do we deal with the
cumulative effect of the housing standards? Strict adherence to
each one may result in a betterment in the overall replacement or
may be in excess of the needs or desires of the family. What is
the extent of agency responsibilities in such cases?
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Decent. Safe, and Sanitary Housing Standards
Decent, safe, and sanitary (DSS) refers exclusively to standards
which affect the health and safety of the occupants. DSS does
not pertain to level of luxury, price, or location. Basically, a
dwelling which meets all local criteria for housing and occupancy
codes will meet decent, safe, and sanitary standards as they are
defined in the relocation regulations. A distinction must be
made at this point, however. Housing and occupancy standards or
codes are not the same as building codes. Building codes define
criteria for new construction, additions, and alterations.
Occupancy or habitability codes apply to all buildings or
dwellings in a community. If the occupancy codes changes to
require smoke detectors for example, all dwellings would be
required to be brought into compliance. Occupancy codes are
narrower in scope than building codes since they are concerned
only with those elements influencing health and safety as opposed
to appearance, marketability and conformity to current building
standards.
Most local housing and occupancy codes are adaptations of one of
the national model codes promulgated by code setting
organizations. A popular code is that issued by BOCA (Building
Officials and Code Administrators International, Inc.).
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Minimum Standards
Where there are no local housing and occupancy codes such as in
rural areas or small towns, or where local occupancy codes are
less stringent than the following standards, the following
minimum standards shall apply:
1. Water - The unit must have an adequate supply of potable
(drinking) water.
2. Kitchen - In the case of a housekeeping dwelling, there shall
be a kitchen area containing a fully usable sink properly
connected to potable hot and cold water and to a sewage
drainage system. Adequate space and utility service
connections for a stove and refrigerator must also be
provided.
3. Heating System - The unit must contain a heating system
capable of sustaining a healthful temperature of
approximately 70 degrees for a displaced person, except in
those areas where local climatic conditions do not require
such a system.
4. Bathroom - The unit must have a separate, well-lighted and
ventilated bathroom affording privacy to the user, containing
a sink, bathtub or shower stall, and a toilet, all in good
working order and properly connected to appropriate sources
of water and a sewage drainage system.
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5. Electric System - The unit must have an adequate and safe
electrical wiring system for lighting and other electrical
services.
6. Structurally Sound - The unit must be structurally sound,
weathertight, and in good repair.
7. Egress - The replacement dwelling unit shall have a safe,
unobstructed means of egress to safe, open space at ground
level. If the replacement dwelling unit is located on the
second story building or above, it must have access directly
from or through a common corridor which has at least two
means of egress.
8. Adequate in Size - The replacement dwelling unit must be
adequate in size with respect to the number of rooms and
area of living space needed to accommodate the displaced
person(s). The number of bedrooms is normally given first
consideration. There must be an adequate number of bedrooms
for the occupants. These decisions normally involve the
correlation of the age and sex of both adults and children
and the appropriateness of sharing bedroom space.
9. For a displaced person who is handicapped, the dwelling shall
be free of any barriers which would preclude reasonable
ingress, egress or use of the dwelling by such displaced
person.
The above standards are minimal and basic. However, it is not
unusual to find housing on the market for sale or rent that does
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not comply with one or more of these standards. Often the
deficiency is the result of long-term deferred maintenance. Many
deficiencies are correctable for a modest cost, but others could
require major reconstruction and may not be economically
feasible. An example of the latter would be a cracked and failed
foundation wall or a structurally unsound roof. Later on in this
chapter, we will discuss specific DSS problems that are commonly
encountered.
Implementation of the Standards
Decent. Safe, and Sanitary Inspections
Certain parts of a dwelling should be examined carefully for DSS
problems. Included are:
1. Porches, stoops, exterior stairs - These parts are generally
wood, of light construction and exposed to the weather. They
deteriorate faster than the rest of the dwelling and should
be replaced if deterioration is detected.
2. Roofs - Deterioration takes place over a 15-25 year cycle.
Interior damage to the structure results if the roof is not
replaced. Look for leakage on interior ceilings and walls
(water spots), signs of roof failure, missing or cupped
shingles, or cracks in roof covering material.
3. Electrical System - The most vulnerable area is wiring that
is homeowner installed. This is frequently done to serve new
fixtures or house additions. A local electrical inspector
can be consulted if you are in doubt as to the safety of any
electrical installation. Be aware of aluminum wiring, frayed
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wires, and outlets that do not work. The presence of any one
of these may be indicative of electrical problems.
4. Foundation - Not every foundation crack is significant. In
older houses settlement cracks can be expected, but if the
cracks are recent or large enough to permit the entry of
water, they may weaken support of the house. This problem
should be corrected. Check for tilting or braces added in
basement, also for wet basements and crawlspaces.
5. Plumbing - Lack of water pressure from faucets, slow emptying
drains, or waste lines that gurgle are definite signs of
trouble. Call in a plumbing expert to check the problem and
recommend any necessary corrective measures. Check the water
heater for venting and overflow. Visually check for water
leaks under sinks and in basements.
Comparable Replacement Dwelling
The term comparable replacement dwelling means a dwelling which
meets the following criteria.
1. Decent, safe, and sanitary, as previously described.
2. Functionally equivalent to the displacement dwelling and
substantially similar with regard to the number of rooms and
area of living space. The replacement dwelling should be
generally similar to the displacement dwelling and be capable
of contributing to a comparable style of living.
3. Located in an area that is not subject to unreasonable
adverse environmental conditions, and not generally less
desirable than the location of the displacement dwelling with
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regard to public utilities and commercial and public
facilities. The replacement dwelling must also be located in
an area that is reasonably accessible to the displaced
person's place of employment.
4. Located on a site that is typical in size for residential
development, containing normal site improvements which
includes customary landscaping. The replacement site need
not include special improvements such as outbuildings,
swimming pools and greenhouses (also referred to as "Major
exterior attributes/appurtenances" which will be discussed
later).
5. Currently available to the displaced person.
6. Within the financial means of the displaced person.
Financial means is defined as follows:
a. Owner-occupant of 180 days or more - a replacement
dwelling is considered to be within the financial means
of an owner-occupant if a comparable DSS replacement
dwelling has been made available and the cost does not
exceed the total amount of the acquisition price of the
displacement dwelling and the replacement housing
payment.
b. Tenant-occupant of 90 days or more or owner-occupant of
90 - 179 days - a replacement rental dwelling is
considered to be within a person's financial means if the
monthly rent plus utilities at the replacement dwelling
does not exceed the monthly rent (fair market rent for
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the owner-occupant) plus utilities at the displacement
dwelling or 30% of his or her income, whichever is less,
plus the amount of the rental assistance payment that the
displaced person is eligible to receive, based on actual
cost, not to exceed the amount computed by the acquiring
agency. The replacement dwelling plus utilities should
be within the means of the tenant and, as affordable, if
not more so, as the displacement dwelling. A good
discussion of the "why" of financial means requirements
is in the preamble of the Regulations published March 2,
1989.
Note that the elements of comparable replacement housing refer to
the specific needs of the displaced persons; financial means,
access to employment, desirability as to access to public and
commercial facilities, etc. This implies a prior determination
of the displaced persons needs and circumstances which can only
be secured by personal contact with each displaced household
early in the process. Most agencies conduct pre-acquisition
interviews as a matter of routine, at which time information is
secured which will be relevant to the search for comparable
housing. It is important to exercise care and patience in
researching the market for comparable housing. Excessive
payments can easily occur by the hasty selection of replacement
properties that are far superior to the properties being
acquired. Conversely, problems can be prevented if the search is
sufficient to find the "best" comparable rather than settling on
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a less than comparable dwelling.
A great deal of judgement is involved in applying the standards
of comparability. The criteria sometimes become subjective in
application and an attitude of reasonableness must prevail. The
following discussion of several items of comparability may
provide some guidance:
1. Functionally equivalent including the number of rooms and
living space. This does not mean that a replacement dwelling
must meet a tape-measure comparison to the acquired property.
The emphasis is on function. The replacement dwelling, when
compared with the acquired dwelling, should perform the same
function, provide the same utility, possess like amenities,
and be capable of contributing to a comparable style of
living. This requires that the principal features of the
acquired dwelling be present in a comparable. Space should
be available for comparable purposes as used in the acquired
dwelling. For example, a workshop in an over-sized garage
instead of a basement and vice versa; ample kitchen cupboards
could substitute for a pantry, and out-of-season storage
could be provided either in an accessible attic or a basement
area. Physical inspection of the interior as well as of the
exterior of selected comparables will clarify for the agent
as well as the displaced person, the actual functional
equivalency of houses.
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2. Available to the displaced person. The agency ordinarily has
no control over the availability of sale or rental housing.
However, displaced persons should only be referred to housing
that has recently been confirmed as being available.
Likewise, in making payment determinations, only active
listings should be utilized. This will require close contact
with sources of housing market information and a willingness
to research the market for currently available housing. If
housing is in short supply, innovative measures may have to
be taken to assure the availability of a comparable when an
offer is made.
3. Adequate to accommodate the displaced person(s). If the
displaced person has special limitations; particularly
relating to health, mobility, or age, the replacement housing
referrals should accommodate those limitations. For
instance, an elderly displaced person with a serious heart
condition may need a one-floor plan or a house with a bath
and bedroom on the first floor. A wheelchair restricted
displaced person would need a unit with ramp access, ample
hallways, and bathroom accessibility. Displaced persons
should not be referred to housing that does not accommodate
these special needs.
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4. The financial means test. It is assumed that owners can
afford replacement housing if they are not required to spend
more per month, based on comparability, toward a mortgage
payment than before acquisition. On the other hand, a tenant
should not have to pay more than 30% of his or her gross
income on rent and utilities. If replacement housing is not
within the financial means of a displaced person, Replacement
Housing of Last Resort may be necessary.
5. Access to employment. This is a critical element in the
choice of replacement housing and the needs of each displaced
person will help determine specific distance limits. A
displaced person who presently walks to work should only be
offered comparable DSS housing within walking distance or
near a bus line reasonably accessible to the place of
employment. Referrals should be made on the same basis. A
displaced person who presently drives 20 miles to work may
not be as restricted to a particular housing area.
Reasonableness and good judgement are important. The
objective should be to refer a displaced person to housing
that does not endanger employment because of increased
distance or travel time. The intent is not necessarily to
keep the travel distance the same, but to be reasonable and
practical. Each displaced person's needs and limitations
regarding travel time and distance to the work site should be
individually determined and understood early in the
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relocation process.
6. Commercial and public facilities. The desirability of
potential replacement housing close to commercial and public
facilities is a case-by-case judgment. It is important to
determine for each displaced family the institutions and
facilities upon which there is a strong dependency. A family
with children would be concerned with schools. An elderly
retired couple without a car would consider it important to
be near a grocery store. Housing choice is usually related
to the location of institutions and facilities used in daily
life. It is an obligation of the displacing agencies to make
housing available that is as desirable as the displacement
dwelling with regard to those places t"hat give essential
support to daily living. This does not mean that the
displaced person's personal desires as to particular schools
or shopping areas have to be compiled with, but a sincere
attempt should be made to acknowledge the displaced person's
preference. Personal tastes, desires, and dislikes will
properly influence a person's choice of housing, however the
agency need not be limited by these personal desires. What
the Agency must consider is the needs and availability.
Personal desires and tastes almost always have to be balanced
and compromised in the selection of replacement housing,
regardless of the reason for seeking a replacement.
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In implementing comparable, and decent, safe, and sanitary
standards for replacement housing, it is important to remember
the overall objective of the program. The objective is fairness
and equity to displaced persons. In carrying out this objective
we are committed to offering every displaced person at least one
replacement dwelling, and, preferably three, that is at least
basically similar to what he or she had before; a dwelling that
is safe to occupy, meets the basic living needs of the person,
and provides for the same or similar life style as enjoyed in the
displacement dwelling.
No discussion concerning replacement housing standards would be
complete without reiterating the need to physically inspect the
exterior and interior of selected conparables if at all possible.
The relocation agent needs to know that the dwelling he or she is
Offering to the displaced person is decent, safe and sanitary and
has amenities comparable to those in the displacement dwelling.
After all, he or she will be "selling" the comparable or
comparables to the displaced person as well as to the Agency for
payment computations. Finally, there is this note of caution;
you may reuse comparables for different displaced persons so long
as they remain available, are comparable, and each person offered
the comparable is given sufficient opportunity to inspect it.
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DECENT SAFE & SANITARY
BASIC
HEALTH & SAFETY
STANDARDS
MEETS ALL LOCAL OCCUPANCY CODES OR AT LEAST:
1) STRUCTURALLY SOUND, WEATHERTIGHT AND IN GOOD REPAIR
2) SAFE AND ADEQUATE ELECTRICAL WIRING
3) HEATING SYSTEM (WHERE CLIMATE CONDITIONS REQUIRE) CAPABLE
OF SUSTAINING APPROXIMATELY 70 DEGREES FAHRENHEIT
4) ADEQUATE IN SIZE AND NUMBER OF ROOMS TO ACCOMMODATE
DISPLACEES
5) BATHROOM, WELL LIGHTED AND VENTILATED, CONTAINING SINK,
TOILET, SHOWER OR BATH, CONNECTED TO WATER AND SEWER,
PROVIDING PRIVACY TO THE USER
6) KITCHEN CONTAINS SINK CONNECTED TO HOT AND COLD WATER AND
DRAINAGE SEWERAGE SYSTEM, AND ADEQUATE SPACE AND UTILITY
CONNECTIONS FOR A STOVE AND REFRIGERATOR
7) CONTAINS UNOBSTRUCTED ACCESS TO SAFE, OPEN SPACE AT GROUND
LEVEL.
8) BARRIER FREE FOR HANDICAPPED DISPLACED PERSONS
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B
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CHAPTER SIX
RESIDENTIAL OWNER - OCCUPANT BENEFITS
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CHAPTER SIX
RESIDENTIAL OWNER - OCCUPANT BENEFITS
The primary benefit available to a displaced residential occupant
is the Replacement Housing Payment. In order to fully discuss
replacement housing payments, an understanding of the terminology
is necessary. Following are definitions of terms used in this
course:
Replacement Housing Payment - This is a general term which
encompasses: Purchase Supplements (including incidental expenses
and mortgage interest differential), Rental Assistance Payments,
and Downpayment Assistance Payments.
Purchase Supplement - A payment, not to exceed $22,500 made to a
homeowner-occupant of 180 days or more. This payment includes:
1. Price Differential, 2. Incidental Expenses and 3. Mortgage
Interest Differential Payment.
1. Price Differential Payment - The difference, if any,
between the amount determined by the acquiring agency as
necessary to purchase a comparable dwelling or the amount
actually paid by the displaced person for a replacement
dwelling, whichever is less; and the amount paid by the
acquiring agency for the displacement dwelling.
2. Incidental Expenses - The sum, if any, of those reasonable
costs actually incurred by the displaced person incident
to the purchase of a replacement dwelling, and customarily
paid by the buyer.
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3. Mortgage Interest Differential Payment - The amount will
compensate the displaced owner-occupant for any increased
interest costs which the he/she is required to pay for
financing the replacement property.
Rental Assistance Payment - A payment, not to exceed $5,250, made
to a residential occupant (tenant or owner-occupant) of 90 days
or more who elects to rent a replacement dwelling. The payment
is equal to 42 times the differences between the monthly rent and
utilities the acquiring agency determines as necessary to rent a
comparable replacement dwelling and utilities, whichever is less.
This is compared to the average monthly rent and utilities paid
by the displaced person for the displaced person for the
displacement dwelling, or the fair market rent determined by the
agency in the case of an owner-occupant who elects to rent.
Utilities - The utilities to be considered for computation
purposes include heat, light, water, and sewer.
Pownpayment Assistance Payment - A payment, not to exceed $5,250
made to a residential tenant of 90 days or more or to a
residential homeowner-occupant of 90-179 days who elects to
purchase a replacement dwelling. The payment is limited to the
amount the displaced person would have received as a rental
assistance payment, however at the Agency's discretion the
eligible displaced tenant or owner who does not meet the 180 day
requirement may receive a downpayment up to $5,250 except for the
90-179 day owner who cannot receive more than he or she would
have received as a 180 day owner occupant.
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General Principles
We must keep one principle in mind for every displaced resident:
The displacing agency must assure that comparable replacement
housing is available. A displaced owner-occupant must be
advised of a comparable DSS dwelling which he or she can buy and
a displaced tenant must be advised of a comparable DSS dwelling
which is available to rent. If a displaced person wishes to
change tenancy status, i.e., the owner has expressed the desire
to rent a replacement, the agency should make a sincere effort to
comply with his or her wishes; however, the project may proceed
if a rental property is currently unavailable.
The stated policy of the Uniform Act is to provide fair and
equitable treatment to persons displaced as a result of programs
designed for the benefit of the public as a whole. Replacement
housing payments should be computed with this in mind. At the
same time, we also have a responsibility to the unaffected
taxpayers. If the purchase or rental of a replacement property
necessarily causes out-of-pocket expenditures the agency must
provide reimbursement in the form of replacement housing
payments, but, only to the extent that the expenditures are
necessary. The relocation program should be operated in
accordance with one of our country's national objectives, that
every person in America live in a decent home and a suitable
living environment.
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Basic Eligibility Retirements
Eligibility for a Replacement Housing Payment is based on the
length of time the displaced person occupied the displacement
property immediately prior to the initiation of negotiations for
the parcel.
In order to be eligible for a Purchase Supplement, the displaced
person must have owned and occupied the displacement property for
180-days or more.
A Downpayment Assistance Payment is available to (1) a homeowner
who has occupied the displacement dwelling for more than 90 days
but less than 180 days, or (2) a tenant who has occupied the
displacement dwelling for 90 days or more. A long-term homeowner
(180 days) is not eligible for this payment.
Rental Assistance Payments are available to all residential
displaced persons who have occupied the displacement dwelling for
at least 90 days immediately prior to the initiation of
negotiations.
Regardless of the type of payment to be claimed, a homeowner
occupant must purchase or rent and occupy decent, safe, and
sanitary replacement dwelling within 1 year after the later of
(1) the date the person receives final payment for the
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displacement dwelling or, in the case of condemnation, the date
the required amount is deposited in the court, or (2) the date
the person is offered replacement housing. A displaced tenant
must rent or purchase and occupy a DSS replacement dwelling
within one year of the date he or she moves from the displacement
dwelling.
Replacement Housing Payments must generally be claimed within 18
months of the applicable above date. Either of the above dates
may be extended by the agency if there exists good cause to do
so, but the payment determination will generally not change.
A displaced person who has occupied a displacement dwelling for
less than 90 days prior to the initiation of negotiations is not
^^ eligible for Replacement Housing Payments under Section 203 or
204 of the Uniform Act. They may be eligible for replacement
housing provided under Section 206(a), Replacement Housing of
Last Resort, providing comparable DSS replacement properties are
not within their financial means and there is an increase in
rent necessitated by the occupancy of a comparable replacement
property.
In some cases it may be desirable to establish a displaced
person's eligibility for relocation payments prior to the
initiation of negotiations. This may be accomplished through the
use of a Notice of Intent to Acquire. When a Notice of Intent to
Acquire has been issued, the displaced person need not be in
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occupancy on the actual date of initiation of negotiations. The
date the displaced person moves becomes the date of initiation of^^
negotiations for computing the occupancy time period.
Computation of Replacement Housing Payments
The first and paramount step in the computation of a Price
Differential Payment is to determine the cost of a decent, safe,
and sanitary comparable replacement dwelling.
The Three Comparable Method
The most effective method for establishing the cost of a DSS
comparable is the Three Comparable Method. This method is
applicable to all types of supplemental payments.
Under the Three Comparable Method, the agency carefully analyzes
the displacement property and the makeup of the displaced
person's family to determine their replacement needs. The real
estate market is then thoroughly searched and analyzed, and the
three most comparable properties are selected, using the
comparable criteria discussed in the chapter on replacement
housing standards. To aid in this real estate market analysis,
many agencies subscribe to local multiple-listing services and/or
maintain close relationships with local real estate brokers.
Subscriptions to local newspapers are also a practical necessity.
After the three most comparable DSS properties have been
selected, an in-depth comparison should be made to select the one
property which, in the opinion of the acquiring agency, is most
comparable to the displacement dwelling.
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In making the analysis, it is strongly recommended that the
agency use a comparable property comparison grid. A sample
comparison grid is in the appendix.
Computation of the Purchase Supplement
The Purchase Supplement is available only to a 180-day owner-
occupant who purchases a decent, safe, and sanitary replacement
property. We learned earlier that the purchase Supplement is
made up of three parts - Price Differential, Incidental Expenses,
and Increased Interest. Our first concern is the Price
Differential:
Using the Three Comparable Method, the agency establishes the
cost of the replacement. The price differential is a simple
subtraction of the acquisition price of the displacement dwelling
from the cost of the most comparable dwelling selected by the
Agency. The result is the maximum price differential to which
the displaced person is entitled. This would be the amount of
the price differential offer.
The philosophy of the supplement program is that the displaced
person must actually experience a cost increase in order to claim
a price differential payment. He or she will be paid the
computed amount of the price differential offer or what is
actually spent for a replacement dwelling, whichever is less.
Let's look at an example of a price differential computation.
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Example 4-2
Cost of Replacement Comparable $50,000
Acquisition Price, Displacement $42.000
Price Differential Offer $ 8,000
The displaced person in this example would receive a Price
Differential offer in the amount of $8,000 but would only
receive this amount if the actual replacement property which he
or she purchased cost $50,000 or more.
The actual price Differential Payment is computed by using the
lesser of (1) the cost of a comparable dwelling or (2) the cost
of the actual replacement property purchased by the displaced
person minus the agency's acquisition price of the displacement
property. If the displaced person does not purchase a
replacement property costing at least as much as the comparable,
he or she will receive a lower payment.
Now let's look at an example of a Price Differential payment when
the displaced 180-day homeowner-occupant actually spends less
than the cost of the comparable dwelling.
Example 4-3
Cost of a Comparable Dwelling $50,000
Acquisition Price, Displacement $42,000
Actual Replacement Cost $48,000
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Payment is the lesser of Computation (A) or fB)
(A) (B)
Cost of Comparable $50,000 Actual Replacement $48,000
Acq. Price, Displ. $42.000 Acq. Price, Displ. $42POOP
Differential $ 8,000 Actual Payment $ 6,000
The Price Differential Payment would be $6,000.
Frequently the displaced person will elect to purchase a
replacement property which costs more than the selected
comparable. In these cases, the Price Differential Payment is
limited to the computed offer, based on the comparable. In
example 4-3, the maximum payment would be $8,000.
When we compute either the Price Differential offer or the actual
payment, circumstances may require that we make adjustments in
establishing either the acquisition price or the cost of the
comparable dwelling. Situations which may require adjustments
are:
Overstated Asking Price - Comparable
Major Exterior Attributes - Displacement
Excess Land - Displacement or Actual Replacement
Mixed-Use - Displacement, Comparable, Actual Replacement
ADJUSTMENTS TO THE ASKING PRICE
Our responsibility is to establish the probable cost of
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comparable replacement housing. It nay therefore be necessary to
make adjustments to the asking prices of the comparables.
1. Price Differential - Adjustments Permitted
The regulations require an adjustment "...to the asking
price of any dwelling if such adjustment is considered
appropriate by the agency, (e.g., local market
conditions)." Thus, the decision as to whether or not an
adjustment should be made rests with the acquiring agency.
If a dwelling is obviously over-priced, it should not be
used as a comparable. If listings in a particular market
are typically listed for more than anticipated or actual
selling price, then adjustments should be made.
Adjustments can be accomplished using the following
techniques, or others, however, adjustments must be made ^r
uniformly by the Agency.
a. Case-By-Case Adjustment - With this technique, the agency
would evaluate the asking prices of the selected
comparables and determine whether or not the asking prices
are indicative of the anticipated selling prices. If a
property is obviously overpriced, it should not be used as
a comparable. However, if a listing has only a slightly
high asking price, the agency can easily adjust the price
to reflect the probable selling price, which can then be
used as the basis for the price differential offer. Such
adjustments should be explained and the file documented
accordingly.
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b. Asking Price — Selling Price Factor — Under 'this
technique, the agency prepares a local market study and
compares asking prices with selling prices of recent sales
in the project area. From the data, the agency develops a
factor or percentage representing the average difference.
The asking prices of such selected comparables are
adjusted using this factor or percentage. This factor
should be updated, whenever necessary and appropriate to
reflect market conditions.
Excellent statistical data which may be used in the
determination of a selling price factor may also be
available form your local Multiple Listing Service. Some
MLS,s list usable statistics in their periodic
publications.
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An example of a local market study follows.
LOCAL MARKET STUDY
SAT.R
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
ASKING PRICE
$53,000
$46,000
$31,900
$58,500
$81,000
$57,500
$55,000
$42,900
$63,500
$69.900
$570,100
SAT/R PRTCE
$50,000
$45,000
$31,000
$58,000
$78,000
$54,000
$55,000
$41,000
$60,000
$65.000
$537,500
The above actual sales prices represent 95 percent of the asking
prices. The asking price of the selected comparables would be
multiplied by .95 to arrive at the adjusted price.
c. Other Adjustment Techniques - Various other innovative
adjustment techniques may be used but, whichever technique
is selected, it should be applied uniformly.
2. Price Differential - Maior exterior Attributes
A basic concept of the supplement program is to compare "apples
to apples." Sometimes a displacement dwelling has a major
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exterior attribute, such as a swimming pool, and no comparable
replacement dwelling can be located which has a swimming pool.
In order to compare "apples to apples", for relocation purposes,
we need to compute the value of the displacement dwelling without
the attribute. This is called a "carve-out." The "carve-out" of
the exterior attribute for relocation purposes has no influence
on the acquisition payment to the displaced person. This process
would negate the agency's responsibility for replacing the item
or participating in any replacement costs.
If the attribute is a truly major item, the contributory value is
probably specified in the appraisal report. Unspecified values
of major items can also be established by consulting with the
appraiser or the agency's review appraiser. The value of the
attribute should be fully documented in the parcel file. This
concept is explained in the following example.
PRICE DIFFERENTIAL
MAJOR EXTERIOR ATTRIBUTE
The displacement dwelling, valued at $75,000, has an inground
swimming pool. No available comparable with a pool can be found;
however; an otherwise comparable property is available for
$73,500.
Carve out Computation (Acquisition Price)
Value of displacement. Including Pool $75,000
Contributory Value of Pool $ 5.000
Value of displacement, minus value of pool $70,000
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Price Differential Computation
Cost of Replacement $73,500
Adjusted Acquisition Price, Displacement $70.000
Price Differential $ 3,500
3. Price Differential - Excess Land
If the displacement dwelling is located on a lot which is
substantially larger than the typical lot in the project area,
an adjustment must be made to the acquisition price for
relocation computations. This adjustment is necessary so that
we can compare similar situations.
As in the previous major exterior attribute computation, we must
determine the value allocated to the excess land. If the excess
land value is itemized in the approved appraisal report, this
would be all of the documentation necessary. If the appraisal
report is silent on this item, the appraisal section must be
requested to supply the contributory value of the excess land
before the purchase price differential can be computed.
This concept is explained in the following example:
PRICE DIFFERENTIAL
EXCESS LAND ADJUSTMENT
The displacement residential property is located on a two acre
site. The appraised fair market value is $65,000. Typical lots
in the area are one acre in size. The appraiser has allocated
$5,000 of the fair market value to the excess land in the
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appraisal report.
Carve-out Computation
Fair Market Value - Displacement $65,000
Excess Land Value $-5.000
Carve-out Value $60,000
Price Differential Computation
Cost of Comparable Replacement dwelling $70,500
Carve-Out Value, Displacement $60.000
Price Differential $10,500
4. Price Differential - Mixed-Use Properties
An adjustment may also be necessary when the displaced person
•uses a portion of the displacement property for other than
residential use. One example would be a "Mom and Pop" store with
living quarters behind or above the store.
An adjustment is necessary in a mixed-use situation because by
law we can supplement only the residential use portion of the
displacement property. Although the price differential payment
could be computed using a similar, mixed-use property, if
available, adjustments would be necessary to both the
displacement property and to the selected comparable properties.
It is much easier to carve-out the residential portion and
compare it to comparable residential units.
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The mixed-use adjustment can be perplexing because the
residential-use value may be quite difficult to establish. For
example, if the subject property is a drug store and the
displaced person and his family occupy an apartment above the
store, in all likelihood, the majority of the fair market value
for the property would be attributable to the commercial portion.
If the market approach were used in establishing the fair market
value, and the comparables had similarly apartments, the
appraisal would shed no light on the value of the residential-use
portion. One answer may be to use the income approach. If the
appraiser has provided the market rent for the store and for the
apartment, the income approach may be used even if it was not
relied upon in the final correlation of value. If the market
rent for the store was shown at $750 per month and the apartment
at $250 per month the apartment would represent 25 percent of the
gross income for the entire property. ($250/$1,000 = 25%). The
appraisal section should be consulted to establish the value of
the residential unit and the file documented with the factors
used in establishing the value.
The same situation occurs when the displaced person owns a duplex
and occupies one of the units. It is necessary to establish the
value of the owner-occupied unit. The agency should seek
comparable duplex properties. However, since we cannot
supplement the investment portion of the property (the portion
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not occupied by the owner), we must base our replacement housing
computation solely on the value of the unit the displaced person
occupies, disregarding that portion of the asking price
attributable to the unit which would be rented to others.
The following are examples for mixed-use property.
PRICE DIFFERENTIAL
MIXED-USE (NONRESIDENTIAL) CARVE~OUT
The displaced person occupies the second floor apartment above a
drug store which he also occupies. The entire property has been
valued at $200,000. The market rent is $750 per month for the
drug store and $250 per month for the apartment.
Carve-out Computations
Fair Market Value - entire property $200,000
Drug Store Portion = $750/$1,000 = 75 % -$150.000
Carve-Out Value Apartment $ 50,000
Price Differential Computation
Asking Price of Comparable Property $ 220,000
Store Portion (Carve-Out Value) $220,000 x 75 % -$ 165.000
Carve-Out Value of Apartment $ 55,000
Asking price for comparable apartment $55,000
Carve-Out Value of Subject Apartment -$50.000
Price Differential $ 5,000
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EXAMPLE 4-7A
Price Differential
Mixed-Use (Residential) Carve-Out
The displaced person occupies one side of a duplex. He rents the
other side to a tenant.
Carve—Out Computations
Carve-Out value of Apartment $50,000
Price Differential Computation
Carve-out value comparable Duplex $58,000
Carve-Out value of subject Apartment $50.000
Price Differential $ 8,000
5. Price Differential — Carve-out of Actual Replacement
We know that a displaced owner-occupant must purchase and occupy
a decent, safe, and sanitary replacement property which sold for
at least as much as the agency's comparable to claim the full
price differential. If a replacement is acquired for less, then
the Price Differential Payment would be reduced accordingly.
There is also another requirement; the replacement must be
residential. Any portion of the actual replacement cost which is
for other than residential use must be disregarded. This
carve-out method will apply if the displaced person purchases
either excess land or a mixed-use property, including a duplex.
In order to avoid problems and misunderstandings, the possibility
of an actual replacement carve-out should be thoroughly discussed
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with the displaced person beforehand.
6. Purchase Supplement Payments - Partial Acquisitions
If the project limits are such that it is not necessary for the
agency to acquire the entire property, a partial acquisition may
be appropriate. Host partial acquisitions do not involve a
displacement; however, this is not always the case. Displacement
may be necessary because of the elimination of access, the
acquisition of a septic system and/or a water well which cannot
be replaced on the remaining property, or the dwelling itself may
fall within the area required for the project.
One formula for computing the price differential portion of a
purchase supplement is: the cost of the comparable replacement
minus the acquisition price of the displacement, equals the price
differential offer. In some partial acquisition cases this can
create a substantial financial windfall.
If the remainder constitutes a buildable lot and the Agency
makes an offer to purchase the remainder, the fair market value
of the remainder attributable to a residential lot may be added
to the acquisition cost of the displacement dwelling, for
computation purposes. If the displacing agency chooses to
operate under this procedure, it should apply it uniformly on all
proj ects.
To illustrate this concept, say the subject property is a lot
125 x 50': Even though only 10 feet is needed from the front of
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the property, the dwelling will be taken. The remainder (125* x
140') is a desirable buildable lot:
Value Before Acquisition $60,000
Value After Acquisition (land only) $12.000
Value of Acquisition $48,000
If the agency makes an offer to purchase the remaining buildable
lot and the owner refuses to sell, the value of the lot ($12,000)
may be added to the acquisition price for price differential
computation purposes (i.e. $48,000 + $12,000).
In the case of an uneconomic remnant, which is not a buildable
lot, the value of such remnant may also be added to the agency's
acquisition price, however if the displaced person refuses to
sell the uneconomic remnant to the agency, the value may not be
used in the computation for replacement housing payments.
7- Owner-Retention of the Displacement Dwelling
If a displaced homeowner-occupant of 180 days or more elects to
retain his dwelling and move it to a site which he already owns
or purchases, the purchase supplement is computed using he
standard three comparable method. The cost of a comparable
replacement dwelling is established, as usual. If the relocated
dwelling becomes the displaced person's replacement property, it
will be necessary to determine the actual cost of the replacement
property.
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For our purposes, the cost of the replacement property is the sum
of:
1. The retention cost of the dwelling (the amount the
displaced person paid the acquiring agency, usually called
"salvage" value.
2. The cost to move the dwelling to its new site.
3. Any costs necessary to restore the dwelling and site to
its condition prior to the move.
4. Any costs necessary to correct decent, safe, and sanitary
deficiencies.
5. The cost of the replacement site, not to exceed the cost
of an available suitable replacement site.
Certain limitations must be considered. First, the costs for
moving, restoring, improving to DSS condition etc., must all be
actual and reasonable costs. Care should be taken that extra
items are not included in the restoration total, such as for
finishing the basement when the original dwelling did not enjoy
this feature.
If the displaced person is relocating the dwelling onto the
remainder, or to a residential lot which he or she has previously
owned, the applicable land cost would be the current fair market
value.
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In owner-retention situations, no replacement housing payment can
be made unless the total replacement housing costs such as lot
cost, moving, and restoration exceeds the amount the agency paid
for the displacement property.
To illustrate this concept, review the following example:
Cost of Comparable Replacement $42,000
Agency Acquisition Price -$35,OOP
Maximum Price Differential $ 7,000
Actual cost of Replacement Property
Retention Value $ 3,000
Moving cost $10,000
Restoration Costs $15,000
Lot Price $10,000
Total $38,000
Payment Computation:
Actual Replacement Cost $38,000
Agency Acquisition Price $35.OOP
Price Differential $ 3,000
In this example, if the actual replacement cost had totaled
$35,000, no price differential could be paid, other than closing
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costs and increased interest costs, if applicable. If the actual
replacement cost had exceed the agency's cost of comparable
replacement, (42,000) the maximum computed purchase differential
of $7,000 would be paid, plus closing costs and increased
interest costs if applicable.
8. Multiple Ownership
When the displacement dwelling is owned by several persons not
all of whom occupy the property, special purchase supplement
procedures are necessary.
If the supplement was computed using as the acquisition price
only the occupant's share of the agency's entire acquisition
price, we would in effect provide a substantial windfall to the
occupant. He/she would become a total owner of a comparable
property, instead of being only a partial owner as before the
acquisition.
The agency should compute the price differential in the usual
manner by establishing the cost of a comparable replacement and
deducting the entire acquisition price. This establishes the
maximum price differential which can be claimed. In order for
the displaced occupant who has partial ownership to claim the
offered price differential, he/she must purchase a DSS property
costing at least as much as his/her share of the acquired
dwelling plus the computed price differential payment.
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Let's look at an example:
The displaced person owns a one-fourth share of a property of
which he/she is the sole occupant. The acquisiton price is
$60,000 and the agency has determined that it will cost $68,000
to replace the property.
Computaiton of Price Differential Offer
Cost of comparable replacement $68,000
Total Acquisition Price $60.000
.Maximum Price Differential $ 8,000
The displaced person can claim the offered $ 8,000 Price
Differential only if he/she purchases a DSS replacement property
costing a least $23,000.
Computation of Partial Owner's Offer
Share of Acquisition Price($60,000/4) $15,000
Plus Price Differential S 8.000
$23,000
If the actual replacement property costs less than $23,000, the
Price Differential would be reduced accordingly. If the partial
owner-occupant cannot secure the necessary financing, he/she may
be relocated as a tenant and receive a rental assistance payment.
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Incidental Expense Payments
Incidental expenses are those reasonable costs actually incurred
by the displaced person incidental to the purchase of a
replacement dwelling, and customarily paid by the buyer. These
expenses are paid as part of either a Purchase Supplement or a
Downpayment Assistance payment and are subject to the statutory
limits of $22,500 and $5,250 respectively.
Eligible incidental expenses include:
(1) Legal, closing, and related costs, including those for title
search preparing conveyance instruments, notary fees,
preparing surveys and plats, and recording fees.
(2) Lender, FHWA, of VA appraisal and loan application fees.
(3) FHA Mortgage Insurance Fees.
(4) Loan origination or assumption fees that do not represent
prepaid interest (limited to amount necessary or balance of
existing mortgage for homeowners).
(5) Certification of structural soundness and termite
inspection when required.
(6) Credit report.
(7) Owner's and mortgagee's evidence or assurance of title,
e.g., title insurance not to exceed the costs for a
comparable replacement dwelling.
(8) Escrow agent's fee.
(9) State revenue or documentary stamps, sales or transfer
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taxes. (Not to exceed the costs for a comparable
replacement dwelling).
(10) Such other costs as the Agency determines to be incidental
to the purchase.
Mortgage Interest Differential Payment
Increased mortgage interest payments may be paid as part of a
Purchase Supplement. This benefit is available only to an
owner-occupant of 180 days or more. The payment is made to
compensate the displaced person for additional costs which are
experienced because the mortgage rate on the actual replacement
dwelling is greater than that of the displacement dwelling. The
existing mortgage must be bonafide and valid lien for at least
qualifying mortgage can be considered.
The payment computation is based on the unpaid balance of the
existing mortgage on the displacement dwelling and its remaining
term, and the current prevailing interest rate charged by lending
institutions in the area of the replacement dwelling. If there
is more than one mortgage outstanding on the displacement
dwelling, a separate computation will be required for each
mortgage.
Addition information and the Computation for the Mortgage
Interest Differential Payment can be found in the Appendix.
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If you are going to compute many increased mortgage interest
payments, it may be wise to acguire a financial calculator. A
financial calculator is an invaluable asset in computing or
reviewing increased interest payments. The usual payment can be
computed simply.
Decent. Safe, and Sanitary Inspection
Before any type of supplemental payment can be made, the claimant
must purchase (or rent) and occupy a decent, safe and sanitary
replacement dwelling. The agency must also inspect the dwelling
unit, using the criteria discussed in the chapter on Replacement
Housing Standards.
In order to avoid problems, the agency should caution displaced
persons not to become financially obligated to purchase (or rent)
a replacement dwelling unit until the inspection has been
performed. Often sales agreements are written subject to the DSS
inspecition by the displacing agency.
The agency's records should contain documentation of the DSS
inspection. Most agencies have developed and use a form for this
purpose.
If the dwelling cannot be certified as DSS, the displaced person
should be informed of the specific deficiencies noted. The cost
to correct DSS deficiencies may sometimes be included as a part
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of the price differential payment. When reviewing these
receipted bills, care should be taken that the cost of repairs or*
improvements which are not necessary to correct specific DSS
deficiencies are included in the replacement cost. For Example,
if the inspection revealed the need for only a minor furnace
repair, we would not be justified in allowing the cost of a new
furnace.
Occupancy Eligibility - Special Circumstances
Projects necessitated by disasters, emergencies, or an imminent
threat to the public health or welfare may require special
considerations regarding the required occupancy period prior to
the initiation of negotiations.
For example, if a flood severely damaged a bridge to the extent
that it needed to be replaced and the plans for the revised
structure necessitated the acquisition of several dwellings near
the bridge approach, it may be that the same flood caused the
owners of those dwellings to vacate their homes. If so, they
may not be in physical occupancy of their dwellings as of the
date of initiation of negotiations to acquire the property.
No person shall be denied eligibility for a replacement housing
payment solely because he or she is unable to meet the occupancy
regulations due to a disaster, an emergency, or an imminent
threat to the public health or welfare, as determined by the
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President or the Federal agency funding the project.
Disaster-Related Insurance Proceeds
To the extent necessary to avoid duplicate compensation, the
amount of any insurance proceeds received by a person in
connection with a disaster related loss to the displacement
dwelling shall be included in the acquisition cost of the
displacement dwelling when computing the price differential.
Delay in Occupancy of Replacement Dwelling
Circumstances sometimes arise which make it impossible for the
displaced person to occupy the replacement dwelling within the 1-
year occupancy period. If the delay was caused by reasons beyond
the displaced person's control, as determined by the agency, the
occupancy requirement can be considered to be satisfied.
Conversion of Payment
A displaced person who initially rents a replacement dwelling and
claims and receives a rental assistance payment retains
eligibility for a Purchase Supplement or Downpayment Assistance
Payment, if applicable, provided he/she purchase and occupies a
DSS replacement dwelling during the 1-year eligibility period.
The Purchase Supplement or Downpayment Assistance Payment shall
be reduced by the amount of the rental assistance payment already
received.
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Payment after death.
A replacement housing payment is personal to the displaced person
and upon his or her death the undisbursed portion of any such
payment shall not be paid to the heirs or assigns, except:
1. The amount attributable to the displaced person's period of
actual occupancy of the replacement housing shall be paid.
2. The full payment should be disbursed in any case in which a
member of a displaced family dies and the other family
member(s) continue to occupy the replacement dwelling
selected in accordance with these regulations.
3. Any portion of a replacement housing payment necessary to
satisfy the legal obligation of an estate in connection
with the selection of a replacement dwelling by or on
behalf of a deceased person shall be disbursed to the
estate.
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CHAPTER SEVEN
RESIDENTIAL TENANT AND 90-179
DAY OWNER - OCCUPANTS BENEFITS
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CHAPTER SEVEN
Residential Tenant and 90-179 Day
Owner-Occupants Benefits
Tenants receive replacement housing benefits just as do owner-
occupants of 180 days. However, tenants of 90 days or more and
owner-occupants of 90-179 days receive benefits that are related
to the short-term or less stable occupancy that they are
considered to have. The replacement housing benefits are
computed for a term of 42 months and the upper limit is $5,250.
This computation carries with it several built-in assumptions
such as, tenants will be in a position to pay the higher rents in
3-1/2 years, and tenants do not stay in one dwelling as long as
owners. . These assumptions should be ignored and tenants should
also be assisted in finding replacement housing with the same
care, concern, and courtesy that is provided to owner-occupants.
Relocation agents should be particularly aware of and concerned
with the tenants that do not fit these assumptions and assist
them in locating housing that will continue to be affordable. In
any case, advisory services are particularly important for
tenants.
Rental Asssistance Payments
Rental assistance payments must be computed for all tenants and
short-term owners, regardless of their desire to purchase
replacement housing. The computed rental assistance payment
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determines whether the displaced person will be assisted and paid
under these benefits or Replacement Housing of Last Resort. It
is not necessary to compute a downpayment for any tenant or
short-term (90-179 day) owner (note special requirements for
short-term owner).
For a short-term owner the rental assistance payment is computed
using the same procedures as the computations for a replacement
housing payment for 180 day owners. Three comparables are
compared to determine the cost of a replacement rental unit that
is DSS and comparable to the acquired dwelling.
After the rental price of the available property most nearly
comparable to the displacement dwelling unit is established, the
computation is completed using the following formula:
Monthly rent of comparable replacement plus
utilities x 42 months minus the
Average monthly rent of displacement dwelling plus
utilities x 42 months equals the maximum rental
assistance payment, not to exceed $5,250.
If $5,250 is exceeded, replacement housing of last resort must
be used. The above formula calls for "average monthly rent" and,
under most circumstances, this would be used; however, there are
some instances when "market rent" should be used as the probable
rent that the property would normally command in the local rental
market. In all instances, the cost of utilities must be added to
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the rent of the displacement dwelling as well as to the rent of
the replacement dwellings when computing the rental assistance
payment. Market rent should be used in the case of an eligible
displaced homeowner occupant who elects to rent, rather than
purchase, a replacement property. Occasionally, a tenant will
enjoy a rental at less than market rent. It is the displacing
agencies responsibility to determine why the property is renting
for less than market rent.
If the property rents for less than market rent because the
tenant performs a service for the landlord, such as making minor
repairs and collecting rents from the other tenants, the market
rent amount may be used in the- computation unless there are other
extenuating circumstances. This assumes that the value of the
service performed is equal to the difference between contract
rent and market rent. If the contract rent is less because the
displaced person is a long term or good tenant, equity would
declare that the contract rent be used.
If the tenant is a low-income tenant who is paying more than 30%
of his or her gross income for rent and utilities, then the
amount equal to 30% of gross income must be used as the base rent
for the acquired displacement dwelling.
Let's follow a Rental Assistance Payment computation example:
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Rental Assistance Payment
Contract Rent $250/month + utilities $100/month
Market Rent $250/month + utilities $100/month
Rent of comparable replacement - $300/month •*• utilities
$100/month
$400 - 350 = $50 x 42 = $2100
This displaced person could claim the computed $2100 if the
actual replacement rental was $300 or more per month. If the
replacement rent was less, say $280 per month, the payment would
be reduced as follows:
$380 - 350 = $30 X 42 = $1260
The actual payment is computed using the lesser of (1) the rent
of the comparable replacement or (2) the actual replacement rent,
minus the contract (or market or 30% of income if applicable)
rent times 42 for the 42 month rent supplement period. These
computations include utilities.
Rental Assistance Payment - Utility Adjustment
Since utilities are considered to be a necessary cost of housing
and the regulations require that housing costs not exceed 30% of
a tenants' gross income, utility costs will have to be computed.
The utility services to be considered are heat, light, water, and
sewer. Heat may be furnished by gas, electricity, oil, or hot
water; the particular utility source is not that important. Some
of the utility services may be provided for as a part of the
monthly rental payments for either the acquired dwelling, the
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replacement comparable, or the actual replacement housing
occupied. This is an important factor. The purpose of the
payment computation is to assure that the rental assistance
payment be based on the actual cost of occupying the acquired
dwelling as compared to the anticipated cost of occupying a
replacement dwelling.
The first step is to determine the monthly rent and the actual
utility costs for the acquired dwelling. The second step would
be to determine whether these combined costs exceeded 30% of the
displaced person's income. The monthly rent may include some
utility costs. The tenant should either have receipts for the
balance of the utility costs or give written permission for this
information to be obtained from the utility companies. The costs
should be secured for a year and an average of the 12 months cost
used for payment computation purposes. If the combined rent and
utility costs exceed 30% of the tenant's gross income averaged
over a year, then the 30% figure should be used as the housing
cost of the acquired dwelling. If the combined rent and
utilities do not exceed 30% of the displaced person's income,
then the combined costs of rent and utilities for the acquired
dwelling become the base figure for computing the rental
assistance payment.
The cost of utilities for the selected comparable dwelling must
also be computed if they are not already included in the rent.
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The local utility companies will have to be contacted to
establish either the actual record of utility costs for the
dwelling or the average utility costs for similar dwellings.
Most utility companies will be cooperative in providing this type
of information if given sufficient time to research their records.
A comparison would look like this:
Displacement Comparable
Rent $250 " $350
Sewer included included
Water included included
Lights $ 65 (includes heat) 30
Heat - included
$315 $380
In this case, the Rental Assistance Payment offer would be:
Cost of comparable dwelling $380
Cost of acquired dwelling $315 (does not exceed 30%
of income)
Rental Assistance Payment (1 mo) $ 65 x 42 months = $2760
The displaced person would receive an offer in the amount of
$2760.
If the displaced person rents a replacement dwelling for $380 or
more, including utilities, the $2760 payment could be made. If
the replacement dwelling rents for less than $380 per month,
including utilities, the payment would be reduced to the actual
increased costs of the replacement dwelling.
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If the displaced person's gross income was $1000 per month, 30%
of his income would be $300. Then, the computed payment would be
$80 x 42 months or $3360.
Disbursement of Rental Assistance Payments
Usually Rental Assistance Payments are made in a lump-sum amount.
Occasionally, the agency may, on a case-by-case basis determine
that there is good cause for the payment to be made in
installments. The agency makes this determination. However, the
total amount of the payment vests to the displaced person when he
occupies a DSS dwelling.
Downpayment Assistance Payment
A tenant of 90 or more days or a 90-179 day owner-occupant is
eligible for downpayment assistance. A 180-day owner-occupant is
not eligible for downpayment assistance.
The payment cannot exceed $5,250 or the computed rental
assistance payment in accordance with the procedures adopted by
the displacing agency. After a displacing agency decides whether
to use the computed rental assistance payment or $5250, the same
procedure must be applied uniformly to all displaced persons.
Eligible expenses include the required downpayment and all
incidental costs necessary for purchase. The items of
incidental costs are the same as those used for homeowners.
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It is not necessary to locate comparables for tenants to
purchase. The only agency obligation is to compute and advise
the tenant resident of the rental assistance payment. If the
tenant elects to purchase, the agency shall assure that the
purchased replacement dwelling is decent, safe, and sanitary and
suitable in size and utility for the displaced person(s). The
agency shall participate in the required downpayment and
incidental expenses up to a maximum of $5,250.
Downpayment assistance for a 90-179 day owner-occupant requires
an additional step to establish payment eligibility and
limitations. The downpayment assistance payment cannot exceed
the amount that would have been received under the replacement
housing payment computation for a 180-day owner. Therefore, a
replacement housing payment must be computed as if for a 180 day
owner-occupant. The computed amount would include a price
differential for a DSS comparable replacement, estimated
incidental costs, and an interest differential payment, if
appropriate. The maximum available downpayment to a 90-179 day
owner-occupant would be the lesser of: the computed replacement
housing payment, $5,250, or the rental assistance payment if
agency procedures so require.
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CHAPTER EIGHT
RESIDENTIAL BENEFITS
RESIDENTIAL MOVES
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CHAPTER EIGHT
RESIDENTIAL BENEFITS
RESIDENTIAL MOVES
All displaced persons, residential, business, and farm, are
entitled to be reimbursed for the actual and reasonable cost of
moving personal property from the acquired property. The Uniform
Act provides a wide range of reimbursement options, and for this
reason residential and business/farm moves will be discussed
separately. The following procedures are for tenant as well as
owner-occupied properties.
Residential Moves
Household moves are a common occurrence in our mobile society and
are regarded as routine events. Indeed, a family moving to a
larger or better house may reflect business success or a
promotion, and the prospect of better schools and more
conveniences. The family moving to a new town or city is
frequently following a new job opportunity and the tensions and
inconveniences of moving are offset by the prospects of improved
social or economic status. However, this is not the case when
the move is caused by a public project. The move is involuntary;
it is imposed by a Government agency. It is not related to
family needs, nor is it a signal of job success. It is often a
very stressful and emotional experience. Fear, helplessness,
hostility, and anger are some of the feelings that may surface as
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the result of a forced move. The negative reaction can be more
intense when those displaced are in some way more vulnerable or
dependent upon neighborhood ties. This may be the case
especially when the displaced persons are elderly or handicapped.
Also those who have fewer housing options, may be particularly
resentful of forced relocation.
The above conditions should encourage relocation agents to be
more sensitive and patient when working with persons displaced
from their residences. The advisory services discussed in
Chapter 2 can help to alleviate some of the anxiety caused by
forced displacement. The positive aspects of moving should be
emphasized. There are also specific actions which can be taken
to facilitate the actual move of a household, such as:
1. Providing a list of local commercial movers prescreened for
reliability and reasonable costs.
2. Preparing lists of local move-it-yourself truck and trailer
rental companies and self-storage services, plus the current
rates for their services.
3. Being readily available to explain agency regulations, the
claim process, and payment procedures.
4. Making a telephone call or personal visit to the family a day
or so prior to the move to confirm moving plans and learn of
any problems.
5. Always being willing to listen. Even if you feel the problem
is beyond your control or the complaint is irrational; it is
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very real to the displaced person. It can be helpful to
listen attentively without being argumentative.
6. Actively help elderly and handicapped displaced persons with
assistance in conducting the move. Referrals to church
associations, social services organizations, and notifying
other family members of the pending move may also be helpful.
7. Providing other materials to assist in planning and preparing
for a move. (See samples in Appendix).
RESIDENTIAL MOVING OPTIONS
The displaced person(s) has a choice of being reimbursed on an
actual cost basis for moving costs actually incurred or a fixed
schedule. These are explained in detail below:
Actual Cost Moves
Actual cost reimbursement, as the name implies, is a payment for
the actual direct expenses incurred by the family in conducting
the move. The move may be performed by a commercial mover or it
may be a self-move. Payment will be made on the basis of
receipted bills for costs incurred. Actual costs may include any
of the following:
1. Transportation of the displaced person and personal property
up to 50 miles, unless the Agency determines that relocation
beyond 50 miles is justified.
2. Payment to a commercial mover for completing all or part of
the move.
3. Or, if a self-move, rental vehicles or equipment such as
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trucks, pads, dollies, etc.
4. Packing, crating, uncrating, and unpacking of personal
property.
5. Payment for the storage of personal property not to exceed 12
months if justified unless the agency determines that a
longer period is necessary.
6. Insurance premiums to cover the value of personal property
for damage or loss during the move or during necessary
storage.
7. Replacement value of personal property lost, stolen, or
damaged under certain circumstances when insurance is not
reasonably available.
8. Compensation paid to persons employed to help conduct the
move.
9. Special services, such as an ambulance to transfer persons
who are physically handicapped.
10. Payments to service personnel to reinstall household
appliances and equipment, such as a washer, dryer, telephone,
etc.
The total amount of reimbursement under the actual cost option is
limited only by costs actually incurred that are necessary and
reasonable for the move. The agency should use good judgment and
common sense in determining necessity and reasonableness. The
reasons for the determinations should be provided to the
displaced persons before they incur costs or expend time.
Guidelines for recordkeeping should be made available.
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Questionable items or amounts should be challenged. For example,
charges for packing should be related to the amount of property
that requires packing. The hourly rate charged in an actual cost
situation should not exceed the amount charged by local moving
firms. It may be helpful to advise the displaced persons of the
appropriate hourly rates to be used. One way of setting these
figures may be to use the rate paid to unskilled packers and
movers of local moving firms. If questionable costs are
submitted, the displaced person should be given an opportunity to
provide explanation. Also, displaced persons should be advised
of the appeal process provided by the agency and how decisions
adverse to him or her can be reconsidered.
Moving Cost Schedules
The moving cost schedule method for payment provides the
opportunity for the displaced family to be paid a fixed allowance
in place of actual costs incurred. This method is
administratively simple, since it minimizes recordkeeping and
paperwork for the displaced person and the agency. There are two
schedules, one pertains to dwelling units where the displaced
person owns the personal property to be moved, and the other
pertains to cases where the displaced person does not own the
personal property. Payment under each schedule is based upon a
room count of the number of rooms occupied.
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The advantage of the moving cost schedule for both the agency and
the displaced person is that it minimizes red tape. It is clear,
simple, and easy to administer.
Displaced persons can know in advance the amount that will be
paid for the move and they can plan accordingly. If the move
costs less than the schedule provides, the displaced person is
money ahead. The schedule reimbursement method is often used by
those who plan to move themselves or with the help of friends.
The money saved can be used for any other purpose.
SPECIAL SITUATIONS
The administration of the residential moving reimbursement
process is simple in most cases but variations can and do occur.
Most are due to the variety in living and room arrangements and
unpredictable personal circumstances that occur. A few of the
more typical situations are discussed below:
1. The Split Move
Residents in a unit may decide to move to separate locations.
If the separate move is voluntary, the total reimbursement
should not be more than would have been incurred had a single
move occurred. If a separate move is necessary because a
comparable unit is not available, the agency should then
reimburse fully for both moves.
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2. What constitutes a room?
We know that the moving cost schedule is based on room count,
but is a combination living room - dining room, one room or
two? Do basements or an attic, where items are stored,
constitute rooms? It is lead agency policy that the term
"room" should be interpreted liberally. Any differentiated
area could constitute a room for schedule move purposes,
including a basement or storage room. The living room -
dining room combination could be two rooms, since it is used
for two living functions. If an area, such as an attic,
contains a sufficient amount of personal property, it can be
counted as a room. The determination is a matter of good
judgment on the part of the relocation agent.
3. What about property stored on the site outside of buildings?
Can this be included in the scheduled move?
The schedule is intended to reimburse the displaced person
for moving personal property located within the dwelling,
garage or storage area which relates to the residential
occupancy of the property. On occasion a displaced person
may have substantial property stored outside or used for a
hobby (e.g. woodworking shop) for which an actual cost move
could be paid in addition to the payment under the schedule
for household effects.
4. What documentation is required to support an actual cost self
move claim?
The minimum documentation needed to support an actual cost
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move claim includes receipts for all labor, materials and
services purchased, a record of the dates, number of hours
worked and work performed by family members or others, and
mileage records. The agency should develop a form or format
for the support documentation. The form should be provided
to the displaced person when he or she indicates that he
plans to make an actual cost move. The agency should advise
the displaced person of the hourly rate which can be used and
that no extraordinary costs should be incurred, such as for
storage, without the prior approval of the agency.
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CHAPTER NINE
REPLACEMENT HOUSING OF LAST RESORT
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CHAPTER NINE
Replacement Housing of Last Resort
The Replacement Housing of Last Resort (HLR) provision of the
Uniform Act was designed to assure that comparable DSS
replacement housing could be made available to a displaced person
when such housing could not otherwise be provided within the
person's financial means. State highway agencies have used HLR
since the early 1970s, primarily by making "super payments" that
exceeded the statutory limits for the payments to owners and
tenants for replacement housing. Many other agencies, both
Federal and federally funded, did not recognize a need for making
payments in excess of the statutory limits and did not do so.
With the issuance of the governmentwide common rule in 1986, HLR
provisions became a part of the regulations for these agencies.
In the 1987 amendments to the law, Congress at once strengthened
the HLR provisions and required justification on a case-by-case
basis. The law states in Section 206(a) "...The head of the
displacing agency may take such action as is necessary or
appropriate to provide such dwelling by use of funds authorized
for such project ...and may use this section to exceed the
maximum amounts which may be paid...on a case-by-case basis for
good cause...
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The requirements and methods for HLR are in the regulations
published March 2, 1989. Since HLR is only necessary when
sufficient comparable replacement housing is not available,
increases in project costs or time may occur. It is important
that the agency develop a plan for making such housing available
early in the project planning process. Relocation planning for
most projects should be designed to identify the needs for HLR.
Particular concern should be for large families, people who are
elderly or handicapped, tight or volatile housing markets,
large, older dwellings or a large number of substandard dwellings
within the project area and similar situations. If it is
determined that there is little, if any comparable replacement
housing available to displaced persons of an entire program or
project, justification for the use of the Replacement Housing of
Last Resort should be prepared for the entire project or program.
If it is determined that there are particular displaced persons
who may need Replacement Housing of Last Resort, then
justification should be prepared for those displaced persons.
The method selected for providing housing of last resort should
be cost effective when all the elements that contribute to total
program or project costs are considered.
Agencies have broad latitude in how comparable replacement
housing will be provided for a reasonable cost when it is not
otherwise available.
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There are three (3) main characteristics that distinguish
Replacement Housing of Last Resort from the regular provisions
for replacement housing:
1. Methods - HLR enables the agency to take direct action in
the housing market; construct new houses, construct
additions to existing houses, rehabilitate existing
houses, work out special financing arrangements, etc. In
contrast, the regular relocation program is limited to
referral to existing housing units available on the
market. HLR authority permits the use of any method
which is otherwise legal under State law, and which will
resolve the housing problem in a cost effective manner.
2. Monetary Limits - There are no -prescribed monetary
limits to the amount of funds that can be used to
undertake HLR. The normal program benefit limits of
$22,500 for owners and $5,250 for tenants do not apply.
HLR is also available to occupants of less than 90 days
or any person legally in occupancy on a parcel on the
date of acquisition. The monetary limits are based on
the availability of a DSS comparable in the market,
affordable to the person, that does not exceed 30% of his
or her income or is the same price as the acquired
dwelling, whichever is greater. Once HLR is triggered,
the agency may spend whatever is necessary to provide the
needed housing. This does not mean, however, that HLR
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will cost more than a regular relocation, or that the
agency is not constrained by the overall need to conserve
public funds in the operation of its program. The agency
should always look at a variety of options before it
decides to make a super "super payment" or involve itself
in a costly time consuming project.
3. Administrative Procedures - The use of HLR is outside the
scope of regular relocation activity and requires a
special determination of need for its use. The process
is usually quite simple. When the acquiring agency makes
the determination that there is a reasonable likelihood
that the project cannot be advanced to construction and
completion in a timely manner because no comparable
replacement dwelling(s) will be available to person(s) to
be displaced, the agency may on a case-by-case basis, for
good cause, be authorized to take additional measures to
provide the necessary housing. If there is a general lack
of availability of replacement dwellings for project or
program displaced persons, the "good cause" can be for the
program or project instead of for individual cases.
Scope of Housing of Last Resort
HLR is used more frequently to resolve replacement housing
problems when there is a unique housing need or when the cost of
available comparable housing would result in payments in excess
of the statutory payment limits ($5,250 or $22,500).
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There have been few projects that have necessitated large scale
construction of new homes.
High replacement housing costs have occurred more frequently in
recent years. In 1971, when the Uniform Act was enacted, the
average cost of a single family residence was approximately
$27,000. In 1984, the average cost had increased to over
$75,000. The statutory payment limits, unchanged until 1987,
were sufficient to rehouse almost all displaced persons in the
early 1970s, but became increasingly inadequate in recent years.
The authority provided by HLR is used to make higher payments
when needed by displaced persons to purchase or rent comparable
housing. As of September 1988, almost $112 million had been
committed to HLR in the Federally-assisted highway program.
Conditions Requiring Housing of Last Resort
HLR is necessitated by two broad classes of circumstances:
(A) Displaced persons with needs for specialized or unusual
housing that are not readily found in the local housing
market; and
(B) A community with housing shortages and competing demands
for housing that drive up the prices and limit the supply
available to displaced persons. The very open ended
nature of HLR makes it impossible to provide an exhaustive
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detailed list of conditions for its use. One way to
illustrate how the program may be used is to consider the
wide range of justifications for actual cases. The
following list summarizes some of those basic situations
or circumstances which may also require the use of HLR:
— Acquired dwelling has 5 bedrooms. No comparable
available on market within regular payment limits.
Large family size; few large dwellings (4-5 BR)
available on the market.
— Acquired dwelling is in area that has limited
properties available for sale.
Acquired dwelling is in area with rapidly escalating
prices; comparable dwellings within regular payments
limits are no longer available.
Low-income family paying modest rent for a
substandard unit.
Displaced person who is wheelchair dependent needs a
house that can accommodate a wheelchair - wide doors
and special kitchen/bath fittings.
Elderly alcoholic man, displaced from a small shed
with no heat or utilities for which he paid no rent,
with limited income from Social Security.
Emergency room nurse who needs to be within 15
minutes of the hospital as a condition of
employment. No comparable dwelling is available
within the critical radius and her financial means.
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— Family that needs an isolated yard to accommodate
the needs of their emotionally disturbed child.
None is available within regular benefit limits.
Family with a bad reputation in a small community
(fights, drunkenness, trash on premises) that could
not find a landlord willing to rent to them.
Elderly widow who is dependent on a son living
nearby for care and living needs. The only
available apartment was priced too high for regular
payment limits.
Tenant occupant of less than 90 days who is unable
to afford replacement housing (cost of all available
housing exceeded thirty percent of his income).
The following generalizations can be made about the use of HLR
from the above list:
1. Personal circumstances (age, health, etc.) influence the
need for HLR.
2. The use of HLR cuts across economic lines. The program is
not used exclusively for displaced persons with low-
incomes .
3. The use of HLR often involves a single case on a project.
Where more than one case occurs on a project, they are
generally due to unrelated circumstances.
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Methods Used to Provide Housing
Innovative methods and broad latitude in the choice of methods
are encouraged in the implementation of HLR. This program is
intended to respond to unique and unusual housing needs, and in
many cases the best solution may be the one that does not fit a
common mold. The methods of providing HLR include but are not
limited to:
a. Rehabilitation of and/or additions to an existing
replacement dwelling.
Rehabilitation. The agency may purchase an existing
house and add a bedroom or make any repairs necessary to
bring the house up to DSS standards. The agency may also
remove barriers to the handicapped and construct special
physical structures such as wheelchair ramps. The house
may then be rented or sold to the displaced person.
b. New construction.
The agency may contract for the construction of new
housing to be rented or sold to displaced persons for
amounts within their financial means.
c. The provision of a direct loan or the use of other
financial techniques.
This includes a wide range of financing instruments to
assist a displaced person with the purchase of an
existing dwelling. Some of these methods are as follows:
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1. Mortgage Assistance. A mortgage may be secured by
the displaced person and the agency may pay a
monthly amount to the mortgage holder to make up the
difference between the normal P&I payment and the
monthly payment the displaced person can afford.
2. Mortgage Origination. The agency may take back a
mortgage from the displaced person at an interest
rate and terms the displaced person can afford. The
loan may bear interest or it may be interest free,
depending upon the circumstances and the policies of
the agency.
3. Downpayment Assistance. The agency may contribute
an amount toward the purchase price of a dwelling
that will enable the remainder to be financed at a
payment the displaced person can afford.
4. Annuity. The agency may negotiate with a financial
institution such as a bank or an insurance company to
deposit an amount which will generate a monthly
payment by the institution to subsidize the rent or
mortgage payment of a displacee.
d. Payments in excess of the statutory limits.
Better known as "super payments". Payments in excess of
the statutory limits of $22,500 and $5,250 may be made in
lump sum or installment payments.
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e. The relocation and, if necessary, rehabilitation of a
dwelling.
f. Purchase of Existing Housing.
The agency may purchase an existing dwelling which is to
be rented or sold to the displaced person.
g. Removal of barriers to the handicapped.
There are innumerable variations and combinations of
techniques and methods that can be used to provide
housing. HLR should be considered a useful
administrative tool which can free the process of
providing replacement housing from the regular procedural
constraints. It is a tool that invites innovation and
creativity in solving unique or difficult replacement
housing problems.
Housing of Last Resort Practices
The efficient cost effective use of HLR requires the exercise of
sound business practices. The following paragraphs describe
various practices and procedures which should be considered when
utilizing HLR.
1. The funds that the agency authorizes for HLR is to provide
housing for a displaced person. HLR is a program
characterized by extraordinary funding justified by a need
for decent, safe, and sanitary comparable housing. The
opportunity for diversion of funds to anything other than
housing should be minimized, if feasible.
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2. If possible, contact the displaced persons after they
move. If the agency subsidizes the rent as a HLR method,
an escrow account may be established, payable on a
periodic basis to the displaced person, jointly to the
displaced person and the landlord, or to some other
appropriate person, as agreed to by the displaced person.
Such accounts should only be established with the full
knowledge of the displaced person and his or her
concurrence that this is the most appropriate method to
assure housing availability. Do not set up accounts to be
paid to landlords or other persons without their written
agreement to continue to provide the selected housing,
maintained in accordance with DSS standards, for the
displaced person for the entire 42 months. In the event
of changes, the escrow agent should be instructed to
promptly notify the agency if the displaced person moves
or the dwelling can no longer be made available. Since
the full amount of the HLR rental subsidy vested with the
displaced person when he or she occupied DSS replacement
housing, the remainder can be paid to him or her or the
agency can assist in locating other housing.
The following story is an example of why visits and
follow-ups can be most important. One relocation office
established a trust account at a local bank for the
routine issuance of monthly rent subsidy payments to the
landlord. The house was advertised for sale several weeks
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later without notice to the bank or the Agency.
The subsidy payments would have continued to the owner
after the sale if the Agency had not made a periodic post
move visit and observed that the house was for sale and
the tenant scheduled for eviction.
3. Investigate the desires, need, and intentions of the
displaced person before deciding on a HLR method. In-
depth interviews should be conducted before planning
housing solutions. There may be several solutions for one
displaced person or several for a group of displaced
persons. Do not make assumptions about a displaced
person's attitude about a particular housing proposal
until all of the options have been explored with him or
her.
4. Try to plan a solution that will accommodate a displaced
person's long-term housing needs. If a tenant is placed
in an agency-owned house, at a guaranteed rent and term,
there should be an attempt made to sell it to the tenant
at the end of the rental agreement as part of the HLR
plan, before disposition to a third party.
Special counseling may be necessary in order to help the
displaced person qualify for a mortgage, but it would be
worth the effort. Another possibility might be to offer
the dwelling initially for rent with an up-front option to
purchase agreement that would apply a portion of the rent
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to a downpayment. Another option would be for the agency
to purchase a dwelling, apply the HLR as a downpayment,
carry the note for 3-1/2 years, and then aid the displaced
person in getting an FHA, VA, or other mortgage.
5. Coordination with other agencies should be attempted and
opportunity for cooperative agreements should be explored.
Local agencies with programs involving housing such as
Public Housing Authorities may be in a better position to
provide and manage housing than the displacing agency.
HLR projects may be contracted out to other agencies for
construction as well as management. However, the
displacing agency always retains responsibilities for the
outcome of the relocation.
6. If appropriate and concurred in by the displaced person,
consideration should be given to using a HLR rental
assistance payment to assist the displaced person in
making a downpayment for a replacement house. Assistance
may be needed in obtaining financing or the agency may
need to furnish the initial financing.
7. All feasible housing proposals should be discussed with
the displaced person and his or her concurrence received
before proceeding with the selected plan. His or her
written consent to accept a housing proposal should be
received before it is implemented. In the absence of a
displaced person's written agreement, the potential exists
for a substantial expenditure for the construction of a
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house, for example, which the displaced person may be
unwilling to accept and occupy when completed.
8. Consideration should be given to the broad community
impact of any housing solution. For instance, it may
better serve the overall public for an existing
deteriorated house to be rehabilitated than for a new
house to be constructed nearby, leaving the deteriorated
house to remain a blight on the community. Rehabilitation
could serve two goals, removal of a blighting influence
and the rehousing of a displaced person. However,
remember that the initial concern is furnishing comparable
OSS housing to the displaced person.
9. Do not limit consideration of housing solutions to those
that may have minimum administrative involvement. People
who are displaced often have unique needs and housing
solutions may have to be creative and individualized in
order to meet those special needs. Merely providing the
displaced person with more money to spend on housing (the
super-payment Method) may be administratively simple, but
this method may be more expensive than other housing
solutions and it does not address specific housing needs
other than the higher cost of housing.
10. HLR should be used only after all regular relocation
benefits and services have been attempted. HLR,
obviously, should not be a substitute for lack of
leadtime, or inadequate relocation advisory services.
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Some relocation agents may have a tendency to postpone
contacts with displaced persons with difficult housing
needs, such as large families, or a handicapped person
needing a one-floor plan replacement dwelling unit. The
use of HLR to back up an inefficient relocation operation
is wasteful and is perceived to be inequitable by persons
who do not receive benefits under the HLR concept.
11. Make every attempt to identify potential HLR cases early.
Knowing that HLR is a possibility may focus attention on a
case early enough to enable the Agency to resolve the
problem by the use of intensified routine relocation
services. Also, if the need for HLR is confirmed later
on, the advance planning should provide sufficient time
for the Agency to consider a broad range of possible HLR
alternatives.
12. Also be aware that the personal circumstances of a
displaced person can change after relocation into HLR. A
subsequent move may be necessary due to a job opportunity
in a distant location, a family illness, loss of
employment, or other similar reasons. The HLR method
should not freeze a person into a dwelling. On the other
hand, the agency cannot incur additional costs to
subsidize a subsequent move which is not project related.
To the extent feasible, the agency should be willing to
make benefits transferrable if necessary.
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13. Although it is not required, the acquiring agency should
develop a plan defining the needs of the displaced
persons, the method of providing the necessary housing and
an explanation of the level of funding necessary. The
plan is a guide for action. It can protect the program
from manipulation and later charges of unfairness that can
arise when "making up the rules as we go along."
Replacement Housing of Last Resort should be considered during
the relocation planning process for any project with displaced
persons who cannot readily be moved using the regular program
benefits and procedures. Early planning should be emphasized
when HLR is being considered on a project as well as early
contact with the affected displaced persons. Considerable lead
.time may be needed to complete the plan and to avoid costly
delays in highway construction.
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CHAPTER TEN
MOBILE HOMES
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CHAPTER TEN
MOBILE HOMES
The Mobile Home - Realty or Personalty
The determination of the status of a mobile home as realty or
personalty governs the type of relocation payments the owner
receives.
If the acquiring agency is a Federal Agency, it may set its own
policy in accordance with Federal law, after determining the
status of a mobile home as realty or personalty. However, the
policy should be consistent for the program, project or area
where the project is located. This policy may be set by taking
into account the prior experience of the Agency in acquiring or
displacing mobile homes as well as the availability of
replacement sites or homes on the current project. In general
there are fewer problems associated with acquiring a mobile home
as realty, especially if the site is owned by the owner occupant
of the mobile home.
A mobile home to be acquired by a State, local agency, or person
is considered to be realty or personalty in accordance with the
laws of the State in which it is located. Some State laws allow
mobile homes to be considered as either realty or personalty or
do not address the issue. Other State laws provide that mobile
homes be considered realty if the wheels have been removed and
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the mobile homes have been attached in some permanent fashion to
the site. Other State laws consider mobile homes to be
personalty regardless of how they are attached to the land.
If applicable, State law should be considered when the appraisal
is made. If the mobile home is realty, it will be appraised in
the same manner as other real property and the acquisition price
for the mobile home and the site, if owned by the occupant, will
be used as the basis for computing the replacement housing
payment.
If the mobile home is not acquired because it is considered
personalty under State law, the owner is entitled to
reimbursement of the cost to move the mobile home. An owner-
occupant will be reimbursed for the cost to move the mobile home,
but will not be entitled to a replacement housing payment for the
mobile home. However, he or she may be eligible for a
replacement housing payment for an appropriate replacement site.
A whole new set of circumstances is introduced if the owner-
occupied mobile home is considered personalty, but the acquiring
agency determines it cannot be moved because:
1. The mobile home is not and cannot economically be made
decent, safe, and sanitary because it is structurally
unsound, inadequate in size to accommodate the displaced
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person(s), or does not meet code requirements.
2. The mobile home cannot be moved without substantial damage
or unreasonable cost.
3. There are no available comparable replacement sites for
the mobile home.
4, The mobile home is decent, safe, and sanitary, but mobile
home park entrance requirements require extensive
modifications that are not economical.
5. The mobile home cannot be relocated because it does not
meet mobile home park entrance requirements.
If the mobile home is considered personalty, but cannot be moved
because of one or more of the above circumstances, the Agency may
acquire the mobile home if State law permits, and use the
purchase price as a base for determining the replacement housing
payment for the mobile home owner. If the Agency cannot purchase
the mobile home because it is considered personalty, the salvage
value or trade-in value of the mobile home, whichever is higher,
shall be used as the acquisition cost of the mobile home for
purposes of computing the replacement housing payment. Title to
the mobile home does not pass to the Agency, however, and the
displaced owner is still responsible for moving the unit off of
the Agency acquired land. If a mobile home needs repairs,
modifications or correction of certain DS&S standards, and the
agency decides the costs would be reasonable, then the costs of
such repairs would be reimbursable as a moving expense and the
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mobile home could then be moved. If the mobile home is abandone
in place, the Agency may remove it in accordance with State law.
If an owner-occupant disagrees with an Agency determination that
a mobile home (which is considered personalty) can be relocated
after making repairs or modifications which are reimbursable, and
insists on receiving a replacement housing payment the Agency may
use an alternate comparability procedure. The Agency may use as
the cost of a comparable replacement mobile home, the sum of, (1)
the value of the displaced mobile home, (2) the estimated cost of
any necessary repairs or modifications, (3) the estimated cost of
moving the unit to replacement site and, (4) any necessary
related expenses. From this total, the value of the displaced
mobile home is deducted to arrive at the replacement housing
payment. If the payment is accepted, the owner will still be
responsible for removing the mobile home from the project site.
The situation noted above can best be explained by an example. A
displaced person who owns a mobile home with an oil-fired furnace
is denied admittance to a replacement mobile home park because
the park will not allow the necessary outside oil tank. The
installation of a gas furnace will solve the problem and enable
the displaced mobile home owner to move the unit into the mobile
home park. See Example #8 for an explanation of the alternate
comparability procedure.
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Replacement Housing Payments
Ownership/Tenancy Requirements
The ownership or tenancy of the mobile home determines the
occupant's status as an owner or a tenant, not the site upon
which it is located. The length of time the mobile home has been
located on the displacement site prior to the initiation of
negotiations determines the occupant's status as a 180-day owner,
90 day owner or tenant.
180-Day Owner-Occupant
A displaced owner-occupant who has owned and occupied a mobile
home on the displacement site for at least 180-days immediately
preceding the initiation of negotiations for the acquisition of
the mobile home and/or the site is entitled to a replacement
housing payment not to exceed $22,500. The replacement housing
payment will be computed for a replacement mobile home and site,
or a conventional dwelling if comparable mobile homes and sites
are not available. An alternate payment for rental assistance
can also be made at the option of the owner-occupant, however, a
rental assistance payment cannot exceed $5,250 and will be based
on the market rent of the acquired mobile home and site.
90 Day Owner Occupants and 90 Day Tenant Occupants
90-179 Day owner-Occupant - A displaced owner-occupant who has
owned and occupied a mobile home on the displacement site, for at
least 90 days but less than 180 days immediately preceding the
date of initiation of negotiations for the acquisition of the
mobile home and/or site, is entitled to a replacement housing
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payment not to exceed $5,250 for rental assistance or down
payment assistance.
90-Day Tenant-Occupant - A displaced tenant who has occupied a
mobile home on a displacement site for 90 days or more
immediately preceding the initiation of negotiations for the
acquisition of the mobile home and/or the site is also entitled
to a replacement housing payment not to exceed $5,250 for rental
assistance or downpayment assistance.
If the tenant-occupied mobile home is to be relocated, the tenant
may elect to remain a tenant in the subject mobile home at the
replacement site. If so, he/she may be eligible for a rental
assistance payment providing the mobile home is decent, safe and
sanitary and there is justifiable increase in the rent at the
replacement site. However, the payment may not exceed the
agency's computation based on a comparable mobile home and site.
The displaced tenant occupant may also be eligible for a
downpayment to purchase a replacement mobile home and site, or a
conventional dwelling. The total downpayment may not exceed
$5,250 or the computed rental assistance payment whichever is in
accordance with the displacing agency's regulations for RHP's for
tenants.
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The basic replacement housing payment to be computed for both the
90 day tenant and the 90-179 day owner occupant will be a Rental
Assistance payment for a replacement mobile home and site, or a
conventional dwelling if no comparable mobile homes and sites
are available. If the 90-179 day owner-occupant elects to
purchase and receive a down payment, the payment will be computed
in the same manner as a 180 day owner for a purchase supplement.
The computed payment, plus estimated incidental expenses and
increased mortgage interests costs (if any), will set the upper
limits for assistance in purchasing a replacement mobile home and
site, but cannot exceed $5,250.
If an owner occupant is reimbursed for the cost of moving the
mobile home and any necessary related expenses, he/she is not
eligible to receive a replacement housing payment to assist in
purchasing or renting a replacement dwelling. However, an owner-
occupant may be eligible for a rental assistance payment, a price
differential payment or a downpayment toward the rental or
purchase of a replacement site, depending upon the length and
type of occupancy on the displacement site.
REPLACEMENT HOUSING PAYMENT COMPUTATIONS
A replacement housing payment computation for a person displaced
from a mobile home is usually comprised of a computation for a
comparable mobile home and a computation for a comparable mobile
home site, or a combination of the two.
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The first step is to compare the value or the rent of the
displacement mobile home to the cost or the rent of a comparable
replacement mobile home and compute a price differential offer or
a rental assistance offer, depending upon the ownership or
tenancy status of the mobile home occupant.
The second step is to compare the displacement site to a
comparable replacement site and compute a price differential
offer, or a rental assistance offer, depending upon the ownership
or tenancy of the mobile homesite.
If the displaced person owns both the mobile home and the mobile
home site, the agency should endeavor to locate a mobile home on
a site, as a unit for comparison purposes, similar to the
comparison of conventional dwellings. (See example 1 for a
detailed computation.)
Mobile Home to Conventional Dwelling
There will be some cases when a displaced mobile home owner-
occupant will prefer to purchase and relocate to a conventional
dwelling. In this case the maximum price differential
computation will be based on a comparable mobile home and site.
(See example 9 for a more detailed discussion and a sample
computation for a mobile homeowner who purchases a conventional
dwelling.)
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Conventional Dwelling to Mobile Home
Sometimes, a 180 day owner who occupies a conventional dwelling
may decide to purchase a mobile home and site, or perhaps rent a
replacement site. The purchase supplement would be computed in
the usual manner using a conventional dwelling.
If the displaced person purchases a DSS mobile home and a mobile
home site, he or she can receive a purchase supplement up to the
amount of the computed offer plus incidental expenses and an
increased interest payment if applicable. This total amount may
not exceed $22,500. (See example 10.)
^^ Replacement Housing Payment for a site only.
An owner occupant of a mobile home may be eligible for a
replacement housing payment for a replacement site even though
the mobile home was moved and moving costs were reimbursed. The
computation for 180 day owner-occupants cannot exceed $22,500 for
a purchased site comparable to the acquired site. The
computation for a 90-day tenant or 90 day owner-occupant cannot
exceed $5,250 for a replacement rental site. (See examples 2 &
5.)
Replacement Housing of Last Resort
Replacement Housing of Last Resort should be utilized when:
(1) comparable replacement housing is not available for the
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displaced person.
(2) comparable replacement housing is available for the
displaced person but the computed offer exceeds the
maximum amounts of $22,500 for 180 day owner occupants and
$5,250 for tenants or 90-179 day owner occupants.
Note: Housing of Last Resort for short term owners (90-179 days)
or tenants (90 days or more) only becomes necessary when
comparable replacement housing is not available or when
comparable replacement housing is available but the rental
assistance offer exceeds the maximum amount of $5,250. If the
rental assistance offer exceeds $5,250, the displaced person can
use the computed amount to rent a replacement mobile home and
site or as a downpayment for a DSS replacement dwelling of his or
her choice.
Moving Costs and Related Expenses
Any displaced person who owns and/or occupies a mobile home
located within the required acquisition site is entitled to
reimbursement of moving costs and related expenses for moving the
mobile home if it is considered personal property, and/or for
moving the contents of the mobile home.
Owner-Occupants of Mobile Homes Classified as Personalty
The owner-occupant of a displaced mobile home classified as
personal property and not acquired by the displacing agency may
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be reimbursed for moving and related expenses on an actual cost
basis, providing the agency determines the costs are reasonable
and necessary. The following expenses may be eligible for
reimbursement:
1. Moving the mobile home and other personal property.
Moving expense are generally limited to a 50 mile radius
unless the agency determines that a move in excess of 50
miles is justified.
2. Packing, crating, moving, unpacking, and uncrating
personal property. If these services are performed by the
mobile home owner-occupant, the agency may, at its
discretion, pre-establish a reasonable amount for
reimbursement of these expenses instead of requiring
documentation. The agency should have a policy in place
to support any pre-established amounts.
3. Disconnecting and reconnecting household appliances.
4. The reasonable cost of disassembling, moving, and
reassembling any attached appurtenances such as porches,
decks, skirting and awnings which were not acquired, plus
the cost of leveling the mobile home, anchoring the mobile
home, and normal utility hook-up charges.
5. The cost of repairs or modifications to enable a mobile
home (that is considered personalty under State law) to be
moved and/or the costs necessary to make the mobile home
decent, safe, and sanitary, providing the agency
determines the cost is reasonable and economically
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feasible.
6. The cost of insurance for the replacement value of the
mobile home and other personal property during the move.
7. The replacement value of the mobile home and other
personal property lost, stolen, or damaged during the
moving process, which is not the fault of or due to the
negligence of the displaced person, his/her agent, or
employee(s), when insurance covering such loss, theft, or
damage is not reasonably available
8. A nonreturnable mobile home park entrance fee is also
reimbursable as part of the moving cost benefit providing
the fee does not exceed the fee charged at a comparable
mobile home park. The agency must also make the
determination that payment of the entrance fee is
necessary in order to relocate the mobile home.
9. Transportation costs of mobile home occupants to the
replacement site.
10. Temporary lodging (including meals) for displaced mobile
home occupants while a mobile home is being relocated and
reestablished at a replacement site. Temporary lodging is
to be used only for a short period of time and payment
should be based on a determination that the costs involved
are reasonable and necessary.
11. Other related moving expenses that the agency determines
to be reasonable and necessary which are not listed as
ineligible under the Uniform Regulations.
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Moves of Mobile Homes not occupied by owners
A non-occupant owner of a displaced mobile home that is not
acquired may be reimbursed for the actual cost of moving the
mobile home from the site based on moving cost findings or
estimates, documented self move, or a commercial move. The use
of an estimated moving cost is appropriate because the mobile
home is personalty and , therefore business move procedures may
apply.
Tenant-Occupants of Mobile Homes
A tenant-occupant of a displaced mobile home may be reimbursed
for moving his/her personal property on an actual cost basis. or
on the basis of the moving expense schedule. The moving expense
allowance depends on the number of rooms of furniture and whether
the mobile home is rented furnished or unfurnished. (See the
Federal Highway Administration Moving Expense Schedule which is
published annually in the Federal Register).
Examples
There are many variations in payment and benefit computations for
mobile home owners and occupant. These variations are generally
considered to be unigue and would normally only apply to mobile
homes. However, they could also apply to boats or other
"detachable" structures used as dwellings. Examples are
included here of some of the various payments for which mobile
home occupants may be eligible to facilitate payment
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computations. As a reminder, at any time that an owner-occupant
relocates a mobile home not acquired because it is considered
personalty, he or she is entitled to the cost of moving that
mobile home to the replacement site. This payment is in addition
to the replacement housing payment for the site.
REPLACEMENT HOUSING PAYMENTS FOR 180-DAY OWNER-OCCUPANTS
Example 1
(180-Day Owner-Occupant)
The displaced persons owns the mobile home and site. The mobile
home is considered realty under State law and the agency will be
acquiring both the mobile home and the site.
The displaced person may be eligible for a replacement housing
payment to purchase a decent, safe, and sanitary replacement
mobile home, a replacement site, incidental expenses for
purchase, and an increased mortgage interest payment. The
displaced persons may purchase or rent a conventional dwelling
instead of a mobile home if he or she wishes. The maximum
replacement housing payment will be $22,500 unless replacement
housing of last resort is required.
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Since the displaced person owns both the mobile home and the
site, the agency should try to locate comparable mobile homes and
sites for sale (on the market as one unit) to use for computing
the RHP offer. If such comparables are not available, an
alternative could be to compare the subject mobile home to
comparable mobile homes and the subject mobile home site to
comparable mobile home sites, and combine the two computations
for the RHP offer.
If comparable mobile homes and sites are not available it may be
necessary for the agency to compute the RHP offer using a larger
or more expensive mobile home and site or a conventional dwelling
on a lot.
If the displaced persons elects to rent a decent, safe, and
sanitary mobile home and site instead of buying, the rental
assistance payment will be the rent for a comparable mobile home
and site minus the market rent of the displacement mobile home
and site for a 42 month period. The maximum rental assistance
payment he/she will be eligible to receive is $5,250.
Example 2
(180-Day Owner-occupant)
The displaced person owns the mobile home and site, but only the
site is being acquired. The mobile home is considered
personalty and will be moved to a replacement site.
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In this case the displaced person may be eligible for a
replacement housing payment to purchase a replacement site, not
to exceed $22,500.
If the displaced person elects to rent a replacement site instead
of purchasing, the rental assistance payment will be based on
the market rent of the displacement site and computed in the
usual manner for a 42 month period. The rental assistance
payment cannot exceed $5,250.
If a comparable replacement mobile home site is not available,
the agency may determine that the mobile home cannot be
relocated, and the RHP offer will be computed in accordance with
the replacement housing payment section of the regulations for
conventional dwellings using the salvage valueor trade-in value
(whichever is higher) of the mobile home as the acquisition price
and the acquisition price of the site. If the total RHP computed
exceeds $22,500 replacement housing of last resort will be
required.
The displaced person may also be eligible for rental assistance
to rent a replacement site, or a downpayment to purchase a
replacement site, but not to exceed $5,250. The combined
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payments cannot exceed $22,500. If the total of the combined
payments do exceed $22,500 replacement housing of last resort
must be provided.
If the displaced person elects to rent a mobile home or
conventional dwelling instead of purchasing, the rental
assistance payment will be based on the market rent of the
displacement mobile home and computed in the usual manner for a
42 month period. The difference in the monthly rent for a
comparable replacement site, if higher, will also be computed for
the 42 month period as a rental assistance payment for the mobile
home site. The total of the combined payments in this case
cannot exceed $5,250.
REPLACEMENT HOUSING PAYMENTS FOR 90 TO 179 DAY OWNER-OCCUPANTS
Example 4
(90-Day Owner-Occupant)
The displaced person owns the mobile home and the site. The
agency will be acquiring both the mobile home and the site. The
mobile home is considered realty.
The displaced person may be eligible for a downpayment to
purchase a decent, safe, and sanitary replacement mobile home and
site or a conventional dwelling plus any incidental expenses
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involved in the purchase. The payment may not exceed the amount
that he/she would have received as a 180 day owner or $5,250,
whichever is less.
If the displaced person elects to rent a decent, safe, and
sanitary replacement mobile home and site or a conventional
dwelling instead of purchasing, the rental assistance payment
will be based on the market rent of the displacement mobile home
and site, and computed in the usual manner for a 42 month period.
If the rental assistance computation for both the mobile home and
the mobile home site exceeds $5,250, replacement housing of last
resort must be used.
Example 5
(90-Day Owner-Occupant)
The displaced person owns the mobile home and the site, but only
the site is being acquired. The mobile home is considered
personalty and will be moved to a replacement site.
In this case, the displaced person would be eligible for a
downpayment to purchase a replacement site upon which to relocate
the mobile home or a rental assistance payment to rent a
comparable site. The payment may not exceed what he/she would
have received as a 180 day owner-occupant, or $5,250, whichever
is less.
A rental assistance computation would be based on the difference
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in the market rent of the displacement site and a comparable
replacement site, and computed in the usual manner for a 42 month
period. If the rental assistance payment exceeds $5,250,
replacement housing of last resort would be required.
Example 6
(90-179 Day Owner-Occupant)
The displaced person owns the mobile home and rents the site.
The mobile home cannot be acquired because it is considered to be
personal property. Also, due to its age and deteriorated
condition, the Agency has determined that the mobile home cannot
be relocated without substantial damage or unreasonable cost.
The displaced person should be informed of his/her eligibility
for a downpayment to purchase replacement housing or a rental
assistance payment if he/she chooses to rent.
Since the mobile home is considered personal property in this
example, it cannot be acquired. If the displaced person elects
to receive a downpayment or a rental assistance payment, he/she
will still own the mobile home and it must be removed from the
project by the displaced person at his or her own expense, unless
there is an agreement with the displacing agency to abandon the
mobile home in place. The displaced person cannot receive both a
replacement housing payment for the mobile home and a moving cost
payment to relocate the mobile home.
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A rental assistance payment should be computed for a replacement
mobile home and site, if available, or a conventional dwelling if
there are no mobile homes available. The maximum payment would
be $5,250 unless replacement housing of last resort is necessary.
If the displaced person elects to purchase a replacement mobile
home and purchase or rent a replacement site, the maximum payment
for downpayment assistance would be limited to the amount he or
she would have received as a 180 day owner up to $5,250,
whichever is less. Salvage value or trade-in value (whichever is
higher) would be used as the acquisition price in the
computation. In any event the payments for purchase of a mobile
home and purchase or rental of a replacement site cannot exceed
$5,250 unless replacement housing of last resort is needed.
It should also be kept in mind that the displaced person may wish
to move the mobile home to a replacement site and continue in
occupancy, regardless of the agency determination that it would
be impractical to move. Because the mobile home is considered
personal property, the agency is obligated to reimburse the
displaced person for moving and related expenses plus the
reasonable costs of repairs necessary to correct damages incurred
during the move.
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Replacement Housing Payments for 90-Day Tenant-occupants
Example 7
The displaced person rents the mobile home and site. The agency
will be acquiring both the mobile home and site from the owner.
The mobile home is considered realty under State law.
The displaced person may elect to rent a decent, safe, and
sanitary replacement mobile home and site or a conventional
dwelling. The rental assistance computation, however, will be
based on the monthly rent of the displacement mobile home and
site and compared to a comparable mobile home and site, in the
usual manner, for a 42 month period.
The displaced person in this example may also decide to purchase
a decent, safe, and sanitary replacement mobile home and site or
a conventional dwelling, and be eligible for a downpayment, not
to exceed $5,250, in accordance with the Displacing Agency's
policies.
In either case, the displaced person would also be eligible to
receive a moving cost payment for moving his or her personal
property from the mobile home and the mobile home site.
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8
(The mobile home is classified as personalty)
Standard vs. Alternate Comparability Procedure
When the Displaced owner-occupant refuses to Correct Deficiencies
in the Mobile Home and Demands a Replacement
Housing Payment
Standard Computation
Cost of Comparable Mobile Home
(With Gas Furnace) $13,000
Value of Displaced Mobile Home - 8.000
Price Differential $ 5,000
Rental Assistance for a comparable lot $50 x 42 Months S 2.100
Maximum Replacement Housing Payment $ 7,100
Total Cost to Relocate $ 7,100
Alternate Computation
Value of Displaced Mobile Home (Comparable)* $ 8,000
Value of Displaced Mobile Home (Acquisition Price) - 8.000
Price Differential 0
Rental Assistance for a comparable lot $50 x 42 Months $ 2,100
Cost of Converting Subject to Gas Heat $ 1,000
Cost of Moving Mobile Home Plus Set Up Charges $ 800
Maximum Replacement Housing Payment $ 3,900
If the displaced person refuses to make the conversion to gas
heat and move the mobile home to the replacement site, the
maximum payment he/she would be eligible to receive is $3,900 no
matter what type of replacement housing is finally selected.
*The displaced mobile home is used as the comparable under this
alternate procedure.
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Example 9
The following example illustrates the method for computing a
replacement housing payment offer for a 180 day mobile home
owner-occupant who also owns the site, but purchases a single
family dwelling:
Computation
Cost of Comparable Mobile Home $18,000
Acquisition price of Subject Mobile Home -10f OOP
Price Differential Offer for Mobile Home $ 8,000
Cost of Comparable Mobile Home Site $ 8,000
Acquisition Price of Subject Mobile Home Site - 6.000
Price Differential Offer for Mobile Home Site $ 2,000
Maximum Price Differential Offer $10,000
Actual cost of Replacement Property $45,000
(Single Family Residence)
Payment
Price Differential Payment $10,000
Note: The subject mobile home and site would probably be
appraised as a unit for a total acquisition price of $16,000.
Ideally the comparable would be for sale for a unit price of
$26,000 which would make the computation much easier, however
unit priced comparables are not always available and a separation
of values may be necessary.
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Example 10
This is an example of a 180 day owner occupant of a conventional
dwelling who purchases a mobile home and a site as a replacement,
Asking Price of Comparable Replacement Property $40,000
Acquisition Price of Acquired Dwelling and Site $35, OOP
Maximum Price Differential Offer $ 5,000
DS&S Mobile Home Purchased $28,000
(Set up charges) 1.500
$29,500
Replacement Site $ 8,000
Site improvements (Water/Septic) $ 4.000
$12,000
Total Replacement Cost $41,500
Acquisition Price of Subject Property -$35.000
$ 6,500
Maximum Price Differential Payment $ 5,000
plus Eligible Incidental Expenses
Generally, an owner-occupant of a conventional dwelling who
elects to purchase a mobile home and site would not be eligible
for a replacement housing payment because the acquisition price
of the acquired property would far exceed the cost of a
replacement mobile home and site.
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CHAPTER ELEVEN
MOVING PAYMENTS AND RELATED EXPENSES:
BUSINESS INCLUDING NONPROFIT ORGANIZATIONS AND FARMS
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CHAPTER ELEVEN
Moving Payments and Related Expenses
Business and Nonprofit Organizations and Farms
Businesses including nonprofit organizations and farms are not
easy to move. They are all different; come in all shapes and
sizes; employ one to thousands of people; can be retail,
wholesale, manufacturers, or distributors; require no machinery
or equipment or require massive equipment and machinery that
requires building modifications; and enjoy different types of
management. One is never like the next even though they may
appear similar. Moving a business is a real challenge for the
displaced business owner, the relocation agent, the customers and
for everyone else involved. It can also be enormously rewarding
when it is completed and everyone is happy (well, almost
everybody).
The time for avoiding problems is as early in the planning
process as it is known that a business site will be affected by a
project. If it is clearly known that a large business, i.e. a
manufacturing plant, a large retail store, or the like is to be
acquired, the business should be contacted and advised of the
potential acquisition and subsequent displacement. The
businesse's participation in early decisions may enhance the
overall planning process and will definitely permit the business
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additional time to make plans. Many small businesses will also
benefit by being informed early.
The planning that will take place with the involved businesses
may cure future problems. The determinations of what's realty,
what's owned by the tenant, and what's personalty are basic to
both the acquisition and relocation processes. It is most
appropriate for the business operator, the business or building
owner,'if different, and agency staff such as appraisers,
relocation agents, and attorneys, when necessary, to participate
in these discussions and the resultant determinations.
Reinstallations, such as for an advertising sign that should have
been classified as real property and acquired as realty may be
avoided. Personalty/Realty decisions are difficult and must
often be made on a case-by-case basis with consideration given to
State law and case law precedent after consultation with the
owner. Some well organized agencies have a practice of making
such determinations early in the project (before appraisals are
secured) for all properties where there are likely to be
questionable items. This may involve a committee in which
representatives of the agency's legal, appraisal and relocation
units participate in reaching a decision. In the absence of a
systematic approach to personalty/realty decisions, problems and
confusion are likely to surface at the relocation stage. The
relocation agent will probably be confronted with items which are
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not feasible to move, items which can be moved only with
substantial modification, or items that can be moved at an
expense which is disproportionate to value.
An example of this may be a fire escape which is not identified
in the appraisal report as part of the real property acquired.
The owner may insist the fire escape is personal property and
should be moved and reinstalled on his replacement building.
Making a determination before the property is appraised is
obviously the only way to prevent such ridiculous problems from
occurring.
Eligibility Requirements for Businesses
All businesses are eligible for the actual cost of moving
personal property from the acquired site. Businesses that meet
the definition of a small business as well as other criteria are
eligible for the reestablishment payment of up to $10,000. The
business must have at least one (1) to 500 employees on site. If
the business has more than 500 employees or does not meet other
criteria and the agency believes that the business should receive
a reestablishment payment, a waiver may be requested for that
business.
The other payment for which a business may be eligible is the
fixed payment, commonly known as the "in lieu" payment. A
business may elect to receive this payment of between $1,000 and
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$20,000 in lieu of the actual cost of moving if it meets the
additional criteria for this payment.
Each of these payments will be discussed in detail in this
chapter.
Benefits Are Limited
In spite of our desire to help businesses relocate successfully,
there are still limits to our capability to help. Implementing
regulations provide specific restraints on reimbursement of
certain types of expenses. Following is a list of cost items
which businesses may incur which are not reimbursable:
1. The cost of moving structures or other items classed as
real property.
2. Interest costs incurred because of the need to finance the
move or the cost of capital improvements at a replacement
site.
3. Costs resulting from the loss of trained employees, and
the corresponding need to train new employees.
4. Loss of good will.
5. Loss of business profits during the move and the
reestablishment period.
6. Increased operating expenses, such as rent or utilities,
at a new location (may be payable as reestablishment
costs).
7. Personal injury.
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8. Legal fees or other cost for preparing a claim against the
Agency.
9. Physical changes to the replacement site in order to
accommodate the relocated businesses (may be payable as
reestablishment costs).
10. Costs for storage of personal property on real property
already owned or leased by the displaced person.
11. Loss of business clientele due to business disruption or
change in location.
In addition to limitation in benefits, the successful relocation
of some businesses is hindered by internal limitations. Among
these are:
1. Physical limitations of the owner or key employees due to
age or disability.
2. Lack of expertise or skill in meeting new management
demands imposed by the move. Such demands could include
generating new clientele, managing a larger inventory, and
training an entirely new staff.
3. Lack of funds needed to reestablish the business. Many
small, and some larger businesses generate only enough
cash flow to support the present operation, and are not
sufficiently capitalized to meet all the additional
reestablishment costs that may be required.
It is important 'to realize that business operators suffer the
same sort of human limitations and inadequacies as do persons
displaced from residences, and are often in need of
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individualized assistance in moving. Businesses are a community
resource in as much as they provide services, products, and
employment, so more is at stake in their reestablishment than in
the personal welfare of the owner/operator.
Business Move Benefits
Following is an itemized list of benefits for which displaced
businesses may be eligible under the Uniform Act:
1. Relocation Advisory Assistance.
2. Actual costs of moving personal property, including
detach, transport, and reinstallation costs.
3. Incidental costs such as storage, insurance, and
searching expenses.
4. Direct loss of tangible personal property.
5. Reestablishment Expenses, not to exceed $10,000.
6. In lieu payment; instead of 2, 3, 4 and 5 above.
Business benefits are outlined on the chart located on the next
page and they are explained in detail in the remaining pages of
this Chapter.
1. Advisory Assistance
A displaced business's need for advisory assistance has three
main elements:
Locating a replacement site.
Reestablishing operations immediately after the move.
Achieving conditions for long term success by
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establishing new clientele, replacing lost employees,
adjusting to higher costs, etc.
The relocation agent is best prepared to service the short term
need to find a replacement site. The median and long term needs
can best be satisfied by referring the business operator to other
agencies and organizations that can provide specialized and
longer term assistance. Organizations that can be of help are
discussed in the Chapter on Advisory Services.
2. Actual Moving Costs
The business operator who has acquired a replacement site and is
now anticipating the actual move usually has specific concerns
about the move.
How long will normal business operations be disrupted?
What unreimbursable related moving costs will occur?
Will my business inventory, machinery, equipment, etc.,
be damaged?
How long will employees be idled by the move?
Are the movers selected by the agency to prepare the
estimates qualified to execute the move?
How soon will I be reimbursed for moving costs I incur?
These are legitimate concerns. Moving almost always causes a
major disruption to the business operation and may even be a
threat to the continued success of the business. Most business
operators have limited or no prior experience in moving. The
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business owner perceives the agency as being primarily interested^
in clearing the site quickly so the project can begin, and to
assure that the move take place at minimum cost. These concerns
generate suspicion and lead the owner to regard the agency as an
adversary during the moving process.
This perception by the business operator may be expressed in a
reluctance to communicate about business needs, suspicion of
proposals made by agency representatives and a desire to control
all moving activities.
The agency has a valid interest in assuring that the move takes
place expeditiously and at a reasonable cost. It also has a
responsibility to minimize hardship and expense to the displaced
business. In order to achieve these goals and gain the
confidence of the business operator, it is important to manage
the move in a systematic and orderly manner. This can be done by
following certain procedures discussed below:
a. The Inventory. This is a detailed itemization of the
personal property to be moved. It should be prepared
before any moving estimates are made. The relocation
agent should verify the accuracy of the inventory, at
least on a spot-check basis. The best method is for the
agent to assist the business operator prepare the
inventory. There should obviously be a physical count of
the various items to be moved. Paper inventories, based
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on accounting or sales records should not be relied upon
as correct.
b. Specifications. These are the detailed instructions as to
when and how the move will be performed. It is important
that all who estimate or bid on the move prepare their
estimates based on the same moving instructions.
Specifications are also the basis for agreement between
all parties (State, displaced person, mover) regarding the
scope of the work to be performed.
c. Bids and Estimates. The move cost is established by
securing estimates or bids prior to the move. Bids and
estimates are not synonymous. A bid is a fixed price
secured under competitive conditions. An estimate is an
approximation of cost. The difference is significant and
should be recognized in planning the move. Bids offer
protection to the business operator and the agency because
they are based on open and free competition among
qualified parties who are contending for business. Some
form of competition is the normal means by which public
agencies procure services.
It is a misconception that competitive procurement
requires formal advertised bidding procedures. There are
many ways competition can be generated. For less complex
moves where time is short, proposals could be solicited by
mail, or the notice could be placed on a bulletin board
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established for that purpose. Competitive procurement of
any kind is dependent on all potential providers having
access to a full and clear description of the work to be
performed. It is important, therefore,
that the inventory and specifications for the move be
available to all bidders.
d. Surveillance. This is also called monitoring the move.
It is the activity of observing the move when it is
actually taking place. The degree of surveillance should
be commensurate with the complexity and cost of the move.
More complex moves may require a full time presence while
low cost simple moves may be well serviced by a follow up
visit .to the replacement site. The surveillance of the
move has several purposes. Most importantly for complex
moves, the agent monitoring the move should determine if
the move is taking place in substantial accord with the
specifications. If economies are being realized by the
mover because of nonperformance of some tasks, or if the
inventory to be moved is substantially less than when the
estimate was prepared, there should be a renegotiation to
recover the savings. If significantly more work is
involved than had originally been specified, there may be
an upward adjustment due. Surveillance is also helpful to
the displaced person because problems, misunderstandings,
and questions can be resolved, or at least heard, by an
agency representative while the move is taking place.
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e. Detach and Reinstallation Costs. Business moves may
involve the relocation of large items of equipment that
may be anchored to the floor, or may require
disassembling. Complex machinery nay have plumbing
connections for water service or lubrication, or have
interconnections with other machinery. Special
installation may also be required to erect shelving or
cabinets. These are all legitimate relocation costs which
may be reimbursed provided the items to be moved are
classified as personal property. Special details,
dismantle, and reinstall instructions should always be
addressed in the move specifications to assure that they
are accounted for in the estimates or bids secured from
movers.
It may be necessary to significantly modify an item in order to
reinstall it, at the new location. A common example is the
reinstallation of retail display cabinets. These cabinets may
have been job built for a particular location and may need to be
shortened, mitered, or lengthened in order to be properly reused
at a replacement site. The cost of performing such work would be
reimbursable if modifications were necessary to reinstall in a
manner that would provide for the same function as at the
displacement site.
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Reimbursement Methods
There are a variety of reimbursement methods that can be
employed. The choice of a method should be agreed to jointly by
the agency and the displaced person prior to the start of the
move.
The relocation agent handling the case should be in a position to
advise the displaced person regarding the method that would be
most appropriate. Following are several methods that can be
considered:
a. Commercial Moves. The displaced person can arrange for a
licensed commercial mover to execute the move and present
receipted bills for reimbursement. If the agency concurs ^^
in this type of move, it should take measures to assure
the reasonableness of the costs. It is recommended, but
not required, that the agency secure two estimates or bids
based on an inventory and written specifications. More
than one mover should be invited to submit proposals and
the agency should also give prior approval for the move to
take place. The commercial move leaves great opportunity
for excessive billing and conspiracy to fraud if strong
administrative controls are not maintained.
b. Actual Cost Self-Move. Many displaced businesses have
highly specialized inventory or equipment which its
employees are best qualified to handle. Also, a business
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owner may want to maintain total control over the move to
assure proper placement of items, to facilitate reopening,
or to keep employees productive during the move. If a
self-move is performed, the reimbursement would be based
on an actual cost accounting of labor and equipment
utilized. Employee's time should be billed at actual
rates paid by the business; however, the hourly rate
charged should not exceed the amount charged by local
moving firms.
Equipment used in the move should be reimbursed on a pro
rata accounting of actual costs or, if rented, the billed
rental amounts. The business may also bill for the time
of management personnel who supervise the move. The
actual cost self-move places maximum control over the move
with the business operator. It is particularly
appropriate where strict inventory control is important.
An example would be an auto parts store, where there are
hundreds of small parts on shelves and bins.
c. Self-Move flower of Two Bids or Estimates Method)
If the displaced business operator desires to assume
complete responsibility for the move, and eliminate the
documentation required by the actual cost self-move
method, a lump sum amount may be negotiated. This amount
may not exceed the lower of two acceptable bids or
estimates secured by the agency, from qualified moving
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firms, moving specialists or consultants, or prepared by a
qualified agency staff employee. This method will enable
the business to have great flexibility as to how the move
takes place. The move can be done partly or entirely by
the business1 employees or a mover can be hired to perform
all or part of the move.
An inherent problem in this method is assuring the
adequacy of the bids or estimates. If commercial movers
are called in to provide bids or estimates on a job which
they have only a remote chance of getting, the prices may
not be reasonable. Move specifications are also very
important in this type of move. If specifications require
extra work, special handling or premium time, there should
be a sound basis for these costs. Monitoring during the
move will disclose whether or not the specifications are
adhered to. Adjustments should be made to the final claim
prior to reimbursement if economies are realized in the
actual move that were not called for in the
specifications.
3. Incidental Costs. There are several types of activities
and corresponding expenses that are related to the move
which can be reimbursed. These costs are described below:
a. Searching Expenses
Up to $1,000 can be reimbursed for the costs
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expended in searching for a replacement property.
These costs may include direct expenses of employees
of the displaced business or payments made to
consultants assisting in the search. Eligible
expenses may include: salary, meals and lodging,
travel expenses, fees paid to real estate finders,
and consultants, etc. If appropriate and with prior
funding agency approval, searching expenses in excess
of $1,000 may be reimbursed.
b. Insurance
Property which is delicate or of high value may be
insured at agency expense for risk of damage during
the move. If the move is performed by a commercial
mover, the standard insurance limits carried by the
mover should be determined and the adequacy of these
limits evaluated. The insurer may impose conditions
and requirements on the move to limit risk. Examples
would be that high value art work needs to be
transported under guard or that delicate machinery
needs to be handled by trained technicians.
c. Planning Costs
Complex or expensive moves may need specialized
consultants to plan and expedite the move. This
could include services of firms that take
inventories, specialized industrial consultants to
develop move specifications, fees of professional
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movers to provide moving cost estimates, etc.
4- Direct Loss of Tangible Personal Property
This type of payment is really a substitute for a payment
for moving personal property which is not moved but is
disposed of by sale or trade-in. Many businesses have
machinery or equipment that is old, obsolete, and of
marginal value. This benefit provides the business
operator with an opportunity to upgrade and modernize the
operation with equipment which has higher productivity or
a longer useful life. Or, a business operator may decide
to sell certain items without replacement if the items are
no longer needed. The "direct loss" benefit allows the
business to be paid an amount up to the cost to move
items which are not moved. The direct loss formula is as
follows:
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ACTUAL
DIRECT LOSS OF TANGIBLE PERSONAL PROPERTY
= THE LESSER OF
* THE COST TO MOVE THE ITEM
OR
* THE FAIR MARKET VALUE FOR CONTINUED USE
LESS THE PROCEEDS FROM THE SALE
(IF THE ITEM IS NOT REPLACED).
OR
*THE REPLACEMENT COST LESS THE PROCEEDS
FROM THE SALE/TRADE IN VALUE (IF THE
ITEM IS REPLACED).
*PLUS THE COST OF THE SALE
Example 1: The owner will replace an obsolete sheet metal press
with a new sheet metal press at the replacement site,
Condition: Business to be re-established - Item to be replaced
The payment will 'be the lesser of:
a. The replacement cost minus the proceeds of the sale
(trade-in value when applicable), or
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b. The estimated cost to move the item of personal property
to the replacement site.
Replacement cost $2,800
Proceeds of sale $ 850
Estimated cost to move $1,000
Replacement cost $2,800
Proceeds of sale -_$ 850
$1,950
Estimated cost to move * $1,000
Expense of sale $ 50
Direct loss payment $1,050
Example 2: The owner will not replace the obsolete sheet metal
press at the replacement site.
Condition: Business to be re-established - Item not replaced
The payment will be the lesser of:
a. The fair market value for continued use of the item minus
the proceeds of the sale, or
b. The estimated cost to move the item of personal property
to the replacement site.
Fair market value for continued use $1,500
Estimated cost to move $ 500
Proceeds of sale $ 550
FMV for continued use $1,500
Proceeds of sale -$ 550
$ 950
Estimated cost to move $ 500
Expense of sale $ 50
Direct loss ament $ 550
The direct loss option is particularly beneficial to businesses
with outmoded equipment which is bulky, heavy, or otherwise
expensive to move. It may also have relatively low sale value or
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even negative value).
It is required in the development of a direct loss claim that the
business operator attempt to sell (or trade in) the property
which is subject to the claim. However, the agency may determine
in advance that a sale is not necessary if there is no obvious
market for the property to be moved from the site. Example 2
would be a good illustration of this situation if there were no
market for the obsolete sheet metal press and no possibility of
a sale. In such a case the press would be abandoned and the
owner could claim the lower amount: the value for continued use
($1,500) or the estimated cost to move ($500).
Reestablishment Expenses
Small businesses are eligible for reestablishment expenses in an
amount up to $10,000 in addition to the actual costs of moving.
Small businesses are defined as businesses that have at least
one, but not more than 500 employees working at the site being
acquired or displaced by a program or project. At least one
person includes persons who own their own businesses (self-
employed) . "Working at the site" means that the business
operation is full-time and that at least one employee works full
time at the site. The definition seeks to avoid making payments
to absentee landlords or to others who do not actually conduct
their business operations on or from the site. Payment to a
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part-time business in the home which does not contribute
materially (see definition in 49 CFR, Part 24.2(e)) to the
household income is also excluded. The emphasis is that the
payment is to be available to those who actually operate a
business on or from the acquired site. On the other hand, if
there is a business that does not meet the requirements, but is
considered by the displacing agency to be eligible, a waiver can
be requested from the Federal or Federal funding agency. Of
course, these payments are also available to farms and nonprofit
organizations that meet the criteria.
The payment, not to exceed $10,000, is to be used for expenses
actually incurred in reestablishing the small business, including
nonprofit organizations and farms at the replacement site. The ^^
reestablishment expenses must be reasonable and necessary, as
determined by the agency. Of course, estimates will have to be
computed for increased operation costs at the replacement site
for 2 years based on the best available data.
The following are the allowable expenses:
1. Repairs or improvements to the replacement real property
as required by Federal, State or local law, code or
ordinance.
2. Modifications to the replacement property to accommodate
the business operation or make replacement structures
suitable for conducting the business.
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3. Construction and installation costs, not to exceed $1,500
for exterior signing to advertise the business.
4. Provision of utilities from right-of-way to improvements
on the replacement site.
5. Redecoration or replacement of soiled or worn surfaces at
the replacement site, such as paint, panelling, or
carpeting.
6. Licenses, fees and permits when not paid as part of moving
expenses.
7. Feasibility surveys, soil testing and marketing studies.
8. Advertisement of replacement location, not to exceed
$1,500.
9. Professional services in connection with the purchase or
lease of a replacement site.
10. Estimated increased costs of operation during the first 2
years at the replacement site, not to exceed $5,000, for
such items as:
(i) Lease or rental charges,
(ii) Personal or real property taxes,
(iii) Insurance premiums, and
(iv) Utility charges, excluding impact fees.
11. Impact fees or one-time assessments for anticipated heavy
utility usage.
12. Other items that the Agency considers essential to the
reestablishment of the business.
13. Expenses in excess of the regulatory maximums set forth in
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(3), (8) and (10) of this section may be considered
eligible if large and legitimate disparities exist between
costs of operation at the displacement site and costs of
operation at an otherwise similar replacement site. In
such cases the regulatory limitation for reimbursement of
such costs may, at the request of the Agency, be waived by
the Federal agency funding the program or project, but in
no event shall total costs payable under this section
exceed the $10,000 statutory maximum.
(b) Ineligible expenses. The following is a non-
exclusive listing of reestablishment expenditures
not considered to be reasonable, necessary, or
otherwise eligible:
(1) Purchase of capital assets, such as, office
furniture, filing cabinets, machinery or trade
fixtures.
(2) Purchase of manufacturing materials, production
supplies, product inventory or other items used in
the normal course of the business operation.
(3) Interior or exterior refurbishments at the
replacement site which are for aesthetic purposes,
except as provided in the previous part (5) of this
section.
(4) Interest on money borrowed to make the move or
purchase the replacement property.
(5) Payment to a part-time business in the home which
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does not contribute materially to the household
income.
INELIGIBLE MOVING AND RELATED EXPENSES.
A displaced person is not entitled to payment for:
(a) The cost of moving any structure or other real property
improvement in which the displaced person reserved
ownership. However, this part does not preclude the
computation under owner retention of a displacement
dwelling; or
(b) Interest on a loan to cover moving expenses; or
(c) Loss of goodwill; or
(d) Loss of profits; or
(e) Loss of trained employees; or
^^ (f) Any additional operating expenses of a business or farm
operation incurred because of operating in a new location
except for an eligible reestablishment expense; or
(g) Personal injury; or
(h) Any legal fee or other cost for preparing a claim for a
relocation payment or for representing the claimant
before the Agency; or
(i) Expenses for searching for a replacement dwelling; or
(j) Physical changes to the real property at the replacement
location of a business or farm operation except as
provided for as a moving expense or a reestablishment
expense; or
(k) Costs for storage of personal property on real property
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already owned or leased by the displaced person.
Fixed Payment for Moving Expenses
A business owner may choose to receive a fixed payment of between
$1,000 and $20,000 in lieu of moving costs, if certain basic
eligibility criteria are met. This payment precludes
reimbursement for all other moving and related costs, including
search expense, storage, direct loss claims and reestablishment.
The in-lieu payment computation is based on the average annual
net earnings before taxes for the 2 years immediately prior to
displacement for a business or for a farm. The payment to a
nonprofit organization is to be supported with financial
statements and is the average of two years annual gross revenue
less administrative expenses.
Business In Lieu Payment
Example
Year Displaced 1990
Net Income: 1989 - $16,500
1988 - $18,500
1987 = $20.000
In lieu payment * $17,500 unless the diminishing
income is due to the project. Then it would be appropriate to
use the 1987 and 1988 net incomes and compute a payment of
$19,250.
There are six special eligibility criteria. The first is that a
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substantial loss of existing patronage (clientele or net
earnings) will occur at a replacement site. The substantial loss
of patronage criteria may be assumed to exist for a displaced
business unless the agency determines that it will not suffer
such a loss. An example of when a substantial loss assumption
may not be appropriate is when an office building is acquired and
a single person professional office, such as a lawyer, doctor, or
insurance agent is displaced and there is city-wide clientele.
Even here, however, there may be other circumstances, such as
advanced age of the owner, which would obviously support a
substantial loss of patronage determination.
The second is that the business has owned or rented personal
property which must be moved from the displacement site at the
business's expense. The business must actually vacate or
relocate from the displacement site.
The third is that the business is not part of a commercial
enterprise that has more than three other entities that are not
being acquired.
The fourth is that the business is not operated solely for
renting dwellings to others.
The fifth is that the business is not operated soley for renting
the site (including structures).
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The sixth eligibility requirement is that the business must
contribute materially to the income of the displaced person
during the 2 taxable years prior to displacement. The term
"contributes materially" means that during the 2 taxable years
prior to the taxable year in which the displacement occurs, or
during such other period the agency determines to be more
equitable. For the business or farm operation to show a material
contribution to the income of the displaced person it must be
further documented that it:
a. Had average annual gross receipts of at least $5,000; or
b. Had average annual net earnings of at least $1,000; or
c. Contributed at least 33-1/3 percent of the owner's or
operator's average annual gross income from all sources;
or
d. If the above criteria creates a hardship or an inequity
in any given case, the Agency may approve other criteria
deemed more appropriate.
The in lieu payment may be made without regard to whether the
business operator discontinues or relocates the business. The
intention to reestablish the business has no bearing on the
eligibility requirements. All businesses should be encouraged to
reestablish and should be provided advisory assistance that will
help with successful relocation regardless of eligibility for an
in-lieu claim.
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The in-lieu payment option has several advantages:
It is administratively simple and relieves the agency
from reviewing detailed moving expenses.
The displaced person may spend the payment in any way
desired. If the payment exceeds actual moving expenses,
the excess amount may help pay some of the costs which
could not otherwise be reimbursed.
Displaced businesses that choose not to reestablish, may
find the payment useful to replace lost income for a time,
or to cover expenses involved in discontinuing
operations.
Relocation agents should assure that business owners are
aware of the various options available to them so that
they are able to make informed decisions. Good
relocation assistance requires that the agent spend
enough time with the business owner to understand the
complexity of his or her business, the impact of
acquisition, and the moving requirements of the
particular business.
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CHAPTER TWELVE
APPEALS
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CHAPTER TWELVE
APPEALS
Appealing the alleged failure of the Agency to properly consider
his or her application for assistance is the right of every
person who may be affected by a Federal or federally-funded
project. Addressing appeals is not an activity of preference for
anyone. Most Agencies would prefer to avoid dealing with
appeals.
The best way to avoid appeals is to make every effort to comply
with the Uniform Act and the applicable regulations while
conducting program or project activities. Competent employees
who know the regulations and agency procedures, follow them
carefully, and work with displaced persons in a compassionate
manner will certainly assist in limiting appeals. Accurate
appraisals and appropriate negotiation procedures will also help
reduce the number of appeals.
In accordance with the 1987 amendments, appeal rights are no
longer confined to the amount of or eligibility for payments.
Persons filing appeals may be anyone who believes he or she is
eligible for assistance of some kind. Most agencies already have
well-established procedures in place for just compensation and
negotiation concerns, including administrative and legal
settlements. Therefore, appeals for these issues are not
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anticipated. However, there could be appeals by persons desiring^
the status of displaced persons or requesting assistance because
of the proximity of their business or residence to the project.
Frequently, a displaced person will tell the relocation agent
about procedures, eligibility criteria, comparables used, or
payments computed that are of concern. These items can become
the subject of an appeal if they are not responded to promptly
and with understanding. Sometimes, a displaced person may be
complaining about one thing when he or she is really upset about
something else. Careful listening will reveal the real problem
and hopefully, a resolution, without entering the appeal process.
The next step may be an informal appeal. This could occur if the
relocation agent is not able to provide resolution of the
displaced person's concerns. The relocation agent would take
the concerns of the displaced person(s) to his/her supervisor or
administrator of the relocation site office on an informal basis.
A reevaluation of an application, the selected comparable,
computed payments, or the offered services may be necessary.
Frequently, the relocation agent may be presenting information to
the displaced persons that was prepared by someone else. His or
her understanding of the reasons for payment computations or the
selection of comparables may be the clue to providing acceptable
rationale to the displaced person.
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If the displaced person is still dissatisfied with the agency's
determinations after the informal meeting, he or she may enter
the formal appeal process.
The formal appeal process is entered when a person files a
written appeal with the Agency. Any aggrieved person may file a
written appeal with the Agency. When the displaced person
believes that the Agency has failed to properly determine the
person's eligibility for any services or benefits. The written
appeal may be on an agency form, in a letter, or a hand written
note. It may be written with the assistance of the relocation
agent, a secretary or another person. It may be dictated to a
member of the agency staff and signed by the displaced person.
The only criteria is that a written document, regardless of form,
be presented to initiate the formal review process.
The agency may set a reasonable time limit for a person to file
an appeal. The time limit shall not be less than 60 days after
the person receives written notification of the agency's
determination regarding the person's application or claim for
relocation services or payments.
The Agency shall have established appeal procedures. The
procedures will provide, at a minimum for:
1. The administrative procedures for an appeal hearing.
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2. The title of the agency official conducting the review of
the appeal who may be either the head of the agency or his
or her designee. The official conducting the review can
also be a hearing officer from another agency if
designated or if there are existing administrative
procedures for hearings.
3. The right of the person filing the appeal to be
represented by legal counsel or other representative in
connection with his or her appeal, but solely at the
person's own expense.
4. The right of the person to review the files and to inspect
and copy all materials pertinent to his or her appeal
except for materials classified as confidential by the
Agency.
5. The scope of the review of the appeal. The Agency shall
consider all pertinent justification and other material
submitted by the person as well as all the available
information that is needed to ensure a fair and full
review of the appeal. The agency assemblage of the data
to be considered should be completed as soon after receipt
of the applicants' material as is feasible. Only
justifiable delays should be tolerated.
6. Customarily, an agency conducts a hearing with the
aggrieved person as a part of the appeal process. The
hearing should be held as soon after receipt of the appeal
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as possible. The agency should always conduct itself in a
business-like manner and with "good faith".
7. The determination and notification of the appeal decision.
A prompt written determination, including an explanation
of the basis on which the decision was made, shall be
furnished to the person after receipt of all information
submitted in support of the appeal. "Prompt11 means not
more than 60 days and, preferably 30-45 days maximum. If
the full relief requested is not granted, the agency
shall advise the person of his or her right to seek
judicial review through the appropriate court system.
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CHAPTER THIRTEEN
RELOCATION PROGRAM AT
THE CONSTRUCTION STAGE
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CHAPTER THIRTEEN
RELOCATION PROGRAM AT THE CONSTRUCTION STAGE
This chapter is written primarily for agencies acquiring
right-of-way for highway projects. The references are to 23 CFR
because it contains the regulations, which cross references 49
CFR Part 24, with which highway agencies must comply. However,
the principles should apply to any Federal or Federal-aid
program or project that requires displacement of residential
occupants, businesses, nonprofit organizations and farms. The
Federal agency is responsible for compliance with the Uniform Act
regulations and the displacing agency, whether Federal, State or
an individual has committed itself to performing displacements in
accordance with the Uniform Act. Most projects or programs have
specific points in time when the acquired sites must be vacant so
that some type of construction activity may take place.
All highway real property acquisition and relocation activities
are undertaken to provide clear right-of-way for a construction
project. With a systematic approach to project development all
relocations should normally be completed by the time a project is
advertised for construction. In accordance with 23CFR 635,
Subpart C, the Federal Highway Administration cannot authorize
advertising for construction until the State highway department
has certified that the right-of-way is clear, or as an exception,
provisions have been made to have the right-of-way clear by a
specified date. (At least by date of contract award). The State
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is also responsible for the certificate of any local governments
that receive Federal-aid funds through the State. The FHWA is
responsible for assuring that the State has met its
responsibilities for the relocation program. In order to meet
this responsibility:
a. FHWA shall verify that comparable replacement housing has
been made available to displaced persons prior to
authorizing advertising for physical construction bids.
The initial verification will normally consist of a review
of documentation. The verification may also be
accomplished by field reviews to the depth necessary to
provide sufficient evidence that the required replacement
housing is in place and has been made available.
"Made available" means that all displaced persons have
been informed of the location of comparable replacement
dwellings, and sufficient time (not less than 90 days) has
been allowed for the displaced person to negotiate for or
enter into a purchase agreement or lease for the
replacement property. The persons must be assured of
receiving the relocation assistance and payments in
sufficient time to complete their purchase or lease.
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b. The FHWA shall not authorize advertising for physical
construction bids unless all applicable provisions of the
Uniform Relocation Act have been complied with and a
certifying statement has been received from the State
Highway Agency to that effect.
c. As appropriate, FHWA will approve certifying statements
for projects administered under Certification Acceptance
or a Secondary Road plan. FHWA does not normally issue
specific authorization to advertise for bids for physical
construction under these plans, but is still responsible
for the Uniform Act requirements. The State shall not
advertise for bids for physical construction until the
Uniform Act requirements and the requirements of 23 CFR
have been met. They should not advertise for bids until
FHWA has approved the Certifying statement in writing.
Although the primary thrust of the certifying statement and
verification is aimed toward replacement housing, other facets of
relocation, e.g., moving personal property, are equally important
in clearing the right-of-way for construction. The certification
is also applicable to businesses, farms, and nonprofit
organizations.
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If all acquisitions and relocations have been completed prior to
the certifying statement, the State only needs to indicate that
it has legal/physical possession of the property and all
relocations have been accomplished in compliance with the CFR.
The State will have met the criteria for relocation assistance at
the construction stage when it has completed the following:
I. Provided relocation assistance advisory services to
residential occupants, businesses, farms, and
nonprofit organizations which includes the location
and availability of replacement properties meeting
the needs of the occupants.
2. Furnished the displaced person, in writing, the
computed amount of his/her replacement housing
payments, if any, and the amount of the moving
allowance or of an actual cost move.
3. Allowed the displaced person sufficient time to
negotiate for and obtain possession of a replacement
property and move his/her personal property.
4. Furnished a 90-day notice, and if the alternate
procedure is used, furnished the 30-day notice after
legal possession was obtained. The notice shall
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specify the required vacation date. (The notices are
not necessary if a displaced person moves before they
are to be issued.)
5. Informed the displaced person of his/her right to
appeal and the procedure for making an application to
appeal if there is a disagreement with the State's
determination of eligibility for assistance.
Occasionally, all relocations have not been completed when a
certifying statement is needed in order to advertise for
construction bids. 23 CFR 635.309(c) (3) provides for exceptions
to the legal/physical occupancy of the right-of-way when it is in
the public interest to do so. When this situation arises, the
State must meet the following criteria in addition to the
relocation requirements:
1. Provide a public interest finding, including why it
is in the public interest to proceed.
2. Identify each remaining parcel that is not in the
physical possession of the State.
3. Establish an estimated date when physical occupancy
by the State will be obtained and substantiate that
such date is realistic. The date established for
each parcel should be no earlier than the date on the
90-day or 30-day notice.
4. Provide notification in the bid proposals that the
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State does not have physical possession of a
parcel(s) and provide the date when it is expected to
be obtained. If a right-of-way certificate indicates
less than full legal/physical possession by the
State, the FHWA has only two alternatives. The
letting may be delayed or, as an exception, the
construction may be authorized conditionally. In
either case the FHWA should receive from the State a
supplemental certifying statement when all
relocations have been accomplished in compliance with
the CFR and the State has full legal/physical
possession. The letting may then be held or the
conditions removed from the construction contract.
CLARIFICATION OF TERNS
Legal Possession
Under the "quick take" provisions of some State laws, title to
the real property is transferred to the acquiring agency
immediately after the filing for condemnation in the appropriate
court. The transfer of title gives legal possession to the
acquiring agency. However, under FHWA regulations, the agency
may still be required to provide a displaced person with a 90-day
or 30-day notice. The transference of title under the "quick
take" provision is not sufficient to furnish a certificate that
the Right-of-Way is clear. The requirement of the Uniform Act
that a vacate notice has been issued with adequate time for
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vacation must also be met.
Physical Possession
In contrast to legal possession, physical possession gives the
acquiring agency the right to enter on the property and perform
work. It may be in the form of a right-of-entry granted by the
owner prior to legal possession and transfer of ownership, or it
may constitute transfer of full physical and legal ownership to
the acquiring agency. If the improvements are vacated and
personal property has been removed, then the acquiring agency has
the right to occupy the real estate. Only this type of
possession is adequate for a certifying statement that the
right-of-way is cleared for construction.
These requirements should be reviewed frequently by agency
personnel responsible for working on projects requiring
displacement of people. FHWA should verify that the acquiring
and displacing agency(si have complied with the requirements of
the CFR and the Uniform Act regulations by reviewing documentary
evidence and conducting field reviews as appropriate.
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APPENDICES
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APPENDIX I
LAW
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^•Public Law 91-646
91st Congress, S. 1
January 2, 1971
(2As amended by Public Law 100-17,
Apr. 2, 1987, Title IV, Uniform
Relocation Act Amendments of 1987.)
Prepared by:
Office of Right-of-Way
Federal Highway Administration
AN ACT
To provide for uniform and equitable treatment of persons
displaced from their homes, businesses, or farms by Federal
and federally assisted programs and to establish uniform"
and equitable land acquisition policies for Federal and
federally assisted programs.
Be it enacted by the Senate and House of
Representatives of the United States of America in Congress
assembled, That this Act may be cited as the "Uniform
Relocation Assistance and Real Property Acquisition
Policies Act of 1970".
TITLE I—GENERAL PROVISIONS
SEC. 101. As used in this Act—
(1) The term "Federal agency" »eans any department,
agency, or instrumentality in the executive branch of the
Government, any wholly owned Government corporation, the
Architect of the Capitol, the Federal Reserve banks and
branches thereof, and any person who has the authority to
acquire property by eminent domain under Federal law.
(2) The term "State" means any of the several States
of the United states, the District of Columbia, the
Commonwealth of Puerto Rico, any territory or possession of
the United States, the Trust Territory of the Pacific
Islands, and any political subdivision thereof.
(3) The term "State agency" means any department,
agency, or instrumentality of a State or of a political
subdivision of a State, any department, agency, or
instrumentality of two or more states or of two or more
political subdivisions of a State or States, and any person
who has the authority to acquire property by eminent domain
under State law.
(4) The term "Federal financial assistance" means a
grant, loan, or contribution provided by the United States,
^Unamended text appears in regular typeface.
2Amended text is displayed in boldface.
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except any Federal guarantee or insurance, any interest
reduction payment to an individual in connection with the
purchase and occupancy of a residence by that individual/
and any annual payment or capital loan to the District of
Columbia.
(5) The term "person" means any individual,
partnership, corporation, or association.
(6)(A) The term "displaced person" Beans, except as
provided in subparagraph (B)~
(i) any person who moves from real property,
or moves his personal property from real
property- (I) as a direct result of a
written notice of intent to acquire or
the acquisition of such real property
in whole or in part for a program or
project undertaken by a Federal agency
or with Federal financial assistance;
or
(II) on which such person is a
residential tenant or conducts a small
business, a farm operation, or a business
defined in section 101(7)(D), as a direct
result of rehabilitation, demolition, or
such other displacing activity as the lead
agency may prescribe, under a program or
project undertaken by a Federal agency or
with Federal financial assistance in any
case in which the head of the displacing
agency determines that such displacement is
permanent; and
(ii) solely for the purposes of sections
202 (a) and (b) and 205 of this title, any person
who moves from real property, or moves his
personal property from real property—
(I) as a direct result of a written
notice of intent to acquire or the
acquisition of other real property, in whole
or in part, on which such person conducts a
business or farm operation, for a program or
project undertaken by a Federal agency or
with Federal financial assistance; or
(II) as a direct result of
rehabilitation, demolition, or such other
displacing activity as the lead agency may
prescribe, of other real property on which
such person conducts a business or a farm
operation, under a program or project
undertaken by a Federal agency or with
Federal financial assistance where the head
of the displacing agency determines that
such displacement is permanent.
(B) The term "displaced person" does not include-
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(i) a person who has been determined,
according to criteria established by the head of
the lead agency, to be either in unlawful
occupancy of the displacement dwelling or to have
occupied such dwelling for the purpose of
obtaining assistance under this Act;
(ii) in any case in which the displacing
agency acquires property for a program or
project, any person (other than a person who was
an occupant of such property at the time it was
acquired) who occupies such property on a rental
basis for a short ten or a period subject to
termination when the property is needed for the
program or project.
(7) The term "business" means any lawful activity,
excepting a farm operation, conducted primarily—
(A) for the purchase, sale, lease and rental of
personal and real property, and for the manufacture,
processing, or marketing of products, commodities, or
any other personal property;
(B) for the sale of services to the public;
(C) by a nonprofit organization; or
(D) solely for the purposes of section 202
of this title, for assisting in the purchase, sale,
resale, manufacture, processing, or marketing of
products, commodities, personal property, or services
by the erection and maintenance of an outdoor
advertising display or displays, whether or not such
display or displays are located on the premises on
which any of the above activities are conducted.
(8) The term "farm operation" means any activity
conducted solely or primarily for the production of one or
more agricultural products or commodities, including
timber, for sale or home use, and customarily producing
such products or commodities in sufficient quantity to be
capable of contributing materially to the operator's
support.
(9) The term "mortgage" means such classes of liens as
are commonly given to secure advances on, or the unpaid
purchase price of, real property, under the laws of the
State in which the real property is located, together with
the credit instruments, if any, secured thereby.
(10) The term "comparable replacement dwelling" means
any dwelling that is (A) decent, safe, and sanitary; (B)
adequate in size to accommodate the occupants; (C) within
the financial means of the displaced person; (D)
functionally equivalent; (E) in an area not subject to
unreasonable adverse environmental conditions; and (F) in a
location generally not less desirable than the location of
the displaced person's dwelling with respect to public
utilities, facilities, services, and the displaced person's
place of employment.
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(11) The term "displacing agency" means any Federal
agency carrying out a program or project, and any State, i
State agency, or person carrying out a program or project
with Federal financial assistance, which causes a person to
be a displaced person.
(12) The term "lead agency" means the Department of
Transportation.
(13) The term "appraisal* means a written statement
independently and impartially prepared by a qualified
appraiser setting forth an opinion of defined value of an
adequately described property as of a specific date,
supported by the presentation and analysis of relevant
market information.
EFFECT UPON PROPERTY ACQUISITION
SEC. 102. (a) The provisions of section 301 of title
III of this Act create no rights or liabilities and shall
not affect the validity of any property acquisitions by
purchase or condemnation.
(b) Nothing in this Act shall be construed as creating
in any condemnation proceedings brought under the power of
eminent domain, any element of value or of damage not in
existence immediately prior to the date of enactment of
this Act.
CERTIFICATION
SEC. 103. (a) Notwithstanding sections 210 and 305 of
this Act, the head of a Federal agency may discharge any of
his responsibilities under this Act by accepting a
certification by a State agency that it will carry out such
responsibility, if the head of the lead agency determines
that such responsibility will be carried out in accordance
with State laws which will accomplish the purpose and
effect of this Act.
(b) (1) The head of the lead agency shall issue
regulations to carry out this section.
(2) The head of the lead agency shall, in
coordination with other Federal agencies, monitor from
time to time, and report biennially to the Congress on,
State agency implementation of this section. A State
agency shall make available any information required
for such purpose.
(3) Before making a determination regarding any
State law under subsection (a) of this section, the
head of the lead agency shall provide interested
parties with an opportunity for public review and
comment. In particular, the head of the lead agency
shall consult with interested local general purpose
governments within the State on the effects of such
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State lav on the ability of local governments to carry
out their responsibilities under this Act.
(c) (1) The head of a Federal agency Bay withhold his
approval of any Federal financial assistance to or
contract or cooperative agreement with any displacing
agency found by the Federal agency to have failed to
comply with the lavs described in subsection (a) of
this section.
(2) After consultation vith the head of the lead
agency, the head of a Federal agency may rescind his
acceptance of any certification under this section, in
vhole or in part, if the State agency fails to comply
vith such certification or vith State lav.
TITLE II—UNIFORM RELOCATION ASSISTANCE
DECLARATION OF FINDINGS AND POLICY
SEC. 201. (a) The Congress finds and declares that—
(1) displacement as a direct result of programs or
projects undertaken by a Federal agency or vith Federal
financial assistance is caused by a number of
activities, including rehabilitation, demolition, code
enforcement, and acquisition;
(2) relocation assistance policies must provide
for fair, uniform, and equitable treatment of all
affected persons;
(3) the displacement of businesses often results
in their closure;
(4) minimizing the adverse impact of displacement
is essential to maintaining the economic and social
veil-being of communities; and
(5) implementation of this Act has resulted in
burdensome, inefficient, and inconsistent compliance
requirements and procedures which vill be improved by
establishing a lead agency and allowing for State
certification and implementation.
(b) This title establishes a uniform policy for the
fair and equitable treatment of persons displaced as a
direct result of programs or projects undertaken by a
Federal agency or vith Federal financial assistance. The
primary purpose of this title is to ensure that such
persons shall not suffer disproportionate injuries as a
result of programs and projects designed for the benefit of
the public as a vhole and to minimize the hardship of
displacement on such persons.
(c) It is the intent of Congress that—
(1) Federal agencies shall carry out this title in
a manner vhich minimizes vaste, fraud, and
mismanagement and reduces unnecessary administrative
costs born by States and State agencies in providing
relocation assistance;
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(2) uniform procedures for the administration of
relocation assistance shall, to the maximum extent
feasible, assure that the unique circumstances of any
displaced person are taken into account and that
persons in essentially similar circumstances are
accorded equal treatment under this Act;
(3) the improvement of housing conditions of
economically disadvantaged persons under this title
shall be undertaken, to the maximum extent feasible, in
coordination with existing Federal, State, and local
governmental programs for accomplishing such goals; and
(4) the policies and procedures of this Act will
be administered in a manner which is consistent with
fair housing requirements and which assures all persons
their rights under title VTII of the Act of April 11,
1968 (P.L. 90-284), commonly known as the Civil Rights
Act of 1968, and title VI of the Civil- Rights Act of
1964.
MOVING AND RELATED EXPENSES.
SEC. 202. (a) Whenever a program or project to be
undertaken by a displacing agency will result in the
displacement of any person, the head of the displacing
agency shall provide for the payment to the displaced
person of—
(1) actual reasonable expenses in moving himself,
his family, business, farm operation, or other personal
property;
(2) actual direct losses of tangible personal
property as a result of moving or discontinuing a
business or farm operation, but not to exceed an amount
equal to the reasonable expenses that would have been
required to relocate such property, as determined by
the head of the agency;
(3) actual reasonable expenses in searching for a
replacement business or farm; and
(4) actual reasonable expenses necessary to
reestablish a displaced farm, nonprofit organization,
or small business at its new site, but not to exceed
$10,000.
(b) Any displaced person eligible for payments under
subsection (a) of this section who is displaced from a
dwelling and who elects to accept the payments authorized
by this subsection in lieu of the payments authorized by
subsection (a) of this section may receive an expense and
dislocation allowance, which shall be determined according
to a schedule established by the bead of the lead agency.
(c) Any displaced person eligible for payments under
subsection (a) of this section who is displaced from the
person's place of business or farm operation and who is
eligible under criteria established by the head of the lead
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agency Bay elect to accept the payment authorized by this
subsection in lieu of the payment authorized by subsection
(a) of this section. Such payment shall consist of a fixed
payment in an amount to be determined according to criteria
established by the head of the lead agency, except that
such payment shall not be less than $1,000 nor more than
$20,000. A person whose sole business at the displacement
dwelling is the rental of such property to others shall not
qualify for a payment under this subsection.
(d) (1) Except as otherwise provided by Federal law—
(A) if a program or project (i) which is
undertaken by a displacing agency, and (ii) the
purpose of which is not to relocate or reconstruct
any utility facility, results in the relocation of
a utility facility;
(B) if the owner of the utility facility
which is being relocated under such program or
project has entered into, with the State or local
government on whose property, easement, or right-
of-way such facility is located, a franchise or
similar agreement with respect to the use of such
property, easement, or right-of-way? and
(C) if the relocation of such facility
results in such owner incurring an extraordinary
cost in connection with such relocation;
the displacing agency may, in accordance with such
regulations as the head of the lead agency may issue,
provide to such owner a relocation payment which may
not exceed the amount of such extraordinary cost (less
any increase in the value of the new utility facility
above the value of the old utility facility and less
any salvage value derived from the old utility
facility).
(2) For purposes of this subsection, the term—
(A) "extraordinary cost in connection with a
relocation" means any cost incurred by the owner
of a utility facility in connection with
relocation of such facility which is determined by
the head of the displacing agency, under such
regulations as the head of the lead agency shall
issue—
(i) to be a non-routine relocation
expense;
(ii) to be a cost such owner ordinarily
does not include in its annual budget as an
expense of operation; and
(iii) to meet such other requirements as
the lead agency may prescribe in such
regulations; and
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(B) "utility facility" means—
(i) any electric, gas, water, st<
power, or materials transmission or
distribution system;
(ii) any transportation system;
(iii) any communications system
(including cable television); and
(iv) any fixtures, equipment, or other
property associated with the operation,
maintenance, or repair of any such system;
located on property which is owned by a State or
local government or over which a State or local
government has an easement or right-of-way. A
utility facility may be publicly, privately, or
cooperatively owned.
REPLACEMENT HOUSING FOR HOMEOWNER
SEC. 203. (a)(1) In addition to payments otherwise
authorized by this title, the head of the displacing agency
shall make an additional payment not in excess of $22,500
to any displaced person who is displaced from a dwelling
actually owned and occupied by such displaced person for
not less than one hundred and eighty days prior to the
initiation of negotiations for the acquisition of the
property. Such additional payment shall include thej
following elements:
(A) The amount, if any, which when added to
the acquisition cost of the dwelling acquired by
the displacing agency, equals the reasonable cost
of a comparable replacement dwelling.
(B) The amount, if any, which will compensate
such displaced person for any increased interest
costs and other debt service costs which such
person is required to pay for financing the
acquisition of any such comparable replacement
dwelling. Such amount shall be paid only if the
dwelling acquired by the displacing agency was
encumbered by a bona fide mortgage which was a
valid lien on such dwelling for not less than 180
days immediately prior to the initiation of
negotiations for the acquisition of such dwelling.
(C) Reasonable expenses incurred by such
displaced person for evidence of title, recording
fees, and other closing costs incident to the
purchase of the replacement dwelling, but not
including prepaid expenses.
(2) The additional payment authorized by this
section shall be made only to a displaced person who
purchases and occupies a decent, safe, and sanitary
replacement dwelling within one year after the date onl
which such person receives final payment from the
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displacing agency for the acquired dwelling or the date
on which the displacing agency's obligation under
section 205(c) (3) of this Act is Bet, whichever is
later, except that the displacing agency may extend
such period for good cause. If such period is
extended, the payment under this section shall be based
on the costs of relocating the person to a comparable
replacement dwelling within one year of such date.
(b) The head of any Federal agency may, upon
application by a mortgagee, insure any mortgage (including
advances during construction) on a comparable replacement
dwelling executed by a displaced person assisted under this
section, which mortgage is eligible for insurance under any
Federal law administered by such agency notwithstanding any
requirements under such law relating to age, physical
condition, or other personal characteristics of eligible
mortgagors, and may make commitments for the insurance of
such mortgage prior to the date of execution of the
mortgage.
REPLACEMENT HOUSING FOR TENANTS AND CERTAIN OTHERS
SEC. 204 (a) In addition to amounts otherwise
authorized by this title, the head of a displacing agency
shall make a payment to or for any displaced person
displaced from any dwelling not eligible to receive a
payment under section 203 which dwelling was actually and
lawfully occupied by such displaced person for not less
than ninety days immediately prior to (1) the initiation of
negotiations for acquisition of such dwelling, or (2) in
any case in which displacement is not a direct result of
acquisition, such other event as the head of the lead
agency shall prescribe. Such payment shall consist of the
amount necessary to enable such person to lease or rent for
a period not to exceed 42 months, a comparable replacement
dwelling, but not to exceed $5,250. At the discretion of
the head of the displacing agency, a payment under this
subsection may be made in periodic installments.
Computation of a payment under this subsection to a low-
income displaced person for a comparable replacement
dwelling shall take into account such person's income.
(b) Any person eligible for a payment under subsection
(a) of this section may elect to apply such payment to a
down payment on, and other incidental expenses pursuant to,
the purchase of a decent, safe, and sanitary replacement
dwelling. Any such person may, at the discretion of the
head of the displacing agency, be eligible under this
subsection for the maximum payment allowed under subsection
(a), except that, in the case of a displaced homeowner who
has owned and occupied the displacement dwelling for at
least 90 days but not more than 180 days immediately prior
to the initiation of negotiations for the acquisition of
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such dwelling, such payment shall not exceed the payment
such person would otherwise have received under section
203 (a) of this Act had the person owned and occupied the
displacement dwelling 180 days immediately prior to the
initiation of such negotiations.
RELOCATION PLANNING, ASSISTANCE COORDINATION, AND ADVISORY
SERVICES
SEC. 205 (a) Programs or projects undertaken by a
Federal agency or with Federal financial assistance shall
be planned in a manner that (1) recognizes, at an early
stage in the planning of such programs or projects and
before the commencement of any actions which will cause
displacements, the problems associated with the
displacement of individuals, families, businesses, and farm
operations, and (2) provides for the resolution of such
problems in order to minimize adverse impacts on displaced
persons and to expedite program or project advancement and
completion.
(b) The head of any displacing agency shall ensure that
the relocation assistance advisory services described in
subsection (c) of this section are made available to all
persons displaced by such agency. If such agency head
determines that any person occupying property immediately
adjacent to the property where the displacing activity
occurs is caused substantial economic injury as a result
thereof, the agency head may make available to such person
advisory services.
(c) Each relocation assistance advisory program
required by subsection (b) of this section shall include
such measures, facilities, or services as may be necessary
or appropriate in order to~
(1) determine, and make timely recommendations on,
the needs and preferences, if any, of displaced persons
for relocation assistance;
(2) provide current and continuing information on
the availability, sales prices, and rental charges of
comparable replacement dwellings for displaced
homeowners and tenants and suitable locations for
businesses and farm operations;
(3) assure that a person shall not be required to
move from a dwelling unless the person has had a
reasonable opportunity to relocate to a comparable
replacement dwelling, except in the case of—
(A) a major disaster as defined in section
102(2) of the Disaster Relief Act of 1974;
(B)' a national emergency declared by the
President; or
(C) any other emergency which requires the
person to move immediately from the dwelling
because continued occupancy of such dwelling by
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such person constitutes a substantial danger to
the health or safety of such person;
(4) assist a person displaced fro* a business or
farm operation in obtaining and becoming established in
a suitable replacement location;
(5) supply (A) information concerning other
Federal and State programs which may be of assistance
to displaced persons, and (B) technical assistance to
such persons in applying for assistance under such
programs; and
(6) provide other advisory services to displaced
persons in order to minimize hardships to such persons
in adjusting to relocation.
(d) The head of a displacing agency shall coordinate
the relocation activities performed by such agency with
other Federal, State, or local governmental actions in the
community which could affect the efficient and effective
delivery of relocation assistance and related services.
(e) Whenever two or more Federal agencies provide
financial assistance to a displacing agency other than a
Federal agency, to implement functionally or geographically
related activities which will result in the displacement of
a person, the heads of such Federal agencies may agree that
the procedures of one of such agencies shall be utilized to
implement this title with respect to such activities. If
such agreement cannot be reached, then the head of the lead
agency shall designate one of such agencies as the agency
whose procedures shall be utilized to implement this title
with respect to such activities. Such related activities
shall constitute a single program or project for purposes
of this Act.
(f) Notwithstanding section 101(6) of this Act, in any
case in which a displacing agency acquires property for a
program or project, any person who occupies such property
on a rental basis for a short term or a period subject to
termination when the property is needed for the program or
project shall be eligible for advisory services to the
extent determined by the displacing agency.
HOUSING REPLACEMENT BY FEDERAL AGENCY AS LAST RESORT
SEC. 206. (a) If a program or project undertaken by a
Federal agency or with Federal financial assistance cannot
proceed on a timely basis because comparable replacement
dwellings are not available, and the head of the displacing
agency determines that such dwellings cannot otherwise be
made available, the head of the displacing agency may take
such action as is necessary or appropriate to provide such
dwellings by use of funds authorized for such project. The
head of the displacing agency may use this section to
exceed the maximum amounts which may be paid under sections
203 and 204 on a case-by-case basis for good cause as
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determined in accordance with such regulations as the head
of the lead agency shall issue.
(b) No person shall be required to move from his
dwelling on account of any program or project undertaken by
a Federal agency or with Federal financial assistance,
unless the head of the displacing agency is satisfied that
comparable replacement housing is available to such person.
STATE REQUIRED TO FURNISH REAL PROPERTY INCIDENT TO FEDERAL
ASSISTANCE (LOCAL COOPERATION)
SEC. 207. Whenever real property is acquired by a State
agency and furnished as a required contribution incident to
a Federal program or project, the Federal agency having
authority over the program or project may not accept such
property unless such State agency has made all payments and
provided all assistance and assurances, as are required of
a State agency by sections 210 and 305 of this Act. Such
State agency shall pay the cost of such requirements in the
same manner and to the same extent as the real property
acquired for such project, except that in the case of any
real property acquisition or displacement occurring prior
to July 1, 1972, such Federal agency shall pay 100 per
centum of the first $25,000 of the cost of providing such
payments and assistance.
STATE ACTING AS AGENT FOR FEDERAL PROGRAM
SEC. 208. Whenever real property, is acquired by a
State agency at the request of a Federal agency for a
Federal program or project, such acquisition shall, for the
purposes of this Act, be deemed an acquisition by the
Federal agency having authority over such program or
project.
PUBLIC WORKS PROGRAMS AND PROJECTS OF THE GOVERNMENT OF THE
DISTRICT OF COLUMBIA AND OF THE WASHINGTON METROPOLITAN
AREA TRANSIT AUTHORITY
SEC. 209. Whenever real property is acquired by the
government of the District of Columbia or the Washington
Metropolitan Area Transit Authority for a program or
project which is not subject to sections 210 and 211 of
this title, and such acquisition will result in the
displacement of any person on or after the effective date
of this Act, the Commissioner of the District of Columbia
or the Washington Metropolitan Area Transit Authority, as
the case may be, shall make all relocation payments and
provide all assistance required of a Federal agency by this
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Act. Whenever real property is acquired for such a program
or project on or after such effective date, such
Commissioner or Authority, as the case may be, shall make
all payments and meet all requirements prescribed for a
Federal agency by title III of this Act.
REQUIREMENTS FOR RELOCATION PAYMENTS AND ASSISTANCE OF
FEDERALLY ASSISTED PROGRAM; ASSURANCES OF AVAILABILITY
OF HOUSING
SEC. 210. Notwithstanding any other lav, the head of a
Federal agency shall not approve any grant to, or contract
or agreement with, a displacing agency (other than a
Federal agency), under which Federal financial assistance
will be available to pay all or part of the cost of any
program or project which will result in the displacement of
any person on or after the effective date of this title,
unless he receives satisfactory assurances from such
displacing agency that—
(1) fair and reasonable relocation payments and
assistance shall be provided to or for displaced persons,
as are required to be provided by a Federal agency under
sections 202, 203, and 204 of this title;
(2) relocation assistance programs offering the
services described in section 205 shall be provided to such
displaced persons;
(3) within a reasonable period of time prior to
displacement, comparable replacement dwellings will be
available to displaced persons in accordance with section
205(c)(3).
FEDERAL SHARE OF COSTS.
SEC. 211. (a) The cost to a displacing agency of
providing payments and assistance under this title and
title III of this Act shall be included as part of the cost
of a program or project undertaken by a Federal agency or
with Federal financial assistance. A displacing agency,
other than a Federal agency, shall be eligible for Federal
financial assistance with respect to such payments and
assistance in the same manner and to the same extent as
other program or project costs.
(b) No payment or assistance under this title or title
III of this Act shall be required to be made to any person
or included as a program or project cost under this
section, if such person receives a payment required by
Federal, State, or local law which is determined by the
head of the Federal agency to have substantially the same
purpose and effect as such payment under this section.
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ADMINISTRATION—RELOCATION ASSISTANCE IN PROGRAMS
RECEIVING FEDERAL FINANCIAL ASSISTANCE
SEC. 212. In order to prevent unnecessary expenses and
duplications of functions, and to promote uniform and
effective administration of relocation assistance programs
for displaced persons under sections 206, 210, and 215 of
this title, a State agency may enter into contracts with
any individual, firm, association, or corporation for
services in connection with such programs, or may carry out
its functions under this title through any Federal or State
governmental agency or instrumentality having an
established organization for conducting relocation
assistance programs. Such State agency shall, in carrying
out the relocation assistance activities described in
section 206, whenever practicable, utilize the services of
State or local housing agencies, or other agencies having
experience in the administration or conduct of similar
housing assistance activities.
DDTIES OF LEAD AGENCY
SEC. 213. (a) The head of the lead agency shall—
(1) develop, publish, and issue, with the active
participation of the Secretary of Bousing and Urban
Development and the heads of other Federal agencies
responsible for funding relocation and acquisition
actions, and in coordination with State and local
governments, such regulations as may be necessary to
carry out this Act;
(2) ensure that relocation assistance activities
under this Act are coordinated with low-income housing
assistance programs or projects by a Federal agency or
a State or State agency with Federal financial
assistance;
(3) monitor, in coordination with other Federal
agencies, the implementation and enforcement of this
Act and report to the Congress, as appropriate, on any
major issues or problems with respect to any policy or
other provision of this Act; and
(4) perform such other duties as may be necessary
to carry out this Act.
(b) The head of the lead agency is authorized to issue
such regulations and establish such procedures as he may
determine to be necessary to assure—
(1) that the payments and assistance authorized by
this Act shall be administered in a manner which is
fair and reasonable and as uniform as practicable;
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(2) that a displaced person who Bakes proper
application for a payment authorized for such person by
this title shall be paid promptly after a move or, in
hardship cases, be paid in advance; and
(3) that any aggrieved person may have his
application reviewed by the head of the Federal agency
having authority over the applicable program or project
or, in the case of a program or project receiving
Federal financial assistance, by the State agency
having authority over such program or project or the
Federal agency having authority over such program or
project if there is no such State agency.
(c) The regulations and procedures issued pursuant to
this section shall apply to the Tennessee Valley Authority
only with respect to relocation assistance under this title
and title I.
PLANNING AND OTHER PRELIMINARY EXPENSES FOR ADDITIONAL
HOUSING
SEC. 215. In order to encourage and facilitate the
construction or rehabilitation of housing to meet the needs
of displaced persons who are displaced from dwellings
because of any Federal or Federal financially assisted
project, the head of the Federal agency administering such
project is authorized to make loans as a part of the cost
of any such project, or to approve loans as a part of the
cost of any such project receiving Federal financial
assistance, to nonprofit, limited dividend, or cooperative
organizations or to public bodies, for necessary and
reasonable expenses, prior to construction, for planning
and obtaining federally insured mortgage financing for the
rehabilitation or construction of housing for such
displaced persons. Notwithstanding the preceding sentence,
or any other law, such loans shall be available for not to
exceed 80 per centum of the reasonable costs expected to be
incurred in planning, and in obtaining financing for, such
housing, prior to the availability of such financing,
including, but not limited to, preliminary surveys and
analyses of market needs, preliminary site engineering,
preliminary architectural fees, site acquisition,
application and mortgage commitment fees, and construction
loan fees and discounts. Loans to an organization
established for profit shall bear interest at a market rate
established by the head of such Federal agency. All other
loans shall be without interest. Such Federal agency head
shall require repayment of loans made under this section,
under such terms and conditions as he may require, upon
completion of the project or sooner, and except in the case
of a loan to an organization established for profit, may
cancel any part or all of a loan if he determines that a
permanent loan to finance the rehabilitation or the
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construction of such housing cannot be obtained in an
amount adequate for repayment of such loan. Upon repayment
of any such loan, the Federal share of the sum repaid shall
be credited to the account from which such loan was made,
unless the Secretary of the Treasury determines that such
account is no longer in existence, in which case such sum
shall be returned to the Treasury and credited to
miscellaneous receipts.
PAYMENTS NOT TO BE CONSIDERED AS INCOME
SEC. 216. No payment received under this title shall be
considered as income for the purposes of the Internal
Revenue Code of 1954; or for the purposes of determining
the eligibility or the extent of eligibility of any person
for assistance under the Social Security Act or any other
Federal law (except for any Federal law providing low-
income housing assistance).
TRANSFERS OF SURPLUS PROPERTY
SEC. 218. The Administrator of General Services is
authorized to transfer to a State agency for the purpose of
providing replacement housing required by this title, any
real property surplus to the needs of the United States
within the meaning of the Federal Property and
Administrative Services Act of 1949, as amended. Such
transfer shall be subject to such terms and conditions as
the Administrator determines necessary to protect the
interests of the United States and may be made without
monetary consideration, except that such State agency shall
pay to the United States all net amounts received by such
agency from any sale, lease, or other disposition of such
property for such housing.
REPEALS
SEC. 220. (a) The following laws and parts of laws are
hereby repealed:
(1) The Act entitled "An Act to authorize the
Secretary of the Interior to reimburse owners of lands
required for development under his jurisdiction for
their moving expenses, and for other purposes,"
approved May 29, 1958 (43 U.S.C. 1231-1234).
(2) Paragraph 14 of section 203(b) of the National
Aeronautics and Space Act of 1958 (42 U.S.C. 2473).
(3) Section 2680 of title 10, United States Code.
(4) Section 7 (b) of the Urban Mass Transportation
Act of 1965 (49 U.S.C. 1606(b)).
(5) Section 114 of the Housing Act of 1949 (2
U.S.C. 1465).
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(6) Paragraphs (7)(b)(iii) and (8) of section 15
of the United States Housing Act of 1937 (42 U.S.C.
1415, 1415(8)), except the first sentence of paragraph
(8).
(7) Section 2 of the Act entitled "An Act to
authorize the Commissioners of the District of Columbia
to pay relocation costs made necessary by actions of
the District of Columbia government, and for other
purposes11, approved October 6, 1964 (78 Stat. 1004;
Public Law 88-629; D.C. Code 5-729).
(8) Section 404 of the Housing and Urban
Development Act of 1965 (42 U.S.C. 3074).
(9) Sections 107 (b) and (c) of the Demonstration
Cities and Metropolitan Development Act of 1966 (42
U.S.C. 3307).
(10) Chapter 5 of title 23, United States Code.
(11) Sections 32 and 33 of the Federal-Aid Highway
Act of 1968 (Public Law 90-495).
(b) Any rights or liabilities now existing under prior
Acts or portions thereof shall not be affected by the
repeal of such prior Acts or portions thereof under
subsection (a) of this section.
EFFECTIVE DATE
SEC. 221. (a) Except as provided in subsections (b) and
(c) of this section, this Act and the amendments made by
this Act shall take effect on the date of its enactment.
(b) Until July 1, 1972, sections 210 and 305 shall be
applicable to a State only to the extent that such State is
able under its laws to comply with such sections. After
July 1, 1972, such sections shall be completely applicable
to all States.
(c) The repeals made by paragraphs (4), (5), (6), (8),
(9), (10), (11), and (12) of section 220(a) of this title
and section 306 of title III shall not apply to any State
so long as sections 210 and 305 are not applicable in such
State.
TITLE III—UNIFORM REAL PROPERTY ACQUISITION
POLICY
UNIFORM POLICY ON REAL PROPERTY ACQUISITION PRACTICES
SEC. 301. In order to encourage and expedite the
acquisition of real property by agreements with owners, to
avoid litigation and relieve congestion in the courts, to
assure consistent treatment for owners in the many Federal
programs, and to promote public confidence in Federal land
acquisition practices, heads of Federal agencies shall, to
the greatest extent practicable, be guided by the following
policies:
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(1) The head of a Federal agency shall make
reasonable effort to acquire expeditiously real property
negotiation.
(2) Real property shall be appraised before the
initiation of negotiations, and the owner or his designated
representative shall be given an opportunity to accompany
the appraiser during his inspection of the property, except
that the head of the lead agency may prescribe a procedure
to waive the appraisal in cases involving the acquisition
by sale or donation of property with a lov fair market
value.
(3) Before the initiation of negotiations for real
property, the head of the Federal agency concerned shall
establish an amount which he believes to be just
compensation therefor and shall make a prompt offer to
acquire the property for the full amount so established.
In no event shall such amount be less than the agency's
approved appraisal of the fair market value of such
property. Any decrease or increase in the fair market
value of real property prior to the date of valuation
caused by the public improvement for which such property is
acquired, or by the likelihood that the property would be
acquired for such improvement, other than that due to
physical deterioration within the reasonable control of the
owner, will be disregarded in determining the compensation
for the property. The head of the Federal agency concerned
shall provide the owner of real property to be acquired
with a written statement of, and summary of the basis for,
the amount he established as just compensation. Where
appropriate the just compensation for the real property
acquired and for damages to remaining real property shall
be separately stated.
(4) No owner shall be required to surrender possession
of real property before the head of the Federal agency
concerned pays the agreed purchase price, or deposits with
the court in accordance with section 1 of the Act of
February 26, 1931 (46 Stat. 1421; 40 U.S.C. 2583), for the
benefit of the owner, an amount not less than the agency's
approved appraisal of the fair market value of such
property, or the amount of the award of compensation in the
condemnation proceeding for such property.
(5) The construction or development of a public
improvement shall be so scheduled that, to the greatest
extent practicable, no person lawfully occupying real
property shall be required to move from a dwelling
(assuming a replacement dwelling as required by title II
will be available), or to move his business or farm
operation, without at least ninety days' written notice
from the head of the Federal agency concerned, of the date
by which such move is required.
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(6) If the head of a Federal agency permits an owner or
tenant to occupy the real property acquired on a rental
basis for a short term or for a period subject to
termination by the Government on short notice, the amount
of rent required shall not exceed fair rental value of the
property to a short-term occupier.
(7) In no event shall the head of a Federal agency
either advance the time of condemnation, or defer
negotiations or condemnation and the deposit of funds in
court for the use of the owner, or take any other action
coercive in nature, in order to compel an agreement on the
price to be paid for the property.
(8) If any interest in real property is to be acquired
by exercise of the power of eminent domain, the head of the
Federal agency concerned shall institute formal
condemnation proceedings. No Federal agency head shall
intentionally make it necessary for an owner to institute
legal proceedings to prove the fact of the taking of his
real property.
(9) If the acquisition of only a portion of a property
would leave the owner with an uneconomic remnant, the head
of the Federal agency concerned shall offer to acquire that
remnant. For the purposes of this Act, an uneconomic
remnant is a parcel of real property in which the owner is
left with an interest after the partial acquisition of the
owner's property and which the bead of the Federal agency
concerned has determined has little or no value or utility
to the owner.
(10) A person whose real property is being acquired in
accordance with this title may, after the person has been
fully informed of his right to receive just compensation
for such property, donate such property, and part thereof,
any interest therein, or any compensation paid therefor to
a Federal agency, as such person shall determine.
BUILDINGS, STRUCTURES, AND IMPROVEMENTS
SEC. 302. (a) Notwithstanding any other provision of
law, if the head of a Federal agency acquires any interest
in real property in any State, he shall acquire at least an
equal interest in all buildings, structures, or other
improvements located upon the real property so acquired and
which he requires to be removed from such real property or
which he determines will be adversely affected by the use
to which such real property will be put.
(b) (l) for the purpose of determining just
compensation to be paid for any building, structure, or
other improvement required to be acquired by subsection
(a) of this section, such building, structure, or other
improvement shall be deemed to be a part of the real
property to be acquired notwithstanding the right or
obligation of a tenant, as against the owner of any
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other interest in the real property, to remove such
building, structure, or improvement at the expirationI
of his term, and the fair market value which such
building, structure, or improvement contributes to the
fair market value of the real property to be acquired,
or the fair market value of such building, structure,
or improvement for removal from the real property,
whichever is the greater, shall be paid to the tenant
therefor.
(2) Payment under this subsection shall not result
in duplication of any payments otherwise authorized by
law. No such payment shall be made unless the owner
and the land involved disclaims all interest in the
improvements of the tenant. In consideration for any
such payment, the tenant shall assign, transfer, and
release to the United States all his right, title, and
interest in and to such improvements. Nothing in this
subsection shall be construed to deprive the tenant of
any rights to reject payment under this subsection and
to obtain payment for such property interests in
accordance with applicable law, other than this
subsection.
EXPENSES INCIDENTAL TO TRANSFER OF TITLE TO UNITED STATES
SEC. 303. The head of a Federal agency, as soon as
practicable after the date of payment of the purchase price
or the date of deposit in court of funds to satisfy the
award of compensation in a condemnation proceeding to
acquire real property, whichever is the earlier, shall
reimburse the owner, to the extent the head of such agency
deems fair and reasonable, for expenses he necessarily
incurred for—
(1) recording fees, transfer taxes, and similar
expenses incidental to conveying such real property to
the United States;
(2) penalty costs for prepayment of any
preexisting recorded mortgage entered into in good
faith encumbering such real property; and
(3) the pro rata portion of real property taxes
paid which are allocable to a period subsequent to the
date of vesting title in the United States, or the
effective date of possession of such real property by
the United States, whichever is the earlier.
LITIGATION EXPENSES
SEC. 304. (a) The Federal court having jurisdiction of
a proceeding instituted by a Federal agency to acquire real
property by condemnation shall award the owner of any
right, or title to, or interest in, such real property such
sum as will in the opinion of the court reimburse such
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owner for his reasonable costs, disbursements, and
expenses, including reasonable attorney, appraisal, and
engineering fees, actually incurred because of the
condemnation proceedings, if—
(1) the final judgment is that the Federal agency
cannot acquire the real property by condemnation; or
(2) the proceeding is abandoned by the United
States.
(b) Any award made pursuant to subsection (a) of this
section shall be paid by the head of the Federal agency for
whose benefit the condemnation proceedings was instituted.
(c) The court rendering a judgment for the plaintiff in
a proceeding brought under section 1346(a)(2) or 1491 of
title 28, United States Code, awarding compensation for the
taking of property by a Federal agency, or the Attorney
General effecting a settlement of any such proceeding,
shall determine and award or allow to such plaintiff, as a
part of such judgment or settlement, such sum as will in
the opinion of the court or the Attorney General reimburse
such plaintiff for his reasonable costs, disbursements, and
expenses, including reasonable attorney, appraisal, and
engineering fees, actually incurred because of such
proceeding.
REQUIREMENTS FOR UNIFORM LAND ACQUISITION POLICIES;
PAYMENTS OF EXPENSES INCIDENTAL TO TRANSFER OF
REAL PROPERTY TO STATE; PAYMENT OF LITIGATION EXPENSES
IN CERTAIN CASES
SEC. 305. (a) Notwithstanding any other law, the head
of a Federal agency shall not approve any program or
project or any grant to, or contract or agreement with, an
acquiring agency under which Federal financial assistance
will be available to pay all or part of the cost of any
program or project which will result in the acquisition of
real property on and after the effective date of this
title, unless he receives satisfactory assurances from such
acquiring agency that—
(1) in acquiring real property it will be guided,
to the greatest extent practicable under State law, by
the land acquisition policies in section 301 and the
provisions of section 302, and
(2) property owners will be paid or reimbursed for
necessary expenses as specified in sections 303 and
304.
(b) For purposes of this section, the term "acquiring
agency* means—
(1) a State agency (as defined in section 101(3))
which has the authority to acquire property by eminent
domain under State lav, and
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(2) a State agency or person which does not
such authority, to the extent provided by the head
the lead agency by regulation.
REPEALS
SEC. 306. Sections 401, 402, and 403 of the Housing and
Urban Development Act of 1965 (42 U.S.C. 3071-3073),
section 35 (a) of the Federal-Aid Highway Act of 1968 (23
U.S.C. 141) and section 301 of the Land Acquisition Policy
Act of 1960 (33 U.S.C. 596) are hereby repealed. Any
rights or liabilities now existing under prior Acts or
portions thereof shall not be affected by the repeal of
such prior Act or portions thereof under this section.
SEC. 418 of P.L. 100-17 provided an effective date as
follows for the amendments made by P.L. 100-17 to the
Uniform Act:
The amendment made by section 412 of this title (to the
extent such amendment prescribes authority to develop,
publish, and issue regulations) shall take effect on the
date of the enactment of this title. This title and the
amendments made by this title (other than the amendm
made by section 412 to such extent) shall take effect
the effective date provided in such regulations but not
later than 2 years after such date of enactment.
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APPENDIX II
REGULATION
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[As published in the Federal Register, Vol. 54, No.
40/Thursday March 2, 1989/Rules and Regulations]
[4910-22]
DEPARTMENT OF TRANSPORTATION
Office of the Secretary
49 CFR Part 24
[FHWA Docket No. 87-22]
RIN 2125-AB 85
UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY ACQUISITION
REGULATIONS FOR FEDERAL AND FEDERALLY ASSISTED PROGRAMS
AGENCY: Federal Highway Administration (FHWA), DOT.
ACTION: Final rule.
SUMMARY: This regulation establishes a governmentwide single
rule for the implementation of statutory amendments to the
Uniform Relocation Assistance and Real Property Acquisition
Policies Act of 1970 (the Uniform Act) made by the Uniform
Relocation Act Amendments of 1987, Title IV of the Surface
Transportation and Uniform Relocation Assistance Act of 1987,
(1987 Amendments) Pub. L. 100-17, 101 Stat. 246-256. The
Uniform Act applies to all Federal or federally assisted
activities that involve the acquisition of real property or
the displacement of persons, including displacements caused by
rehabilitation and demolition activities. This regulation is
intended to ensure that the implementation of the Uniform Act
by Federal agencies is, in fact, as uniform and consistent as
possible, while encouraging State and local discretion in
implementing the Uniform Act's provisions.
DATES: This regulation is effective March 2, 1989. Further
information concerning agency implementation is provided
below.
FOR FURTHER INFORMATION CONTACT: F. D. Luckow, Chief,
Program Requirements Division, Office of Right-of-Way, HRW-10,
(202) 366-0116; or Reid Alsop, Office of the Chief Counsel,
HCC-40, (202) 366-1371. The address is Federal Highway
Administration, 400 Seventh Street, SW., Washington, D.C.
20590.
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SUPPLEMENTARY INFORMATION:
Background
This regulation is the final step in the development of
a governmentwide single rule for implementing the Uniform Act.
The background of this development is described in
considerable datail in the preamble to the interim final rule
issued on December 17, 1987, (52 FR 47994), and the Notice of
Proposed Rulemaking (NPRM), issued on July 21, 1988, (53 FR
27598), and is not repeated here.
On February 27, 1985, a Presidential Memorandum was
signed and published in the Federal Register on March 5, 1985
(50 FR 8953), naming the Department of Transportation (DOT) as
the agency with lead responsibility for the Uniform Act. This
led to the publication of a multi-agency governmentwide common
rule on February 27, 1986 (51 FR 7000).
The 1987 Amendments named the DOT as lead agency. The
Secretary of the Department of Transportation has delegated
this responsibility to the Federal Highway Administration
(FHWA). The 1987 Amendments require the lead agency, in
coordination with other Federal agencies, to issue rules,
establish procedures and make interpretations to implement
provisions of the Uniform Act.
Implementation of the 1987 Amendments
On Tuesday, May 19, 1987 (52 FR 18768) the FHWA issued
a Notice describing significant changes in the law and general
plans to implement those changes. On Tuesday, December 1,
1987 (52 FR 45667) the FHWA issued a Notice of Regulatory
Intent giving further notice of the specific regulatory
actions that it and the other affected Federal agencies would
take to implement the 1987 Amendments.
A few provisions of the 1987 Amendments upon which the
law is explicit and allows for little, if any, administrative
discretion or interpretation, and for which a period of public
notice and comment would have been impractical, were
implemented in an interim final rule in Part 24 issued by FHWA
(52 FR 47994), on December 17, 1987.
On the same day (52 FR 48015) 17 Federal Departments
and agencies that administer the Uniform Act, and had adopted
the governmentwide common rule, published interim final rules
rescinding the governmentwide common rule from the
codification of their regulations and adopting in its place a
cross-reference to the governmentwide single regulation
published by FHWA at 49 CFR Part 24. The effective date for
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these agency rescissions and cross references varied, however
all such actions were to take effect on or before April 2,
1989, the date the 1987 Amendments become mandatory.
An eighteenth Federal Department, the Department of
Housing and Urban Development (HUD), was unable to join the
other Federal agencies in publishing an interim final
rescission and cross referencing action on December 17, 1987,
because of its need to first satisfy certain Congressional
review obligations. HUD subsequently published such an interim
rule on February 19, 1988 (53 FR 4964).
As discussed in the preamble to the NPRM, no comments
were received that objected to the use of the rescission and
cross-referencing actions by the various Federal agencies
concerned to establish a governmentwide single regulation.
The only relevant comment objected to the effective date of
HUD's rescission and cross-referencing action. HUD considered
that comment but does not believe it is feasible to change the
date for administrative reasons, in order to best achieve a
smooth transition to the new requirements of the 1987
Amendments.
The objective of the February 27, 1985 Presidential
memorandum, and one of the primary goals of the 1987
Amendments, was to establish governmentwide uniformity so as
to eliminate the differences and inconsistencies among Federal
agencies that had plagued Federal implementation of the
Uniform Act since its enactment in 1971. These differences
and inconsistencies had been particularly burdensome to State
and local governments that were administering a variety of
Federal programs, and also, in some cases, resulted in
differences in the benefits provided to persons in like
circumstances.
The 1987 Amendments clearly provide that a single
Federal lead agency will promulgate a governmentwide single
rule for the Uniform Act's implementation. Accordingly, other
Federal agencies covered by the Act no longer have independent
statutory authority to promulgate their own separate Uniform
Act regulations and, in implementing the Uniform Act, must
follow the regulations published by the lead agency. The
Uniform Act is unique in that it imposes requirements directly
upon a large number of Federal and Federally assisted
programs, but assigns the authority for the publication of all
necessary implementing regulations to one lead agency. (Of
course, such regulations will continue to be developed with
the participation of HUD and other Federal agencies).
Accordingly, because a governmentwide single regulation is
required by law, because of the unique nature of the Uniform Act,
because no comments were received, and because no useful purpose
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would be served by having 18 Federal agencies take additional
regulatory action to formally finalize their rescission and
cross-reference actions, the interim rescission and cross-
reference actions taken by such agencies should henceforth be
considered final, and will remain in effect indefinitely.
Those departments and agencies, and the parts of the Code of
Federal Regulations which contain a cross reference to this part,
are listed below:
Department of Agriculture
7 CFR Part 21
Department of Commerce
15 CFR Part 11
Department of Defense
32 CFR Part 259
Department of Education
34 CFR Part 15
Department of Energy
10 CFR Part 1039
Environmental Protection
Agency
40 CFR Part 4
Federal Emergency
Management Agency
44 CFR Part 25
General Services
Administration
41 CFR Part 105-51
Department of Housing and Urban
Development
24 CFR Part 42
Department of the Interior
41 CFR Part 114-50
Department of Justice
41 CFR Part 128-18
Department of Labor
29 CFR Part 12
National Aeronautics and
Space Administration
14 CFR Part 1208
Pennsylvania Avenue
Development Corporation
36 CFR Part 904
Tennessee Valley Authority
18 CFR Part 1306
Veterans Administration
38 CFR Part 25
Department of Health and
Human Services
45 CFR Part 15
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The United States Postal Service will incorporate changes in
its full-text regulation at 39 CFR Part 777 to make it consistent
with this rule and will publish its final rule on or before April
2, 1989 in the Federal Register.
Implementation Dates
This final rule replaces the December 17, 1987 interim final
rule that was contained in 49 CFR Part 24. As is discussed
further below, this final rule is basically the same as the
interim final rule except for the addition of provisions
implementing those sections of the 1987 Amendments that were not
implemented in the interim final rule. This final rule is the
last regulatory step in the implementation of the 1987
Amendments. The preamble to the interim final rule noted that "a
final rule will replace this interim final rule prior to the date
the 1987 Amendments become mandatory".
The rescission and cross reference actions taken by the
agencies listed above provided for some differences in the dates
when each agency would implement 49 CFR Part 24. (However all
the agencies will adopt Part 24 on or before April 2, 1989, the
date on which the 1987 Amendments become mandatory). Agency
implementation of this final rule is therefore governed by the
implementation dates for implementing 49 CFR Part 24 contained in
the various agency's December 17, 1987 rescission and cross
reference actions. Generally those actions provide that direct
Federal projects, undertaken by a Federal agency itself, will
comply with Part 24, and that federally assisted projects would
comply with Part 24 if the recipient of the Federal financial
assistance was able to comply, except that all programs funded by
the Department of Housing and Urban Development and the
Environmental Protection Agency would not comply with Part 24
until April 2, 1989.
As was the case with the interim final rule, nothing in this
rule prohibits the retroactive payment of any additional benefits
provided by this rule. Whether to provide any such benefits
retroactively depends entirely on an agency's discretion and
funding authorities.
Comments Received in Response to the NPRM
On Thursday, July 21, 1988 (53 FR 27598) the FHWA issued a
NPRM for the purpose of developing a comprehensive,
governmentwide single rule for the uniform and consistent
implementation of the Uniform Act, as amended.
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The major changes made by the 1987 amendments include:
— Expansion of the Uniform Act coverage to include
virtually all activities that receive Federal funds, including
those undertaken by private entities.
— A moderate increase in benefit levels.
— The establishment of a lead agency to issue a
governmentwide single implementing regulation.
— Providing that the computation of certain relocation
benefits be done in accordance with the lead agency regulations,
rather than prescribing the computation method in the statute.
Granting States greater flexibility and discretion in
implementing the provisions of the Uniform Act.
All members of the public affected by relocation or land
acquisition activities undertaken or funded by Federal agencies
were encouraged to comment on this NPRM. Comments from
interested State and local governments were particularly
requested.
The NPRM was a "full text" rule primarily as a convenience
to the reader. Comments were specifically requested and desired
on changes stemming from the 1987 Amendments. Numerous
commenters however took the opportunity to again express an
opinion on certain issues that were addressed in the
governmentwide common rule or in the governmentwide single
interim final rule. As such, comments were exhaustively dealt
with in the preambles to those rules (51 FR 7000 and 52 FR 8015)
respectively; they are not repeated in this rulemaking.
A description of the regulatory changes proposed for this
part were set forth in the NPRM. The only major changes proposed
were those required by enactment of the 1987 Amendments. Where
no such changes were required, the provisions of the
governmentwide common rule, as modified by the December 17, 1987
interim final rule, were generally repeated in the proposed rule.
That is, the proposed rule was basically the same as the common
interim final rule with the exception of those additional changes
that were considered necessary to fully implement the 1987
Amendments. Comments were invited on both those non-
discretionary changes that were adopted in the December 17, 1987,
interim final rule and the remaining changes proposed in the
NPRM.
In furtherance of the statutory objective of securing the
views of State and local governments and the public in the
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promulgation of these regulations, the FHWA conducted three
public meetings during the comment period following publication
of the proposed rule.
Dates for the meetings were August 17, 1988 in Philadelphia,
Pennsylvania, August 22 in Portland, Oregon and August 24 in
Chicago, Illinois.
The purpose of these meetings was to receive comments on the
proposed rule from interested parties. These comments are
entered in FHWA Docket No. 87-22 and have been given full
consideration in the development of the final rule.
In response to the July 21, 1988 Federal Register
publication, there were a total of 120 comments received at the
docket, including those received at the 3 public meetings.
These 120 comments represent 101 different organizations or
persons: 31 State highway administrations, 4 other State level
agencies, 19 local public agencies, 7 private parties, 5 public
interest groups, 4 consultants, and 31 associations. Most of
the associations represented utilities and were concerned
primarily with their new responsibilities as acquiring agencies
under the Act or with § 24.307, dealing with discretionary
utility relocation payments. Comments received from several
organizations involved in the rural electric cooperative
industry relating to acquisition activities claimed a
significant economic impact on the industry. However, careful
analysis of the comments indicates that because of their
unfamiliarity with the provisions of the Uniform Act, the
respondents have misunderstood certain of the requirements of
the regulation.
Great care and attention have been given to these comments
and as most of the apparent questions concern real property
acquisition requirements, these comments have been extensively
considered and discussed in § 24.101(b) and (c) of this
preamble.
There is no basis for expecting that reasonable compliance
with this regulation as required by the 1987 Amendments will
impose exceptional additional expenditures on the part of the
members of the rural electric cooperative industry- A number of
unnecessary administrative requirements found in earlier
regulations have been eliminated with a consequent reduction in
the burden on affected entities. Other requirements*have been
reduced or modified to further the goals of efficient and cost
effective implementation of the Uniform Act.
More than 1,200 specific comments were received. Many of
the comments were directed at provisions in the current
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governmentwide common rule, for which no changes were proposed
in the NPRM, or provisions which are specifically determined by
the statute. A large number of comments were general
statements, or questions, regarding a section or subsection
which required no change in the regulation but which are
addressed in the appropriate section discussion following in
this preamble.
A number of respondents had questions about operational
details which cannot be addressed in the rule itself. FHWA
will, however, respond to these and other concerns in
forthcoming technical advisories and similar instructive
memoranda.
Except as related to a few specific provisions, which are
addressed at the appropriate places in the preamble, the vast
majority of the public comments dealt more with clarification of
interpretation than with substantive matters.
Some commenters suggested different wording or rearranging
certain paragraphs within the rule itself. While a certain
amount of such editorial refinement has been done when it was
necessary for clarity, the FHWA recognizes that the basic
format, as well as most of the specific provisions of this
rulemaking were articulated in the governmentwide common rule,
and acquiring and displacing agencies have become familiar with
the existing format. To avoid confusion, we therefore have not
made wholesale changes in format or location of the respective
provisions in this rule merely for editorial preference.
Some comments suggested changes that are precluded by
statute; however, we are cognizant of the concerns expressed in
such comments. We are interested in the experiences gained by
persons and agencies as they operate within the framework of
this regulation, and will consider legislative changes, if
necessary.
In addition, an early draft of the NPRM, the NPRM itself,
and a draft of this final rule were each circulated to affected
Federal agencies for their review and comment. Further, a
number of meetings were held with representatives of interested
Federal agencies. Many useful comments were provided during
this process. We were particularly assisted by the time and
expertise provided by HUD.
All comments were reviewed and appropriate changes to the
proposed rule were made. A description of the substantive
changes from the proposed rule follows. Other changes not
affecting content were made for clarity or readability.
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[Section-by-Section Analysis]
Subpart A - General
Section 24.1 Purpose.
Paragraph (c) was proposed to establish efficient and cost
effective implementation as one of the primary purposes of this
regulation. Two of the three comments on the paragraph
commended the inclusion of the paragraph while the other
indicated misgivings that, without a definition or explanation
of the intent of the paragraph, it may appear to some agencies
that cost savings are more important than providing the
assistance or protection due an owner or displaced person.
This paragraph has been included in the final regulation to
emphasize the Federal concern that State and local agencies not
be burdened with unnecessary regulatory requirements in the
implementation of the Uniform Act. For this reason, the NPRM
preamble discussion of this paragraph called attention to the
waiver provision of § 24.7 and its use to avoid unnecessary
delay or administrative burdens. The waiver provision, in
turn, is explicit regarding two major considerations. The
first is that the Federal agency, before waiving any
requirement, must determine that the waiver does not reduce any
assistance or protection provided to an owner or displaced
person under this regulation. The second is that any request
for a waiver shall be justified on a case-by-case basis. While
FHWA does not interpret case-by-case to mean, necessarily, a
parcel-by-parcel basis, neither does it encompass the waiver of
a requirement on a program-wide scope. The broader the scope
of the waiver, the more carefully the Federal agency must weigh
its effect on the assistance and protection to be provided an
owner or displaced person.
Section 24.2 Definitions.
Section 24.2(a) Agency. There were several comments on
this paragraph and as a result the paragraph on lead agency has
been removed and is now a separate paragraph (§ 24.2( )) within
the definitions.
Other respondents suggested deletions, expansions, or
other changes in the remaining definitions. However, the
definitions are taken from the statute and they remain
unchanged. As explained in the preamble of the NPRM published
in the Federal Register July 21, 1988, the term "Agency" is
generally used throughout this part to encompass all entities
subject to the Uniform Act.
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Section 24.2fd) Co^p^r^le replacement dwelling. Comments
were received from five entities concerning the definition of
the term "comparable replacement dwelling." The term and its
definition originate in the Uniform Act and the 1987 Amendments,
as stated in the preamble of the NPRM. The terms "comparable
style of living" and "functionally equivalent," taken together,
mean that the comparable replacement dwelling selected for
computing the replacement housing payment is located in the
same, or same type of, residential development as the acquired
dwelling, on a site typical in size for that development; is the
same type of dwelling, i.e., single-family for single family,
apartment for apartment, etc.; and provides the same or similar
amenities within the dwelling. For example, if the displaced
person entertains large groups frequently and the acquired
dwelling is arranged to accommodate this living style, then the
replacement comparable house should also be capable of being
arranged in this fashion.
This does not, however, require strict and absolute
adherence to an exhaustive, detailed, feature-by-feature
comparison. A mechanistic approach is not required. Reasonable
trade-offs can be made. These should reflect the range of
purposes for which the various features of the replacement
dwelling may be used. Additional discussion about this subject
can be found in the appendix.
Section 24.2fd) f8) (i). A recommendation was received to ^p
change the word "paid" to "offered" in describing the
replacement housing payment provided to a 180-day owner-
occupant. We have retained the current wording because the
computation of the full price differential, as described in
§ 24.401(c), is limited to the lesser of the amount needed for
purchase of a comparable replacement dwelling or the actual
dwelling purchased.
Section 24.2(d)f8)(ii). This section has been revised to
clarify that the utility costs for replacement rental housing
will be based on estimated average monthly utility costs
because the actual utility costs will not be available. For
additional clarification of the issue of utility costs refer to
the discussion in this preamble for § 24.402(b), Rental
assistance payment.
Eight comments were received about the use of 30 percent of
the gross monthly income for determining the financial means of
displaced tenants. In accordance with the discussion in the
preamble of the NPRM, FHWA examined this issue carefully before
revising § 24.2(d)(8) and § 24.402 Replacement housing payment
for 90-day occupants. The use of 30 percent of gross monthly
income for all tenants, to meet the statutory requirement that
the income of a low-income tenant be considered when computing a
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rental assistance payment, is still considered to be the most
equitable, practical, and appropriate method. It is similar to
the method used by many agencies such as State highway agencies
prior to the Common Rule. Additional discussion of this issue
is to be found in this preamble for § 24.402(b) Rental
assistance payment.
Section 24.2(d) (8)(iii). Eleven comments were received
about the possible eligibility of a less than 90 day occupant
for a replacement housing payment under Housing of last resort.
Most objected to this eligibility.
Persons who are in occupancy at the time of the initiation
of negotiations, but who do not meet the length of occupancy
requirements in §§ 24.401 or 24.402, are displaced persons and
are entitled to advisory assistance and moving payments. They
may, also, be entitled to rental assistance under housing of
last resort provisions if comparable rental replacement housing
is not available at a rent not greater than 30 percent of the
person's gross monthly household income. This section provides
financial means standards for a class of displaced person
heretofore called "subsequent occupants." When section 205 was
amended in 1987, section 205(c)(3) was revised to require
assurances that a person shall not be required to move from a
dwelling unless the person has had a reasonable opportunity to
relocate to a comparable replacement dwelling. Since an
occupant of less than 90 days is a displaced person, the
necessary criteria for providing a comparable replacement
dwelling was developed. The use of the financial means criteria
assure that the displaced person will participate in the cost of
a comparable replacement dwelling to the maximum extent of his
or her financial capability. In response to another comment,
FHWA also addressed the appropriate use of the income of those
receiving public assistance. If they receive an amount
designated for shelter and utilities, then that is the amount
that should be used in determining the displaced person's
financial means.
Section 24.2(e) Contribute materially. Four comments were
received about this definition. Two recommended that all the
criteria would have to be present for the business to contribute
materially to the income of a displaced person. This is clearly
not the case. One preferred that the displacing agency be
authorized to develop alternative criteria. This definition has
remained as written. FHWA considers that sufficient flexibility
has been permitted in the definition of "contribute materially"
to accommodate unusual circumstances.
Section 24.2(f) Decent. safef and sanitary dwelling. Two
comments were received concerning the addition of "cooling" to
the requirement for heating. If cooling is determined to be as
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critical as heating for a particular State or area, a displacing
agency may, in a uniform manner, require that an adequate
cooling system be provided in a comparable replacement dwelling.
Section 24.2 falf21fivl Persons not displaced. The NPRM
specifically requested comments on § 24.2(g)(2) (iv) as to
whether certain tenants who are affected by HUD funded
rehabilitation activities should be considered "displaced
persons." Such tenants are those who are not required to move
permanently because of the federally funded physical alteration
of their dwelling units, or a change in the unit's ownership,
but whose rents are increased following completion of the
rehabilitation activities, resulting in the tenants moving
elsewhere. The NPRM proposed that such tenants would not be
included in the definition of "displaced person" if the other
conditions included in § 24.2(g)(2)(iv) were satisfied. These
conditions included the opportunity to lease and occupy another
dwelling unit in the same building or complex (without regard to
the amount of rent charged) and the payment of any temporary
relocation costs.
Twenty-two comments were received on this subject. Seven
recommended that these tenants be covered. Eight recommended
the addition of a further condition mentioned in the NPRM, to
provide that, so long as the tenant is offered an opportunity to
rent a decent, safe, and sanitary dwelling for the same amount
as the tenant paid before the rehabilitation project, or 30
percent of the household's gross income, whichever is greater,
such tenant would not be considered a displaced person. Two
commenters recommended retaining the language in the NPRM.
Three commenters generally opposed considering such tenants as
displaced persons. Finally, two comments concerned technical
matters.
HUD recommended that this section be deleted from the
regulation, but suggested that it could be covered in HUD's
various program regulations so that coverage could be tailored
to each affected HUD program. HUD continues to believe that
these tenants are not covered by the Uniform Act because the
rental increase that prompts their move is, in HUD's view, not a
direct result of rehabilitation. However, HUD has indicated its
willingness and desire to treat the financial hardship faced by
such persons on a program-by-program basis, and to deal
specifically with this issue in developing new regulations
implementing its several programs assisting residential
rehabilitation.
Since this issue affects only HUD funded activities, we
believe that HUD's views should be given great weight.
Accordingly, this section has been revised to include language
similar to that contained in § 24.2(f)(2) (iii) of the common
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governmentwide rule. This would not preclude HUD from providing
assistance to such persons in their various program regulations.
Section 24.2 fa) m(viii). At the request of one Federal
agency, we have changed the term "sells" to "conveys" in
§ 24.2(g)(2)(viii). Occasionally, Federal agencies acquire land
through exchanges or other agreements that are not technically
"sales."
Section 24.2(k) Initiation of negotiations. Several
respondents commented on this section. Since it is not
practical to try to identify what specifically constitutes the
initiation of negotiations for each and every Federal, or
federally assisted program, the definition must be somewhat
generic. Nonetheless, the intent and purpose is reasonably
clear. The prefatory paragraph addresses those situations in
which specific Federal program regulations define the meaning of
initiation of negotiations for that program. For the bulk of
the acquisition on Federal, or federally assisted programs,
projects, or activities, the proposed definition is sufficient.
We have added a definition of Notice of intent to acquire or
notice of eligibility for relocation assistance, at § 24.2(o),
which should help to clarify the meaning of initiation of
negotiations and its relationship to entitlements under the
Uniform Act. The two controlling points in this set of
circumstances are the action or actions of the agency and the
action of the displaced person. There must be a clear,
legitimate and reasonable causal connection between the two.
For example, a tenant moving on the basis of having learned his
landlord had applied for a rehabilitation loan would not
establish the tenant's eligibility for benefits.
Section 24.2( ) Lead agency. The definition of "lead
agency" was inserted at this point in the definitions, and the
following preamble discussion refers to the new section numbers
for the definition in question.
Section 24.2(n) Nonprofit organization. The definition was
revised to recognize that a non-profit organization must, in
addition to having tax-exempt status under the Internal Revenue
Code, be appropriately incorporated under the laws of a State as
a non-profit organization.
Section 24.2(o) Notice of intent to accruire or notice of
eligibility for relocation assistance. This added definition
was discussed under § 24.2(k). The purpose of a notice of this
nature is to clearly establish a displaced person's eligibility
for relocation benefits. However, it should be understood that
the absence of such a notice does not deprive the person of
eligibility for relocation benefits. The Federal funding
agency, within its own program or project requirements, should
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develop a procedure for the timely delivery of such notices to
persons to be displaced, including those affected by activities
undertaken prior to the commitment of Federal financial
assistance to the activity.
Section 24.2(p) Programs 017 projects. In response to
comments from two Federal agencies the definition of "project"
has been revised. Because of the multiplicity of Federal and
federally assisted programs and projects, a single definition
must necessarily be extremely general. Each Federal agency will
continue to have responsibility for identifying its programs and
projects that are covered by the Uniform Act.
Section 24.2(t) Small business. A number of respondents
commented on the definition of "small business." Specific
comment on the 500 employee threshold was solicited and the
responses ranged from one recommending a change to a dollar
volume criterion; two recommending 20 employees; three
recommending 50 employees; four recommending 100 employees; one
recommending 250; one respondent recommended the threshold be
eliminated and the payment be available to any and all
businesses; two indicated concern, but had no threshold number;
and ten indicated agreement with the 500 employee threshold.
FHWA's use of a 500 employee threshold for a small business is
in accordance with the Small Business Administration's current
definition of small businesses. Since the purpose of the
definition is to facilitate the application of the small
business criterion to the eligibility requirements for business
re-establishment payments, the definition remains unchanged
except for the addition of the requirement that there must be at
least one employee at the affected site.
Section 24.2fv) Unlawful occupancy. The definition of
"unlawful occupancy" has been changed slightly to clarify its
applicability. One commenter mentioned that local custom, type
of tenancy and type of facility may dictate different practices
in terms of dealing with unlawful occupants. This has been
addressed in the modified language. The main point of the other
substantive comments received on this definition actually dealt
with the relationship of this provision to § 24.206, Eviction
for cause. As these two provisions deal with basic eligibility
issues, displacing agencies should be especially aware of the
interrelationship. In response to comments, changes have been
made in the eviction for cause provision which is discussed
below at § 24.206. While the intent of this provision is to
generally proscribe certain types of occupants, such as
squatters, from eligibility for relocation payments, displacing
agencies are permitted some discretion where specific
circumstances may warrant a finding that the occupancy is
lawful.
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Section 24.2(z) Utility costs. There were eight comments
on this paragraph, five recommended the addition of the cost of
trash removal to utility costs. Due to the wide variance in
local practices for trash removal ranging from "haul your own"
to free government services, FHWA has not modified the
definition of utility costs. All costs now included are
generally furnished by public agencies.
Section 24.4 Assurances, monitoring and corrective action.
Section 24.4(a) Assurances. Six comments were received on
this section. One comment about the procedures for monitoring
local public agencies conducting highway projects is more
appropriately considered under the FHWA's program guidance. Two
commenters were concerned about the effect of the regulatory
language on their current procedures and practices. One agency
also asked that the requirement for a "specific reference to any
State law which the Agency believes provides an exception to
sections 301 or 302 of the Uniform Act" be deleted and, in its
place, the lead agency request each State Attorney General to
provide an opinion as to exceptions permissible under State law.
This would, then, be provided to each State agency; presumably
by the lead agency.
We believe the section on Assurances reflects the intent of
sections 210 and 305 of the Uniform Act; provides reasonable
uniformity for all Federal agencies; and should not impose any
significant or time-consuming burden on those agencies with
respect to the approval of a State agency's assurances. Neither
the Uniform Act, nor this regulation, dictates the length
(sentence, paragraph, or page) of a State agency's assurances.
The Uniform Act requires that assurances be "satisfactory" and
this regulation requires that assurances be "appropriate," and
in accordance with sections 210 and 305, for displacing and
acquiring agencies respectively. The Federal funding agency
determines that the assurances meet these requirements.
Since it is likely that some State agencies may operate
under statutes which could provide them with exceptions not
available to other State agencies, we believe it necessary for
the individual State agencies, on their own behalf, to identify
any State law which provides them with an exception to sections
301 or 302 of the Uniform Act.
One commenter may have misunderstood the relationship
between the assurances and Subpart G, Certification, as well as
the nature of the assurances. The assurances should not be
viewed as an alternative to certification. If anything, it is
the other way around and, even then, the certification must
address the requirements of the Uniform Act covered by the
assurances if the certifying State agency intends to assume
those responsibilities. The assurances are, therefore,
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fundamental and it is anticipated that most State agencies will
initially provide assurances to ensure compliance with the
Uniform Act rather than seek approval of a certification
application. A State agency must provide these assurances, or
obtain a certification, as set forth in both the Act and
regulation, as a condition of receiving Federal financial
assistance.
However, in response to a concern of the Department of
Agriculture, agencies who acquire under the procedures for
voluntary transactions, or persons without the power of eminent
domain, will not be required to certify under section 305 of
the Uniform Act. Any agency that displaces persons will have
to provide assurances or be certified for compliance with
section 210 of the Act.
The purpose for providing exceptions to the real property
acquisition procedures in § 24.101(a) is to make it clear that
not all acquisitions are subject to the requirements of Subpart
B of this regulation. The section is intended to describe
circumstances which would exclude specific acquisitions from
the application of the regulation; it is not intended to
provide the basis for the exclusion of an entire agency
program.
Section 24.5 Manner of "notice.
Two comments were received on this section, which is
unchanged from previous requirements in both the Common and the
Interim Final Rules. One comment approved of the requirement
and the other comment suggested that the notice to the owner of
the Agency's interest in acquiring property described in
§ 24.102(b) also be personally served or sent by certified or
registered first class mail. No change has been made.
Section 24.6 Administration of jointly-funded projects.
Two comments were received on this section, which is
essentially unchanged from previous requirements, except for
the addition of the statutory responsibility of the lead agency
to designate a cognizant agency in the absence of agreement
between Federal agencies. Neither comment addressed this
change and no further change has been made.
Section 24.7 Federal agency waiver of regulations.
Two comments were received which were specifically related
to this section. One noted approval of the provisions as
written, the second asked for some examples of a proper
justification, or some basis upon which to make a decision.
This section has already been discussed in general in
connection with comments on § 24.1. Because of the great
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variety of situations which nay make seeking a waiver
advisable, we do not believe it practical to provide examples.
Examples have a tendency to be both limiting and, conversely, to
serve as unreliable justifications or precedents for expansive
interpretations.
The primary concern is that the waiver of a nonstatutory
requirement in the regulation does not reduce any assistance or
protection provided to an owner or displaced person under this
part. There is little doubt that requirements imposed by the
Uniform Act may, necessarily, create some delay and
administrative burden. Therefore, it would be inappropriate to
grant a waiver based on the general proposition of delay and
administrative burden. The waiver proposal must be specific
and it must protect the rights of owners and displaced persons
and not be designed to serve some convenience of the requesting
agency.
The proper implementation of this provision of the
regulation requires the exercise of good judgement, with proper
concern for displaced persons.
Section 24.8 Compliance with other laws and regulations.
Two comments were received on this section. One said the
list of authorities should include a statute which was already
included. The second comment suggested the inclusion of
Executive Order 12630, Governmental Actions and Interference
with Constitutionally Protected Property Rights, and this has
been done.
This section was also revised to emphasize that there may
be other laws and regulations to be complied with in
implementing this regulation and the list provided is not
necessarily all inclusive.
Section 24.9 Recordkeeping and reports.
Section 24.9(a) Records. Four comments were received on
this section. One appreciated the provision for
confidentiality of records. Another asked for the "established
requirements" for "adequate records." The adequacy of an
agency's records is determined by the ability of those records
to demonstrate compliance with this regulation regarding the
agency's acquisition and displacement activities. Two comments
were concerned with the 3-year retention period for records.
One suggested' an extension to 5 years, the other suggested a
period of 3 years after the project is completed. There is
nothing to prevent an Agency from retaining records for a
period longer than 3 years after final payment to a property
owner or displaced person. FHWA has amended the regulation to
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require retention of records for 3 years or in accordance with
applicable regulations of the federal funding agency.
Section 24.9(c) Reports. Special consideration and
comment was requested on the format and timing of this report.
Four comments were favorable to both the format and timing of
the report. One comment agreed with the format, but claimed
the information was needed on an annual basis. Two comments
approved of the timing, but wanted the format changed. The
final respondent wanted both the timing and the format altered.
With the exception of one suggested format change, to lump all
non-residential displacements together, the proposed changes
are clearly related to the specific program requirements of the
respondents. As such, it would be inappropriate to address
these concerns with revisions to a report intended to serve,
with as little burden as possible, as source material for
periodic reports to the Congress on the principal activities
conducted under the Uniform Act. The report format and timing
remain unchanged.
Section 24.10 Appeals.
Section 24.10fb) Actions which nay be appealed. Several
comments were received on this section. The principal concern
was that the appeal process seemed to extend to the question of
just compensation. There are well established procedures in
place in every State, and in the Federal government, to handle
disagreements involving just compensation. These procedures
typically begin with the offer of just compensation and
conclude, where necessary, with litigation.
What is appealable is found in the Uniform Act and the
regulation where they refer to the aggrieved person's
"application." This refers to the application for the benefits
of the Uniform Act. The intent of the Act and the regulation
is to require that there be a procedure for appeals concerning
the benefits or eligibility conferred by the Uniform Act. This
prQvides an administrative remedy for persons aggrieved by an
agency determination as to his or her benefits or eligibility.
Normally this procedure would have to be completed before such
person could seek judicial review.
Section 24.lO(c) Time limit for initiating appeal. Two
commenters suggested extending the time limit for initiating an
appeal. The responsibility for setting the time limit rests
with the Agency subject only to the constraint that it not be
less than 60 days after the person receives written
notification of the Agency's determination regarding the
person's application or claim.
Section 24.10(hi Agency official to review appeal,
Several comments were received about agency appeal processes,
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the levels of review, and the official conducting the review,
whether from the agency or another appropriate hearing officer.
The appeal process is an entirely internal process of an
agency. The decisions by the agency about the process must
only conform to these regulations and whatever other
administrative rules which the agency must follow. However, as
stated in the rule, agencies must advise the person of his or
her right to seek judicial review after the administrative
hearing procedure is exhausted.
Having considered the comments, FHWA has elected to retain
§ 24.10 as written.
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Subpart B - Real Property Acquisition
Section 24.101 Applicability of acquisition requirements.
Section 24.101 fa). There were a large number of
comments on this section which addresses the applicability
of Subpart B and Title III of the Uniform Act. Most of
the comments expressed a concern with limited scope of
application, and several requested that the voluntary
transaction criteria found in Appendix A of the December
17, 1987 interim final rule be included.
FHWA has substantially revised this section based on
the comments. Voluntary transaction criteria have been
included, and a provision has been added exempting from
coverage certain real property transactions between
cooperatives and their members. The presence of Federal
financial assistance is the basic determinant for
applicability, with exceptions provided for those
acquisitions listed in § 24.101(a) (l)-(4).
Eminent domain authority is not a determining factor
by itself, although any acquisition made under the threat
of eminent domain is clearly subject to Subpart B
requirements because such an acquisition cannot be a
voluntary transaction.
Essential to the voluntary transaction process is the
requirement that the owner must be informed in writing
that the property will not be acquired unless amicable
agreement can be reached. However, even though an
acquisition may be excluded as a voluntary transaction,
agencies may choose to follow the Subpart B process.
Section 24.101fb) and (c), Certain clarifications
have been made in these sections. The change in
§ 24.101(c), federally-assisted projects, is applicability
"to the greatest extent practicable under State law"
(emphasis supplied), which is the same wording as that
found in Section 305(a) of the Uniform Act. FHWA
interprets this to mean an agency must comply if
compliance is legally possible under State law. This
should be taken into account in an agency's assurances
pursuant to § 24.4(a).
Utility companies as acquiring agencies. - When the
Congress amended the Uniform Act, it changed the
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definition of "State agency" to include "any person who
has the authority to acquire property by eminent domain
under State law." Utility companies are the most common
example of non-governmental entities which are granted
eminent domain authority. The effect of this change was,
for the first time, to bring utility companies under
Uniform Act coverage for certain of their projects.
Sixteen comments were submitted by or on behalf of
utility companies, representing the views and concerns of
many hundreds of individual entities through their
associations, cooperatives, and law firms. Almost all of
these comments concern the possible impact of Subpart B of
these regulations upon rural electric cooperatives that
may receive Federal financial assistance from the Rural
Electrification Administration (REA) in the Department of
Agriculture (USDA).
This section of the preamble is devoted to the
comments and concerns of those entities. FHWA believes
that compliance with the Uniform Act and these regulations
will not be as burdensome as some of the commenters
perceive it to be. In addition, as discussed further
below, one suggestion, exempting from coverage certain
transactions between cooperatives and their members, has
been adopted.
Following are the substantive issues raised in the
comments, with an FHWA reply.
1. The rule should be amended so it would not apply
to electric cooperatives.
Reply: FHWA does not have authority to exempt any
entity or group of entities from compliance. However, as
described in some detail later, the regulations
intentionally provide much latitude and discretion in how
a particular objective may be accomplished.
2. It would appear that all of our projects and
acquisitions are covered by the regulation.
Reply: There are certain conditions that must be
present before a utility company must comply with Subpart
B requirements. Most importantly, there must be Federal
financial assistance as defined at § 24.2 (j). If Federal
involvement is solely the guarantee of a loan from non-
Federal sources, for example, the Uniform Act is not
applicable.
If an individual acquisition qualifies as a voluntary
transaction under § 24.101(a)(1), Subpart B requirements
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do not apply. This may be important for non-site specific
acquisitions.
It was stated in a comment that a condition of
membership in a cooperative may include an obligation to
contribute power line rights-of-way. A provision has been
added in 24.101(a)(3) to provide that Subpart B
requirements do not apply if the contribution of real
property to a cooperative is made by a member to meet the
requirements of membership agreements, contracts or by-
laws. FHWA believes that such cases, where members of
cooperatives have agreed to provide real property to the
cooperative as necessary to advance the common interest of
the members, are similar to voluntary transactions rather
than to normal Federal or federally funded acquisition.
3. This regulation appears to replace the State
eminent domain law under which we operate.
Reply: Both section 305 of the Uniform Act and
§24.101(c) of this part make it clear that the real
property acquisition policies in Title III of the Act and
Subpart B of this part are applicable "to the greatest
extent practicable under State law". This means that
while compliance is required if it is not prohibited by
State law, these provisions do not supersede or overrule
any State law requirements. Accordingly, utility
companies must continue to comply with the requirements of
State eminent domain law. Section 24.4(a) of this part
addresses the assurances of compliance that must be
submitted (generally a one-time action) to the Federal
agency providing financial assistance. Section 24.101(c)
addresses the matter of exceptions to Subpart B
provisions because of provisions of State law.
A utility company may wish to contact the highway
agency in its State for assistance in preparing its
assurances in those situations where the same State
eminent domain law applies to both the highway agency and
the utility company. The State highway agency should know
whether the assurances of compliance need to be qualified
because of State law.
4. We understand §§ 24.102(c) (2) and 24.103(a) to
require an appraisal report containing all of the
information listed in § 24.103(a) when the property value
exceeds $2,500.
Reply: That is not the intent of these sections.
Under the appraisal waiver provisions of § 24.102(c) (2) ,
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the utility company has the option of not making an
appraisal if the value is estimated to be less than
$2,500, and the valuation problem is simple and straight-
forward. See the preamble discussion of that section for
further information.
Under the appraisal standards in § 24.103(a), the
utility company essentially determines its own appraisal
documentation standards and policies, particularly with
respect to acquisitions which do not require a detailed
appraisal. The intent of this provision is to match the
extent of the analysis and documentation to the complexity
of the appraisal problem.
In difficult, complex valuation situations,
§ 24.103(a) requires preparation of a "detailed"
appraisal, and specifies the minimum content of such
appraisals. The minimum content specifications apply only
to detailed appraisal reports. Several commenters missed
this point.
Finally, there is no necessary connection between the
$2,500 appraisal waiver ceiling, and the need to prepare a
detailed appraisal report. The decision on when to secure
a detailed appraisal lies primarily with the utility
company, based on its assessment of the situation.
5. The regulation appears to require that we
contract for the services of independent appraisers, even
though we have well qualified appraisers on our staff.
Reply: This is incorrect. The use of staff or
outside personnel for appraisal work is entirely at the
discretion of the utility company. The only policy which
addresses this issue is 24.103(d), which essentially
states the appraiser must be qualified to perform the
work.
6. The regulation appears to require that we give
the owner a copy of the appraisal, which will hinder
negotiations.
Reply: The regulation does not require that the
owner be given a copy of the appraisal. In some cases
this is a matter of State law, but in the typical
situation it is a negotiation policy decision at the
discretion' of the Agency.
In § 24.102(e), the owner is required to be given a
written offer and summary statement which, in very brief
terms, amounts to a description of what the offer is for.
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A utility company may wish to contact the State highway
agency and obtain a copy of its summary statement form or
format for use as a guide.
7. These regulations are not appropriate for use in
acquiring substation sites. Generally there are many
alternative locations available, and one of the owners
will usually be happy to sell a satisfactory site.
Reply: It was this kind of situation FHWA
contemplated when it developed the voluntary transaction
policy and criteria found at 24.101(a)(1). If an
acquisition meets the criteria, Subpart B requirements do
not apply.
8. Section 24.102(j) regarding a deposit with the
court is in conflict with our State"law on various
points. State law specifies a different place for the
deposit, and is likewise specific on how the amount of the
deposit is to be determined.
Reply: The provision comes from section 301(4) of
the Uniform Act, and, as noted above, is applicable to
the greatest extent practicable under State law on
federally assisted projects. If State law prescribes a
different process there is no conflict because State
eminent domain law prevails. See also § 24.4(a) regarding
assurances.
9. Just compensation in our State is based oh the
before and after rule, rather than the take plus damage
rule. If we were to appraise damages separately, as seems
to be necessary under § 24.103(a)(5), the appraisal would
not be admissible in court.
Reply: The language in section 301(3) of the Uniform
Act recognizes the differences in State law on what
constitutes just compensation. It was not FHWA intent to
force a different appraisal process. This oversight has
been corrected by the addition of "where appropriate" to
§ 24.103(a) (5) .
10. The requirement for a review appraisal in
§ 24.104 should be deleted except for high value
situations.
Reply: FHWA has not adopted this recommendation
because of the importance we place on the appraisal review
function.
The comment indicates there may be a
misunderstanding. Section 24.104 does not require an
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appraisal by a reviewer (although the reviewer may choose
to do so because of an inadequate appraisal report).
Rather, this section is intended to require a review of
the appraisal or appraisals on a property.
The review is an essential part of the process of
establishing the amount of the offer of just compensation
to be made to the owner. In simplistic terms, the
reviewer checks for errors of fact, consistency of value
from property to property, and general adequacy of the
appraisal as a basis for the offer of just compensation.
Where there is only one appraisal, the reviewer is
that critical second party involved in the process of
setting the amount of the offer. The association with
§ 24.4(c) regarding prevention of fraud, waste,
and mismanagement is readily apparent.
The reader is directed to the discussion under
§ 24.104 in Appendix A for further information. As stated
there, in low value, uncomplicated situations a signature
may suffice as the reviewer's statement.
The foregoing discussion of issues raised in the
comments is intended to assist utility companies and
others in the implementation of these regulations and to
describe how the impact of these regulations on
cooperatives will be limited. However, it is possible
that there may be other questions that have not been
answered. We encourage any further comments relating to
the impact of this regulation on rural electric
cooperatives. Any further comments on this subject will
be considered and, if warranted the regulation will be
amended and/or the discussion in the preamble will be
supplemented.
Most, if not all, Federal financial assistance for
utility companies comes through the REA of the USDA. FHWA
intends to work closely with Departmental officials in
effecting smooth implementation.
Section 24.102 Basic acquisition policies.
Section 24.102fc)(2). This section addresses waiver
of appraisals. One comment said agencies should have the
latitude to decide not to obtain an appraisal where
property may be donated without first obtaining a release
from the owner.
The Agency has that discretion for the under $2,500
value category. A prior release is not necessary.
However, the FHWA does not agree with extending that same
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policy to all donation situations. An owner may want an
appraisal and an offer before making a decision to donate,
and it is only fair to make the owner aware of this
option.
On the matter of establishing the dollar threshold at
$2,500, four stated it was too high, seven said it was too
low, and ten stated $2,500 was acceptable. FHWA has
decided to retain the proposed threshold.
A commenter raised the question of a review where no
appraisal has been made. Other comments questioned how an
Agency is going to know if an acquisition is worth less
than $2,500 in the absence of an appraisal.
Section 24.102(c)(2) contemplates that an informed
judgement will be made by a qualified person. While it is
not a regulatory requirement, prudence suggests the value
calculation be in writing, and be retained.
On the matter of a review: Under § 24.102(d), the
Agency is required to make a written offer. Offer letters
are generally signed by someone at the management level.
It is general FHWA policy to have not less than two people
involved in setting the amount of an offer of just
compensation. This process would constitute a review
where no appraisal is made. Precisely how such matters
will be handled is within Agency discretion.
A few comments objected to waiving an appraisal for
any reason. An Agency has no obligation to waive the
appraisal of an acquisition if it prefers not to.
Section 24.103 Criteria for appraisals.
Section 24.103(a). One Agency described how it
intended to integrate the appraisal waiver provision in
§ 24.102(c)(2) with this section on appraisal standards.
Many other variations are also possible, but the comment
is summarized here for purposes of illustration. In
brief, negotiators will be instructed to clearly explain
to the owner the right to have an appraisal made and in no
way pressure the owner to sign a waiver; acquisitions
valued between $500 and $2,500 are to be supported by
sales in the project area, and will be approved by a
review appraiser prior to negotiations. As described,
this Agency intends to do more than the minimum: an
appraisal would always be a property owner option; some
value documentation will be a requirement; and a
reviewer's approval is necessary in certain circumstances.
This description is intended to illustrate the latitude an
agency has in implementing the provisions of this Subpart.
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Section 24.103fa) (2). One comment recommended the
requirement for a 5-year sales history be cut back to two
or three years. This recommendation was not adopted,
primarily because it applies only when a detailed
appraisal is necessary. When a detailed appraisal is not
necessary, the agency may set a different standard.
Section 24.103(a)(3). A comment recommended that a
statement be added to the effect that the appraiser must
explain the absence of more recent sales data when the
sales used are over 6 months old. This is viewed as a
good business practice on the part of the appraiser, but
not as an essential regulatory requirement.
Section 24.103fe). Three comments recommended an
increase in the dollar threshold from $2,500 to $5,000
where the same person can both appraise and negotiate.
The FHWA has not adopted this recommendation because
support for the increase is not widespread.
Section 24.104 Review of appraisals.
Section 24.104fbK In response to a comment, a
minor editorial clarification has been made to this
section regarding the role of the reviewing appraiser in
establishment of the Agency's offer of just compensation.
Section 24.105 Acquisition of tenant-owned improvements.
Four comments expressed a concern with the matter of
adequately protecting the rights of a tenant owner of
improvements. One of these comments recommended specific
reference to tenant owners be made at many points within
Subpart B.
FHWA has made no change because it believes tenant
owner interests are adequately protected. The language of
Subpart B is based on the premise that if a tenant can
demonstrate an ownership interest in real property, that
person is an owner of real property to be acquired for
purposes of this regulation, and is to be treated as such.
Section 24.105fc). Five comments stated that
contributory value or salvage value measures of
compensation to a tenant-owner are not fair and equitable
when the appraiser finds that all of the value is in the
land, with no value attributable to the improvement. As a
consequence, they recommended a "value in place" measure
of compensation be added to this section.
FHWA appreciates the difficulty this circumstance
presents, but the provisions of Section 302 of the Uniform
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Act do not permit it to accommodate the recommendation.
Section 302 specifies contributory value, or value for
removal (which has been implemented as salvage value) as
the measures of compensation.
However, there is some latitude available under
§ 24.105(e). Payment under "other applicable law" could
include provisions of State law and/or relocation
assistance benefits. Also, contributory value can be
viewed on a temporary basis in the valuation estimate
process. FHWA believes the basic objective is payment of
an amount of compensation which is just, reasonable, and
fair.
Two comments were received from representatives of
the outdoor advertising industry. Both comments focused
on the way advertising signs are treated by §§ 24.2(s),
24.105, and 24.303(e) of the regulation. They suggested
that, pursuant to section 302 of the Uniform Act, all
advertising signs covered by the Uniform Act should be
acquired as tenant owned improvements, and that the value
of a sign in place before removal should be used in
determining the owner's compensation. Neither of these
suggestions have been adopted.
Specific language concerning advertising signs in
section 101(7) (D) of the Uniform Act makes it clear that
some, if not all, signowners should be entitled to moving
and related expenses under section 202 of the Uniform Act,
rather than to compensation for a sign's acquisition under
section 302. Furthermore, that language in section
101(7)(D) was amended in the 1987 Amendments to broaden
the benefits available to signowners under section 202.
For many years, FHWA has reconciled the specific language
in section 101(7) (D) of the Uniform Act and the more
general language concerning tenant improvements in section
302 of the Act by providing that an advertising sign
considered to be personal property under State law should
receive the relocation benefits provided by section 202,
and if considered to be real property, it should be
acquired in accordance with section 302. FHWA believes
this is the most reasonable interpretation of the
provisions of the Uniform Act, and it continues to be
reflected in this final rule.
When a sign is acquired under section 302, subsection
302(b)(1) provides that its owner should receive the
greater of its contributory value to the real property or
its "fair market value . . for removal from the real
property."
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FHWA interprets this phrase to mean that removal of
the sign must be taken into consideration in determining
"fair market value for removal," and believes this is
done in §§ 24.105 and 24.2(s) of the regulation.
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Subpart C - General Relocation Requirements
Section 24.203 Relocation notices.
Section 24.203(a). A comment was received that the term
"as soon as feasible" was not sufficiently specific. FHWA
considers this term to mean "as soon as practical" and does
not believe that any further elaboration is necessary. This
comment and several other similar comments addressed to this
section may have merit in individual situations, but do not
necessitate changes in the regulations. Displacing agencies
may wish to clarify particular matters that are of concern to
them in their operating instructions.
Section 24.203(b). In response to one comment, a
definition of "Notice of intent to acquire or notice of
relocation eligibility" has been added at § 24.2(o).
Section 24.205 Relocation planning, advisory services, and
coordination.
Section 24.205(a) Relocation planning. There were 13
comments concerning relocation planning. Most were in favor
of the planning concept, but were concerned about how
relocation plans could hinder project development. The
relocation planning required by this section should be a tool
to assist in the orderly development of a project and should
be considered in this light by both the displacing agency and
the funding agency. FHWA believes that most displacing
agencies are well aware of the program or project benefits
which can be derived through early and sound relocation
planning and many agencies currently use comprehensive
planning techniques in project development. We do not view
relocation planning as a complicated, time consuming activity,
We see relocation planning as a process which provides
meaningful information to program and project decision makers,
It does not need to result in a detailed document containing
unnecessary data and needless problem solving. Instead, it
should be a process which is scoped to the complexity and
nature of anticipated program or project relocation activity
and should not require a burdensome commitment of Agency
resources. Language emphasizing this has been added to this
section. In response to several comments, there is no
requirement that planning documents be submitted for approval
to the funding agency at any stage of a project or program.
Planning is the responsibility of the displacing agency.
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Section 24.205(c) Relocation assistance advisory
services. Several comments were received concerning
relocation assistance advisory services. Three comments
objected to the requirement to provide transportation to
inspect housing in § 24.205(c)(2)(ii)(D). This provision is
not new and has been a part of the common rule for
implementation of the Uniform Act since that rule was first
promulgated by DOT on March 5, 1985 (50 FR 8955 (1985)). It is
the obligation of the displacing agency to assure that both
owners and tenants are able to inspect the housing to which
they are referred. There is no evidence to suggest that this
service has been abused by displaced persons.
Section 24.205fc)(2)(Hi}. At the suggestion of one
commenter, the words "comparable and" have been removed from
this section. The emphasis is on the identification of
suitable property locations for business and farm operations.
Section 24.205(c)(2)fvi). The provision of advisory
services to a person who initially occupies property after it
is acquired by the agency is required by the statute.
Therefore, it cannot be deleted as recommended by several
commenters. These persons are not displaced persons, but are
eligible for advisory services.
Section 24.206 Eviction for cause.
In response to comments, this provision has been modified
in several respects. HUD, in its program regulations dealing
with displacements caused by other than State-agency
acquisition, has long recognized eviction for cause as a basis
for denying eligibility for relocation benefits. Now that the
Uniform Act and these implementing regulations apply to this
broader array of displacement activities, it is necessary that
valid evictions continue to be recognized as a factor that can
extinguish potential rights to relocation payments.
At the same time, it is important that otherwise entitled
persons not be denied relocation payments by an eviction
undertaken for the purpose of evading an obligation to make
relocation assistance available, or for minor violations of a
lease.
Accordingly, this final rule retains the major thrust of
the eviction for cause section, which has been a part of the
governmentwide common rule since 1986, that persons lawfully
occupying property at the time of the initiation of
negotiations will continue to have a presumptive entitlement
to relocation payments.
However, modifications have been included to clarify that
payments may be denied in certain circumstances. Thus, a
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person who is evicted for cause prior to the initiation of
negotiations may be denied payment even if that person
vacates the premises after the initiation of negotiations.
addition, persons who seriously or repeatedly violate material
terms of the lease or occupancy agreement may be evicted even
if the eviction proceeding is begun after the initiation of
negotiations.
In either case, the Agency must assure itself that the
eviction action is not undertaken to evade the protections of
the Uniform Act. Such eviction for cause circumstances should
arise only infrequently and Federal funding agencies will be
expected to ensure that this provision is not misused.
Section 24.207 General requirements claims for
relocation payments.
Section 24.207ff) Deductions from relocation
payments. This section has remained the same as was
published as part of the common rule in the March 5, 1985
Federal Register. Section 24.207 continues to allow agencies
to deduct a person's unpaid rent owed to the agency from the
person's relocation payment in cases where it will not prevent
the person from obtaining a comparable replacement dwelling.
Since the relocation payment is not to be considered income
(§ 24.208) and is provided for the particular purpose of
obtaining replacement housing for the displaced person, it
cannot be released to other creditors without assurances that
comparable decent, safe, and sanitary housing will be
available to the displaced person.
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Subpart D - Payments for Moving and Related Expenses
In addition to comments on proposed rule changes, a
number of comments received on this subpart were requests for
clarification. Ordinarily, such clarification would be
provided by technical advisory guidance. However, to be
responsive to the comments, we have summarized the answers to
some of these below.
Section 24.306 in the NPRM has been renumbered as
§ 24.304 and § 24.304 has been renumbered as § 24.306 to
provide a better grouping of topics. The numbers used below
are those used in this final rule.
Section 24.301 Payment for actual reasonable moving and
related expenses - residential moves.
Questions were received about payment for the storage of
personal property covered in § 24.301(d). As with all other
moving expenses, the Agency determines what storage costs are
reasonable and necessary for a move to take place. If the
Agency determines storage to be necessary, the costs of
moving the personal property to and from storage would also
be eligible for payment. Boarding of animals is not
considered to be storage.
Section 24.302 Fixed payment for moving expenses
residential moves.
There were numerous comments concerning the $50 fixed
payment for moving expenses provided in § 24.302. FHWA has
clarified the language of this exception to apply only to
persons with minimal personal possessions who are in
occupancy of a dormitory-style room shared by two or more
unrelated persons, or a person whose residential move is
performed by an agency at no expense to the person. This
language is also reflected in the moving expense schedule
which is published by FHWA in the Notices section, of today's
Federal Register.
Section 24.303 Payment for actual reasonable moving and
related expenses - nonresidential moves.
Sections 24.303(a)(3) and 24.304 fa) (4). Four comments
asked for clarification of the difference in treatment of
utilities in these two sections. The expenses for providing
utilities under § 24.303(a) (3) are those costs incurred to
attach relocated personal property to utility service already
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provided on-site, such as electrical boxes, gas meters, and
water meters. Modifications to the equipment or to the on-
site utility service may also be eligible, if necessary.
These costs must be necessary to reinstall personal property
that has been moved from a displacement site or newly
installed at such site and would generally only benefit the
relocated business operation. Section 24.304(a)(4) provides
for making electrical and other services available to the
replacement site. These costs may be necessary to make the
real property suitable for the business operation and could
generally enhance the value of the real property. Costs
under § 24.304(a)(4) are limited by statute to $10,000 for
all reestablishment expenses. Costs under § 24.303(a)(3) are
limited to what is necessary, without dollar limitation.
Section 24.303(al(9). There were several comments about
relettering of signs and replacing stationery made obsolete
as a result of a move. This section covers those business
items typically used by a business for the purpose of
advising its customers and the public of the location of the
business. If a displacing agency considers other items
appropriate for this category, it may use the waiver
procedures in § 24.7 on a case-by-case basis.
Section 24.303 fa)(IP), One commenter suggested that an
acquiring agency could become responsible under the
requirements of this section for abandoned personal property
that could be considered hazardous material. This is not a
Uniform Act issue, but an issue typically governed by Federal
or State laws governing the proper disposal of hazardous
material.
Section 24.303(a)(13). Two comments stated that the
$1,000 limit on the cost of searching for a replacement
location was not adequate for some business and farm
operations. The displacing agency may use the waiver
procedures in § 24.7 on a case-by-case basis if a displaced
business or farm operation has unique requirements or
circumstances.
Section 24.303(cK Questions were received about self-
moves of business or farm operations. This section does not
preclude actual cost self-moves supported by records and
receipts of the costs incurred. The Agency may use moving
costs findings prepared by qualified staff, estimates
obtained by the Agency, or if acceptable to the Agency,
estimates obtained by the business or farm operator. A
single moving cost finding for a low cost or uncomplicated
move prepared by qualified staff is a "single bid or
estimate" for purposes of this section.
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Section 24.304 Reestablishment expenses - nonresidential
moves.
Twenty eight commenters provided comments on this
section. While generally in agreement with the list of
eligible expenses in § 24.304(a), the majority thought that
the dollar limits should be removed from the three categories
where limits are imposed. We have elected to retain the
dollar limits which serve as cost controls for expenses which
we believe to be most vulnerable to abuse.
Since it is the Agency's prerogative to determine which
reestablishment expenses are reasonable and necessary and since
§ 24.304(a) (13) allows the Agency to request a waiver from the
Federal funding agency within the $10,000 statutory maximum,
there is sufficient flexibility provided to the Agency. On the
other hand, the stated limits of $5,000 for increased operating
costs and $1,500 for exterior signing are considered to be
reasonable in most cases, and may assist a business owner in
making appropriate decisions about a new business site and the
size and type of signing for the new business site. The
inclusion of increased costs of operations as an eligible
expense in § 24.304(a)(10) was also commented upon. The
Uniform Act's legislative history supports the inclusion of
these expenses. Since the costs of operation are legitimate
reportable business expenses, the income tax records of most
businesses should be adequate to provide a record of such costs
prior to displacement. The costs at the new location can be
established or estimated using such sources as the new leases,
utility company projections for utility charges and taxing
authority records for tax increases.
Section 24.304(b)(6)t This section has been deleted. The
1987 Amendments exclude "a person whose sole business at the
displacement dwelling is the rental of such property to
others..." from qualifying for an "in lieu" payment (see
§ 24.306(a)(4)). This exclusion, however, does not extend to
reestablishment expenses.
Section 24.306 Fixed payment for moving expenses - non-
residential moves.
Comments were received from 20 sources on this section.
Recommendations were made to pay the fixed payment as an option
to a business with no criteria or, conversely, to pay the fixed
payment only if the business was discontinued. The additional
criteria added in the NPRM were also commented upon. Several
wanted to add additional criteria. One commenter wanted
different criteria for farm operations than for businesses. A
number of comments were received that would make the owners of
residential property ineligible for this payment. Others
thought that the owners of leased commercial property should
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also be ineligible.
FHWA has not changed this section. The fixed payment is
an alternative to the payments for moving and reestablishing a
business, farm, or nonprofit organization. The new criteria
are added to either clarify eligibility, correct inequities, or
implement new statutory exclusions as explained in the preamble
of the NPRM. The displacing agency retains the flexibility to
determine the basic eligibility based on the substantial loss
of existing patronage criteria and gains criteria that can
readily be explained to displaced persons.
There is no requirement now, nor has there ever been such
a requirement, that a displaced business must be discontinued
to receive this payment. Similarly, this payment has been and
continues to be available to otherwise eligible businesses that
do discontinue operations. There is also no requirement that a
business be without a source of income as suggested by three
commenters.
Establishing separate income and payment criteria for farm
operations would not be appropriate at this time.
There were several comments concerning the perceived
inequity of the ineligibility of owners of rental residential
property for a fixed payment while owners of other rental
property remained eligible. FHWA has corrected this inequity
by, generally, excluding owners of rental property from
eligibility for non-residential fixed payment.
Section 24.3Q6fd) Nonprofit organization. There were a
variety of comments concerning the minimal fixed payment of
$2,500 in lieu of actual moving expenses. Most of them favored
increasing the payment available to nonprofit organizations.
In response, FHWA has revised the payment to nonprofit
organizations to range from $1,000 to $20,000 based on criteria
similar to businesses, i.e. the average annual revenue for 2
years minus operating expenses. This procedure will be more
equitable for nonprofit organizations.
Section 24.306(e) Average annual net earnings of a
business or farm operation. Several comments were received
about the computation of average annual net earnings when
business or farm operations suffer a net loss for any year.
There are several ways to compute net losses. Some agencies
have used "0" if the net earnings result in a net loss. Other
agencies use the actual net loss figure. Either method is
acceptable if used uniformly by a funding agency.
Section 24.307 Discretionary utility relocation payments.
A few respondents urged that the reimbursement of
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extraordinary expenses be made mandatory, while several others
indicated the discretion given the displacing agency should be
retained. The discretionary language, "the displacing agency
may, at its option," has been retained because the 1987
Amendments and the Conference Report accompanying them are
quite clear that this payment is intended to be at the
discretion, or option, of the displacing agency. It would not
be appropriate to make mandatory by regulation that which was
left clearly permissive by statute.
Section 24.307(a)(51. A number of respondents objected
to the language in the NPRM which requires that State or local
reimbursement be "permitted by State statute." The principal
thrust of the objections was that this language meant that
unless there was a specific State statute permitting the
payment, no payment could be considered. FHWA agrees that the
proposed language could be subject to misinterpretation and
have revised the subsection, to provide that reimbursement must
be "in accordance with State law." This conforms to the clear
intent of Congress, as expressed in the Conference Report that
accompanied the 1987 Amendments.
Section 24.307(b) Extraordinary expenses. Six comments
expressed concern with this section's definition of
"extraordinary expenses." Three of the comments recommended
changes which would permit certain expenses, even though
ordinarily budgeted, to be considered as "not routine or
predictable expenses" and, therefore, qualify as "extraordinary
expenses." FHWA has not adopted these recommendations. It is
the expressed intent of Congress, as found in the Conference
Report, that "utilities would continue to pay those ordinary
relocation costs within their reasonable contemplation as
occupants of local rights-of-way..." FHWA believes the language
of this section will allow a utility company to present its
case for those expenses which it considers to be "not routine
or predictable" and not ordinarily budgeted as operating
expenses.
Four comments urged removal of the provision which would
exclude from extraordinary expenses those expenses which the
utility company has explicitly and knowingly agreed to bear as
a condition for use of the right-of-way. Again the language of
the rule represents the clear intent of Congress as expressed
in the Conference Report accompanying the 1987 Amendments.
While we are cognizant of the concerns presented by the
public utility industry, we believe this rule clearly expresses
the intent of Congress, and, as a consequence, § 24.307(b) is
unchanged.
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Subpart E - Replacement housing payments
Section 24.401 Replacement housing payment for 180-day
homeowner-occupants.
Section 24.401 fa)(2). Several comments were received
about the extension of eligibility for a replacement housing
payment beyond one year for good cause. In response, the
meaning of "for good cause" has been amplified in the
appendix.
Section 24.401fa) (2)(i). Comments were received about
the appropriate "start" date for the one-year eligibility
for a replacement housing payment in the case of
condemnation. In response FHWA has clarified that the one-
year period starts when the full amount of estimated just
compensation is deposited in the court. This may be the
Agency's proffered amount or a commissioners' award, if
appropriate. In either case, the Agency does not need to
delay the one-year start date until final adjudication.
Section 24.401 fa)(2)(ii). This section has been
changed to conform with the amendments of section 203(a)
of the Uniform Act made by section 406(5) of the 1987
Amendments. Several comments were received about the
differences between the criteria for eligibility for 180 day
owner-occupants and 90 day owner-occupants and tenants. The
change in criteria for 180 day owner-occupants is statutory.
There is no requirement that changes be made in criteria for
90 day owner-occupants and tenants. The "date the displaced
person moves" is a simpler criterion to use then the "date
the displacing agency's obligation under § 24.204 is met"
and has been retained where feasible.
Section 24.401(d). Thirty-one comments were received
concerning the method for computing increased mortgage
interest payments. The commenters were about evenly split
between preference for the buydown method as presented in
the body of the NPRM, and the buydown method presented in
the preamble. A few wanted the option of using the former
annuity or amortization method if it should prove less
expensive for the Agency.
The discussions in favor of the simplified buydown
method presented in the preamble emphasized the cost-savings
and time-savings to the Agency, and the ability of a
displaced person to plan his or her replacement housing
purchase knowing the full amount of payments to which such
person is entitled. The view of these commenters was that
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this would not create a windfall because the displaced
person still had to acquire a decent, safe, and sanitary
replacement dwelling to be eligible; only the financing
terms were his or her choice. Several comments were also
made that the displaced person could readily understand the
concept that an interest rate at less than current market
interest rates was an asset and the computed payment was
related to this fact.
On the other hand, those comments that favored the
language in the body of the NPRM were concerned that a
windfall would be created if a person paid cash for the
replacement dwelling or assumed an existing mortgage at a
lower interest rate than the computed rate. There was also
a question of the legality for the preamble alternate, and
concern that making the payment available on terms other
than those actually used in the purchase of a replacement
dwelling would not satisfy the statutory language.
FHWA has elected to retain the procedure in the body of
the NPRM. This procedure requires that an estimate of the
amount of the payment be provided to the person. Such
estimate shall be based on the current prevailing rate for
fixed-rate mortgages and subsequent payment based on the
actual mortgage terms obtained. This process will require
advisory services to the displaced person to enable such
person to be prudent in the financing of his or her
replacement dwelling.
In response to comments received, FHWA has revised §
24.401(d)(2), by adopting the language in § .401(d)(3) of
the common governmentwide rule, to provide that the payment
shall be based on the remaining term of the mortgage on the
displacement dwelling or the actual term of the new
mortgage, whichever is less.
Many of the same commenters who preferred this method
did not think that their agency could make the increased
mortgage interest payments at the time of closing because of
their payment procedures or the loan processing procedures
of lending institutions. In response, the final rule has
been revised to provide that the payments must be made "at
or near" the time of closing. However, the implied purpose
of the increased mortgage interest costs payment is to
reduce the replacement mortgage; therefore this payment must
be available to lower the amount of the mortgage in a timely
manner, preferably at the time of the closing on the
replacement property. This procedure does require close
coordination with the closing agent, but is more cost-
effective than the amortization method. The agencies who
thought they would be most successful using the buy-down
procedure were those who used escrow accounts to make funds
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available to displaced persons.
There were also several comments about home equity
loans and the inclusion of these mortgages in the
computation of the increased mortgage interest costs
payment. Home equity loans are valid mortgage liens on
residential real property regardless of how the proceeds
from the loans are used. Therefore, they must be included
in the computation.
In answer to another comment, the mortgage rate to be
used to compute the increased mortgage interest costs
payment when the property is secured with an adjustable rate
mortgage is the interest rate that is current on the
property as of the date of acquisition.
A sample computation of an increased mortgage interest
costs payment is included in Appendix A, as requested by a
number of commenters. An IBM PC compatible computer program
and financial calculator instructions will be made available
as technical guidance as soon as feasible.
Section 24.402 Replacement housing payment for 90-
day occupants.
Section 24.402(a)(2)fii)fA). The change made in
§ 24.401(a)(2)(i), concerning the deposit of estimated just
compensation, is made here also.
Section 24.402fb) Rental assistance payment.
There were numerous comments about the changes made
in this section.
The first issue was the inclusion of the cost of
utilities in the computation of the rental assistance
payment. The inclusion of utilities has been an ongoing
issue since the publication of the common rule in 1985.
Since that time, utility services have been included in the
computation of a rental assistance payment if they were
included at the displacement dwelling and/or the comparable
dwelling as a part of the rent. FHWA recognizes the
concerns of the current 14 commenters about the increased
administrative burden for securing information and the
variables in utility usage due to differing user lifestyles.
These concerns can be addressed in various ways. One
commenter suggested that a schedule be devised for utility
costs with the input of utility companies in the project
area that will reflect actual, reasonable costs. Another
agency suggested that if true comparables are used for
payment determination, the utility costs should also be
comparable and their inclusion should not increase the cost
of replacement housing. Relocation from a substandard
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dwelling to a standard dwelling could, in fact, decrease the
cost of utilities, especially the cost of heat unless a
larger dwelling is used to meet the needs of a family, or if
all utilities were not available in the displacement
dwelling, as noted by another commenter.
Agencies may establish their own procedures to be used
for determining the cost of utilities if the procedures are
used uniformly.
FHWA is continuing to include utilities in the monthly
base housing computation because utilities are considered to
be an integral part of monthly housing costs and
historically have been treated as such by several Federal
programs including those administered by HUD as a standard
practice. The existence of adequate utilities is a primary
requirement for a dwelling to be decent, safe, and sanitary.
The 30 percent figure used in § 24.402(b) (2)(ii) to
determine base monthly rental is considered a reasonable
percentage of income to be applied to rental housing costs
under current market and economic conditions, and is
consistent with the percentage of income figures currently
being used in other subsidized housing and related programs
of HUD and other agencies. Several commenters stated that,
in their experience, many tenants are now paying 40 percent
or more of their incomes for housing costs. Our concern is
that the 40 percent payments primarily reflect the lack of
affordable rental housing in the current market. We do
agree that some tenants voluntarily elect to spend more than
30 percent of their income for housing when more affordable
housing is available. However, FHWA believes these
lifestyle choices for convenience, prestige or other
reasons to be the exceptions, not the rule. Consideration
must also be given to the fact that private lending
institution requirements set the limit on the monthly cost
of housing after purchase of a dwelling at approximately the
same level as the 30 percent of income criteria established
for tenants.
The inclusion of a person's income in computing a base
monthly rent figure was also opposed by several commenters.
The biggest concern was a perceived difficulty in the
verification of income and an implied reluctance to accept
income information from some displaced persons. FHWA
believes that accurate information concerning income can be
obtained from most persons. If there is obvious evidence
that a person has more income than reported, it is the
Agency's prerogative to accept the income as reported, to
request additional verification of income, including income
tax returns, or to inform the person that there is
reasonable doubt that the information is accurate. If the
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income information is not provided or amplified as
requested, the Agency may take such action as it deems
necessary to obtain income information under a uniform
agency-wide or area-wide policy.
Section 24.402(b)f3) Manner of disbursement* Eleven
comments were received concerning the vesting of the full
amount of the rental assistance payment when the displaced
tenant receives the first rental assistance payment, either
in lump sum or as an installment. Most of the comments took
exception to the idea of vesting.
The vesting of the full amount of the rental assistance
payment is intended to establish at a definite point in
time, the full amount of the payment for the 42 month period
after displacement. Vesting eliminates the red-tape
requirements of recordkeeping, re-inspection, and
recertification of the replacement dwellings, and continued
contacts with the displaced person and the person's landlord
that would otherwise be necessary. It also eliminates the
potential problem of additional project costs as rents are
increased or new DSS dwellings need to be found for those
who no longer live in standard housing. FHWA understands
that the same commenters are concerned about the diversion
of lump sum rental assistance payments for non-housing uses,
and a subsequent return of the displaced person to sub-
standard housing. One way to effectively provide
installment payments, either to the displaced person or to
the person and the person's landlord, without continuing
agency supervision, is to place the payment in an escrow
account that will be disbursed according to a pre-
determined schedule. This method could also serve for
disbursement of housing of last resort payments, which are
also vested. The method of disbursement remains the
Agency's discretion.
It should be understood that, under vesting, the only
times a rental assistance payment should change are during
the one-year period described in § 24.402(a) (2), and then
only if tenant elects to up-grade his or her housing to
receive the full amount of the original computed rental
assistance payment based on a comparable dwelling, or
changes his or her status from tenant to owner and therefore
becomes eligible for an additional payment (see
§ 24.403(6)).
Section 24.402fc) Downpayment assistance payment.
Twenty-one comments were received concerning downpayment
assistance. Only 4 of the 21 commenters believed that the
amount available for downpayment assistance should be
limited to the computed amount of the rental assistance
payment for tenants. The majority stated that agencies
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should make downpayment assistance payments of up to $5,250,
with most recommending that the payment be restricted to the
amount necessary to obtain conventional loan financing for
purchase of a replacement dwelling. The main concern
expressed was that allowing each agency to select a
procedure for computing the down payment
assistance payment did not promote uniformity.
Since the legislation does not give the lead agency the
authority to select a particular procedure, but reserves
such authority to the displacing agencies, we have elected
to retain the existing language. As several commenters
suggested, displacing agencies may want to coordinate with
other agencies within the State or jurisdiction where they
are located to reach a consensus on the procedure to be
followed in that State or jurisdiction. FHWA will
appreciate being advised of the experience of the various
agencies in the implementation of this procedure. If the
experience indicates that a change is needed to affect a
more uniform implementation, we will seek a legislative
change.
Regardless of the procedure selected, a rental
assistance payment will have to be initially computed for
tenants. If the computed rental assistance payment is zero,
then the downpayment assistance is zero unless the agency
has elected to make downpayment assistance payments of up to
$5,250. If their eligibility is greater than $5,250 for
rental assistance, they will be eligible for housing of last
resort for rental assistance or downpayment assistance. As
is required by statute, eligibility for owners of more than
90 days but less than 180 days for downpayment assistance
will be limited to the amount that would have been computed
had they been 180 day owners.
Section 24.403 Additional rules governing replacement
housing payments.
Several comments were received concerning the
requirement in § 24.403(a)(l) that an adjustment be made to
the asking price of any dwelling used to compute the
replacement housing payment to the extent justified by local
market data. This procedure has been a part of the
governmentwide common rule since it was first published in
March 1985. It requires that adjustments be made in the
asking price of comparable dwellings to the extent that the
market demonstrates that expected sale prices will be less
than the asking prices. A clarification of the use of this
procedure has been added to Appendix A.
In § 24.403(a)(2), for clarity and as suggested by
several commenters, FHWA has separated the procedures for
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major exterior attributes and buildable residential lots
into two paragraphs.
Section 24.403(c)(61. Several comments were received
concerning the use of current fair market value for the
acquisition price of a previously owned dwelling when it is
used as the replacement dwelling. The.current fair market
value is used because (1) it is the amount that would have
been paid if the dwelling were purchased on the current
market as a replacement residence, (2) the displaced owner
could have acquired any other dwelling as a replacement and
(3) the use of the previously owned dwelling is the
conversion of an existing asset to replacement housing
purposes. This regulation operates the same whether the
previously-owned dwelling is mortgaged or unencumbered. In
response to one commenter, the cost of an appraisal of the
previously owned dwelling is a reimbursable cost if the
agency considers an appraisal to be appropriate and
necessary.
Section 24.404 Replacement housing of last resort.
There were 13 comments on replacement housing of last
resort. Several concerned the requirement that the use of
housing of last resort be justified. Such justification is
considered important for good program management and is
consistent with the requirement, added by the 1987
Amendments, that any payment provided for housing of last
resort that exceeds the maximum amounts provided to tenants
and owners by §§ 24.401 and 24.402 must be justified. A
slight modification was made to § 24.404(a) (2) (i) at the
recommendation of one commenter to clarify that
justification for last resort housing assistance may be for
an entire project or program area, if appropriate, without
additional case-by-case justification. A number of comments
were received about the change in status of a displaced
person from a tenant to an owner. FHWA has clarified that
such a change in status must be with the concurrence of the
displaced person. The concurrence of the displaced person
should be received prior to the execution of any of the
methods of providing for housing of last resort. Several
general comments were received about the concept of
replacement housing of last resort. Replacement housing of
last resort is a legislatively authorized continuation of
the replacement housing assistance provided by §§ 24.401 and
24.402 of this part, and provides for comparable replacement
housing for displaced persons not adequately provided for
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under those sections, or who do not meet the eligibility
requirements of those sections. Additional flexibility is
provided to displacing agencies for the provision of housing
of last resort so that housing needs are met for owners and
tenants in the most cost-effective, yet equitable way.
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Subpart F - Mobile Homes
Section 24.502 Moving and related expenses - mobile homes.
Only one comment was received on this subpart. In
response, § 24.502(a) has been modified to state more
clearly that, even though an owner-occupant whose mobile
home is not acquired may receive replacement housing under
§ 24.503(a)(3), and therefore is not eligible for payment
for moving the mobile home, he may be eligible for payment
for moving personal property from the mobile home. Also,
the commenter thought that all mobile homes should be
treated as real property. This may be appropriate in areas
where mobile homes are treated as real property under State
law or where an agency has the option to consider mobile
homes to be either real property or personal property.
However, some State laws consider mobile homes to be
personal property only, and, therefore, they may not be
acquired as realty.
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Subpart G - Certification
This subpart implements one of the most significant
changes added by the 1987 Amendments. As such, FHWA has a
special interest in its implementation and would appreciate
receiving further information on its use and effectiveness.
Several respondents commented on Subpart G, however no
single comment, or group of comments, was sufficiently
persuasive to necessitate a change in the proposed text.
However, one comment on § 24.603, Monitoring and corrective
action, did draw our attention to the need for a substantive
revision of § 24.603(b).
Section 24.602 Certification application
Two commenters recommended that certification
applications be made directly from the head of the State
agency to the Federal agency providing financial assistance,
rather than through the State governor, or the governor's
designee. FHWA does not adopt this recommendation. There
is a definite need for a focal point within each State for
the receipt and screening of certification applications.
Consistent with the principles of federalism, the Office of
the Governor, as the Chief Executive Officer in any State,
is the logical starting point for this process since the
governor normally exercises executive authority over the
State agencies that are recipients of Federal financial
assistance or through which Federal financial assistance is
channelled to subrecipients at the local level, all of whom
are subject to the Uniform Act and any of whom could make
application for certification approval. The certification
process does not alter the existing relationship between
local subrecipients and the State-level recipients of
Federal financial assistance. It is expected that any
certification application made by a sub-recipient will be
made through the State-level agency to the governor, or the
governor's designee. In those instances where the local
level agency (city, county, etc.) is the direct recipient,
and there is no State-level agency authorized to perform
such functions, the certification application would be made
directly to the governor, or the governor's designee.
The governor, or a State office or agency designated by
the governor, will be able to standardize the process and
develop an expertise in the processing of applications.
Further, the governor or his or her designee will be more
able to assess the capabilities of those State agencies
seeking to assume Federal agency responsibilities through
the certification process. A focal point of this nature
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will be particularly advantageous in processing
certifications from a State agency seeking certification
approval from more than one Federal agency.
Two commenters indicated some misunderstanding of the
responsibilities of the Federal funding agency.
It is not intended that the Federal funding agency
endorse an approved application received from the governor,
or the governor's designee, if the Federal funding agency
has appropriate indications revealing program deficiencies
regarding the certifying State agency. The purpose of
having the Federal funding agency accept the approved
application without performing an independent review is
threefold: first, it emphasizes the role of the governor,
or the governor's designee, in evaluating the State agency
certifications; second, it will bring into focus the current
status of the Federal funding agency's oversight of its
State agencies; third, unless there are pre-existing
appropriate indications of deficiencies, the certification
approval can be handled more expeditiously. The second of
the three foregoing points is the basis for the written
assessment of the State agency's capabilities to operate
under certification which the Federal funding agency must
provide when the certification application is transmitted to
the Federal lead agency.
Section 24.603 Monitoring and corrective action.
One respondent objected to the permissive withholding
of Federal financial assistance if a certified State agency
failed to comply with applicable State law and regulation
serving as the basis of its certification. The respondent
perceived this to mean that the authority to withhold
approval of Federal financial assistance is available to any
Federal agency regardless of the source of the financial
assistance. This, of course, is not the case. The
authority and the responsibility regarding the withholding
of Federal financial assistance rests with each Federal
agency regarding its projects, programs, and activities.
The respondent's comment did, however, lead us to the
recognition of a possible inconsistency between the
requirements of § 24.603(b) and the assurances required by
§ 24.4 and sections 210 and 305 of the Uniform Act. As a
consequence, 24.603(b) is revised and clarified to provide
that if a State agency certifies, under State law and
regulation, it can and will comply with the provisions of
the Uniform Act which would otherwise be covered by the
sections 210 and 305 assurances and, then, fails to comply,
the Federal agency should withhold Federal financial
assistance in that State agency's programs, projects, and
activities affected by the Uniform Act.
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The certification process does not diminish the State
agency's fundamental responsibilities regarding compliance
with the Uniform Act, particularly those provisions referred
in the sections 210 and 305 assurances. It is clear, from
the statute, that compliance with provisions which are the
subject of the assurances is of paramount importance to the
continued Federal financial assistance of programs,
projects, and activities affected by the Uniform Act.
For example, if Uniform Act non-compliance occurred in
connection with a federally assisted project the Federal
agency should exercise its authority to withhold Federal
financial assistance until the state agency is again
performing in compliance with the certification.
In order to ensure coordination of information among
Federal agencies that may have accepted a certification from
the same state agency, language has been added to
§§ 24.603(b) and (c) to require that the lead agency be
consulted by the Federal funding agency before any Federal
funds are withheld from a certified state agency or the
acceptance of a certification is revoked.
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Appendix A to Part 24 - Additional Information
The appendix has been modified and augmented to provide
for better understanding of the sections of the regulations
to which it pertains.
Section 24.2(g)(2) Persons not displaced. "Permanently" has
been added to the first sentence to clarify that some
persons may be temporarily displaced but are not displaced
persons because they have not been permanently displaced.
Section 24.102(m) Fair rental. In response to several
comments concerning short-term rent, the modifier,
"generally," has been added to the last sentence.
Section 24.306 Fixed payment for moving expenses - non-
residential moves. FHWA has added clarifying language in
Appendix A for non-profit organizations treated under this
section.
Section 24.401 Replacement housing payment for 180-day
homeowner-occupants.
Section 24.401(a) (2). A statement has been added to
clarify the phrase "for good cause."
Section 24.401(d). The computation of a "buydown" payment,
the factors used in computation, and the agency's obligation
to the displaced person are explained. Even though one
commenter suggested that adjustment of the buydown payment,
when a displaced person elects to mortgage the replacement
dwelling for less than the remaining mortgage on the
displacement dwelling, penalizes the displaced person for
making a larger downpayment, we are retaining this
provision. In addition, we have accepted a recommendation
that the mortgage with the shortest term be used to compute
the payment. FHWA has amended the procedures to reflect
this adjustment.
The FHWA is interested in your experience with this new
procedure for computing the mortgage interest differential
payment.
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Appendix B to Part 24 - Statistical Report Fon
The reformatted statistical report form includes a new
line item for reporting payments for the statutory business
reestablishment expense entitlement. (See line 7A).
Several comments were received regarding the information
required in Part B, column (A). More accurate statistical
analyses can be obtained by changing the requirement for
column (A) to displacements instead of number of claims
since a displaced person may receive more than one claim in
several categories. The heading for column (A) has been
changed to number of displacements.
As required by Section 1320.21 of OMB's new paperwork
clearance regulation that was published in the Federal
Register on May 10, 1988, we have included an agency
disclosure notice for public reporting on the STATISTICAL
REPORT FORM.
A request was received from HUD to add new items to the
statistical report form to collect race, sex, ethnicity,
handicap and familial status data. These items were not
included in the report form presented in the NPRM and,
therefore, FHWA does not have the benefit of public comment
on what, if any, paperwork burden such additional
information collection would have on agencies or persons
carrying out acquisition or displacement activities.
Therefore, the report form format remains unchanged at this
time except for the minor alteration referred to above.
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Regulatory Impact
The FHWA has determined that this action does not
constitute a major rule under Executive Order 12291 or a
significant rule under the regulatory policies and
procedures of the Department of Transportation. Executive
Order 12291 requires that a regulatory impact analysis be
prepared for "major" rules which are defined in the Order as
any rule that has an annual effect on the national economy
of $100 million or more, or has certain other specified
effects.
The economic impacts of this final rule are primarily
mandated by the provisions of the 1987 Amendments. However,
since some of the statutory changes are administrative or
procedural, savings to Federal, State, and local agencies
should result in the administration of the Uniform Act.
Other statutory changes, which alter benefit levels, and
expand the Act's application to include certain private
persons who receive Federal financial assistance, and
persons displaced by certain nonacquisition activities,
should result in a modest increase in amounts paid under the
Uniform Act.
However, we do not believe that the proposed
regulations will have an annual economic effect of $100
million or more, or the other effects listed in the
Executive Order. For this reason, FHWA has determined that
this regulation is not a major rule within the meaning of
the Order.
Federal agencies administering direct Federal
activities, as well as many states, currently have the
necessary authority to comply with the additional provisions
of the 1987 Amendments implemented in this rule. To delay
the promulgation of the amendments made in this rule would
deprive many parties of the protections and benefits
intended by those provisions of the 1987 Amendments.
Accordingly, the FHWA finds good cause to make this
regulation effective without the 30-day delay in effective
date under the Administrative Procedures Act, 5 U.S.C.
553(b).
Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 605(b))
requires that for each rule with a "significant economic
impact on a substantial number of small entities" an
analysis be prepared describing the rules impact on small
entities, and identifying any significant alternatives to
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the rule that would minimize the economic impacts on small
entities.
The provisions of the Uniform Act that are implemented
in this final rule have not changed substantially. The
primary impact of the 1987 Amendments is expected to be an
increase in benefits provided to small businesses, the
elimination of unnecessary administrative requirements
imposed on State and local agencies, and the consequent
reduction of burden on those affected entities, and the
expansion of the Act's application to those private entities
that seek and receive Federal financial assistance.
In response to comments received from rural electric
cooperatives FHWA has considered the impact that this rule
would have on such cooperatives. Primarily for the reasons
provided elsewhere in the preamble we have concluded that
this regulation would not have a significant economic impact
on a substantial number of small electric cooperatives.
Based on information available to FHWA at this time and
under the criteria of the Regulatory Flexibility Act, the
FHWA hereby certifies that this regulation will not have a
significant economic impact on a substantial number of small
entities.
Paperwork Reduction Act Requirements
Today's final rule makes one change to the Uniform Act
Report form, which is contained in Appendix B of Part 24. A
new item, 7A, is added to obtain information relating to the
new business reestablishment payment added by the 1987
Amendments. Several minor editorial changes have also been
made in this form. Federal funding agencies which elect to
require a report on Uniform Act activities will submit the
revised form to the Office of Management and Budget (OMB)
for review under 44 U.S.C. 3504(h), the Paperwork Reduction
Act, Pub. L. 96-511. Agencies may continue to use the
previous report form until OMB approval is granted.
Federalism Assessment
As discussed in the Supplementary Information sections
of this preamble, this final rule builds upon the positive
Federalism accomplishments achieved in the promulgation of
the governmentwide common rule on February 27, 1986 (51 FR
7000) which significantly reduced administrative burdens on
States and local recipients of Federal financial assistance.
The FHWA has determined that the Federalism accomplishments
of the common rule are retained in today's rule and the
changes which have been made are fully consistent with the
principles and criteria contained in Executive Order 12612
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and do not have sufficient further Federalism implications
to warrant the preparation of a complete Federalism
Assessment.
This final rule implements a provision of the 1987
Amendments that gives substantial additional discretion to
the States. This is the certification procedure which
provides an alternative whereby State agencies, with
adequate authority under State law, can comply with the
Uniform Act with a minimum amount of Federal supervision or
oversight. This certification procedure would give maximum
authority and control to the State governor, or his or her
designee, in managing and coordinating the certification
procedure in each State.
List of Subjects in 49 CFR Part 24
Real property acquisition, Relocation assistance,
Reporting and recordkeeping requirements, Transportation.
Accordingly, Title 49 of the Code of Federal
Regulations is amended as set forth below.
Issued on:
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Part 24 is revised to read as follows:
PART 24 - UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY
ACQUISITION FOR FEDERAL AND FEDERALLY ASSISTED PROGRAMS
Subpart A — General
Section
24.1 Purpose.
24.2 Definitions.
24.3 No duplication of payments.
24.4 Assurances, monitoring and corrective action.
24.5 Manner of notices.
24.6 Administration of jointly-funded projects.
24.7 Federal agency waiver of regulations.
24.8 Compliance with other laws and regulations.
24.9 Recordkeeping and reports.
24.10 Appeals.
Subpart B — Real Property Acquisition
24.101 Applicability of acquisition requirements.
24.102 Basic acquisition policies.
24.103 Criteria for appraisals.
24.104 Review of appraisals.
24.105 Acquisition of tenant-owned improvements.
24.106 Expenses incidental to transfer of title to
the Agency.
24.107 Certain litigation expenses.
24.108 Donations.
Subpart C — General Relocation Requirements
24.201 Purpose.
24.202 Applicability.
24.203 Relocation notices.
24.204 Availability of comparable replacement
dwelling before displacement.
24.205 Relocation planning, advisory services, and
coordination.
24.206 Eviction for cause.
24.207 General requirements — claims for relocation
payments.
24.208 Relocation payments not considered as income.
Subpart D — Payments for Moving and Related Expenses
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24.301
24.302
24.303
24.304
24.305
24.306
24.307
Payment for actual reasonable moving and related
expenses residential moves.
Fixed payment for moving expenses--
residential moves.
Payment for actual reasonable moving and
related expenses—nonresidential moves.
Reestablishment expense's nonresidential
moves.
Ineligible moving and related expenses.
Fixed payment for moving expenses—
nonresidential moves.
Discretionary utility relocation payments.
Subpart E — Replacement Housing Payments
24.401 Replacement housing payment for 180-day
homeowner-occupants.
24.402 Replacement housing payment for 90-day
occupants.
24.403 Additional rules governing replacement
housing payments.
24.404 Replacement housing of last resort.
24.501
24.502
24.503
24.504
24.505
24.601
24.602
24.603
Appendix A
Appendix B
Authority:
Subpart F — Mobile Homes
Applicability.
Moving and related expenses—mobile homes.
Replacement housing payment for 180-day
mobile homeowner-occupants.
Replacement housing payment for 90-day mobile
home occupants.
Additional rules governing relocation
payments to mobile home occupants.
Subpart G — Certification
Purpose.
Certification application.
Monitoring and corrective action.
to Part 24 - Additional Information
to Part 24 - Statistical Report Form
Section 213, Uniform Relocation Assistance and
Real Property Acquisition Policies Act of
1970, Pub. L. 91-646, 84 Stat. 1894 (42 U.S.C.
4601) as amended by the Surface Transportation
and Uniform Relocation Assistance Act of 1987,
Title IV of Pub. L. 100-17, 101 Stat. 246-
256 (42 U.S.C. 4601 note); and 49 CFR
1.48(cc).
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Subpart A General
§ 24.1 Purpose.
The purpose of this part is to promulgate rules to
implement the Uniform Relocation Assistance and Real
Property Acquisition Policies Act of 1970, as amended (42
U.S.C. 4601 et seq.), in accordance with the following
objectives:
(a) To ensure that owners of real property to be
acquired for Federal and federally-assisted projects are
treated fairly and consistently, to encourage and expedite
acquisition by agreements with such owners, to minimize
litigation and relieve congestion in the courts, and to
promote public confidence in Federal and federally-assisted
land acquisition programs;
(b) To ensure that persons displaced as a direct resul
of Federal or federally-assisted projects are treated
fairly, consistently, and equitably so that such persons
will not suffer disproportionate injuries as a result of
projects designed for the benefit of the public as a whole;
and
(c) To ensure that Agencies implement these
regulations in a manner that is efficient and cost
effective.
§ 24.2 Definitions.
(a) Agency. The term "Agency" means the Federal
agency, State, State agency, or person that acquires real
property or displaces a person.
(1) Acquiring agency. The term "acquiring agency"
means a State agency, as defined in paragraph (a)(4) of this
section, which has the authority to acquire property by
eminent domain under State law, and a State agency or person
which does not have such authority. Any Agency or person
solely acquiring property pursuant to the provisions of
§ 24.101(a)(1), (2), (3), or (4) need not provide the
assurances required by § 24.4(a)(l) or (2).
(2) Displacing agency. The term "displacing agency"
means any Federal agency carrying out a program or project,
and any State, State agency, or person carrying out a
program or project with Federal financial assistance, which
causes a person to be a displaced person.
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(3) Federal agency. The term "Federal agency" means any
department, Agency, or instrumentality in the executive branch
of the Government, any wholly owned Government corporation, the
Architect of the Capitol, the Federal Reserve Banks and
branches thereof, and any person who has the authority to
acquire property by eminent domain under Federal law.
(4) State agency. The term "State agency" means any
department, Agency or instrumentality of a State or of a
political subdivision of a State, any department, Agency, or
instrumentality of two or more States or of two or more
political subdivisions of a State or States, and any person who
has the authority to acquire property by eminent domain under
State law.
(b) Appraisal. The term "appraisal" means a written
statement independently and impartially prepared by a qualified
appraiser setting forth an opinion of defined value of an
adequately described property as of a specific date, supported
by the presentation and analysis of relevant market
information.
(c) Business. The term "business" means any lawful
activity, except a farm operation, that is conducted:
(1) Primarily for the purchase, sale, lease and/or rental
of personal and/or real property, and/or for the manufacture,
processing, and/or marketing of products, commodities, and/or
any other personal property; or
(2) Primarily for the sale of services to the public; or
(3) Primarily for outdoor advertising display purposes,
when the display must be moved as a result of the project; or
(4) By a nonprofit organization that has established its
nonprofit status under applicable Federal or State law.
(d) Comparable replacement dwelling. The term "comparable
replacement dwelling" means a dwelling which is:
(1) Decent, safe and sanitary as described in
paragraph (f) of this section;
(2) Functionally equivalent to the displacement dwelling.
The term "functionally equivalent" means that it performs the
same function, provides the same utility, and is capable of
contributing to a comparable style of living. While a
comparable replacement dwelling need not possess every feature
of the displacement dwelling, the principal features must be
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present. Generally, functional equivalency is an objective
standard, reflecting the range of purposes for which the
various physical features of a dwelling may be used. However,
in determining whether a replacement dwelling is functionally
equivalent to the displacement dwelling, the Agency may
consider reasonable trade-offs for specific features when the
replacement unit is "equal to or better than" the displacement
dwelling. (See Appendix A of this part);
(3) Adequate in size to accommodate the occupants;
(4) In an area not subject to unreasonable adverse
environmental conditions;
(5) In a location generally not less desirable than the
location of the displaced person's dwelling with respect to
public utilities and commercial and public facilities, and
reasonably accessible to the person's place of employment;
(6) On a site that is typical in size for residential
development with normal site improvements, including customary
landscaping. The site need not include special improvements
such as outbuildings, swimming pools, or greenhouses. (See
also § 24.403(a) (2) .) ;
(7) Currently available to the displaced person on the
private market. However, a comparable replacement dwelling for
a person receiving government housing assistance before
displacement may reflect similar government housing assistance.
(See Appendix A of this part.); and
(8) Within the financial means of the displaced person.
(i) A replacement dwelling purchased by a homeowner in
occupancy at the displacement dwelling for at least 180 days
prior to initiation of negotiations (180-day homeowner) is
considered to be within the homeowner's financial means if the
homeowner will receive the full price differential as described
in 24.401(c), all increased mortgage interest costs as
described at § 24.401(d) and all incidental expenses as
described at § 24.401(e) , plus any additional amount required
to be paid under § 24.404, Replacement housing of last resort.
(ii) A replacement dwelling rented by an eligible
displaced person is considered to be within his or her
financial means if, after receiving rental assistance under
this part, the person's monthly rent and estimated average
monthly utility costs for the replacement dwelling do not
exceed the person's base monthly rental for the
displacement dwelling as described at § 24.402(b)(2).
(iii) For a displaced person who is not eligible to
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receive a replacement housing payment because of the person's
failure to meet length-of-occupancy requirements, comparable
replacement rental housing is considered to be within the
person's financial means if an Agency pays that portion of the
monthly housing costs of a replacement dwelling which exceeds
30 percent of such person's gross monthly household income or,
if receiving a welfare assistance payment from a program that
designates amounts for shelter and utilities, the total of the
amounts designated for shelter and utilities. Such rental
assistance must be paid under § 24.404, Replacement housing of
last resort.
(e) Contribute materially. The term "contribute
materially" means that during the 2 taxable years prior to the
taxable year in which displacement occurs, or during such other
period as the Agency determines to be more equitable, a
business or farm operation:
(1)
or
Had average annual gross receipts of at least $5000;
(2) Had average annual net earnings of at least $1000; or
(3) Contributed at least 33 1/3 percent of the owner's or
operator's average annual gross income from all sources.
(4) If the application of the above criteria creates an
inequity or hardship in any given case, the Agency may approve
the use of other criteria as determined appropriate.
(f) Decent, safe, and sanitary dwelling. The term
"decent, safe, and sanitary dwelling" means a dwelling which
meets applicable housing and occupancy codes. However, any of
the following standards which are not met by an applicable code
shall apply unless waived for good cause by the Federal agency
funding the project. The dwelling shall:
(1) Be structurally sound, weatherti.ght, and in good
repair.
(2) Contain a safe electrical wiring system adequate for
lighting and other devices.
(3) Contain a heating system capable of sustaining a
healthful temperature (of approximately 70 degrees) for a
displaced person, except in those areas where local climatic
conditions do not require such a system.
(4) Be adequate in size with respect to the number of
rooms and area of living space needed to accommodate the
displaced person. There shall be a separate, well lighted and
ventilated bathroom that provides privacy to the user and
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contains a sink, bathtub or shower stall, and a toilet, all in
good working order and properly connected to appropriate
sources of water and to a sewage drainage system. In the case
of a housekeeping dwelling there shall be a kitchen area that
contains a fully usable sink properly connected to potable hot
and cold water and to a sewage drainage system, and adequate
space and utility service connections for a stove and
refrigerator.
(5) Contains unobstructed egress to safe, open space at
ground level. If the replacement dwelling unit is on the
second story or above, with access directly from or through a
common corridor, the common corridor must have at least two
means of egress.
(6) For a displaced person who is handicapped, be free of
any barriers which would preclude reasonable ingress, egress,
or use of the dwelling by such displaced person.
(g) Displaced person (1) General. The term "displaced
person" means any person who moves from the real property or
moves his or her personal property from the real property:
(This includes a person who occupies the real property prior to
its acquisition, but who does not meet the length of occupancy
requirements of the Uniform Act as described at § 24.401(a) and
24.402(a)):
(i) As a direct result of a written notice of intent to
acquire, the initiation of negotiations for, or the acquisition
of, such real property in whole or in part for a project.
(ii) As a direct result of rehabilitation or demolition
for a project; or
(iii) As a direct result of a written notice of intent to
acquire, or the acquisition, rehabilitation or demolition of,
in whole or in part, other real property on which the person
conducts a business or farm operation, for a project. However,
eligibility for such person under this paragraph applies only
for purposes of obtaining relocation assistance advisory
services under § 24.205(c), and moving expenses under § 24.301,
§ 24.302 or § 24.303.
(2) Persons not displaced. The following is a
nonexclusive listing of persons who do not qualify as displaced
persons under this part:
(i) A person who moves before the initiation of
negotiations (see also § 24.403(d)), unless the Agency
determines that the person was displaced as a direct result of
the program or project; or
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(ii) A person who initially enters into occupancy of the
property after the date of its acquisition for the project; or
(iii) A person who has occupied the property for the
purpose of obtaining assistance under the Uniform Act;
(iv) A person who is not required to relocate permanently
as a direct result of a project. Such determination shall be
made by the Agency in accordance with any guidelines
established by the Federal agency funding the project (see Also
Appendix A of this part); or
(v) An owner-occupant who moves as a result of an
acquisition as described at §§ 24.101(a) (1) and (2), or as a
result of the rehabilitation or demolition of the real
property. (However, the displacement of a tenant as a direct
result of any acquisition, rehabilitation or demolition for a
Federal or federally-assisted project is subject to this
part.); or
(vi) A person whom the Agency determines is not displaced
as a direct result of a partial acquisition; or
(vii) A person who, after receiving a notice of relocation
eligibility (described at 24.203(b)), is notified in writing
that he or she will not be displaced for a project. Such
notice shall not be issued unless the person has not moved and
the Agency agrees to reimburse the person for any expenses
incurred to satisfy any binding contractual relocation
obligations entered into after the effective date of the notice
of relocation eligibility; or
(viii) An owner-occupant who voluntarily conveys his or
her property, as described at § 24.101(a) (1) and (2), after
being informed in writing that if a mutually satisfactory
agreement on terms of the conveyance cannot be reached, the
Agency will not acquire the property. In such cases, however,
any resulting displacement of a tenant is subject to the
regulations in this part; or
(ix) A person who retains the right of use and occupancy
of the real property for life following its acquisition by the
Agency; or
(x) A person who retains the right of use and occupancy of
the real property for a fixed term after its acquisition by the
Department of Interior under Pub. L. 93-477 or Pub. L. 93-303;
or
(xi) A person who is determined to be in unlawful
occupancy prior to the initiation of negotiations (see
paragraph (y) of this section), or a person who has been
evicted for cause, under applicable law, as provided for in
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S 24.206.
fh)Dwelling. The term "dwelling" means the place of
permanent or customary and usual residence of a person,
according to local custom or law, including a single family
house; a single family unit in a two-family, multi-family, or
multi-purpose property; a unit of a condominium or cooperative
housing project; a non-housekeeping unit; a mobile home; or any
other residential unit.
(i) Farm operation. The term "farm operation" means any
activity conducted solely or primarily for the production of
one or more agricultural products or commodities, including
timber, for sale or home use, and customarily producing such
products or commodities in sufficient quantity to be capable of
contributing materially to the operator's support.
(j) Federal financial assistance. The term "Federal
financial assistance" means a grant, loan, or contribution
provided by the United States, except any Federal guarantee or
insurance and any interest reduction payment to an individual
in connection with the purchase and occupancy of a residence by
that individual.
(k) Initiation of negotiations. Unless a different action
is specified in applicable Federal program regulations, the
term "initiation of negotiations" means the following:
(1) Whenever the displacement results from the acquisition
of the real property by a Federal agency or State agency, the
"initiation of negotiations" means the delivery of the initial
written offer of just compensation by the Agency to the owner
or the owner's representative to purchase the real property for
the project. However, if the Federal agency or State agency
issues a notice of its intent to acquire the real property, and
a person moves after that notice, but before delivery of the
initial written purchase offer, the "initiation of
negotiations" means the actual move of the person from the
property.
(2) Whenever the displacement is caused by rehabilitation,
demolition or privately undertaken acquisition of the real
property (and there is no related acquisition by a Federal
agency or a State agency), the "initiation of negotiations"
means the notice to the person that he or she will be displaced
by the project or, if there is no notice, the actual move of
the person from the property.
(3) In the case of a permanent relocation to protect the
public health and welfare, under the Comprehensive
Environmental Response Compensation and Liability Act of 1980
(Pub. L. 96-510, or "Superfund") the "initiation of
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negotiations" means the formal announcement of such relocation
or the Federal or federally-coordinated health advisory where
the Federal Government later decides to conduct a permanent
relocation.
( ) Lead agency. The term "lead agency" means the
Department of Transportation acting through the Federal Highway
Administration.
(m) Mortgage. The term "mortgage" means such classes of
liens as are commonly given to secure advances on, or the
unpaid purchase price of, real property, under the laws of the
State in which the real property is located, together with the
credit instruments, if any, secured thereby.
(n) Nonprofit organization. The term "nonprofit
organization" means an organization that is incorporated under
the applicable laws of a State as a non-profit organization,
and exempt from paying Federal income taxes under section 501
of the Internal Revenue Code (26 U.S.C. 501).
(o) Notice of intent to acguire or notice of eligibility
for relocation assistance. Written notice furnished to a
person to be displaced, including those to be displaced by
rehabilitation or demolition activities from property acquired
prior to the commitment of Federal financial assistance to the
activity, that establishes eligibility for relocation benefits
prior to the initiation of negotiation and/or prior to the
commitment of Federal financial assistance.
(p) Owner of a dwelling. A person is considered to have
met the requirement to own a dwelling if the person purchases
or holds any of the following interests in real property;
(1) Fee title, a life estate, a land contract, a 99-year
lease, or a lease including any options for extension
with at least 50 years to run from the date of acquisition; or
(2) A interest in a cooperative housing project which
includes the right to occupy a dwelling; or
(3) A contract to purchase any of the interests or estates
described in paragraphs (p)(1) or (2) of this section, or
(4) Any other interest, including a partial interest,
which in the judgment of the Agency warrants consideration as
ownership.
(q) Person. The term "person" means any individual,
family, partnership, corporation, or association.
(r) Program or project. The phrase "program or project"
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means any activity or series of activities undertaken by a
Federal agency or with Federal financial assistance received or
anticipated in any phase of an undertaking in accordance with
the Federal funding agency guidelines.
(s) Salvage value. The term "salvage value" means the
probable sale price of an item, if offered for sale on the
condition that it will be removed from the property at the
buyer's expense, allowing a reasonable period of time to find a
person buying with knowledge of the uses and purposes for which
it is adaptable and capable of being used, including separate
use of serviceable components and scrap when there is no
reasonable prospect of sale except on that basis.
(t) Small business. A business having at least one, but
not more than 500 employees working at the site being acquired
or displaced by a program or project.
(u) State. Any of the several States of the United States
or the District of Columbia, the Commonwealth of Puerto Rico,
any territory or possession of the United States, the Trust
Territories of the Pacific Islands or a political subdivision
of any of these jurisdictions.
(v) Tenant. The term "tenant" means a person who has the
temporary use and occupancy of real property owned by another.
(w) Uneconomic remnant. The term "uneconomic remnant"
means a parcel of real property in which the owner is left with
an interest after the partial acquisition of the owner's
property, and which the acquiring agency has determined has
little or no value or utility to the owner.
(x) Uniform Act. The term "Uniform Act" means the Uniform
Relocation Assistance and Real Property Acquisition Policy Act
of 1970 (84 Stat. 1894; 42 U.S.C. 4601 et seq.; Pub. L. 91-
646), and amendments thereto.
(y) Unlawful occupancy. A person is considered to be in
unlawful occupancy if the person has been ordered to move by a
court of competent jurisdiction prior to the initiation of
negotiations or is determined by the Agency to be a squatter
who is occupying the real property without the permission of
the owner and otherwise has no legal right to occupy the
property under state law. A displacing agency may, at its
discretion, consider such a squatter to be in lawful occupancy.
(z) Utility costs. The term "utility costs" means
expenses for heat, lights, water and sewer.
(aa) Utility facility. The term "utility facility" means
any electric, gas, water, steam power, or materials
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transmission or distribution system; any transportation .system;
any communications system, including cable television; and any
fixtures, equipment, or other property associated with the
operation, maintenance, or repair of any such system. A
utility facility may be publicly, privately, or cooperatively
owned.
(bb) Utility relocation. The term "utility relocation"
means the adjustment of a utility facility required by the
program or project undertaken by the displacing agency. It
includes removing and reinstalling the facility, including
necessary temporary facilities; acquiring necessary right-of-
way on new location; moving, rearranging or changing the type
of existing facilities; and taking any necessary safety and
protective measures. It shall also mean constructing a
replacement facility that has the functional equivalency of the
existing facility and is necessary for^ the continued operation
of the utility service, the project economy, or sequence of
project construction.
S 24.3 No duplication of payments.
No person shall receive any payment under this part if
that person receives a payment under Federal, State, or local
law which is determined by the Agency to have the same purpose
and effect as such payment under this part. (See Appendix A of
this part, § 24.3.)
§ 24.4 Assurances, monitoring and corrective action.
(a) Assurances (1) Before a Federal agency may approve any
grant to, or contract or agreement with, a State agency under
which Federal financial assistance will be made available for a
project which results in real property acquisition or
displacement that is subject to the Uniform Act, the State
agency must provide appropriate assurances that it will comply
with the Uniform Act and this part. A displacing agency's
assurances shall be in accordance with section 210 of the
Uniform Act. An acquiring agency's assurances shall be in
accordance with section 305 of the Uniform Act and must contain
specific reference to any State law which the Agency believes
provides an exception to sections 301 or 302 of the Uniform
Act. If, in the judgment of the Federal agency, Uniform Act
compliance will be served, a State agency may provide these
assurances at one time to cover all subsequent federally-
assisted programs or projects. An Agency which both acquires
real property and displaces persons may combine its section 210
and section 305 assurances in one document.
(2) If a Federal agency or State agency provides Federal
financial assistance to a "person" causing displacement, such
Federal or State agency is responsible for ensuring compliance
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with the requirements of this part, notwithstanding the
person's contractual obligation to the grantee to comply.
(3) As an alternative to the assurance requirement
described in paragraph (a) (l) of this section, a Federal
agency may provide Federal financial assistance to a State
agency after it has accepted a certification by such State
agency in accordance with the requirements in Subpart G of this
part.
(b) Monitoring and corrective action. The Federal agency
will monitor compliance with this part, and the State agency
shall take whatever corrective action is necessary to comply
with the Uniform Act and this part. The Federal agency may
also apply sanctions in accordance with applicable program
regulations. (Also see § 24.603, Subpart G.)
(c) Prevention of fraud, waste, and mismanagement. The
Agency shall take appropriate measures to carry out this part
in a manner that minimizes fraud, waste, and mismanagement.
§ 24.5 Manner of notices.
Each notice which the Agency is required to provide to a
property owner or occupant under this part, except the notice
described at § 24.102(b), shall be personally served or sent by
certified or registered first-class mail, return receipt
requested, and documented in Agency files. Each notice shall
be written in plain, understandable language. Persons who are
unable to read and understand the notice must be provided with
appropriate translation and counseling. Each notice shall
indicate the name and telephone number of a person who may be
contacted for answers to questions or other needed help.
§ 24.6 Administration of jointly-funded projects.
Whenever two or more Federal agencies provide financial
assistance to an Agency or Agencies, other than a Federal
agency, to carry out functionally or geographically related
activities which will result in the acquisition of property or
the displacement of a person, the Federal agencies may by
agreement designate one such agency as the cognizant Federal
agency. In the unlikely event that agreement among the
Agencies cannot be reached as to which agency shall be the
cognizant Federal agency, then the lead agency shall designate
one of such agencies to assume the cognizant role. At a
minimum, the agreement shall set forth the federally assisted
activities which are subject to its terms and cite any policies
and procedures, in addition to this part, that are applicable
to the activities under the agreement. Under the agreement,
the cognizant Federal agency shall assure that the project is
in compliance with the provisions of the Uniform Act and this
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part. All federally assisted activities under the agreement
shall be deemed a project for the purposes of this part.
i 24.7 Federal agency waiver of regulations.
The Federal agency funding the project may waive any
requirement in this part not required by law if it determines
that the waiver does not reduce any assistance or protection
provided to an owner or displaced person under this part. Any
request for a waiver shall be justified on a case-by-case
basis.
S 24.8 Compliance with other laws and regulations.
The implementation of this part must be in compliance with
other applicable Federal laws and implementing regulations,
including, but not limited to, the following:
(a) Section I of the Civil Rights Act of 1866 (42 U.S.C.
1982 si sea.) .
(b) Title VI of the Civil Rights Act of 1964 (42 U.S.C.
2000d et sea. ) .
(c) Title VIII of the Civil Rights Act of 1968 (42 U.S.C.
3601 et seq. ) , as amended.
(d) The National Environmental Policy Act of 1969 (42
U.S.C. 4321 e_£ sea.) .
(e) Section 504 of the Rehabilitation Act of 1973 (29
U.S.C. 790 e_t seq. ) .
(f) The Flood Disaster Protection Act of 1973 (Pub. L.
93-234) .
(g) The Age Discrimination Act of 1975 (42 U.S.C. 6101
et sea. ) .
(h) Executive Order 11063 - Equal Opportunity and
Housing, as amended by Executive Order 12259.
(i) Executive Order 11246 - Equal Employment Opportunity.
(j) Executive Order 11625 - Minority Business
Enterprise.
(k) Executive Orders 11988 - Floodplain Management, and
11990 - Protection of Wetlands.
( ) Executive Order 12250 - Leadership and Coordination
of Non-Discrimination Laws.
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(m) Executive Order 12259 - Leadership and Coordination
of Fair Housing in Federal Programs.
(n) Executive Order 12630 - Governmental Actions and
Interference with Constitutionally Protected Property Rights.
i 24.9 Recordkeeping and reports.
(a) Records. The Agency shall maintain adequate records
of its acquisition and displacement activities in sufficient
detail to demonstrate compliance with this part. These
records shall be retained for at least 3 years after each
owner of a property and each person displaced from the
property receives the final payment to which he or she is
entitled under this part, or in accordance with the applicable
regulations of the Federal funding agency, whichever is later.
(b) Confidentiality of records. Records maintained by an
Agency in accordance with this part are confidential regarding
their use as public information, unless applicable law
provides otherwise.
(c) Reports. The Agency shall submit a report of its
real property acquisition and displacement activities under
this part if required by the Federal agency funding the
project. A report will not be required more frequently than
every 3 years, or as the Uniform Act provides, unless the
Federal funding agency shows good cause. The report shall be
prepared and submitted in the format contained in Appendix B of
this part.
§ 24.10 Appeals.
(a) General. The Agency shall promptly review appeals in
accordance with the requirements of applicable law and this
part.
(b) Actions which may be appealed. Any aggrieved person
may file a written appeal with the Agency in any case in which
the person believes that the Agency has failed to properly
consider the person's application for assistance under this
part. Such assistance may include, but is not limited to, the
person's eligibility for, or the amount of, a payment required
under § 24.106 or § 24.107, or a relocation payment required
under this part. The Agency shall consider a written appeal
regardless of form.
(c) Time limit for initiating appeal. The Agency may set
a reasonable time limit for a person to file an appeal. The
time limit shall not be less than 60 days after the person
receives written notification of the Agency's determination on
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the person's claim.
(d) Right to representation. A person has a right to be
represented by legal counsel or other representative in
connection with his or her appeal, but solely at the person's
own expense.
(e) Review of files bv person making appeal. The Agency
shall permit a person to inspect and copy all materials
pertinent to his or her appeal, except materials which are
classified as confidential by the Agency. The Agency may,
however, impose reasonable conditions on the person's right to
inspect, consistent with applicable laws.
(f) Scope of review of appeal. In deciding an appeal, the
Agency shall consider all pertinent justification and other
material submitted by the person, and all other available
information that is needed to ensure a fair and full review of
the appeal.
(g) Determination and notification after appeal. Promptly
after receipt of all information submitted by a person in
support of an appeal, the Agency shall make a written
determination on the appeal, including an explanation of the
basis on which the decision was made, and furnish the person a
copy. If the full relief requested is not granted, the Agency
shall advise the person of his or her right to seek judicial
review.
(h) Aaencv official to review appeal. The Agency
official conducting the review of the appeal shall be either
the head of the Agency or his or her authorized designee.
However, the official shall not have been directly involved in
the action appealed.
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Subpart B—Real Property Acquisition
§ 24.101 Applicability of acquisition requirements.
(a) General. The requirements of this subpart apply to
any acquisition of real property for a Federal program or
project, and to programs and projects where there is Federal
financial assistance in any part of project costs except
for:
(1) Voluntary transactions that meet all of the
following conditions:
(i) No specific site or property needs to be acquired,
although the Agency may limit its search for alternative
sites to a general geographic area. Where an Agency wishes
to purchase more than one site within a geographic area on
this basis, all owners are to be treated similarly.
(ii) The property to be acquired is not part of an
intended, planned, or designated project area where all or
substantially all of the property within the area is to be
acquired within specific time limits.
(iii) The Agency will not acquire the property in the
event negotiations fail to result in an amicable agreement,
and the owner is so informed in writing.
(iv) The Agency will inform the owner of what it
believes to be the fair market value of the property.
(2) Acquisitions for programs or projects undertaken by
an Agency or person that receives Federal financial
assistance but does not have authority to acquire property
by eminent domain, provided that such Agency or person
shall:
(i) Prior to making an offer for the property, clearly
advise the owner that it is unable to acquire the property
in the event negotiations fail to result in an amicable
agreement; and
(ii) Inform the owner of what it believes to be fair
market value of the property.
(3) The acquisition of real property from a Federal
agency, State, or State agency, if the Agency desiring to
make the purchase does not have authority to acquire the
property through condemnation.
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(4) The acquisition of real property by a cooperative
from a person who, as a condition of membership in the
cooperative, has agreed to provide without charge any real
property that is needed by the cooperative.
(b) Less-than-full-fee interest in real property. In
addition to fee simple title, the provisions of this subpart
apply when acquiring fee title subject to retention of a
life estate or a life use; to acquisition by leasing where
the lease term, including option(s) for extension, is 50
years or more; and to the acquisition of permanent
easements. (See Appendix A of this part, § 24.101(b}.)
(c) Federally-assisted projects. For projects
receiving Federal financial assistance, the provisions of
§§ 24.102, 24.103, 24.104, and 24.105 apply to the greatest
extent practicable under State law. (See § 24.4(a).)
§ 24.102 Basic acquisition policies.
(a) Expeditious acquisition. The Agency shall make
every reasonable effort to acquire the real property
expeditiously by negotiation.
(b) Notice to owner. As soon as feasible, the owner
shall be notified of the Agency's interest in acquiring the
real property and the basic protections, including the
agency's obligation to secure an appraisal, provided to the
owner by law and this part. (See also § 24.203.)
(c) Appraisal, waiver thereof, and invitation to owner
- (1) Before the initiation of negotiations the real
property to be acquired shall be appraised, except as
provided in § 24.102(c)(2), and the owner, or the owner's
designated representative, shall be given an opportunity to
accompany the appraiser during the appraiser's inspection of
the property.
(2) An appraisal is not required if the owner is
donating the property and releases the Agency from this
obligation, or the Agency determines that an appraisal is
unnecessary because the valuation problem is uncomplicated
and the fair market value is estimated at $2,500 or less,
based on a review of available data.
(d) Establishment and offer of "Just compensation.
Before the initiation of negotiations, the Agency shall
establish an amount which it believes is just compensation
for the real property. The amount shall not be less than
the approved appraisal of the fair market value of the
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property, taking into account the value of allowable damages
or benefits to any remaining property. (See also § 24.104.)
Promptly thereafter, the Agency shall make a written offer
to the owner to acquire the property for the full amount
believed to be just compensation.
(e) Summary statement. Along with the initial written
purchase offer, the owner shall be given a written statement
of the basis for the offer of just compensation, which shall
include:
(1) A statement of the amount offered as just
compensation. In the case of a partial acquisition, the
compensation for the real property to be acquired and the
compensation for damages, if any, to the remaining real
property shall be separately stated.
(2) A description and location identification of the
real property and the interest in the real property to be
acquired.
(3) An identification of the buildings, structures, and
other improvements (including removable building equipment
and trade fixtures) which are considered to be part of the
real property for which the offer of just compensation is
made. Where appropriate, the statement shall identify any
separately held ownership interest in the property, e.g., a
tenant-owned improvement, and indicate that such interest is
not covered by the offer.
(f) Basic negotiation procedures. The Agency shall
make reasonable efforts to contact the owner or the owner's
representative and discuss its offer to purchase the
property, including the basis for the offer of just
compensation; and, explain its acquisition policies and
procedures, including its payment of incidental expenses in
accordance with § 24.106. The owner shall be given
reasonable opportunity to consider the offer and present
material which the owner believes is relevant to determining
the value of the property and to suggest modification in the
proposed terms and conditions of the purchase. The Agency
shall consider the owner's presentation.
(g) Updating offer of just compensation. If the
information presented by the owner, or a material change in
the character or condition of the property, indicates the
need for new appraisal information, or if a significant
delay has occurred since the time of the appraisal(s) of the
property, the Agency shall have the appraisal(s) updated or
obtain a new appraisal(s). If the latest appraisal
information indicates that a change in the purchase offer is
warranted, the Agency shall promptly reestablish just
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compensation and offer that amount to the owner in writing.
(h) Coercive action. The Agency shall not advance the
time of condemnation, or defer negotiations or condemnation
or the deposit of funds with the court, or take any other
coercive action in order to induce an agreement on the price
to be paid for the property.
(i) Administrative settlement. The purchase price for
the property may exceed the amount offered as just
compensation when reasonable efforts to negotiate an
agreement at that amount have failed and an authorized
Agency official approves such administrative settlement as
being reasonable, prudent, and in the public interest. When
Federal funds pay for or participate in acquisition costs, a
written justification shall be prepared which indicates that
available information (e.g., appraisals, recent court
awards, estimated trial costs, or valuation problems)
supports such a settlement.
(j) Payment before taking possession. Before requiring
the owner to surrender possession of the real property, the
Agency shall pay the agreed purchase price to the owner, or
in the case of a condemnation, deposit with the court, for
the benefit of the owner, an amount not less than the
Agency's approved appraisal of the-fair market value of such
property, or the court award of compensation in the
condemnation proceeding for the property. In exceptional
circumstances, with the prior approval of the owner, the
Agency may obtain a right-of-entry for construction purposes
before making payment available to an owner.
(k) Uneconomic remnant. If the acquisition of only a
portion of a property would leave the owner with an
uneconomic remnant, the Agency shall offer to acquire the
uneconomic remnant along with the portion of the property
needed for the project. (See § 24.2(w).)
(|) Inverse condemnation. If the Agency intends to
acquire any interest in real property by exercise of the
power of eminent domain, it shall institute formal
condemnation proceedings and not intentionally make it
necessary for the owner to institute legal proceedings to
prove the fact of the taking of the real property.
(m) Fair rental. If the Agency permits a former owner
or tenant to occupy the real property after acquisition for
a short term or a period subject to termination by the
Agency on short notice, the rent shall not exceed the fair
market rent for such occupancy.
§ 24.103 Criteria for appraisals.
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(a) Standards of appraisal. The format and level of
documentation for an appraisal depend on the complexity of
the appraisal problem. The Agency shall develop minimum
standards for appraisals consistent with established and
commonly accepted appraisal practice for those acquisitions
which, by virtue of their low value or simplicity, do not
require the in-depth analysis and presentation necessary in
a detailed appraisal. A detailed appraisal shall be
prepared for all other acquisitions. A detailed appraisal
shall reflect nationally recognized appraisal standards,
including, to the extent appropriate, the Uniform Appraisal
Standards for Federal Land Acquisition. An appraisal must
contain sufficient documentation, including valuation data
and the appraiser's analysis of that data, to support his or
her opinion of value. At a minimum, a detailed appraisal
shall contain the following items:
(1) The purpose and/or the function of the appraisal, a
definition of the estate being appraised, and a statement of
the assumptions and limiting conditions affecting the
appraisal.
(2) An adequate description of the physical
characteristics of the property being appraised (and, in the
case of a partial acquisition, an adequate description of
the remaining property), a statement of the known and
observed encumbrances, if any, title information, location,
zoning, present use, an analysis of highest and best use,
and at least a 5-year sales history of the property.
(3) All relevant and reliable approaches to value
consistent with commonly accepted professional appraisal
practices. When sufficient market sales data are available
to reliably support the fair market value for the specific
appraisal problem encountered, the Agency, at its
discretion, may require only the market approach. If more
than one approach is utilized, there shall be an analysis
and reconciliation of approaches to value that are
sufficient to support the appraiser's opinion of value.
(4) A description of comparable sales, including a
description of all relevant physical, legal, and economic
factors such as parties to the transaction, source and
method of financing, and verification by a party involved in
the transaction.
(5) A statement of the value of the real property to be
acquired and, for a partial acquisition, a statement of the
value of the damages and benefits, if any, to the remaining
real property, where appropriate.
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(6) The effective date of valuation, date of
appraisal, signature, and certification of the appraiser.
(b) Influence of the project on lust compensation. To
the extent permitted by applicable lav, the appraiser shall
disregard any decrease or increase in the fair market value
of the real property caused by the project for which the
property is to be acquired, or by the likelihood that the
property would be acquired for the project, other than that
due to physical deterioration within the reasonable control
of the owner.
(c) Owner retention of improvements. If the owner of a
real property improvement is permitted to retain it for
removal from the project site, the amount to be offered for
the interest in the real property to be acquired shall be
not less than the difference between the amount determined
to be just compensation for the owner's entire interest in
the real property and the salvage value (defined at §
24.2(s)) of the retained improvement.
(d) Qualifications of appraisers. The Agency shall
establish criteria for determining the minimum
qualifications of appraisers. Appraiser qualifications
shall be consistent with the level of difficulty of the
appraisal assignment. The Agency shall review the
experience, education, training, and other qualifications of
appraisers, including review appraisers, and utilize only
those determined to be qualified.
(e) Conflict of interest. No appraiser or review
appraiser shall have any interest, direct or indirect, in
the real property being appraised for the Agency that would
in any way conflict with the preparation or review of the
appraisal. Compensation for making an appraisal shall not
be based on the amount of the valuation. No appraiser shall
act as a negotiator for real property which that person has
appraised, except that the Agency may permit the same person
to both appraise and negotiate an acquisition where the
value of the acquisition is $2,500, or less.
§ 24.104 Review of appraisals.
The Agency shall have an appraisal review process and,
at a minimum:
(a) A qualified reviewing appraiser shall examine all
appraisals to assure that they meet applicable appraisal
requirements and shall, prior to acceptance, seek necessary
corrections or revisions.
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(b) If the reviewing appraiser is unable to approve or
recommend approval of an appraisal as an adequate basis for
the establishment of the offer of just compensation, and it
is determined that it is not practical to obtain an
additional appraisal, the reviewing appraiser may develop
appraisal documentation in accordance with 24.103 to support
an approved or recommended value.
(c) The review appraiser's certification of the
recommended or approved value of the property shall be set
forth in a signed statement which identifies the appraisal
reports reviewed and explains the basis for such
recommendation or approval. Any damages or benefits to any
remaining property shall also be identified in the
statement.
S 24.105 Acquisition of tenant-owned improvements.
(a) Acquisition of improvements. When acquiring any
interest in real property, the Agency shall offer to acquire
at least an equal interest in all buildings, structures, or
other improvements located upon the real property to be
acquired, which it requires to be removed or which it
determines will be adversely affected by the use to which
such real property will be put. This shall include any
improvement of a tenant-owner who has the right or
obligation to remove the improvement at the expiration of
the lease term.
(b) Improvements considered to be real property. Any
building, structure, or other improvement, which would be
considered to be real property if owned by the owner of the
real property on which it is located, shall be considered to
be real property for purposes of this Subpart.
(c) Appraisal and establishment of lust compensation
for tenant-owned improvements. Just compensation for a
tenant-owned improvement is the amount which the improvement
contributes to the fair market value of the whole property
or its salvage value, whichever is greater. (Salvage value
is defined at § 24.2(s).)
(d) Special conditions. No payment shall be made to a
tenant-owner for any real property improvement unless:
(1) The tenant-owner, in consideration for the payment,
assigns, transfers, and releases to the Agency all of the
tenant-owner's right, title, and interest in the
improvement; and
(2) The owner of the real property on which the
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improvement is located disclaims all interest in the
improvement; and
(3) The payment does not result in the duplication of
any compensation otherwise authorized by law.
(e) Alternative compensation. Nothing in this Subpart
shall be construed to deprive the tenant-owner of any right
to reject payment under this Subpart and to obtain payment
for such property interests in accordance with other
applicable law.
S 24.106 Expenses incidental to transfer of title to the
Agency.
(a) The owner of the real property shall be reimbursed
for all reasonable expenses the owner necessarily incurred
for:
(1) Recording fees, transfer taxes, documentary stamps,
evidence of title, boundary surveys, legal descriptions of
the real property, and similar expenses incidental to
conveying the real property to the Agency. However, the
Agency is not required to pay costs solely required to
perfect the owner's title to the real property; and
(2) Penalty costs and other charges for prepayment of
any preexisting recorded mortgage entered into in good faith
encumbering the real property; and
(3) The pro rata portion of any prepaid real property
taxes which are allocable to the period after the Agency
obtains title to the property or effective possession of it,
whichever is earlier.
(b) Whenever feasible, the Agency shall pay these costs
directly so that the owner will not have to pay such costs
and then seek reimbursement from the Agency.
§ 24.107 Certain litigation expenses.
The owner of the real property shall be reimbursed for
any reasonable expenses, including reasonable attorney,
appraisal, and engineering fees, which the owner actually
incurred because of a condemnation proceeding, if:
(a) The final judgment of the court is that the Agency
cannot acquire the real property by condemnation; or
(b) The condemnation proceeding is abandoned by the
Agency other than under an agreed-upon settlement; or
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(c) The court having jurisdiction renders a judgment in
favor of the owner in an inverse condemnation proceeding or
the Agency effects a settlement of such proceeding.
S 24.108 Donations.
An owner whose real property is being acquired may,
after being fully informed by the Agency of the right to
receive just compensation for such property, donate such
property or any part thereof, any interest therein, or any
compensation paid therefor, to the Agency as such owner
shall determine. The Agency is responsible for assuring
that an appraisal of the real property is obtained unless
the owner releases the Agency from such obligation, except
as provided in § 24.102(c)(2).
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Subpart C - General Relocation Requirements
§ 24.201 Purpose.
This subpart prescribes general requirements governing
the provision of relocation payments and other relocation
assistance in this part.
§ 24.202 Applicability.
These requirements apply to the relocation of any
displaced person as defined at § 24.2(g).
§ 24.203 Relocation notices.
(a) General information notice. As soon as feasible,
a person scheduled to be displaced shall be furnished with
a general written description of the displacing agency's
relocation program which does at least the following:
(1) Informs the person that he or she may be displaced
for the project and generally describes the relocation
payment(s) for which the person may be eligible, the basic
conditions of eligibility, and the procedures for obtaining
the payment(s).
(2) Informs the person that he or she will be given
reasonable relocation advisory services, including
referrals to replacement properties, help in filing payment
claims, and other necessary assistance to help the person
successfully relocate.
(3) Informs the person that he or she will not be
required to move without at least 90 days' advance written
notice (see paragraph (c) of this section), and informs any
person to be displaced from a dwelling that he or she
cannot be required to move permanently unless at least one
comparable replacement dwelling has been made available.
(4) Describes the person's right to appeal the
Agency's determination as to a person's application for
assistance for which a person may be eligible under this
part.
(b) Notice of relocation eligibility. Eligibility for
relocation assistance shall begin on the date of initiation
of negotiations (defined in § 24.2(k)) for the occupied
property. When this occurs, the Agency shall promptly
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notify all occupants in writing of their eligibility for
applicable relocation assistance.
(c) Ninetv-dav notice (1) General. No lawful
occupant shall be required to move unless he or she has
received at least 90 days advance written notice of the
earliest date by which he or she may be required to move.
(2) Timing of notice. The displacing agency may issue
the notice 90 days before it expects the person to be
displaced or earlier.
(3) Content of notice. The 90-day notice shall either
state a specific date as the earliest date by which the
occupant may be required to move, or state that the
occupant will receive a further notice indicating, at least
30 days in advance, the specific date by which he or she
must move. If the 90-day notice is issued before a
comparable replacement dwelling is made available, the
notice must state clearly that the occupant will not have
to move earlier than 90 days after such a dwelling is made
available. (See §24.204(a).)
(4) Urgent need. In unusual circumstances, an
occupant may be required to vacate the property on less
than 90 days advance written notice if the displacing
agency determines that a 90-day notice is impracticable,
such as when the person's continued occupancy of the
property would constitute a substantial danger to health or
safety. A copy of the Agency's determination shall be
included in the applicable case file.
§ 24.204 Availability of comparable replacement dwelling
before displacement.
(a) General. No person to be displaced shall be
required to move from his or her dwelling unless at least
one comparable replacement dwelling (defined at § 24.2(d))
has been made available to the person. Where possible,
three or more comparable replacement dwellings shall be
made available. A comparable replacement dwelling will be
considered to have been made available to a person, if:
(1) The person is informed of its location; and
(2) The person has sufficient time to negotiate and
enter into a purchase agreement or lease for the property;
and
(3) Subject to reasonable safeguards, the person is
assured of receiving the relocation assistance and
acquisition payment to which the person is entitled in
sufficient time to complete the purchase or lease of the
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property.
(b) Circumstances permitting waiver. The Federal agency
funding the project may grant a waiver of the policy in
paragraph (a) of this section in any case where it is
demonstrated that a person must move because of:
(1) A major disaster as defined in section 102(c) of the
Disaster Relief Act of 1974 (42 U.S.C. 5121); or
(2) A presidentially declared national emergency; or
(3) Another emergency which requires immediate vacation
of the real property, such as when continued occupancy of the
displacement dwelling constitutes a substantial danger to the
health or safety of the occupants or the public.
(c) Basic conditions of emergency move. Whenever"a
person is required to relocate for a temporary period because
of an emergency as described in paragraph (b) of this section,
the Agency shall:
(1) Take whatever steps are necessary to assure that the
person is temporarily relocated to a decent, safe, and
sanitary dwelling; and
(2) Pay the actual reasonable out-of-pocket moving
expenses and any reasonable increase in rent and utility costs
incurred in connection with the temporary relocation; and
(3) Make available to the displaced person as soon as
feasible, at least one comparable replacement dwelling. (For
purposes of filing a claim and meeting the eligibility
requirements for a relocation payment, the date of
displacement is the date the person moves from the
temporarily-occupied dwelling.)
24.205 Relocation planning, advisory services, and
coordination.
(a) Relocation planning. During the early stages of
development, Federal and Federal-aid programs or projects
shall be planned in such a manner that the problems associated
with the displacement of individuals, families, businesses,
farms, and nonprofit organizations are recognized and
solutions are developed to minimize the adverse impacts of
displacement. Such planning, where appropriate, shall precede
any action by an Agency which will cause displacement, and
should be scoped to the complexity and nature of the
anticipated displacing activity including an evaluation of
program resources available to carry out timely and orderly
relocations. Planning may involve a relocation survey or
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study which nay include the following:
(1) An estimate of the number of households to be
displaced including information such as owner/tenant status,
estimated value and rental rates of properties to be acquired,
family characteristics, and special consideration of the
impacts on minorities, the elderly, large families, and the
handicapped when applicable.
(2) An estimate of the number of comparable replacement
dwellings in the area (including price ranges and rental
rates) that are expected to be available to fulfill the needs
of those households displaced. When an adequate supply of
comparable housing is not expected to be available,
consideration of housing of last resort actions should be
instituted.
(3) An estimate of the number, type and size of the
businesses, farms, and nonprofit organizations to be displaced
and the approximate number of employees that may be affected.
(4) Consideration of any special relocation advisory
services that may be necessary from the displacing agency and
other cooperating agencies.
(b) Loans for planning and preliminary expenses. In the
event that an Agency elects to consider using the duplicative
provision in section 215 of the Uniform Act which permits the
use of project funds for loans to cover planning and other
preliminary expenses for the development of additional
housing, the lead agency will establish criteria and
procedures for such use upon the request of the Federal agency
funding the program or project.
(c) Relocation assistance advisory services (1) General.
The Agency shall carry out a relocation assistance advisory
program which satisfies the requirements of Title VI of the
Civil Rights Act of 1964 (42 U.S.C. 2000d et sea.). Title
VIII of the Civil Rights Act of 1968 (42 U.S.C. 3601 £t
seq.). and Executive Order 11063 (27 FR 11527, November 24,
1962), and offers the services described in paragraph (c)(2)
of this section. If the Agency determines that a person
occupying property adjacent to the real property acquired for
the project is caused substantial economic injury because of
such acquisition, it may offer advisory services to such
person.
(2) Services to be provided. The advisory program shall
include such measures, facilities, and services as may be
necessary or appropriate in order to:
(i) Determine the relocation needs and preferences of
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each person to be displaced and explain the relocation
payments and other assistance for which the person nay be
eligible, the related eligibility requirements, and the
procedures for obtaining such assistance. This shall include
a personal interview with each person.
(ii) Provide current and continuing information on the
availability, purchase prices, and rental costs of comparable
replacement dwellings, and explain that the person cannot be
required to move unless at least one comparable replacement
dwelling is made available as set forth in § 24.204(a).
(A) As soon as feasible, the Agency shall inform the
person in writing of the specific comparable replacement
dwelling and the price or rent used for establishing the upper
limit of the replacement housing payment (see § 24.403(a) and
(b)) and the basis for the determination, so that the person
is aware of the maximum replacement housing payment for which
he or she may qualify.
(B) Where feasible, housing shall be inspected prior to
being made available to assure that it meets applicable
standards. (See § 24.2(d) and (f).) If such an inspection is
not made, the person to be displaced shall be notified that a
replacement housing payment may not be made unless the
replacement dwelling is subsequently inspected and determined
to be decent, safe, and sanitary.
(C) Whenever possible, minority persons shall be given
reasonable opportunities to relocate to decent, safe, and
sanitary replacement dwellings, not located in an area of
minority concentration, that are within their financial means.
This policy, however, does not require an Agency to provide a
person a larger payment than is necessary to enable a person
to relocate to a comparable replacement dwelling.
(D) All persons, especially the elderly and handicapped,
shall be offered transportation to inspect housing to which
they are referred.
(iii) Provide current and continuing information on the
availability, purchase prices, and rental costs of suitable
commercial and farm properties and locations. Assist any
person displaced from a business or farm operation to obtain
and become established in a suitable replacement location.
(iv) Minimize hardships to persons in adjusting to
relocation by providing counseling, advice as to other sources
of assistance that may be available, and such other help as
may be appropriate.
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(v) Supply persons to be displaced with appropriate
information concerning Federal and State housing programs,
disaster loan and other programs administered by the Small
Business Administration, and other Federal and State programs
offering assistance to displaced persons, and technical help
to persons applying for such assistance.
(vi) Any person who occupies property acquired by an
Agency, when such occupancy began subsequent to the
acquisition of the property, and the occupancy is permitted by
a short term rental agreement or an agreement subject to
termination when the property is needed for a program or
project, shall be eligible for advisory services, as
determined by the Agency.
(d) Coordination of relocation activities. Relocation
activities shall be coordinated with project work and other
displacement-causing activities to ensure that, to the extent
feasible, persons displaced receive consistent treatment and
the duplication of functions is minimized. (Also see § 24.6,
Subpart A.)
§ 24.206 Eviction for cause.
Eviction for cause must conform to applicable state and
local law. Any person who occupies the real property and is
not in unlawful occupancy on the date of the initiation of
negotiations, is presumed to be entitled to relocation
payments and other assistance set forth in this part unless
the Agency determines that:
(a) the person received an eviction notice prior to the
initiation of negotiations and, as a result of that notice is
later evicted; or
(b) the person is evicted after the initiation of
negotiations for serious or repeated violation of material
terms of the lease or occupancy agreement; and
(c) in either case the eviction was not undertaken for
the purpose of evading the obligation to make available the
payments and other assistance set forth in this part. For
purposes of determining eligibility for relocation payments,
the date of displacement is the date the person moves, or if
later, the date a comparable replacement dwelling is made
available. This section applies only to persons who would
otherwise have been displaced by the project.
§ 24.207 General requirements claims for relocation
payments.
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(a) Documentation. Any claim for a relocation payment
shall be supported by such documentation as may be reasonably
required to support expenses incurred, such as bills,
certified prices, appraisals, or other evidence of such
expenses. A displaced person must be provided reasonable
assistance necessary to complete and file any required claim
for payment.
(b) Expeditious payments. The Agency shall review claims
in an expeditious manner. The claimant shall be promptly
notified as to any additional documentation that is required
to support the claim. Payment for a claim shall be made as
soon as feasible following receipt of sufficient documentation
to support the claim.
(c) Advance payments. If a person demonstrates the need
for an advance relocation payment in order to avoid or reduce
a hardship, the Agency shall issue the payment, subject to
such safeguards as are appropriate to ensure that the
objective of the payment is accomplished.
(d) Time for filing - (1) All claims for a relocation
payment shall be filed with the Agency within 18 months after:
(i) For tenants, the date of displacement;
(ii) For owners, the date of displacement or the date of
the final payment for the acquisition of the real property,
whichever is later.
(2) This time period shall be waived by the Agency for
good cause.
(e) Multiple occupants of one displacement dwelling. If
two or more occupants of the displacement dwelling move to
separate replacement dwellings, each occupant is entitled to a
reasonable prorated share, as determined by the Agency, of any
relocation payments that would have been made if the occupants
moved together to a .comparable replacement dwelling. However,
if the Agency determines that two or more occupants maintained
separate households within the same dwelling, such occupants
have separate entitlements to relocation payments.
(f) Deductions from relocation payments. An Agency shall
deduct the amount of any advance relocation payment from the
relocation payment(s) to which a displaced person is otherwise
entitled. Similarly, a Federal agency shall, and a State
agency may, deduct from relocation payments any rent that the
displaced person owes the Agency; provided that no deduction
shall be made if it would prevent the displaced person from
obtaining a comparable replacement dwelling as required by
§ 24.204. The Agency shall not withhold any part of a
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relocation payment to a displaced person to satisfy an
obligation to any other creditor.
(g) Notice of denial of claim. If the Agency disapproves
all or part of a payment claimed or refuses to consider the
claim on its merits because of untimely filing or other
grounds, it shall promptly notify the claimant in writing of
its determination, the basis for its determination, and the
procedures for appealing that determination.
§ 24.208 Relocation payments not considered as income.
No relocation payment received by a displaced person
under this part shall be considered as income for the purpose
of the Internal Revenue Code of 1954, which has been
redesignated as the Internal Revenue Code of 1986 or for the
purpose of determining the eligibility or the extent of
eligibility of any person for assistance under the Social
Security Act or any other Federal law, except for any Federal
law providing low-income housing assistance.
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Subpart D - Payments for Moving and Related Expenses
§ 24.301 Payment for actual reasonable moving and related
expenses—residential moves.
Any displaced owner-occupant or tenant of a dwelling
who qualifies as a displaced person (defined at § 24.2(g))
is entitled to payment of his or her actual moving and
related expenses, as the Agency determines to be reasonable
and necessary, including expenses for:
(a) Transportation of the displaced person and
personal property. Transportation costs for a distance
beyond 50 miles are not eligible, unless the Agency
determines that relocation beyond 50 miles is justified.
(b) Packing, crating, unpacking, and uncrating of the
personal property.
(c) Disconnecting, dismantling, removing,
reassembling, and reinstalling relocated household
appliances, and other personal property.
(d) Storage of the personal property for a period not
to exceed 12 months, unless the Agency determines that a
longer period is necessary.
(e) Insurance for the replacement value of the
property in connection with the move and necessary storage.
(f) The replacement value of property lost, stolen, or
damaged in the process of moving (not through the fault or
negligence of the displaced person, his or her agent, or
employee) where insurance covering such loss, theft, or
damage is not reasonably available.
(g) Other moving-related expenses that are not listed
as ineligible under § 24.305, as the Agency determines to
be reasonable and necessary.
§ 24.302 Fixed payment for moving expenses residential
moves.
Any person displaced from a dwelling or a seasonal
residence is entitled to receive an expense and dislocation
allowance as an alternative to a payment for actual moving
and related expenses under § 24.301. This allowance shall
be determined according to the applicable schedule approved
by the Federal Highway Administration. This includes a
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provision that the expense and dislocation allowance to a
person with minimal personal possessions who is in
occupancy of a dormitory style roam shared by two or more
other unrelated persons or a person whose residential move
is performed by an agency at no cost to the person shall be
limited to $50.
i 24.303 Payment for actual reasonable'moving and related
expenses—nonresidential moves.
(a) Eligible costs. Any business or farm operation
which qualifies as a displaced person (defined at
§ 24.2(g)) is entitled to payment for such actual moving
and related expenses, as the Agency determines to be
reasonable and necessary, including expenses for:
(1) Transportation of personal property.
Transportation costs for a distance beyond 50 miles are not
eligible, unless the Agency determines that relocation
beyond 50 miles is justified.
(2) Packing, crating, unpacking, and uncrating of the
personal property.
(3) Disconnecting, dismantling, removing,
reassembling, and reinstalling relocated machinery,
equipment, and other personal property, including
substitute personal property described at § 24.303(a)(12).
This includes connection to utilities available nearby. It
also includes modifications to the personal property
necessary to adapt it to the replacement structure, the
replacement site, or the utilities at the replacement site,
and modifications necessary to adapt the utilities at the
replacement site to the personal property. (Expenses for
providing utilities from the right-of-way to the building
or improvement are excluded.)
(4) Storage of the personal property for a period not
to exceed 12 months, unless the Agency determines that a
longer period is necessary.
(5) Insurance for the replacement value of the
personal property in connection with the move and necessary
storage.
(6) Any license, permit, or certification required of
the displaced person at the replacement location. However,
the payment may be based on the remaining useful life of
the existing license, permit, or certification.
(7) The replacement value of property lost, stolen, or
damaged in the process of moving (not through the fault or
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negligence of the displaced person, his or her agent, or
employee) where insurance covering such loss, theft, or
damage is not reasonably available.
(8) Professional services necessary for:
(i) Planning the move of the personal property,
(ii)Moving the personal property, and
(iii) Installing the relocated personal property at
the replacement location.
(9) Relettering signs and replacing stationery on hand
at the time of displacement that are made obsolete as
a result of the move.
(10) Actual direct loss of tangible personal property
incurred as a result of moving or discontinuing the
business or farm operation. The payment shall consist of
the lesser of:
(i) The fair market value of the item for
continued use at the displacement site, less the proceeds
from its sale. (To be eligible for payment, the claimant
must make a good faith effort to sell the personal
property, unless the Agency determines that such effort is
not necessary. When payment for property loss is claimed
for goods held for sale, the fair market value shall be
based on the cost of the goods to the business, not the
potential selling price.); or
(ii) The estimated cost of moving the item, but with
no allowance for storage. (If the business or farm
operation is discontinued, the estimated cost shall be
based on a moving distance of 50 miles.)
(11) The reasonable cost incurred in attempting to
sell an item that is not to be relocated.
(12) Purchase of substitute personal property. If
an item of personal property which is used as part of a
business or farm operation is not moved but is promptly
replaced with a substitute item that performs a comparable
function at the replacement site, the displaced person is
entitled to payment of the lesser of:
(i) The cost of the substitute item, including
installation costs at the replacement site, minus any
proceeds from the sale or trade-in of the replaced item; or
(ii) The estimated cost of moving and reinstalling
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the replaced item but with no allowance for storage. At
the Agency's discretion, the estimated cost for a low
cost or uncomplicated move nay be based on a single
bid or estimate.
(13) Searching for a replacement location. A
displaced business or farm operation is entitled to
reimbursement for actual expenses, not to exceed $1,000, as
the Agency determines to be reasonable, which are incurred
in searching for a replacement location, including:
(i) Transportation.
(ii) Meals and lodging away from home.
(iii) Time spent searching, based on reasonable salary
or earnings.
(iv) Fees paid to a real estate agent or broker to
locate a replacement site, exclusive of any fees or
commissions related to the purchase of such site.
(14) Other moving-related expenses that are not
listed as ineligible under § 24.305, as the Agency
determines to be reasonable and necessary.
(b) Notification and inspection. The following
requirements apply to payments under this section:
(1) The Agency shall inform the displaced person, in
writing, of the requirements of paragraphs (b) (2) and (3)
of this section as soon as possible after the initiation of
negotiations. This information may be included in the
relocation information provided to the displaced person as
set forth in § 24.203.
(2) The displaced person must provide the Agency
reasonable advance written notice of the approximate date
of the start of the move or disposition of the personal
property and a list of the items to be moved. However, the
Agency may waive this notice requirement after documenting
its file accordingly.
(3) The displaced person must permit the Agency to
make reasonable and timely inspections of the personal
property at both the displacement and replacement sites and
to monitor the move.
(c) Self-moves. If the displaced person elects to
take full responsibility for the move of the business or
farm operation, the Agency may make a payment for the
person's moving expenses in an amount not to exceed the
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lover of two acceptable bids or estimates obtained by the
Agency or prepared by qualified staff. At the Agency's
discretion, a payment for a low cost or uncomplicated move
may be based on a single bid or estimate.
(d) Transfer of ownership. Upon request and in
accordance with applicable lav, the claimant shall transfer
to the Agency ovnership of any personal property that has
not been moved, sold, or traded in.
(e) Advertising signs. The amount of a payment for
direct loss of an advertising sign vhich is personal
property shall be the lesser of:
(1) The depreciated reproduction cost of the sign, as
determined by the Agency, less the proceeds from its sale;
or
(2) The estimated cost of moving the sign, but vith no
allovance for storage.
§ 24.304 Reestablishment expenses nonresidential moves.
In addition to the payments available under § 24.303
of this subpart, a small business, as defined in § 24.2(t),
farm or nonprofit organization may be eligible to receive a
payment, not to exceed $10,000, for expenses actually
incurred in relocating and reestablishing such small
business, farm or nonprofit organization at a replacement
site.
(a) Eligible expenses. Reestablishment expenses must
be reasonable and necessary, as determined by the Agency.
They may include, but are not limited to, the folloving:
(1) Repairs or improvements to the replacement real
property as required by Federal, State or local lav, code
or ordinance.
(2) Modifications to the replacement property to
accommodate the business operation or make replacement
structures suitable for conducting the business.
(3) Construction and installation costs, not to exceed
$1,500 for exterior signing to advertise the business.
(4) Provision of utilities from right-of-vay to
improvements on the replacement site.
(5) Redecoration or replacement of soiled or vorn
surfaces at the replacement site, such as paint, panelling,
or carpeting.
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(6) Licenses, fees, and permits when not paid as part
of moving expenses.
(7) Feasibility surveys, soil testing and
marketing studies.
(8) Advertisement of replacement location, not to
exceed $1,500.
(9) Professional services in connection with the
purchase or lease of a replacement site.
(10) Estimated increased costs of operation during the
first 2 years at the replacement site, not to exceed
$5,000, for such items as:
(i) Lease or rental charges,
(ii) Personal or real property taxes,
(iii) Insurance premiums, and
(iv) Utility charges, excluding impact fees.
(11) Impact fees or one-time assessments for
anticipated heavy utility usage.
(12) Other items that the Agency considers essential
to the reestablishment of the business.
(13) Expenses in excess of the regulatory maximums
set forth in paragraphs (a)(3), (8) and (10) of this
section may be considered eligible if large and legitimate
disparities exist between costs of operation at the
displacement site and costs of operation at an otherwise
similar replacement site. In such cases the regulatory
limitation for reimbursement of such costs may, at the
request of the Agency, be waived by the Federal agency
funding the program or project, but in no event shall
total costs payable under this section exceed the $10,000
statutory maximum.
(b) Ineligible expenses. The following is a non-
exclusive listing of reestablishment expenditures not
considered to be reasonable, necessary, or otherwise
eligible:
(1) Purchase of capital assets, such as, office
furniture, filing cabinets, machinery or trade fixtures.
(2) Purchase of manufacturing materials, production
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supplies, product inventory or other items used in the
normal course of the business operation.
(3) Interior or exterior refurbishments at
the replacement site which are for aesthetic purposes,
except as provided in paragraph (a) (5) of this section.
(4) Interest on money borrowed to make the move or
purchase the replacement property.
(5) Payment to a part-time business in the home which
does not contribute materially to the household income.
5 24.305 Ineligible moving and related expenses.
A displaced person is not entitled to payment for:
(a) The cost of moving any structure or other real
property improvement in which the displaced person
reserved ownership. However, this part does not preclude
the computation under § 24.40l(c)(4)(iii); or
(b) Interest on a loan to cover moving expenses; or
(c) Loss of goodwill; or
(d) Loss of profits; or
(e) Loss of trained employees; or
(f) Any additional operating expenses of a business or
farm operation incurred because of operating in a new
location except as provided in § 24.304(a)(10); or
(g) Personal injury; or
(h) Any legal fee or other cost for preparing a claim
for a relocation payment or for representing the claimant
before the Agency; or
(i) Expenses for searching for a replacement dwelling;
or
(j) Physical changes to the real property at the
replacement location of a business or farm operation except
as provided in § 24.303(a) (3) and § 24.304(a); or
(k) Costs for storage of personal property on real
property already owned or leased by the displaced person.
§ 24.306 Fixed payment for moving expenses —nonresidential
moves.
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(a) Business. A displaced business may be eligible to
choose a fixed payment in lieu of the payments for actual
moving and related expenses, and actual reasonable
reestablishment expenses provided by IS 24.303 and 24.304.
Such fixed payment, except for payment to a nonprofit
organization, shall equal the average annual net earnings
of the business, as computed in accordance with paragraph
(e) of this section, but not less than $1,000 nor more than
$20,000. The displaced business is eligible for the payment
if the Agency determines that:
(1) The business owns or rents personal property which
must be moved in connection with such displacement and for
which an expense would be incurred in such move; and, the
business vacates or relocates from its displacement site.
(2) The business cannot be relocated without a
substantial loss of its existing patronage (clientele or
net earnings). A business is assumed to meet this test
unless the Agency determines that it will not suffer a
substantial loss of its existing patronage; and
(3) The business is not part of a commercial
enterprise having more than three other entities which are
not being acquired by the Agency, and which are under the
same ownership and engaged in the same or similar business
activities.
(4) The business is not operated at a displacement
dwelling solely for the purpose of renting such dwelling to
others.
(5) The business is not operated at the displacement
site solely for the purpose of renting the site to others.
(6) The business contributed materially to the income
of the displaced person during the 2 taxable years prior to
displacement (see § 24.2(e)).
(b) Determining the number of businesses. In
determining whether two or more displaced legal entities
constitute a single business which is entitled to only one
fixed payment, all pertinent factors shall be considered,
including the extent to which:
(1) The same premises and equipment are shared;
(2) Substantially identical or interrelated business
functions are carried out and business and financial
affairs are commingled;
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(3) The entities are held out to the public, and to
those customarily dealing with them, as one business; and
(4) The same person or closely related persons own,
control, or manage the affairs of the entities.
(c) A displaced farm operation (defined at § 24.2(i))
may choose a fixed payment, in lieu of the payments for
actual moving and related expenses and actual reasonable
reestablishment expenses, in an amount equal to its average
annual net earnings as computed in accordance with
paragraph (e) of this section, but not less than $1,000 nor
more than $20,000. In the case of a partial acquisition of
land which was a farm operation before the acquisition, the
fixed payment shall be made only if the Agency determines
that:
(1) The acquisition of part of the land caused the
operator to be displaced from the farm operation on the
remaining land; or
(2) The partial acquisition caused a substantial
change in the nature of the farm operation.
(d) Nonprofit organization. A displaced nonprofit
organization may choose a fixed payment of $1,000 to
$20,000, in lieu of the payments for actual moving and
related expenses and actual reasonable reestablishment
expenses, if the Agency determines that it cannot be
relocated without a substantial loss of existing patronage
(membership or clientele). A nonprofit organization is
assumed to meet this test, unless the Agency demonstrates
otherwise. Any payment in excess of $1,000 must be
supported with financial statements for the two 12-month
periods prior to the acquisition. The amount to be used
for the payment is the average of 2 years annual gross
revenues less administrative expenses. (See Appendix A of
this part).
(e) Average annual net earnings of a business or farm
operation. The average annual net earnings of a business
or farm operation are one-half of its net earnings before
Federal, State, and local income taxes during the 2 taxable
years immediately prior to the taxable year in which it was
displaced. If the business or farm was not in operation for
the full 2 taxable years prior to displacement, net
earnings shall be based on the actual period of operation
at the displacement site during the 2 taxable years prior
to displacement, projected to an annual rate. Average
annual net earnings may be based upon a different period of
time when the Agency determines it to be more equitable.
Net earnings include any compensation obtained from the
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business or far* operation by its owner/ the owner's
spouse, and dependents. The displaced person shall furnish
the Agency proof of net earnings through income tax
returns, certified financial statements, or other
reasonable evidence which the Agency determines is
satisfactory.
i 24.307 Discretionary utility relocation payments.
(a) Whenever a program or project undertaken by a
displacing agency causes the relocation of a utility
facility (see §§ 24.2(aa) and (bb)) and the relocation of
the facility creates extraordinary expenses for its owner,
the displacing agency may, at its option, make a relocation
payment to the owner for all or part of such expenses, if
the following criteria are met:
(1) The utility facility legally occupies State or
local government property, or property over which the State
or local government has an easement or right-of-way; and
(2) The utility facility's right of occupancy thereon
is pursuant to State law or local ordinance specifically
authorizing such use, or where such use and occupancy has
been granted through a franchise, use and occupancy permit,
or other similar agreement; and
(3) Relocation of the utility facility is required by
and is incidental to the primary purpose of the project or
program undertaken by the displacing agency; and
(4) There is no Federal law, other than the Uniform
Act, which clearly establishes a policy for the payment of
utility moving costs that is applicable to the displacing
agency's program or project; and
(5) State or local government reimbursement for
utility moving costs or payment of such costs by the
displacing agency is in accordance with State law.
(b) For the purposes of this section, the term
"extraordinary expenses" means those expenses which, in the
opinion of the displacing agency, are not routine or
predictable expenses relating to the utility's occupancy of
rights-of-way, and are not ordinarily budgeted as operating
expenses, unless the owner of the utility facility has
explicitly and knowingly agreed to bear such expenses as a
condition for use of the property, or has voluntarily
agreed to be responsible for such expenses.
(c) A relocation payment to a utility facility owner
for moving costs under this section may not exceed the cost
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to functionally restore the service disrupted by the
federally assisted program or project, less any increase
value of the new facility and salvage value of the old
facility. The displacing agency and the utility facility
owner shall reach prior agreement on the nature of the
utility relocation work to be accomplished, the eligibility
of the work for reimbursement, the responsibilities for
financing and accomplishing the work, and the method of
accumulating costs and making payment. (See Appendix A, of
this part, § 24.307.)
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Subpart E - Replacement Housing Payments
§ 24.401 Replacement housing payment for
180-day homeowner-occupants.
(a) Eligibility. A displaced person is eligible
for the replacement housing payment for a 180-day
homeowner-occupant if the person:
(1) Has actually owned and occupied the
displacement dwelling for not less than 180 days
immediately prior to the initiation of negotiations; and
(2) Purchases and occupies a decent, safe, and
sanitary replacement dwelling within one year after the
later of the following dates (except that the Agency may
extend such one year period for good cause):
(i) The date the person receives final payment
for the displacement dwelling or, in the case of
condemnation, the date the full amount of the estimate of
just compensation is deposited in the court, or
(ii) The date the displacing agency's obligation under
§ 24.204 is met.
(b) Amount of payment. The replacement housing
payment for an eligible 180-day homeowner-occupant may not
exceed $22,500. (See also § 24.404.) The payment under
this subpart is limited to the amount necessary to relocate
to a comparable replacement dwelling within one year from
the date the displaced homeowner-occupant is paid for the
displacement dwelling, or the date a comparable replacement
dwelling is made available to such person, whichever is
later. The payment shall be the sum of:
(1) The amount by which the cost of a replacement
dwelling exceeds the acquisition cost of the displacement
dwelling, as determined in accordance with paragraph (c) of
this section; and
(2) The increased interest costs and other debt
service costs which are incurred in connection with the
mortgage(s) on the replacement dwelling, as determined in
accordance with paragraph (d) of this section; and
(3) The reasonable expenses incidental to the
purchase of the replacement dwelling, as determined in
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accordance with paragraph (e) of this section.
(c) Price differential — (1) Basic computation. The
price differential to be paid under paragraph (b)(1) of
this section is the amount which must be added to the
acquisition cost of the displacement dwelling to provide a
total amount equal to the lesser of:
(i) The reasonable cost of a comparable replacement
dwelling as determined in accordance with § 24.403(a); or
(ii) The purchase price of the decent, safe, and
sanitary replacement dwelling actually purchased and
occupied by the displaced person.
(2) Mixed-use and aultifamilv properties. If the
displacement dwelling was part of a property that
contained another dwelling unit and/or space used for non-
residential purposes, and/or is located on a lot larger
than typical for residential purposes, only that portion of
the acquisition payment which is actually attributable to
the displacement dwelling shall be considered its
acquisition cost when computing the price differential.
(3) Insurance proceeds. To the extent necessary
to avoid duplicate compensation, the amount of any
insurance proceeds received by a person in connection with
a loss to the displacement dwelling due to a catastrophic
occurrence (fire, flood, etc.) shall be included in the
acquisition cost of the displacement dwelling when
computing the price differential. (Also see § 24.3.)
(4) Owner retention of displacement dwelling. If the
owner retains ownership of his or her dwelling, moves it
from the displacement site, and reoccupies it on a
replacement site, the purchase price of the replacement
dwelling shall be the sum of:
(i) The cost of moving and restoring the dwelling to a
condition comparable to that prior to the move; and
(ii) The cost of making the unit a decent, safe, and
sanitary replacement dwelling (defined at § 24.2(f)); and
(iii) The current fair market value for residential
use of the replacement site (see Appendix A of this part,
§ 24.401(c)(4)(iii)), unless the claimant rented the
displacement site and there is a reasonable opportunity for
the claimant to rent a suitable replacement site; and
(iv) The retention value of the dwelling, if such
retention value is reflected in the "acquisition cost" used
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when computing the replacement housing payment.
(d) Increased mortgage interest costs. The
displacing agency shall determine the factors to be used in
computing the amount to be paid to a displaced person under
paragraph (b) (2) of this section. The payment for
increased mortgage interest cost shall be the amount which
will reduce the mortgage balance on a new mortgage to an
amount which could be amortized with the same monthly
payment for principal and interest as that for the
mortgage(s) on the displacement dwelling. In addition,
payments shall include other debt service costs, if not
paid as incidental costs, and shall be based only on bona
fide mortgages that were valid liens on the displacement
dwelling for at least 180 days prior to the initiation of
negotiations. Paragraphs (d) (1) through (5) of this
section shall apply to the computation of the increased
mortgage interest costs payment, which payment shall be
contingent upon a mortgage being placed on the replacement
dwelling.
(1) The payment shall be based on the unpaid mortgage
balance(s) on the displacement dwelling; however, in the
event the person obtains a smaller mortgage than the
mortgage balance(s) computed in the buydown determination,
the payment will be prorated and reduced accordingly. (See
Appendix A of this part.) In the case of a home equity loan
the unpaid balance shall be that balance which existed 180
days prior to the initiation of negotiations or the balance
on the date of acquisition, whichever is less.
(2) The payment shall be based on the remaining term
of the mortgage(s) on the displacement dwelling or the term
of the new mortgage, whichever is shorter.
(3) The interest rate on the new mortgage used in
determining the amount of the payment shall not exceed the
prevailing fixed interest rate for conventional mortgages
currently charged by mortgage lending institutions in the
area in which the replacement dwelling is located.
(4) Purchaser's points and loan origination or
assumption fees, but not seller's points, shall be paid to
the extent:
(i) They are not paid as incidental expenses;
(ii) They do not exceed rates normal to similar real
estate transactions in the area;
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(ill) The Agency determine* them to be necessary; and
(iv) The computation of such points and fees shall be
based on the unpaid mortgage balance on the displacement
dwelling, less the amount determined for the reduction of
such mortgage balance under this section.
(5) The displaced person shall be advised of the
approximate amount of this payment and the conditions that
must be met to receive the payment as soon as the facts
relative to the person's current mortgage(s) are Known and
the payment shall be made available at or near the time of
closing on the replacement dwelling in order to reduce the
new mortgage as intended.
(e) Incidental expenses. The incidental expenses to
be paid under paragraph (b)(3) of this section or
§ 24.402(c)(l) are those necessary and reasonable costs
actually incurred by the displaced person incident to the
purchase of a replacement dwelling, and customarily paid by
the buyer, including:
(1) Legal, closing, and related costs, including those
for title search, preparing conveyance instruments, notary
fees, preparing surveys and plats, and recording fees.
(2) Lender, FHA, or VA application and appraisal fees.I
(3) Loan origination or assumption fees that do not
represent prepaid interest.
(4) Certification of structural soundness and termite
inspection when required.
(5) Credit report.
(6) Owner's and mortgagee's evidence of title, e.g.,
title insurance, not to exceed the costs for a comparable
replacement dwelling.
(7) Escrow agent's fee.
(8) State revenue or documentary stamps, sales or
transfer taxes (not to exceed the costs for a comparable
replacement dwelling).
(9) Such other costs as the Agency determines to be
incidental to the purchase.
(f) Rental assistance payment for 180-dav homeowner.
A 180-day homeowner-occupant, who could be eligible for a
replacement housing payment under paragraph (a) of this
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section but elects to rent a replacement drolling, is
•ligible for a rental assistance payment not to exceed
$5,250, computed and disbursed in accordance with
i 24.402(b).
I 24.402 Replacement housing payment for 90-day occupants.
(a) Eligibility. A tenant or owner-occupant displaced
from a dwelling is entitled to a payment not to exceed
$5,250 for rental assistance, as computed in accordance
with paragraph (b) of this section, or downpayment
assistance, as computed in accordance with paragraph (c) of
this section, if such displaced person:
(1) Has actually and lawfully occupied the
displacement dwelling for at least 90 days immediately
prior to the initiation of negotiations; and
(2) Has rented, or purchased, and occupied a decent,
safe, and sanitary replacement dwelling within 1 year
(unless the Agency extends this period for good cause)
after:
(i) For a tenant, the date he or she moves from the
displacement dwelling, or
(ii) For an owner-occupant, the later of:
(A) The date he or she receives final payment for the
displacement dwelling, or in the case of condemnation, the
date the full amount of the estimate of just compensation
is deposited with the court; or
(B) The date he or she moves from the displacement
dwelling.
(b) Rental assistance payment (1) Amount of payment.
An eligible displaced person who rents a replacement
dwelling is entitled to a payment not to exceed $5,250 for
rental assistance. (See also § 24.404.) Such payment shall
be 42 times the amount obtained by subtracting the base
monthly rental for the displacement dwelling from the
lesser of:
(i) The monthly rent and estimated average monthly
cost of utilities for a comparable replacement dwelling; or
(ii) The monthly rent and estimated average monthly
cost of utilities for the decent, safe, and sanitary
replacement dwelling actually occupied by the displaced
person.
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(2) Base monthly rental for displacement dwelling.
The base monthly rental for the displacement dwelling is
the lesser of:
(i) The average monthly cost for rent and utilities at
the displacement dwelling for a reasonable period prior to
displacement, as determined by the Agency. (For an owner-
occupant, use the fair market rent for the displacement
dwelling. For a tenant who paid little or no rent for the
displacement dwelling, use the fair market rent, unless its
use would result in a hardship because of the person's
income or other circumstances); or
(ii) Thirty (30) percent of the person's average
gross household income. (If the person refuses to provide
appropriate evidence of income or is a dependent, the base
monthly rental shall be established solely on the criteria
in paragraph (b) (2)(i) of this section. A full time
student or resident of an institution may be assumed to be
a dependent, unless the person demonstrates otherwise.); or
(iii) The total of the amounts designated for shelter
and utilities if receiving a welfare assistance payment
from a program that designates the amounts for shelter and
utilities.
(3) Manner of disbursement. A rental assistance
payment may, at the Agency's discretion, be disbursed in
either a lump sum or in installments. However, except as
limited by § 24.403(f), the full amount vests immediately,
whether or not there is any later change in the person's
income or rent, or in the condition or location of the
person's housing.
(c) Dovnpavment assistance payment - (1) Amount of
payment. An eligible displaced person who purchases a
replacement dwelling is entitled to a downpayment
assistance payment in the amount the person would receive
under paragraph (b) of this section if the person rented a
comparable replacement dwelling. At the discretion of the
Agency, a downpayment assistance payment may be increased
to any amount not to exceed $5,250. However, the payment
to a displaced homeowner shall not exceed the amount the
owner would receive under § 24.401(b) if he or she met the
180-day occupancy requirement. An Agency's discretion to
provide the maximum payment shall be exercised in a uniform
and consistent manner, so that eligible displaced persons
in like circumstances are treated equally. A displaced
person eligible to receive a payment as a 180-day owner-
occupant under 24.401(a) is not eligible for this payment.
(See also Appendix A of this part, § 24.402(c).)
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(2) Application of payment. The full amount of the
replacement housing payment for downpayment assistance must
be applied to the purchase price of the replacement
dwelling and related incidental expenses.
S 24.403 Additional rules governing replacement bousing
payments.
(a) Determining cost of comparable replacement
dwelling. The upper limit of a replacement housing payment
shall be based on the cost of a comparable replacement
dwelling (defined at S 24.2(d)).
(1) If available, at least three comparable
replacement dwellings shall be examined and the payment
computed on the basis of the dwelling most nearly
representative of, and equal to, or better than, the
displacement dwelling. An adjustment shall be made to the
asking price of any dwelling, to the extent justified by
local market data (see also §24.205(a) (2) and Appendix A
of this part). An obviously overpriced dwelling may be
ignored.
(2) If the site of the comparable replacement dwelling
lacks a major exterior attribute of the displacement
dwelling site, (e.g., the site is significantly smaller or
does not contain a swimming pool), the value of such
attribute shall be subtracted from the acquisition cost of
the displacement dwelling for purposes of computing the
payment.
(3) If the acquisition of a portion of a typical
residential property causes the displacement of the owner
from the dwelling and the remainder is a buildable
residential lot, the Agency may offer to purchase the
entire property. If the owner refuses to sell the remainder
to the Agency, the fair market value of the remainder may
be added to the acquisition cost of the displacement
dwelling for purposes of computing the replacement housing
payment.
(4) To the extent feasible, comparable replacement
dwellings shall be selected from the neighborhood in which
the displacement dwelling was located or, if that is not
possible, in nearby or similar neighborhoods where housing
costs are generally the same or higher.
(b) Inspection of replacement dwelling. Before making
a replacement housing payment or releasing a payment from
escrow, the Agency or its designated representative shall
inspect the replacement dwelling and determine whether it
is a decent, safe, and sanitary dwelling as defined at
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§ 24.2(f).
(c) Purchase of replacement dwelling. A displaced
person is considered to have met the requirement to
purchase a replacement dwelling, if the person:
(1) Purchases a dwelling; or
(2) Purchases and rehabilitates a substandard
dwelling; or
(3) Relocates a dwelling which he or she owns or
purchases; or
(4) Constructs a dwelling on a site he or she owns or
purchases; or
(5) Contracts for the purchase or construction of a
dwelling on a site provided by a builder or on a site the
person owns or purchases.
(6) Currently owns a previously purchased dwelling and
site, valuation of which shall be on the basis of current
fair market value.
(d) Occupancy requirements for displacement or
replacement dwelling. No person shall be denied
eligibility for a replacement housing payment solely
because the person is unable to meet the occupancy
requirements set forth in these regulations for a reason
beyond his or her control, including:
(1) A disaster, an emergency, or an imminent threat to
the public health or welfare, as determined by the
President, the Federal agency funding the project, or the
displacing agency; or
(2) Another reason, such as a delay in the
construction of the replacement dwelling, military reserve
duty, or hospital stay, as determined by the Agency.
(e) Conversion of payment. A displaced person who
initially rents a replacement dwelling and receives a
rental assistance payment under § 24.402(b) is eligible to
receive a payment under § 24.401 or § 24.402(c) if he or
she meets the eligibility criteria for such payments,
including purchase and occupancy within the prescribed 1-
year period. Any portion of the rental assistance payment
that has been disbursed shall be deducted from the payment
computed under § 24.401 or § 24.402(c).
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(f) Payment after death. A replacement housing
payment is personal to the displaced person and upon his or
her death the undisbursed portion of any such payment shall
not be paid to the heirs or assigns, except that:
(1) The amount attributable to the displaced person's
period of actual occupancy of the replacement housing shall
be paid.
(2) The full payment shall be disbursed in any case in
which a member of a displaced family dies and the other
family member(s) continue to occupy a decent, safe, and
sanitary replacement dwelling.
(3) Any portion of a replacement housing payment
necessary to satisfy the legal obligation of an estate in
connection with the selection of a replacement dwelling by
or on behalf of a deceased person shall be disbursed to the
estate.
§ 24.404 Replacement housing of last resort.
(a) Determination to provide replacement housing of
last resort. Whenever a program or project cannot proceed
on a timely basis because comparable replacement dwellings
are not available within the monetary limits for owners or
tenants, as specified in 24.401 or 24.402, as appropriate,
the Agency shall provide additional or alternative
assistance under the provisions of this subpart. Any
decision to provide last resort housing assistance must be
adequately justified either:
(1) On a case-by-case basis, for good cause, which
means that appropriate consideration has been given to:
(i) The availability of comparable
replacement housing in the program or project area; and
(ii) The resources available to provide comparable
replacement housing; and
(iii) The individual circumstances of the displaced
person; or
(2) By a determination that:
(i) There is little, if any, comparable replacement
housing available to displaced persons within an entire
program or project area; and, therefore, last resort
housing assistance is necessary for the area as a whole;
and
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(11) A program or project cannot be advanced to
completion In a timely manner without last resort housing
assistance; and
(111) The method selected for providing last resort
housing assistance Is cost effective, considering all
elements which contribute to total program or project
costs. (Will project delay justify waiting for less
expensive comparable replacement housing to become
available?)
(b) Basic rights of persons to be displaced.
Notwithstanding any provision of this subpart, no person
shall be required to move from a displacement dwelling
unless comparable replacement housing Is available to such
person. No person may be deprived of any rights the person
may have under the Uniform Act or this part. The Agency
shall not require any displaced person to accept a dwelling
provided by the Agency under these procedures (unless the
Agency and the displaced person have entered into a
contract to do so) in lieu of any acquisition payment or
any relocation payment for which the person may otherwise
be eligible.
(c) Methods of providing comparable replacement
housing. Agencies shall have broad latitude in
implementing this subpart, but implementation shall be for
reasonable cost, on a case-by-case basis unless an
exception to case-by-case analysis is justified for an
entire project.
(1) The methods of providing replacement housing of
last resort include, but are not limited to:
(i) A replacement housing payment in excess of the
limits set forth in § 24.401 or 24.402. A rental
assistance subsidy under this section may be provided in
installments or in a lump sum at the Agency's discretion.
(ii) Rehabilitation of and/or additions to an existing
replacement dwelling.
(ill) The construction of a new replacement dwelling.
(iv) The provision of a direct loan, which requires
regular amortization or deferred repayment. The loan may
be unsecured or secured by the real property. The loan may
bear interest or be interest-free.
(v) The relocation and, if necessary, rehabilitation
of a dwelling.
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(vi) The purchase of land and/or a replacement
dwelling by the displacing agency and subsequent sale or
lease to, or exchange with a displaced person.
(vii) The removal of barriers to the handicapped.
(viii) The change in status of the displaced person
with his or her concurrence tram tenant to homeowner when
it is more cost effective to do so, as in cases where a
downpayment may be less expensive than a last resort rental
assistance payment.
(2) Under special circumstances, consistent with the
definition of a comparable replacement dwelling, modified
methods of providing replacement housing of last resort
permit consideration of replacement housing based on space
and physical characteristics different from those in the
displacement dwelling, (See Appendix A, of this part,
§ 24.404.), including upgraded, but smaller replacement
housing that is decent, safe, and sanitary and adequate to
accommodate individuals or families displaced from marginal
or substandard housing with probable functional
obsolescence. In no event, however, shall a displaced
person be required to move into a dwelling that is not
functionally equivalent in accordance with § 24.2(d) (2)..
(3) The agency shall provide assistance under this
subpart to a displaced person who is not eligible to
receive a replacement housing payment under § 24.401 and
24.402 because of failure to meet the length of occupancy
requirement when comparable replacement rental housing is
not available at rental rates within the person's financial
means, which is 30 percent of the person's gross monthly
household income. Such assistance shall cover a period of
42 months.
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Subpart F - Mobile Homes
S 24.501 Applicability.
This Subpart describes the requirements governing the
provision of relocation payments to a person displaced from
a mobile home and/or mobile home site who meets the basic
eligibility requirements of this part. Except as modified
by this Subpart, such a displaced person is entitled to a
moving expense payment in accordance with Subpart D and a
replacement housing payment in accordance with Subpart E to
the same extent and subject to the same requirements as
persons displaced from conventional dwellings.
§ 24.502 Moving and related expenses - mobile homes.
(a) A homeowner-occupant displaced from a mobile home
or mobile homesite is entitled to a payment for the cost of
moving his or her mobile home on an actual cost basis in
accordance with § 24.301. A non-occupant owner of a rented
mobile home is eligible for actual cost reimbursement under
§ 24.303. However, if the mobile home is not acquired, but
the homeowner-occupant obtains a replacement housing
payment under one of the circumstances described at
§ 24.503(a)(3), the owner is not eligible for payment for
moving the mobile home, but may be eligible for a payment
for moving personal property from the mobile home.
(b) The following rules apply to payments for actual
moving expenses under § 24.301:
(1) A displaced mobile homeowner, who moves the
mobile home to a replacement site, is eligible for the
reasonable cost of disassembling, moving, and reassembling
any attached appurtenances, such as porches, decks,
skirting, and awnings, which were not acquired, anchoring
of the unit, and utility Hhook-upM charges.
(2) If a mobile home requires repairs and/or
modifications so that it can be moved and/or made decent,
safe, and sanitary, and the Agency determines that it would
be economically feasible to incur the additional expense,
the reasonable cost of such repairs and/or modifications is
reimbursable.
(3) A nonretumable mobile home park entrance fee is
reimbursable to the extent it does not exceed the fee at a
comparable mobile home park, if the person is displaced
from a mobile home park or the Agency determines that
payment of the fee is necessary to effect relocation.
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S 24.503 Replacement housing payment for 180-day mobile
homeowner—occupants.
(a) A displaced owner-occupant of a mobile home is
entitled to a replacement housing payment, not to exceed
$22,500, under § 24.401 if:
(1) The person both owned the displacement mobile home
and occupied it on the displacement site for at least 180
days immediately prior to the initiation of negotiations;
(2) The person meets the other basic eligibility
requirements at § 24.401(a); and
(3) The Agency acquires the mobile home and/or mobile
home site, or the mobile home is not acquired by the Agency
but the owner is displaced from the mobile home because the
Agency determines that the mobile home:
(i) Is not and cannot economically be made decent,
safe, and sanitary; or
(ii) Cannot be relocated without substantial damage or
unreasonable cost; or
(iii) Cannot be relocated because there is no
available comparable replacement site; or
(iv) Cannot be relocated because it does not meet
mobile home park entrance requirements.
(b) If the mobile home is not acquired, and the Agency
determines that it is not practical to relocate it, the
acquisition cost of the displacement dwelling used when
computing the price differential amount, described at
§ 24.401(c), shall include the salvage value or trade-in
value of the mobile home, whichever is higher.
§ 24.504 Replacement housing payment for 90-day mobile home
occupants.
A displaced tenant or owner-occupant of a mobile home
is eligible for a replacement housing payment, not to
exceed $5,250, under § 24.402 if:
(a) The person actually occupied the displacement
mobile home on the displacement site for at least 90 days
immediately prior to the initiation of negotiations;
(b) The person meets the other basic eligibility
requirements at § 24.402(a); and
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(c) The Agency acquires the mobile home and/or mobile
home site, or the mobile home is not acquired by the Agency
but the owner or tenant is displaced from the mobile home
because of one of the circumstances described at
S 24.503(a) (3).
f 24.505 Additional rules governing relocation payments to
mobile home occupants.
(a) Replacement housing payment based on dwelling and
site. Both the mobile home and mobile home site must be
considered when computing a replacement housing payment.
For example, a displaced mobile home occupant may have
owned the displacement mobile home and rented the site or
may have rented the displacement mobile home and owned the
site. Also, a person may elect to purchase a replacement
mobile home and rent a replacement site, or rent a
replacement mobile home and purchase a replacement site.
In such cases, the total replacement housing payment shall
consist of a payment for a dwelling and a payment for a
site, each computed under the applicable section in
Subpart E. However, the total replacement housing payment
under Subpart E shall not exceed the maximum payment
(either $22,500 or $5,250) permitted under the section that
governs the computation for the dwelling. (See also
§ 24.403(b).)
Cost of comparable replacement dwelling - (1) If a
comparable replacement mobile home is not available, the
replacement housing payment shall be computed on the basis
of the reasonable cost of a conventional comparable
replacement dwelling.
(2) If the Agency determines that it would be
practical to relocate the mobile home, but the owner-
occupant elects not to do so, the Agency may determine
that, for purposes of computing the price differential
under § 24.401(c), the cost of a comparable replacement
dwelling is the sum of:
(i) The value of the mobile home,
(ii) The cost of any necessary repairs or
modifications, and
(iii) The estimated cost of moving the mobile home to
a replacement site.
(c) Initiation of negotiations. If the mobile home is
not actually acquired, but the occupant is considered
displaced under this part, the "initiation of negotiations"
is the initiation of negotiations to acquire the land, or,
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if the land is not acquired, the written notification that
he or she is a displaced person under this part.
(d) Person moves mobile home. If the owner is
reimbursed for the cost of moving the mobile home under
this part, he or she is not eligible to receive a
replacement housing payment to assist in purchasing or
renting a replacement mobile home. The person may,
however, be eligible for assistance in purchasing or
renting a replacement site.
(e) Partial acquisition of mobile hone park. The
acquisition of a portion of a mobile home park property may
leave a remaining part of the property that is not adequate
to continue the operation of the park. If the Agency
determines that a mobile home located in the remaining part
of the property must be moved as a direct result of the
project, the owner and any tenant shall be considered a
displaced person who is entitled to relocation payments and
other assistance under this part.
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Subpart 6 - Certification
i 24.601 Purpose.
This subpart permits a State agency to fulfill its
responsibilities under the Uniform Act by certifying that
it shall operate in accordance with State lavs and
regulations which shall accomplish the purpose and effect
of the Uniform Act, in lieu of providing the assurances
required by § 24.4 of this part.
i 24.602 Certification application - (a) General.
(1) The State governor, or his or her designee, on
behalf of any State agency or agencies may apply for
certification in accordance with this section.
(2) The governor may designate a lead agency to
administer certification in accordance with this section.
(b) Responsibilities of State agency - (1) The State
agency's application shall be submitted to the governor,
or his or her designee, for approval or disapproval.
(2) The State agency application shall contain a
statement that the State agency shall carry out the
responsibilities imposed by the Uniform Act. The State
agency application shall include a copy of the State laws
and regulations which shall accomplish the purpose and
effect of the Uniform Act.
(c) Responsibilities of governor or his or her
desianee - (1) The governor, or his or her designee, shall
approve or disapprove the State agency's application.
(2) The governor, or his or her designee, shall have
discretion to disapprove any State agency application.
(3) The governor, or his or her designee, shall
analyze State law and regulations and shall certify that
they accomplish the purpose and effect of the Uniform Act.
(4) The governor, or his or her designee, shall
determine in writing whether the State agency's
professional staffing is adequate to fully implement the
State law and regulations.
(5) If the State agency's application is approved by
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the governor, or his or her design**, it shall be
transmitted to the Federal agency providing financial
assistance to the State agency, with an information copy
to the Federal lead agency.
(6) When a determination is received from the
Federal funding agency, the governor, or his or her
designee, shall notify the state agency.
(d) Responsibilities of Federal funding agency -(1)
The Federal funding agency shall accept the approved
application for certification provided by the governor or
his or her designee and shall not conduct an independent
review unless or until future monitoring or other
appropriate indicators reveal program deficiencies
originating therefrom.
(2) The Federal funding agency shall transmit all
complete, approved applications, for certification to the
Federal lead agency.
(3) At the same time as transmission to the Federal
lead agency or during the public comment period, the
Federal funding agency shall provide to the lead agency
its written assessment of the State agency's capabilities
to operate under certification.
(4) The Federal funding agency shall promptly notify
the governor, or his or her designee, of the Federal lead
agency's determination described in paragraph (e) (2) of
this section.
(5) The Federal funding agency shall recognize the
State agency's certification within 30 days of the Federal
lead agency's finding.
(e) Responsibilities of Federal lead agency - (1) The
lead agency shall:
(i) Accept the approval provided by the governor, or
his or her designee, and shall not conduct an independent
review, except as provided for in paragraphs (e)(1)(ii),
(iii) and (iv) of this section, unless future monitoring
or other appropriate indicators reveal program
deficiencies originating therefrom;
(ii) Analyze the extent to which the provisions of
the applicable State laws and regulations accomplish the
purpose and effect of the Uniform Act, with particular
emphasis on the definition of a displaced person, the
categories of assistance required, and the levels of
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assistance provided to persons in such categories;
(iii) Provide a 60-day period of public review and
comment, and solicit and consider the views of interested
general purpose local governments within the State, as
well as the views of interested Federal and State
agencies; and consider all comments received as a result;
and
(iv) Consider any extraordinary information it
believes to be relevant.
(2) After considering all the information provided,
the lead agency shall either make a finding that the State
agency will carry out the Federal agency's Uniform Act
responsibility in accordance with State laws and
regulations which shall accomplish the same purpose and
effect as the Uniform Act, or shall make a determination
that a finding cannot be made; and shall so inform the
Federal funding agency.
5 24.603 Monitoring and corrective action.
(a) The Federal lead agency shall, in coordination
with other Federal agencies, monitor from time to time
State agency implementation of programs or projects
conducted under the certification process and the State
agency shall make available any information required for
this purpose.
(b) A Federal agency that has accepted a State
agency's certification pursuant to this subpart should
withhold its approval of any of its Federal financial
assistance to any project, program, or activity, in
progress or to be undertaken by such State agency, if it
is found by the Federal agency that the State agency has
failed to comply with the applicable State law and
regulations implementing those provisions of the Uniform
Act for which the State agency would otherwise have
provided the assurances required by sections 210 and 305
of the Uniform Act. The Federal agency may withhold
Federal financial assistance if the certifying State
agency fails to comply with the applicable State law and
regulations implementing other provisions of the Uniform
Act. The Federal agency shall notify the lead agency at
least 15 days prior to any decision to withhold funds
under this subpart. The lead agency may consult with the
Federal agency upon receiving such notification. The
lead agency will also inform other Federal agencies which
have accepted a certification under this subpart from the
same State agency of the pending action.
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(c) A Federal agency may, after consultation with the
lead agency, and notice to and consultation with the
governor, or his or her designee, rescind any previous
approval provided under this subpart if the certifying
State agency fails to comply with its certification or
with applicable State law and regulations. The Federal
agency shall initiate consultation with the lead agency at
least 30 days prior to any decision to rescind approval of
a certification under this subpart. The lead agency will
also inform other Federal agencies which have accepted a
certification under this subpart from the same State
agency, and will take whatever other action that may be
appropriate.
(d) Section 103(b) (2) of the Uniform Act, as
amended, requires that the head of the lead agency report
biennially to the Congress on State agency implementation
of section 103. To enable adequate preparation of the
prescribed biennial report, the lead agency may require
periodic information or data from affected Federal or
State agencies.
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Appendix A to Part 24 - Additional Information
This appendix provides additional information to
explain the intent of certain provisions of this part.
Subpart A - General
Section 24.2 Definitions.
Section 24.2fd) (2) Definition of comparable
replacement dwelling. The requirement in § 24.2(d)(2) that
a comparable replacement dwelling be "functionally
equivalent" to the displacement dwelling means that it must
perform the same function, provide the same utility, and be
capable of contributing to a comparable style of living as
the displacement dwelling. While it need not possess every
feature of the displacement dwelling, the principal
features must be present.
For example, if the displacement dwelling contains a
pantry and a similar dwelling is not available, a
replacement dwelling with ample kitchen cupboards may be
acceptable. Insulated and heated space in a garage might
prove an adequate substitute for basement workshop space.
A dining area may substitute for a separate dining room.
Under some circumstances, attic space could substitute for
basement space for storage purposes, and vice versa.
Only in unusual circumstances may a comparable
replacement dwelling contain fewer rooms or,
consequentially, less living space than the displacement
dwelling. Such may be the case when a decent, safe, and
sanitary replacement dwelling (which by definition is
"adequate to accommodate" the displaced person) may be
found to be "functionally equivalent" to a larger but very
run-down substandard displacement dwelling.
Section 24.2(d)(7) requires that a comparable
replacement dwelling for a person who is not receiving
assistance under any government housing program before
displacement must be currently available on the private
market without any subsidy under a government housing
program.
A public housing unit may qualify as a comparable
replacement dwelling only for a person displaced from a
public housing unit; a privately-owned dwelling with a
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housing program subsidy tied to the unit may qualify as a
comparable replacement dwelling only for a person displaced
from a similarly subsidized unit or public housing; a
housing program subsidy to a person (not tied to the
building), such as a HUD Section 8 Existing Housing Program
Certificate or a Housing Voucher, may be reflected in an
offer of a comparable replacement dwelling to a person
receiving a similar subsidy or occupying a privately-owned
subsidized unit or public housing unit before displacement.
However, nothing in this part prohibits an Agency from
offering, or precludes a person from accepting, assistance
under a government housing program, even if the person did
not receive similar assistance before displacement.
However, the Agency is obligated to inform the person of
his or her options under this part. (If a person accepts
assistance under a government housing program, the rental
assistance payment under § 24.402 would be computed on the
basis of the person's actual out-of-pocket cost for the
replacement housing.)
Section 24.2 fa) (2) Persons not displaced. Section
24.2(g)(2)(iv) recognizes that there are circumstances
where the acquisition of real property takes place without
the intent or necessity that an occupant of the property be
permanently displaced. Because such occupants are not
considered "displaced persons" under this part, great care
must be exercised to ensure that they are treated fairly
and equitably. For example, if the tenant-occupant of a
dwelling will not be displaced, but is required to relocate
temporarily in connection with the project, the
temporarily-occupied housing must be decent, safe, and
sanitary and the tenant must be reimbursed for all
reasonable out-of-pocket expenses incurred in connection
with the temporary relocation, including moving expenses
and increased housing costs during the temporary
relocation.
It is also noted that any person who disagrees with
the Agency's determination that he or she is not a
displaced person under this part may file an appeal in
accordance with § 24.10.
Section 24.2OO Initiation of negotiations. This
section of the part provides a special definition for
acquisitions and displacements under Pub. L. 96-510 or
Superfund. These activities differ under Superfund in that
relocation may precede acquisition, the reverse of the
normal sequence. Superfund is a program designed to clean
up hazardous waste sites. When such a site is discovered,
it may be necessary, in certain limited circumstances, to
alert the public to the danger and to the advisability of
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moving immediately. If a decision is made later to
permanently relocate much persons, those who had moved
earlier would no longer be on site when a formal, written
offer to acquire the property was made and thus would lose
their eligibility for a replacement housing payment. In
order to prevent this unfair outcome, we have provided a
definition which is based on the public health advisory or
announcement of permanent relocation.
Section 24.3 No duplication of payments.
This section prohibits an Agency from making a payment
to a person under these regulations that would duplicate
another payment the person receives under Federal, State,
or local lav. The Agency is not required to conduct an
exhaustive search for such other payments; it is only
required to avoid creating a duplication based on the
Agency's "knowledge at the time a payment under these
regulations is computed.
Section 24.9 Recordkeeping and reports.
Section 24.9fc) Reports. This paragraph allows
Federal agencies to require the submission of a report on
activities under the Uniform Act no more frequently than
once every three years. The report, if required, will
cover activities during the Federal fiscal year immediately'
prior to the submission date. In order to minimize the
administrative burden on Agencies implementing this part, a
basic report form (see Appendix B of this part) has been
developed which, with only minor modifications, would be
used in all Federal and federally-assisted programs or
projects.
Subpart B - Real Property Acquisition
Section 24.101 Applicability of acquisition requirements.
Section 24.10Kb) Less-than-full-fee interest in real
property. This provision provides a benchmark beyond which
the requirements of the subpart clearly apply to leases.
However, the Agency may apply the regulations to any less-
than-full-fee acquisition which is short of 50 years but
which in its judgaent should be covered.
Section 24.102 Basic acquisition policies.
Section 24.l02fd) Establishment of offer of ^ust
compensation. The initial offer to the property owner may
not be less than the amount of the Agency's approved
appraisal, but may exceed that amount if the Agency
determines that a greater amount reflects just compensation
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for the property.
Section 24 . 102 (f \ Basic negotiation prpc.e^yre.g i It is
intended that an offer to an owner be adequately presented,
and that the owner be properly informed. Personal, face-
to-face contact should take place, if feasible, but this
section is not intended to require such contact in all
cases.
Section 24.102(1) Miff In JPtrqtive settlement • This
section provides guidance on administrative settlement as
an alternative to judicial resolution of a difference of
opinion on the value of a property, in order to avoid
unnecessary litigation and congestion in the courts.
All relevant facts and circumstances should be
considered by an Agency official delegated this authority.
Appraisers, including reviewing appraisers, must not be
pressured to adjust their estimate of value for the purpose
of justifying such settlements. Such action would
invalidate the appraisal process.
Section 24. 102 M) Payment before taking possession.
It is intended that a right-of-entry for construction
purposes be obtained only in the exceptional case, such as
an emergency project, when there is no time to make an
appraisal and purchase offer and the property owner is
agreeable to the process.
Section 24. 102 (m) Fair rental. Section 301(6) of the
Uniform Act limits what an Agency may charge when a former
owner or previous occupant of a property is permitted to
rent the property for a short term or when occupancy is
subject to termination by the Agency on short notice. Such
rent may not exceed "the fair rental value *** to a short-
term occupier." Generally, the Agency's right to terminate
occupancy on short notice (whether or not the renter also
has that right) supports the establishment of a lesser
rental than might be found in a longer, fixed-term
situation.
Section 24.103 Criteria for appraisals.
Section 24. 103 (a) Standards of appraisal. In
paragraph (a) (3) of this section, it is intended that all
relevant and reliable approaches to value be utilized.
However, where an Agency determines that the market
approach will be adequate by itself because of the type of
property being appraised and the availability of sales
data, it may limit the appraisal assignment to the market
approach .
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Section 24.103fb^ Influence of the project on lust
compensation. As used in this section, the term "project"
is intended to mean an undertaking which is planned,
designed, and intended to operate as a unit.
Because of the public knowledge of the proposed
project, property values may be affected. A property owner
should not be penalized because of a decrease in
value caused by the proposed project nor reap a windfall at
public expense because of increased value created by the
proposed project.
Section 24.103fe) Conflict of interest. The overall
objective is to minimize the risk of fraud and
mismanagement and to promote public confidence in Federal
and federally-assisted land acquisition practices.
Recognizing that the costs may outweigh the benefits in
some circumstances, 24.103(e) provides that the same person
may both appraise and negotiate an acquisition, if the
value is $2,500 or less. However, it should be noted that
all appraisals must be reviewed in accordance with
§ 24.104. This includes appraisals of real property valued
at $2,500, or less.
Section 24.104 Review of appraisals.
This section recognizes that Agencies differ in the
authority delegated to the review appraiser. In some cases
the reviewer establishes the amount of the offer to the
owner and in other cases the reviewer makes a
recommendation which is acted on at a higher level. It is
also within Agency discretion to decide whether a second
review is needed if the first review appraiser establishes
a value different from that in the appraisal report or
reports on a property.
Before acceptance of an appraisal, the review
appraiser must determine that the appraiser's
documentation, including valuation data and the analyses of
that data, demonstrates the soundness of the appraiser's
opinion of value. The qualifications of the review
appraiser and the level of explanation of the basis for the
reviewer's recommended or approved value depend on the
complexity of the appraisal problem. For a low value
property requiring an uncomplicated valuation process, the
reviewer's approval, endorsing the appraiser's report, may
satisfy the requirement for the reviewer's statement.
Section 24.106 Expenses incidental to transfer of title to
the Agency.
Generally, the Agency is able to pay such incidental
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costs directly and, where feasible, is required to do so.
In order to prevent the property owner from making
unnecessary out-of-pocket expenditures and to avoid
duplication of expenses, the property owner should be
informed early in the acquisition process of the Agency's
intent to make such arrangements. In addition, it is
emphasized that such expenses must be reasonable and
necessary.
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Subpart C - General Relocation Requirements
Section 24.204 Availability of comparable replacement
dwelling before displacement.
Section 24.204 fay General. This provision requires
that no one may be required to move from a dwelling without
one comparable replacement dwelling having been made
available. In addition, § 24.204(a) requires that, "Where
possible, three or more comparable replacement dwellings
shall be made available." Thus the basic standard for the
number of referrals required under this section is three.
Only in situations where three comparable replacement
dwellings are not available (e.g., when the local housing
market does not contain three comparable dwellings) may the
Agency make fewer than three referrals.
Section 24.205 Relocation assistance advisory services.
Section 24.205(c)(2) (ii) (C) is intended to emphasize
that if the comparable replacement dwellings are located in
areas of minority concentration, minority persons should,
if possible, also be given opportunities to relocate to
replacement dwellings not located in such areas.
Section 24.207 General requirements claims for
relocation payments.
Section 24.207(a) allows an Agency to make a payment
for low cost or uncomplicated moves without additional
documentation, as long as the payment is limited to the
amount of the lowest acceptable bid or estimate, as
provided for in § 24.303(c).
Subpart D - Payment for Moving and Related Expenses
Section 24.306 Fixed payment for moving expenses
nonresidential moves.
Section 24.306fd)Nonprofit organizations. Gross
revenues may include membership fees, class fees, cash
donations, tithes, receipts from sales or other forms of
fund collection that enables the non-profit organization to
operate. Administrative expenses are those for
administrative support such as rent, utilities, salaries,
advertising and other like items as well as fundraising
expenses. Operating expenses for carrying out the
purposes of the non-profit organization are not included in
administrative expenses. The monetary receipts and expense
amounts may be verified with certified financial statements
or financial documents required by public agencies.
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Section 24.307 Discretionary utility relocation payment*.
Section 24.307(c) describes the issues which Bust be
agreed to between the displacing agency and the utility
facility owner in determining the amount of the relocation
payment. To facilitate and aid in reaching such agreement,
the practices in the Federal Highway Administration
regulation, 23 CFR 645, Subpart A, Utility Relocations,
Adjustments and Reimbursement, should be followed.
Subpart E - Replacement Housing Payments
Section 24.401 Replacement housing payment for 180-day
homeowner-occupants.
Section 24.40iraim. The provision for extending
eligibility for a replacement housing payment beyond the
one year period for good cause means that an extension may
be granted if some event beyond the control of the
displaced person such as acute or life threatening illness,
bad weather preventing the completion of construction of a
replacement dwelling or other like circumstances should
cause delays in occupying a decent, safe, and sanitary
replacement dwelling.
Section 24.401fcl- Price differential. The provision
in § 24.401(c)(4)(iii) to use the current fair market value
for residential use does not mean the Agency must have the
property appraised. Any reasonable method for arriving at
the fair market value may be used.
Section 24.401(d) Increased mortgage interest costs.
The provision in § 24.401(d) set forth the factors to
be used in computing the payment that will be required to
reduce a person's replacement mortgage (added to the
downpayment) to an amount which can be amortized at the
same monthly payment for principal and interest over the
same period of time as the remaining term on the
displacement mortgages. This payment is commonly known as
the "buydown."
The remaining principal balance, the interest rate,
and monthly principal and interest payments for the old
mortgage as well as the interest rate, points and term for
the new mortgage must be known to compute the increased
mortgage interest costs. If the combination of interest
and points for the new mortgage exceeds the current
prevailing fixed interest rate and points for conventional
mortgages and there is no justification for the excessive
rate, then the current prevailing fixed interest rate and
points shall be used in the computations. Justification
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y be the unavailability of the currant prevailing rate
due to the amount of the new mortgage, credit difficulties,!
or other similar reasons.
Sample Computation
Old Mortgage: Remaining Principal Balance $50,000
Monthly Payment (principal
and interest) 458.22
Interest rate 7%
New Mortgage: Interest rate 10%
Points 3
Term 15 years
Remaining term of the old mortgage is determined to be 174
months. (Determining, or computing, the actual remaining
term is more reliable than using the data supplied by the
mortgagee). However, if it is shorter, use the term of the
new mortgage and compute the needed monthly payment.
Amount to be financed to maintain monthly payments of
$458.22 at 10% - $42,010.18
$50,000.00
-42.010.18
Increased mortgage interest costs $ 7,989.82
3 points on $42,010.18 S 1.260.31
Total buydown necessary to maintain
payments at $458.22/month $ 9,250.13
If the new mortgage actually obtained is less than the
computed amount for a new mortgage ($42,010.18), the
buydown shall be prorated accordingly. If the actual
mortgage obtained in our example were $35,000, the buydown
payment would be $7,706.57 ($35,000 - by $42,010.18 - .8331
$9,250.13 X .8331 - $7,706.57).
The Agency is obligated to inform the person of the
approximate amount of this payment and that he or she must
obtain a mortgage of at least the same amount as the old
mortgage and for at least the same term in order to receive
the full amount of this payment. The displacee is also to
be advised of the interest rate and points used to
126
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calculate the payment.
Section 24.402 Replacement housing payment for 90-day
occupants.
The downpayment assistance provisions in f 24.402(c)
are intended to limit such assistance to the amount of the
computed rental assistance payment for a tenant or an
eligible homeowner. It does, however, provide the latitude
for Agency discretion in offering downpayment assistance
which exceeds the computed rental assistance payment, up to
the $5,250 statutory maximum. This does not mean, however,
that such Agency discretion may be exercised in a selective
or discriminatory fashion. The displacing agency should
develop a policy which affords equal treatment for persons
in like circumstances and this policy should be applied
uniformly throughout the Agency's programs or projects. It
is recommended that displacing agencies coordinate with
each other to reach a consensus on a uniform procedure for
the State and/or the local jurisdiction.
For purposes of this section, the term downpayment
means the downpayment ordinarily required to obtain
conventional loan financing for the decent, safe, and
sanitary dwelling actually purchased and occupied.
However, if the downpayment actually required of a
displaced person for the purchase of the replacement
dwelling exceeds the amount ordinarily required, the
amount of the downpayment may be the amount which the
Agency determines is necessary.
Section 24.403 Additional rules governing
replacement housing payments.
Section 24.403 fa)fl). The procedure for adjusting the
asking price of comparable replacement dwellings requires
that the agency provide advisory assistance to the
displaced person concerning negotiations so that he or she
may enter the market as a knowledgeable buyer. If a
displaced person elects to buy one of the selected
comparables, but cannot acquire the property for the
adjusted price, it is appropriate to increase the
replacement housing payment to the actual purchase amount.
Section 24.404 Replacement housing of last resort.
Section 24.404fb) Basic rights of persons to be
displaced. This paragraph affirms the right of a 180-day
homeowner-occupant, who is eligible for a replacement
housing payment under § 24.401, to a reasonable opportunity
to purchase a comparable replacement dwelling. However, it
should be read in conjunction with the definition of "owner
of a dwelling" at § 24.2(p). The Agency is not required to
127
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provide persons owning only a fractional interest in the
displacement dwelling a greater level of assistance to
purchase a replacement dwelling than the Agency would be
required to provide such persons if they owned fee simple
title to the displacement dwelling. If such assistance is
not sufficient to buy a replacement dwelling, the Agency
may provide additional purchase assistance or rental
assistance.
Section 24.404fc) Methods of providing comparable
replacement housing. The use of cost effective means of
providing comparable replacement housing is implied
throughout the subpart. The term "reasonable cost" is used
here to underline the fact that while innovative means to
provide housing are encouraged, they should be cost-
effective.
Section 24.404(c)(2) permits the use of last resort
housing, in special cases, which may involve variations
from the usual methods of obtaining comparability.
However, it should be specially noted that such variation
should never result in a lowering of housing standards nor
should it ever result in a lower quality of living style
for the displaced person. The physical characteristics of
the comparable replacement dwelling may be dissimilar to
those o'f the displacement dwelling but they may never be
inferior.
One example might be the use of a new mobile home to
replace a very substandard conventional dwelling in an area
where comparable conventional dwellings are not available.
Another example could be the use of a superior, but
smaller decent, safe and sanitary dwelling to replace a
large, old substandard dwelling, only a portion of which is
being used as living quarters by the occupants and no other
large comparable dwellings are available in the area.
Subpart F - Mobile Homes
Section 24.503 Replacement housing payment for 180-day
mobile homeowner-occupants.
A 180-day owner-occupant who is displaced from a
mobile home on a rented site may be eligible for a
replacement housing payment for a dwelling computed under
§ 24.401 and a replacement housing payment for a site
computed under § 24.402. A 180-day owner-occupant of both
the mobile home and the site, who relocates the mobile
home, may be eligible for a replacement housing payment
128
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under § 24.401 to assist in the purchase of a replacement
site or, under § 24.402, to assist in renting a replacement
site.
129
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Appendix B to Part 24 - Statistical Report Form
This appendix sets forth the statistical information
collected from Agencies in accordance with § 24.9(c).
General
1. Report coverage. This report covers all
relocation and real property acquisition activities under a
Federal or a federally assisted project or program subject
to the provisions of the Uniform Relocation Assistance and
Real Property Acquisition Policies Act of 1970, as amended
by Pub. L. 100-17, 101 Stat. 132.
2. Report period. Activities shall be reported on a
Federal fiscal year basis, i.e., October 1 through
September 30.
3. Where and when to submit report. Submit an
original and two copies of this report to (Name and
Address of Federal Agency) as soon as possible after
September 30, but NOT LATER THAN NOVEMBER 15.
4. How to report relocation payments. The full
amount of a relocation payment shall be reported as if
disbursed in the year during which the claim was approved,
regardless of whether the payment is to be paid in
installments.
5. How to report dollar amounts. Round off all money
entries in Parts B and C to the nearest dollar.
6. Statutory references. The references in Part B
indicate the Section of the Uniform Act that authorizes the
cost.
PART A. Persons displaced
Report in Part A the number of persons ("households,"
"businesses, including nonprofit organizations," and
"farms") who were permanently displaced during the fiscal
year by project or program activities and moved to their
replacement dwelling or location. This includes
businesses, nonprofit organizations and farms which, upon
displacement, discontinued operations. The category
"households" includes all families and individuals. A
family shall be reported as "one" household, not by the
number of people in the family unit. Persons' shall be
reported according to their status as "owners" or "tenants"
130
-------
of the property from which displaced
PART B. Relocation payments
and ( Bi . Report in Column (A) the
number of displacements during the report year. Report in
Column (B) the total amount represented by the
displacements reported in Column (A) .
Line 7A is a new line item for reporting the business
reestablishment expense payment.
Lines 7A and 9, C.glWfn flR) T Report in Column (B) the
amount of costs that were included in the total amount
approved on Lines 6 and 8, Column (B) .
Lines 12A and B. Report in Column (A) the number of
households displaced by project or program activities which
were provided assistance in accordance with Section 206 (a)
of the Uniform Act. Report in Column (B) the total
financial assistance under Section 206 (a) allocable to the
households reported in Column (A) . (If a household
received financial assistance under section 203 or section
204 as well as under section 206; (a) of the Uniform Act,
report the household as a displacement in Column (A) , but
in Column (B) report only the amount of financial
assistance allocable to section 206 (a). For example, if a
tenant-household receives a payment of $7,000 to rent a
replacement dwelling, the sum of $5,250 shall be included
on Line 10, Column (B) , and $1,750 shall be included on
Line 12B, Column (B).)
Line 13. Report on Line 13 all administrative costs
incurred during the report year in connection with
providing relocation advisory assistance and services under
Section 205 of the Uniform Act.
Line 15. Report on Line 15 the total number of
relocation appeals filed during the fiscal year by
aggrieved persons.
PART C - Real property acquisition subject to Uniform Act
Line 16. Columns (A) and CB) . Report in Column (A)
all parcels acquired during the report year where title or
possession was vested in the acquiring agency during the
reporting period. (Include parcels acquired without
Federal financial assistance, if there was or will be
Federal financial assistance in other phases of the project
or program.) Report in Column (B) the total of the amounts
paid, deposited in court, or otherwise made available to a
property owner pursuant to applicable law in order to vest
131
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title or possession in the acquiring agency.
Line 17. Report on Line 17 the number of parcels
reported on Line 16 that were acquired by condemnation
where price disagreement was involved.
132
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[4910-22]
DEPARTMENT OP TRANSPORTATIOM
Federal Highway Administration
UNIFORM RELOCATION AND REAL PROPERTY ACQUISITION FOR
FEDERAL AND FEDERALLY-ASSISTED PROGRAMS; FIXED PAYMENT FOR
MOVING EXPENSES; RESIDENTIAL MOVES.
AGENCY: Federal Highway Administration (FHWA), DOT.
ACTION: Notice.
SUMMARY: The purpose of this notice is to publish.the
alternative moving expense and dislocation allowance
schedule for persons displaced from dwellings in each
State, the District of Columbia, Puerto Rico, and the
Virgin Islands as required by Section 405(b) of the Surface
Transportation and Uniform Relocation Assistance Act of
1987, Pub. L. 100-17, 101 Stat. 132 (1987 Amendments).
EFFECTIVE DATE: The provisions of this Notice are
effective (date of publication in the FEDERAL REGISTER!.
For further information about implementation dates, see the
discussion in the supplementary information section below.
FOR FURTHER INFORMATION CONTACT: Barbara J. Satorius,
Policy Development Branch, Office of Right-of-Way (202366-
2043); or Reid Alsop, Office of the Chief Counsel (202366-
1371), Federal Highway Administration, 400 Seventh Street,
SW., Washington, D.C. 20590. Office hours, Monday-Friday
are from 7:30 a.m.to 4:00p.m., ET.
SUPPLEMENTARY INFORMATION: Section 202(b) of the Uniform
Relocation Assistance and Real Property Acquisition
Policies Act of 1970, Pub. L. 91-646, 84 Stat. 1894
(Uniform Act), as amended by Section 405(b) of the 1987
Amendments, provides that a displaced individual or family
may elect to be paid for moving expenses on the basis of a
moving expense and dislocation allowance schedule
established by the head of the lead agency as an
alternative to being paid for moving and related expenses
actually incurred. Section 405(b) eliminated statutory
limitations on the amounts that could be paid pursuant to
such a schedule. Implementing regulations at 49 CFR 24.302
provide that the FHWA will develop and approve this
schedule.
The purpose of this notice is to publish the schedule
133
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approved by the FHWA for use in payment determinations by
all Federal, State and local governments, and persons
affected by the Uniform Act, as amended. It has been
developed from data provided by State highway agencies, and
incorporates the dislocation allowance within the
schedule's payment amounts. The exceptions and limitations
are as follows:
1. The expense and dislocation allowance to a person
whose residential move is performed by an agency at no cost
to the person shall be limited to $50.00.
2. An occupant will be paid on an actual cost basis
for moving his or her mobile home from the displacement
site. In addition, a reasonable payment to the occupant
for packing and securing personal property for the move may
be paid at the agency's discretion.
3. The expense and dislocation allowance to a person
with minimal personal possessions who is in occupancy of a
dormitory style room shared by two or more other unrelated
persons shall be limited to $50.00. An occupant who moves
from a mobile home may be paid for the removal of personal
property from the mobile home in accordance with the moving
and dislocation allowance payment schedule.
Any government, agency or person that is in compliance with!
49 CFR Part 24 may implement the schedule being published
today. Any government, agency or person that is unable to
comply with 49 CFR Part 24 at this time may continue to use
the moving expense schedule published in the Federal
Register on December 30, 1986, until the schedule published
here becomes mandatory on April 2, 1989, the date that the
1987 Amendments and 49 CFR Part 24 become fully applicable.
(Catalog of Federal Domestic Assistance Program Number
20.205, Highway Planning and Construction. The regulations
implementing Executive Order 12372 regarding
intergovernmental consultation on Federal programs and
activities apply to this program).
(42 U.S.C. 4601; 49 CFR 24.302(a)).
Issued on:
134
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RESIDENTIAL MOVING EXPENSE t DISLOCATION ALLOWANCE PAYMENT SCHEDULE
STATE
OCCUPANT OWNS FURNITURE
(1) I (2)
NUMBER OF ROOMS OF FURNITURE
1 | 2 | 3 | 4 | 5 | 6 |7
1 «
EACN
ADD.
ROOM
OCCUPANT DOES NOT
OUN FURNITURE (3)
FIRST (EACH ADD.
ROOM 1 ROOM
ALABAMA
ALASKA
ARIZONA
ARKANSAS
CALIFORNIA
COLORADO
CONNECTICUT
DELAWARE
D. C.
FLORIDA
GEORGIA
HAWAII
IDAHO
ILLINOIS
INDIANA
I QUA
KANSAS
KENTUCKY
LOUISIANA
MAINE
MARYLAND
MASSACHUSETTS
MICHIGAN
MINNESOTA
MISSISSIPPI
MISSOURI
MONTANA
NEBRASKA
NEVADA
NEW HAMPSHIRE
NEW JERSEY
NEW MEXICO
NEW YORK
NORTH CAROLINA
NORTH DAKOTA
OHIO
OKLAHOMA
OREGON
PENNSYLVANIA
PUERTO RICO
RHODE ISLAND
SOUTH CAROLINA
SOUTH DAKOTA
TENNESSEE
TEXAS
UTAH
VERMONT
VIRGIN ISLANDS
VIRGINIA
WASHINGTON
WEST VIRGINIA
WISCONSIN
WYOMING
250
350
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
350
500
400
350
400
400
400
350
400
350
350
400
350
400
400
350
350
400
350
350
400
400
400
400
350
350
350
350
400
350
400
400
400
350
350
400
350
400
400
350
350
350
350
350
350
350
350
350
400
400
400
400
350
450
650
550
450
550
550
550
450
550
450
450
550
450
550
550
450
450
550
450
450
550
550
550
550
450
450
450
450
550
450
550
550
550
450
450
550
450
550
550
450
450
450
450
450
450
450
450
450
550
550
550
550
450
550
800
650
550
650
650
650
550
650
550
550
650
550
650
650
550
550
650
550
550
650
650
650
650
550
550
550
550
650
550
650
650
650
550
550
650
550
650
650
550
550
550
550
550
550
550
550
550
650
650
650
650
550
625
925
750
625
750
750
750
625
750
625
625
750
625
750
750
625
625
750
625
625
750
750
750
750
625
625
625
625
750
625
750
750
750
625
625
750
625
750
750
625
625
625
625
625
625
625
625
625
750
750
750
750
625
700
1050
850
700
850
850
850
700
850
700
700
850
700
850
850
700
700
850
700
700
850
850
850
850
700
700
700
700
850
700
850
850
850
700
700
850
700
850
850
700
700
700
700
700
700
700
700
700
850
850
850
850
700
775
1175
950
775
950
950
950
775
950
775
775
950
775
950
950
775
775
950
775
775
950
950
950
950
775
775
775
775
950
775
950
950
950
775
775
950
775
950
950
775
775
775
775
775
775
775
775
775
950
950
950
950
775
850
1300
1050
850
1050
1050
1050
850
1050
850
850
1050
850
1050
1050
850
850
1050
850
850
1050
1050
1050
1050
850
850
850
850
1050
850
1050
1050
1050
850
850
1050
850
1050
1050
850
850
850
850
850
850
850
850
850
1050
1050
1050
1050
850
75
100
100
75
100
100
100
75
100
75
75
100
75
100
100
75
75
100
75
75
100
100
100
100
75
75
75
75
100
75
100
100
100
75
75
100
75
100
100
75
75
75
75
75
75
75
75
75
100
100
100
100
75
200
225
225
200
225
225
225
200
225
200
200
225
200
225
225
200
200
225
200
200
225
225
225
225
200
200
200
200
225
200
225
225
225
200
200
225
200
225
225
200
200
200
200
200
200
200
200
200
225
225
225
225
200
25
35
35
25
35
35
35
25
35
25
25
35
25
35
35
25
25
35
25
25
35
35
35
35
25
25
25
25
35
25
35
35
35
25
25
35
25
35
35
25
25
25
25
25
25
25
25
25
35
35
35
35
25
Exceptions: See supplementary information.
(1) Person whose residential «ove is performed by agency, $50.
(2) Move of a Mobile home from site, actual cost; reasonable anount nay be added
for packing and securing personal property for the awe at agency discretion.
(3) Occupant of dormitory, $50.
-------
RESIDENTIAL NOVING EXPENSE I DISLOCATION ALLOWANCE PAYMENT SCHEDULE
STATE
|AMERICAN SAMOA
I
| COMMONWEALTH OF THE
(NORTHERN MARIANA
ISLANDS
GUAM
OCCUPANT OUNS FURNITURE
|OCCUPANT DOES NOT)
(1) ft (2) |OWN FURNITURE (3)|
1
250
250
250
1
2
350
350
350
UMBER
3
450
450
450
OF ROC
4
550
550
550
MS Of
5
625
625
625
FURNI1
6
700
700
700
rURE
7
775
775
775
e
850
850
850
EACH
ADD.
ROOM
75
75
75
FIRST
ROOM
200
200
200
EACH ADD.
ROOM
25
25
25
EXCEPTIONS:
(1) Persons whose residential *ove is performed by agency. S50
(2) Move of a Mobile hoae fro* site, actual cost; reasonable aanunt «ay be added
for packing and securing personal property for the aove at agency discretion.
(3) Occupant of dormitory, S50
-------
APPENDIX III
MORTGAGE H*'P
-------
Mortgage Interest Differential Payments
Information needed for computations:
Balance of Existing Mortgage ^-Amount of new mortgage_
Interest rate of " " Interest rate of new mortgage,
2Monthly payment of " " Points on new mortgage
3Term of new mortgage
The initial computations for a mortgage interest differential
payment for comparison purposes'will be based on the data for the
existing mortgage(s) available at the time the replacement
housing payment is computed and one of the prevailing fixed
interest rates (including points) for conventional mortgages in
the area. If there is a range of interest rates and points
available in an area that could be considered prevailing or
typical, the Agency may use a prevailing fixed interest rate
that will require the smallest mortgage interest differential
payment by the Agency to maintain the same monthly payment for
the same term for the new mortgage as existed on the old mortgage
for the initial computation and offer. An example follows:
•'•The actual amount of the new mortgage is only of concern if it
is less than the amount needed to be financed to maintain the old
mortgage.
2If the term of the new mortgage is the same as or greater than
the term of the existing mortgage, use the monthly payment of the
existing mortgage(s) to compute the number of months actually necessary
to pay off the existing mortgage.
3If the term of the new mortgage is less than the term of the
existing mortgage(s), use the term of the new mortgage to compute the
.monthly payment necessary to pay off the existing mortgage using the
'shorter term.
-------
Balance of Old Mortgage $50,000
Interest rate of Old Mortgage 7%
Monthly Payment of Old Mortgage 458.22
Computed Remaining Term of Old Mortgage 174 months
Specific instructions for computing mortgage interest payments
using the Hewlett Packard (HP 12C), the Texas Instruments (BA-
II), and the Radio Shack (EO100) calculators are located at the
end of this section.
Available interest rates for fixed mortgages, for 15 years. (Use
the rates for terms of mortgages that are at least as long as the
remaining term of the old mortgage, i.e. the 15 year rates for
terms of 15 years or less and the 30 year table for loans with
remaining terms exceeding 15 years.)
Interest rates 9.5% with 3 points
available for
15 year mortgage 10% with 2 points
10.5% with 1 point
11% with 0 points
The computed mortgage interest differential payments are as
follows:
Amount to
be financed
M3.201.92 9.5X w 3 pts. - 6797.24 (buydoun) * 1296.08 (points) * S8093.32
42.010.18 10.OX w 2 pts. - 7989.82 " * 840.20 " • S8830.02
40,866.89 10.5X u 1 pts. - 9133.11 « * 408.67 » » »9541.78
39,770.48 11X w 0 pts. - 10,229.52 • $10229.52
-------
As demonstrated by this example, the prevailing interest rate
that will provide maintenance of monthly payments of $458.22 at
the least cost to the Agency is 9.5% interest with 3 points.
The Agency may advise the displaced person that he/she may
receive $8,093.32 for the mortgage interest differential payment,
based on the current mortgage rate of 9.5% interest plus 3
points, if a new mortgage is obtained in at least the calculated
replacement mortgage amount of $43,201.92 and for at least 174
months.
Alternate Computations for Smaller and/or Shorter Term New
Mortgage
A. New mortgage j.s smaller than calculate^ replacement mortgage
amount.
In the event the displaced person elects to obtain a mortgage
smaller than the calculated replacement mortgage, the payment
must be prorated. For example:
Old mortgage New mortgage
Balance - $50,000 $40,000
Remain, term 174 months 174 months
Int. rate 7% 9.5%
points - 3
The previous buydown computation indicated that a calculated
replacement mortgage of $43,201.92 was necessary to obtain the
-------
estimated MIDP of $8093.32. To determine the MIDP in this
example, divide the actual new mortgage amount, $40,000 by the
calculated replacement mortgage amount, $43,201.92. The
resulting factor, .92588, is multiplied by the estimated MIDP,
$8,093.32, to give the reduced amount of $7,493.48 as the MIDP on
the smaller new mortgage.
$40,000/$43,201.92 = .92588 X 8093.32 = $7493.48 MIDP
(including points)
B. Shorter term new mortgage
In the event that the displaced person elects to obtain a
mortgage for a shorter term than the remaining term of the old
mortgage, it is necessary to compute a hypothetical monthly
payment for the old mortgage at the old interest rate but at the
shorter term of the new mortgage. This computed hypothetical
monthly payment will be larger than the actual payment on the old
mortgage. Take the previously used old mortgage example:
Old mortgage New mortgage
Remaining balance - $50,000
Interest rate - 7% - 9.5%
Monthly payment - $458.22
Remaining term - 174 months - 120 months
points - 3
-------
Step 1. - Compute a hypothetical monthly payment for old mortgage
based on a 120 month payoff - $580.54
Step 2. - Compute a calculated replacement mortgage using the
hypothetical monthly payment of $580.54 per month, 120 months at
9.5% interest rate. The calculated replacement mortgage amount
is $44864.83. The buy-down amount is the old mortgage balance of
$50,000 less the calculated replacement mortgage of $44,864.83, =
$5,135.17 + points of $1,345.95. (3% of $44,864.83), or a total
of $6,481.11.
The displaced person would need to obtain a mortgage of at least
$44,864.83 to receive a payment of $6,481.11.
C. Smaller new mortgage and shorter term.
A different computation is made if the new mortgage is both
smaller and for a shorter term. Using the old mortgage figures
cited above, with a new mortgage for $40,000, term of 120 months
and 9.5% interest rate, the calculated replacement mortgage as
computed in example B. ($44,864.83) is divided into the smaller
new mortgage ($40,000) giving a factor of .89157 x the estimated
MIDP of $6,481.11 (from example B) for a MIDP of $5,778.34.
The example computations in no way restrict the displaced person
to any combination of mortgage amounts and/or terms for the new
mortgage. The agency's sole restriction is that the MIDP payment
will be computed on mortgage terms at the typical rates
-------
prevailing in the area, unless there is reason for a valid
exception. The displaced person may obtain a fixed rate
mortgage, a variable interest rate mortgage, a mortgage with a
balloon payment, or any other legitimate mortgage. For example,
he or she could elect to get a $60,000 mortgage for 15 years at
11% and no points. He or she would be entitled to a mortgage
interest differential payment of $10,229.52 (based on a new
mortgage of at least the amount of old mortgage minus the
calculated replacement mortgage, for a term not less than the
remaining term on the old mortgage). Even though the mortgage
for 9.5% with 3 points is available, the mortgage for 11% is also
a prevailing rate mortgage.
The displaced person should be fully informed of his or her
options for new mortgages as well as the rudimentary skills
necessary for negotiating for replacement housing.
The agent may elect to provide to the displaced person the
estimated MIDP amount for a new mortgage of the same term and
amounts as for the old mortgage(s) only. The computations for
mortgages of shorter terms and lesser amounts would not be
provided. Instead, a statement would be provided as follows:
-------
You are eligible for a mortgage interest
differential payment of $ .
This payment is based on the remaining
term and amount of the mortgage on your
old dwelling and the current prevailing
mortgage interest rate of % interest
with points.
This eligibility is premised on your
obtaining a mortgage on your new
property for a term of not less than
months, the remaining term on your old
mortgage, for not less than
$ .
If you elect to obtain a mortgage in a
smaller amount or for a shorter term, a
recomputation will be required and your
payment will probably be smaller. Please
contact your relocation agent for the
necessary computations prior to
commitment to such a loan.
The computation for the actual amount of the mortgage interest
differential payment should be made as soon as all the new facts
are known. The necessary facts are:
Old Mortgage(s)
Remaining Principal Balance
Interest rate
Monthly payment
New Mortgage
Amount of new mortgage
Interest rate - new mortgage
points
Term
If the term of the new mortgage is at least as long as the
remaining term of the old mortgage, compute calculated
replacement mortgage, and deduct this amount from the old
mortgage to get the buy-down amount, to which you add the
7
-------
appropriate points, the sum of these two figures equals the
MIDP.
Multiple mortgages
If there is more than one mortgage, compute the buydown by
completing the computations for each mortgage using the terms of
that mortgage. If there is an old second mortgage that has a
higher interest rate than any available rate, the buy-down amount
will be 0, but you then add points to arrive at a MIDP; the
points are still eligible even though the new mortgage is at a
rate that does not exceed the old mortgage.
Variable rate mortgage
If the mortgage is a variable interest rate mortgage, use the
mortgage balance, interest rate, and monthly payment amount that
was in effect in the date of acquisition.
Home equity loans
If there is a home equity loan, use the lesser of the mortgage
balance on the date of acquisition or 180 days prior to the date
of initiation of negotiations. Use the interest rate and monthly
payment in effect for the lowest mortgage balance.
Mortgages with balloon payments
If the mortgage has a balloon payment, use the mortgage balance,
interest rate and monthly payment amount that was in effect on
8
-------
the date of acquisition. The monthly payment is normally
predicated on a term longer than the actual term of the mortgage,
so the computed remaining term will be greater than the actual
remaining term of the mortgage. Use of the computed remaining
term will provide you with the appropriate MIDP.
-------
Buy-down Mortgage Int
Acquired dwelling
Old mortgage
Old interest rate
xest Differential Terminology
the dwelling being acquired for a project
by the agency.
the remaining principal balance of the
existing mortgage on the acquired dwelling.
This is not necessarily the 'pay-off
figure since that can include penalties
and escrow credits.
the interest rate in effect on the old
mortgage at the time of closing on the
acquired dwelling.
Old monthly payment - the monthly payment, principal and
interest, that is actually required by the
mortgatge agreement on the acquired
dwelling.
the number of payments necessary to pay off
the old mortgage given the old monthly
payment and old interest rate. This is to
be calculated by the agent computing the
mortgage interest differential.
the amount of the mortgage entered into on
the replacement dwelling.
the interest rate being charged on the new
mortgage at the time of closing on the
replacement dwelling.
New term - the term of the new mortgage.
Remaining term
New mortgage
New interest rate
10
-------
Points
Prevailing interest
rate and points
Calculated replace-
ment mortgage
Buy-down amount
Hypothetical
monthly payment
MIDP
Estimated MIDP
the pre-paid interest or discount points
needed to secure the interest rate on the
new mortgage.
an interest rate and point combination
commonly available in the area. This may
be a range of rates and points. In special
circumstances, the prevailing rate may be
dictated by what the displaced person is
actually able to secure.
the amount which the agency calculates can
be financed at the lesser of the new
interest rate or prevailing rate which will
maintain either the old mothly payment for
the old term or the hypothetical monthly
payment at the new term when the new term
is shorter than the remaining term.
the difference between the old mortgage and
the calculated replacement mortgage.
the payment necessary to pay off the old
mortgage at the old interest rate for the
new term when the new term is shorter than
the remaining term.
the buy-down amount plus the points.
the amount the MIDP would be if the
relocatee secures a new mortgage for at
least as much as the calculated replacement
mortgage.
11
-------
USING THE HP 12C
- Turn calculator on
Clear financial memory
1. COMPUTING THE REMAINING TERM OF THE OLD MORTGAGE
Explanation Key entry Screen shows
Enter remaining balance
Enter interest rate &
convert to monthly
Enter monthly payment
Compute remaining term
50000
0.58
-458.22
174
2. CALCULATING THE MIDP
Enter interest rate (new
mortg.) & convert to
monthly
Enter remaining payments
Enter monthly payment
Compute replacement
mortgage
Compute points
Compute MIDP as follows:
Old mortgage - new mortgage (50,000 - 43203.11) =
add points
MIDP
0.79
174
-458.22
43203.11
1296.09
6796. 8<
1296.
$8092.98
12
-------
3. ALTERNATE CALCUIATIONS FOR SMALLER AND/OR SHORTER TERM
REPLACEMENT MORTGAGES
A. REPLACEMENT MORTGAGE IS I
REPLACEMENT MORTGAGE AMOUNT
Compute MIDP per 1 &2 above
Enter new (smaller) mortgage
Enter calculated replacement
mortgage amount & divide
Multiply the factor (.92586)
X the calculated MIDP (2-above)
HAN CALCULATED
43203.11
40000
0.92586
7483.70
$7483.70 is the MIDP for the smaller replacement mortgage.
B. SHORTER TERM REPLACEMENT MORTGAGE
Enter remaining balance
Enter interest rate for
old mortgage & convert
to monthly
Enter term of new mortgage
& convert to months
Compute hypothetical
payment
10
g
50000
0.58
120
580.54
Go back to 2 and calculate MIDP using the hypothetical payment,
new mortgage term & interest rate. (in our example, $580.54,
120 months and 9.5%, respectively)
Enter new interest rate,
convert to monthly
hypothetical payment
0.79
580.54
13
-------
new term
compute buy-down
compute points
120
44865.02
1345.95
MIDP computation:
old mortgage - buy-down (50000 - 44865.02)
add points
Total MIDP ------
C. SMALLER REPLACEMENT MORTGAGE -& SHORTER TERM
Compute MIDP based on full
calculated replacement mortgage
for shorter term (example 3 B.)
Divide actual (smaller) replacement
mortgage by buy-down computed per
3 B.
smaller mortgage
buy-down mortgage
multiply factor x MIDP
from 3B.
40000
44865.02
6480.93
enter
-
X
5134.98
1345.95
$6480.93
40000
0.89156
5778.16
The MIDP based on the shorter term and smaller amount (a
combination of examples 3A. & 3B.) is $5778.16, which includes
the points.
*NOTE: You will find the totals on the HP 12C programs will be
slightly different than the computed program or the TI program.
This is because the 12C reports the last period as a full
period, when it is actually a payment of less than a full
payment. This could be corrected, but the difference is usually
only a few cents and should not be of concern.
14
-------
USING THE TI Business Analyst & Radio Shack EC-100
- Turn calculator on
- Put calculator in Financial Mode
1. COMPUTING THE REMAINING TERM OF THE OLD MORTGAGE
Explanation Key entry
Screen shows
Enter remaining balance
Enter interest rate
convert to monthly
store in %i
Enter monthly payment
Compute remaining term
2. CALCULATING THE MIDP
Enter interest rate (new)
convert to monthly
store in %i
Enter remaining payments
Enter monthly payment
Compute replacement
mortgage
50000
7
0.5833333
0.5833333
458.22
173.99705
9.5
0.7916667
0.7916667
173.99705
458.22
4302.762
15
-------
Compute points
1296.082!
Compute MIDP as follows:
Old mortgage - new mortgage (50000 - 43202.762) » 6797.2376
add points 1296.0829
MIDP
Rounded
$8093.3205
8093.32
3. ALTERNATE CALCULATIONS FOR SMALLER AND/OR SHORTER TERM REPLACEMENT
MORTGAGES
A. REPLACEMENT MORTGAGE IS SMALLER THAN CALCULATED REPLACEMENT
MORTGAGE AMOUNT
Compute MIDP per 1&2 above
Enter new (smaller) mortgage
Enter calculated replacement
mortgage amount & divide
Multiply the factor (.9258667)
x the calculated MIDP (2-above)
43202.762
8093.3205
$7493.34 is the MIDP for the smaller replacement mortgage.
40000
0.9258667
7493.3362
B. SHORTER TERM REPLACEMENT MORTGAGE
Enter remaining balance
Enter old interest rate
convert to monthly
store in %i
Enter term of new mortgage
convert to months
50000
0.5833333
0.5833333
10
120
16
-------
store in N
Compute hypothetical
payment
120
580.54239
Go back to 2 and calculate MIDP using the hypothetical payment, new
mortgage term & interest rate. (in our example, $580.54, 120 months
and 9.5%, respectively)
Enter new interest rate,
convert to monthly
store in %i
hypothetical payment
new term
compute buy-down
compute points
0.7916667
0.7916667
580.54239
120
44865.018
1345.9505
MIDP computation:
old mortgage - buy-down (50000
Total MIDP
44865.018) 5134.982
add points 1345.9505
- $6480.9325
rounded 6480.93
C. SMALLER REPLACEMENT MORTGAGE & SHORTER TERM
Compute MIDP based on full
calculated replacement mortgage
for shorter term (example 3 B.)
Divide actual (smaller) replacement
mortgage by buy-down computed per
3 B.
smaller mortgage
buy-down mortgage
44865.018
40000
0.8915632
17
-------
multiply factor x MIDP
from 3 B.
6480.9325
5778.161
The MIDP based on the shorter term and smaller amount (a
combination ofexamples 3 A. & 3 B.) is $5778.16, which
includes the points.
*NOTE: You will find the totals on the TI and the HP 12C will
be slightly different from each other and from the computer
program. This is because the 12C reports the last period as a
full period, when it usually is actually a payment of less than
a full payment. This could be corrected, but the difference
usually is only a few cents and should be of no concern.
We have used a floating decimal place and carried the figures
out as far as the BA II screen shows. This was to avoid
rounding errors but is not necessary if you prefer to fix the
decimal place.
Turn BA II off
18
-------
APPENDIX IV
MISCELLANEOUS ITEMS
-------
The material presented in this appendix includes sample forms and
letters and other relocation related material.
The material is for use in advising displaced persons as well as
for becoming better informed relocation agents. The forms and
letters may be used in preparing an agency's own forms and
letters. They are presented for the generation of ideas and not
as required forms.
Some of the material was provided by the State of Nebraska
Department of Roads. We appreciate their assistance.
-------
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-------
One of the most unnerving situations that you
can oe 'acea with s 3 ccmoiamt 'rom 3 citizen
It 'akes a great aeai o1 s«»l ana salience to nan-
die complaints effectively *cw ,ou "andie me
situation can result "Ot only ir ust rearing uO Tie
problem out more importantly n mprovmg peo-
pie s Defection ol government '-cm 'hat of an
adversary 'o "ia' ot a 'neno Some points on now
to hanoie complaints are as 'onows
Defusing the Situtation
' Do not ma*e :ne citizen making a complaint
wart
a '< /ou are " 'ne middle ol an important
meefrg rvourof'ce exoiam tne situation
'o me person maKing the complaint and in-
dicate 'ne e^gm of 'ime t wui *ake *o con-
cede ii not oe Dusy anc ask "ie oerson ;o
cail again E/ei oe'ter get me person s
na"-e 3"d o-cne ->u— oer and -"turn me
can is seen as ocss.cie
: Maxir-q a r. tize" watt mav aocear *c De a
-,ooo sea is ' ji'ows ul
'ne QroDt tne situa-
tion were reversed9
5 ThmK aOOut ana prepare your -esponse
oefore vou answer Do not let your personal
opinions enter mto the conservation
5 Don : oe condescending Avoid using
•ecnmcai 'argon it ,5 important mat the per
son understands you I' you are unc'ear me
person -nay 'eei you are trying 10 contuse
-urn/her on purpose
SMILE & WAKE CTE GDUTACT
" MaKe sure fo soeaK ciearty and to maintain
3000 eye contact
6 Never mane promises Vou may "ot Be m the
position to mane a promise or unforeseen cir-
cumstances ~iay 'orce ther case me c tizen man.ng me
tc^C'ain' AH! oe extremeiv anorv ano wm pro-
paou cpmpiam again and much icude' and
s'-orger man oetore
doling
' indicate mat you want to wo« with me citizen
•o scave the propiem
2 Assure 'he person mat me complaint ias
Seen heard and mo'e importantly
unoe'SIOOO
3 Aiwavs reply to citizen complaints indicate
wnat has oeen done and wnat wm se done
'f "ie orooiem has not oeen solved .noicate
wnat you did ana why tne orooiem couio not
De solved
4 " me answer win (ane some time can me
citizen to indicate what you are aomg and me
appronmate time : wnl '.axe to produce an
answer
5 The person maKing me complaint should
•eave teeung tne prooiem has seen resoived
or soon will De or at least tnat some action
*ui oe tanen
6 " /ou can ' answer me prooiem or t me
answer is not satisfactory mvite tne oerson
•o soeaK 'o your DOSS ano give tne DOSS s
name and position
7 ChecK DaCK with the person mamng the com-
piamt 'o ensure tnat the solution is satisfac-
tory ?no ! 't 'S not to tma out wnat can De
aone to maxe it satisfactory
Responding to a Complaint
Tne Best way to respona to complaints is oy
letter Phone calls can pe easnv forgotten A let-
ter is wnnen proof tnat complaint was received
and tnat a response was made
i The letter should tollow a standard form
a In the upper right hand corner there snouid
appear
- your name
- vour position
- tne date
D In the ieti hand side there should Be tne
name and address ol tne person malting
the complaint
3 Second, indicate the research or study that
you did
•i Third state your conclusions based on the
•esearcn
5 Fourth clearly state wnat has Been aone and
what will De done Avoia maKing promises
6 Finally always thank the person with a com-
plaint 'or onnging the proDiem to your
attention
- These are some characteristics o' a good
letter
• to the point
• accurate
- answers tne prooiems
• "meiy
• does not use technical iargon
does not mane promises
Checklist of Dot and Don ts
DOS.
' Oo greet the person making a complaint with
a smiie
2 Do pay attention to wnat tne person has to
say
3 Do maintain gooa eye contact
•» Do sit up straight ano lean 'orwara slightly
5 Do assure the person mat tne complaint nas
oeen heard ana "hat you want to work with the
person to fmd a solution
6 Do respona to complaints, even it no solution
nas Deen found
DON'TS
• Don • make me person with tne complaint
«ait
C Don t interrupt the person
3 Don • 'old your arms and snuf le vour papers
J Don t iet /our personal opinions enter tne
conversation
S Don t o« condescending
6 Don ' use technical .argon
* Don t mane promises
Planning Ahead
' Organize a citizen complaint strategy to tram
employees m your department now to nanole
complaints properly
2 Emphasize to your employees tne importance
o* pemg courteous and friendly and working
with persons making complaints
3 Tie Key to preventing or at least reducing
tne numper ot complaints is effective com-
munication Citizens should Be informed of
protects m the planning stages They are at-
fectea oy hignway proiects Ignoring their
neeas m the planning stage perpetuates tne
myth tnat government doesn t give a hoot
ano plants the seeds of resentment tnat will
later Bear fruit as citizens complaints
a For large protects, mlorm citizens by public
meetings
-------
Dulling Frcjaet _
Buainaaa Location
Nonprofit Organisation County
Pan r*ro*a _
occunvr
Occupant'* Kama _ ovn«r Tenant
Addraaa of Proparty Raea
Raaidanca talaphona: ___^__________ Buainaea talaphona: _______
If raa: Singla fam. Duplax Hulti fa». Slaaping rm. Nobila MOM
If Businaas typa _____________ muaina_m naaa _________________
Typa of building: atoriaa: Const: ________________________
ir RzsiDnrriAi.
Ha»d of Houaahold: Aga Sax
Employad at: Addraaa:
Moda of traval to work: Diatanca to work (ona way)
No. of ear» and othar vahiclaa in family
othar Hoda
Faaily Mambara Hork or School of
Sanaa Ralationahip Aga Sax location Traval Diatanci
Total numbar of rma. Thaaa room* ara: Living Room ___ Sap Dining Room
Kitchan Badrooma: 1 , 2 , 3 , 4 , 5 Paaily JO. Dan Rac Rooa
Batha: 1 1-1/J 2 3 3-1/2 Utility R*. Baaaaant
Li»t utility bldga.
Garaga: l ear_ 1-1/J^ 2 2-1/2 3 . Carport: 1 car 2 car Othar
IT MOBILE HOME SHOW OUTSIDE KZASURDOHTS Naka Nodal *r. _
Patio aixa Typa undarakirting Awninga Othar
la Uiia thair principal 4 lagal raaidanca la it D3iS If not, why?
How long hava thay occuplad thia dwalling: Yaara . Montha __^_____
IF OWNER, whan did thay purchaaa? If TtKAMT, whan did thay rant
IF omra, approx. bal. of aortgaga $ If TEXANT, rant par aonth $
If OWKER, approx. »thly. aortgaga pymt $ If TDIAJIT, utilitiaa includad
(avg.)
in rant , If TZXAITT, coat of utilitiaa (not includad in
rant) if TZMAXT, groaa monthly ince*a of antire family f
[thia includaa: aalariaa, social aaeurity banafita, child aupport, aliaony,
waifara, intaraat, 4 ranta, axcapt aarninga of dapandant childran]
If thay will not provida thia information Aak ia it ovar: S500 , $1000 ,
$1500 , $2000 , $3000 /par month
DO TKTY TKIMK AT THIS TIKE TKTY MAXT TO: PUKCHASI A HP» HOKZ OR RDfT
what araaa ara thay moat intaraatad in
What typa of proparty would thay want: Acraaga: if ao numbar of «cra»_
lot
Singla family raa. Duplax , Mobila Homa , Apartmant
Othar
-------
Information obtained fro*: ______________ Data:
Information obtained by: ___
IF * working PARH or • BUSINESS:
Type of farming or bu«in«««:
Number of employeea: ____________________________
Deacriba Buildings: ___________________________
Raplacea-ne Sit*
Explain «ny anticipated relocation problt
POR AU,
Ooea property have: Public waear aupply _____ if Mo, what cyp«
Public ««war ayataa ___ if No. what typa
Caa __________ Elactncity _________ Propana
ou» A surra saoriK XPP-OXOIATI LOCATTOM or *rr OWPOOOCKD ncp«ov-nrxTs
IV OR CLOSE TO Tm UOT OP NAT, mica a* SaptlC t_l_U, drain tlalda,
utilltia*. walla, ate.
IT OWC OR NORZ OP TXZ OWNERS OP RZCORO ARE DECEASED:
Naaa of paraon dacaaaad __________________________ data of daath
Did thia paraon laava a Will? if ao, WBO racalvadtAia proparty?
IP TREY DIED WITHOUT A WILL, AND STIU. CUM THIS PRO>ERT« UST ALL KNOWN
HEIRS:
Spouaa or
Naaa of aingla. atraac
Hair Relationship wid. dlv. addraaa city atata up
-------
Nader Study Assails
'Corporate Welfare'
WASHINGTON (UPI) - The
annual budget deficit could be cut
by more than 1100 billion if the
government eliminated various
forms of "corporate welfare," a
new study by Public Citizen, a
Ralph Nader group, said Thurs-
day.
The study, entitled "Aid For
Dependent Corporations," de-
fines "corporate welfare" as the
amount the government takes out
of the pockets of taxpayers and
consumers and puts into cor-
porate coffers.
"Corporate AFDC programs
will cost taxpayers 12 times as
much as the poor people's pro-
gram, Aid to Families with De-
pendent Children," Public Citizen
President Joan Claybrook said in
a statement accompanying the
report. "It costs more than Medi-
care, Medicaid, veterans' medi-
cal care and child nutrition
programs combined — programs
that serve millions of Ameri-
cans."
Tax breaks in the form of cred-
its, deductions and other write-
offs head the list of corporate wel-
fare and represent "perhaps the
fastest growing segment of the
economy," the study said. It esti-
mated that such tax reductions
will cost the government about
|83 billion in fiscal 1986, up from
$7 billion in fiscal 1970.
Examples include the 10 per-
cent investment tax credit for
business, accelerated write-offs
for business property, tax-exempt
industrial development bonds and
expense account living.
Next on the list Is direct cash
grants from the government to
corporations, led by agricultural
subsidies distributed through the
Commodity Credit Corp. The
study said corporate farmers are
the major beneficiaries.
Together with grants from the
Economic Development Adminis-
tration and Urban Development
Action Grant and airline and mar-
itime subsidies, direct govern-
ment grants to corporations will
total $13.7 billion in fiscal 1986.
Other aspects of corporate wel-
fare, according to the study, are
direct loans at subsidized interest
rates and loan guarantees that en-
able high-risk corporations to bor-
row from private lenders.
Services and information pro-
vided to businesses at taxpayer
expense, government agencies
whose main purpose is to promote
business or to protect business
from competition, and laws re-
stricting competition or limit lia-
bility also contribute to corporate
welfare programs.
Together, the study said, all
forms of corporate welfare will
cost the government about 1107
billion in fiscal 1986, which begins
Oct. 1, if no programs are cut.
However, President Reagan's
budget calls for the elimination of
some of the items, such as Urban
Devlopment Action Grants, the
Economic Development Adminis-
tration and Export-Impost Bank
direct loans.
The Treasury Department's tax
simplification plan, which the
president has not yet embraced,
also calls for the elimination of
the very costly investment tax
credit and a modification of the
generous schedule for depreciat-
ing business property.
-------
-A.
ACRE: 43,560 square feet.
ADJUSTABLE RATE MORT-
GAGE: a home loan on which the
interest rate rises and falls accord-
ing to the prevailing rate on a cer-
tain index.
AMORTIZED LOAN: a loan
requiring periodic payments that
include interest and pan of the
principal.
ANNUAL PERCENTAGE RATE:
a measure of the entire cost of the
loan, including interest, points and
fees. Usually^higher than the loan's
interest rate"
APPRAISAL: an opinion of the
value of a property.
APPRECIATION: an increase in
value.
ASSESSMENT: a value placed
on a property for purposes of taxa-
tion.
ASSUMPTION: a buyer agrees
to take over repayment of an exist-
ing loan as part of the terms of a sale.
-B,
BUY-DOWN: a cash payment
(usually as points) to a lender in
order to reduce the interest rate to
the borrower for a specific penod of
time
-C,
CHATTEL: articles of personal
property, sometimes included in a
sale.
CLOSING: settlement, or the
occasion of completing the trans-
action.
COMPARABLE8 (OOMPS): pro-
perties similar to the subject
property, used to estimate its value.
COMPETfnVE MARKET ANAL-
YSIS: a method of valuing a
property from recent sales, current
listings, and properties listed which
did not sell.
CONFORMING LOAN: loan for
an amount of $168,700 or less.
CONVENTIONAL LOAN: loans
that are not FHA or VA, nor from
private parties.
COUNTER-OFFER: a new offer
made in response to a rejected origi-
nal offer.
CRS: Certified Residential Spe-
cialist, a designation awarded to
REALTORS who have obtained the
GRI designation, plus have com-
pieted prescribed advance courses in
real estate study. Only 9,700 of the
2 million licensed agents in the
cr untry have earned this desig-
m-.^on.
-D,
DOWER: right of a widow (or
widower) to a portion of the
deceased spouse's property.
-E.
EASEMENT: the right of one
party to use land belonging to
another, for a specific purpose.
ENCROACHMENT: the unau-
thorized intrusion of an improve-
ment onto another's lot.
EQUITY: the market value of a
property, minus the debt against it.
FANNIE MAE: Federal National
Mortgage Association, a secondary
mortgage market.
FREDDIE MAC: Federal Home
Loan Mortgage Corporation, a secon-
dary mortgage market.
FEE SIMPLE: complete owner-
ship of all rights associated with a
property.
FIXTURE: an object which has
been attached to a property so as to
become a part of it.
-G,
GD7T LETTER: a letter from a
family member pledging a certain
amount of money as a gift toward the
purchase of a property.
GINNIE MAE: Government
National Mortgage Association, a
mortgage-backed securities pro-
gram
GOOD FAITH ESTIMATE: an
estimate of closing costs.
GRI: Graduate REALTORS Insti-
tute, a designation awarded to
REALTORS who complete pre-
scribed courses of real estate study.
Only 20,000 REALTORS in the coun-
try have earned this designation.
HUD-l: the standard settlement
statement required by most lenders,
devised by the Department of Hous-
ing and Urban Development.
JUMBO LOAN: see non-con-
forming loan.
LOAN ORIGINATION FEE: 1 %
of the loan amount, charged by a
lender to make a loan.
LOAN TO VALUE RATIO: the
percentage of the market value of a
property a particular loan amount
equals.
-M.
MARKET VALUE: the cash
price that a willing buyer and seller
would agree upon, given full
exposure to the market, and dis-
closure of all information.
MECHANICS LIEN: a lien
placed against a property by unpaid
workmen or materials suppliers.
MULTIPLE LISTING SERVICE
(MLS): an organization of brokers
which facilitates exchange of infor-
mation on listings, often on
computer.
-------
-N
NON-CONFOBMING LOAN: a
mortgage loan for an amount of
$168,701 or more.
-P
PITI: a loan payment combining
principal, interest, real estate taxes,
and hazard insurance.
PLANNED UNIT DEVELOP-
MENT (PUD): individually owned
houses with common areas owned
together
PLAT: a map showing the loca-
tion and boundaries of a property
POINT: a charge made by a
lender equal to 1% of the loan
amount.
PRIVATE MORTGAGE INSUR-
ANCE (PMI): an insurance which
covers the lender for a loan amount
over 80% of a property's value.
-R,
REALTOR: a member of the
National Association of REALTORS,
which enforces the REALTORS Code
of Ethics. 770,000 of the 2 million
licensed real estate agents in the
country are REALTORS.
SECOND: a mortgage which
ranks behind the first mortgage on
a property.
SECONDARY MORTGAGE
MARKET: whereby mortgages are
sold by lenders to investors, thus
replenishing their cash supplies to
make further loans.
SETTLEMENT: day on which
atle is conveyed.
-T.
TITLE: the nght to or ownership
of a property.
TITLE INSURANCE: a policy
which protects the lender and/or
owner against undiscovered defects
m the title to a property.
-W.
WARRANTY DEED: a deed
which contains the highest number
of covenants and warranties, consi-
dered the best deed a purchaser can
receive.
WRAP-AROUND MORTGAGE:
a new mortgage that contains exist-
ing loans plus an additional loan
amount.
-------
What should I specifically look for in
a new home?
New home construction is changing all the time as
builders try to adapt designs to today's lifestyles, make
the most of living space, and incorporate new technology,
building materials, and equipment, while keeping prices
affordable Buying a new home is attractive because
everything's new. from floors to appliances Energy effi-
ciency (insulation, weatherstnppmg, energy-saving heat-
ing/cooling systems and electricity) is reauired by building
codes. Buying a new home while it's under construction
lets you choose paint, wallpaper, tiling, etc
Newness itself is a virtual assurance that your main-
tenance costs will be predictable, and a builder's warranty
(highly desirable) guarantees freedom from structural
flaws.
Here are some of the signs of good construction to be
checked out at the site:
• good carpentry throughout (well-fitted windows and mold-
ings, non-squeaking wood floors, even wall surfaces).
• solid structure with sturdy support.
• basement floors and walls that have no cracks or
damp spots.
• insulation that measures as advertised.
• everything in good working order (faucets, heating/
cooling systems, electrical outlets, etc.).
• a yard free of low. wet spots; grading that slopes
away from the home tor good drainage
How do I evaluate a resale home?
Homes with a past have special appeal. An existing
home is a settled place (literally): the foundation, the land-
scaping, the neighborhood, including its services, are
about where they're probably going to be for some time
The home has a lived-m look. Some rooms may be
larger than in new homes, woodwork has mellowed, the
yard is a generous size Its price may be lower (per
square foot) and its financing possibilities more flexible
than in new homes, especially rf you can ptck up an
assumabte mortgage
The thing to be on the look-out for is wear-and-tear:
• How firm is the foundation?
• How sound are the sills, walls, floors and ceilings?
• What kind of plumbing was installed, when''
• What's the shape and extent of the electrical system?
• What shape is the heating/cooling system in?
• What are monthly fuel costs?
• How well does the insulation protect the indoors?
• What will it cost you to remodel if necessary (espe-
cially kitchen and baths) or to make necessary repairs?
If in doubt—or just for your peace of mind—you can
hire a certified home inspector for a professional opinion.
What can I expect from a professional
home inspection?
The job of a professional inspector is to IOOK over every
maior part of a home, and write a report that juages tr>e
homes quality and condition.
A well-qualified building inspector (one with memoer-
ship m the American Society of Home inspectors) can
spot problems that you might not be able to see or get to
However, it's wise for you to accompany the inspector so
that you don't have to get the report secondhand
Expect problems to be clearly explained, repair
expenses closely calculated, maintenance costs esti-
mated, and a written report delivered within a day or two
Remember you are buying a resale home; the price
reflects the fact that nothing is new.
The territory covered by inspection includes:
Exterior, the foundation (tor holes, cracks), the gutters
and down spouts (for gaps in joints, sagging), siding (lor
warp), paint (for peeling, blistering), windows and doors
(tor cracks, loose caulking), roof (for worn or bald spots),
chimney (for tilting, loose bncks or stones), driveways,
retaining walls and walks (for holes, sagging, cracks),
grounds (for proper grading and healthy landscaping)
Interior general structure (for soundness, rot), floors
and stairs (tor squeaking, shaking, bowing), plumbing
system (for condition of pipes and fixtures, leaks, clog-
ging), heating/cooling system(s) (for condition and capac-
ity), electrical system (tor age condition, adequacy of
voltage and outlets, proper grounding, signs of wear),
insulation in walls, attic and basement (for thickness and
efficiency), walls (lor cracks, loose plaster signs of leak-
age), kitchen (age and condition of appliances and
plumbing).
What's the secret in making a good
condominium buy?
Buying a condominium means, in most cases, buying
amenities—neighborly lifestyle, sometimes complete with
shopping, entertainment, playgrounds and/or sports facil-
ities Condominiums serve almost every possible kind of
homebuyer angles, families with children, retired people
First-time buyers are particularly drawn to condominiums
because of the amount of space available at a reasonable
price
Each condominium association has its own rules, and
as a member of your community you help govern what
can be done to the outade of units, whether or not chil-
dren anchor pets are welcome, what landscaping and
community improvements are made, and what by-laws
are passed or amended Because the owners association
can spend tof amenities or limit spending to save
This material is reprinted with the permission of the Gooder Group. It is not
Group publishes a Home Buyers Handbook and a
Virginia 22031-4901. Ask for discount prices on bulk orders.
-------
Proceed with
caution when
buying house
By H. KENNETH SEEBER
Buying a home is probably the
largest financial investment that
most people ever make. Consumers
need to recognize that house hunting
is not a game but a senous responsi-
bility. The risks are great.
Sometimes buyers can lose sight
of what's really important They will
bargain for days over the type of car-
pet they want in the house, but don't
shop around for the best financing
available. They assume that if they
play their cards right, everything will
take care of itself.
This can lead home buyers to
make a number of mistakes when
buying a new home, such as:
• Not getting it in writing. When
customers accept a verbal agree-
ment instead of a written contract
they lose control. If there is a dis-
pute, it boils down to one person's
word against another.
• Not shopping around for fi-
nancing. A quarter of a percentage
point difference in interest rates can
mean the difference between qualify-
ing for a home loan and being reject-
ed, not to mention the thousands of
dollars it will cost borrowers over the
life of the loan.
• Not reading the financing fine
pnnt. When people find good financ-
ing, they often forget to ensure that
the commitment on the loan is long
enougn to last until the construction
on their new house is complete.
Many homebuyers are faced with
getting a commitment on a home
that is under construction, and then
finding that the commitment expires
before the house is completed.
• Not performing a thorough
walk-through. When people are not
attentive during their walk-through,
they often miss many cosmetic prob-
lems that can cause annoyances later
on. Rather than disputing these
problems with their builders after
the house has been purchased, buy-
ers should perform a careful and
thorough walk-through before the
sale.
• Not taking time to read their
warranty document. Many builders
provide a warranty but unfortunately
all warranties don't cover the same
items. Consumers should ask to see
what is and is not covered under the
warranty and whether or not the
warranty is insured in the event
something happens to the builder.
The most recognized home war-
ranty and insurance program provid-
ed by builders today is Home Own-
ers Warranty's Ten-Year Protection
Plan. It is the only such plan en-
dorsed by the National Association
of Home Builders.
HOW builders provide a two-year
warranty, which HOW insures, and
an additional eight years of insur-
ance against major structural defects
in the home.
H. Kenneth Seeber is president
of Home Owners Warranty
Corporation.
-------
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Agents
^ AGENTS, From PAGE 11
and sellers during the time
before closing.
Hainge recommends giv-
ing the prospective buyer a
list of what will be needed at
loan application time. "It
should be done early in the
process, preferably during
the qualifying interview, so
that problem areas can be
spotted early and corrected
before the application proc-
ess even begins," said
Hainge.
The author also urges in-
structing the prospect to
give the loan officer every-
thing he requests through-
out the loan process. This
preparation is, according to
loan officers and processors,
the most overlooked el-
ement of the loan process.
"One of the most impor-
tant skills you should have,"
said Hainge, "is the ability
to qualify buyers for the
maximum loan payument
they can carry for conven-
tional and governmental fi-
nancing." Qualifying
prospects ahead of time
gives homebuyers an accu-
rate picture of their loan ca-
pability and limits the
homes shown to those that
they can afford, thereby
saving everyone's times.
Also, the obligation to
sellers will truly be fulfilled.
"Their home won't be shown
to unqualified prospects,"
said Hainge, "and you can
better advise them as to
whether or not the prospect
making an offer seems qual-
ified for the loan."
Hainge reviews re-
sources for real estate sales
agents to gain the financing
knowledge needed to best
serve their sellers and buy-
ers.
-------
Income/Mortgage
Guide ._
How Much Home Can You Afford?
As a general rule, you'll want to spend 28-35 percent of your household
income on housing. This table shows approximately how much mongage
a person with your income can afford at rates of 9, 10 and 11 percent.
For example, if your household income is $50,000, you can afford a
$135,000 mongage. This loan is based on a 30-year term with a 10 per-
cent down payment.
'Taxes and insurance are not included.
Annual
Income
Monthly
P/I at 9%
Monthly
P/I at 10%
Monthly
P/I at 11%
Mortgage
Amount
$20,000
$434
$474
$515 $54,000
$30,000
$652
$711
$772 $81,000
$40,000
$869
$948
$1,029 $108,000
$50,000
$1,087
$1,185
$1,287 $135,000
$60,000 $1,304
$1,422 $1,544 $162,000
$70,000
$1,521
$1,659
$1,801 $189,000
$80,000
$1,739
$1,896 $2,058 $216,000
$90,000
$1,956
$2,134
$2,316 $243,000
$100,000 $2,174
$2,371
$2,573 $270,000
-------
Local Inspection Firms
Adding Testing Services
INSPECT, From F3
ruled out radon testing, but he is
skeptical.
"Because you have such a short
[time] window it should be called
screening rather than testing," he
said.
Adding an asbestos-testing ser-
vice is proving less popular among
home inspectors. The ASHI survey
did not pick up any statistically sig-
nificant number of inspectors who
provide that service.
Affiliated Building is one local
company that does do asbestos
work, charging customers who are
already getting a standard inspection
$50 per sample collected from vari-
ous parts of a home, which could in-
clude the boiler, heating pipes, floor
tiles, plaster, appliance parts and
roof shingles.
Only about 4 percent of its cus-
tomers request such testing, Wasson
said.
Claxton Walker & Associates will
collect and send asbestos samples to
a laboratory at no charge, but the
customer will have to pay the lab for
the analysis, said Kent A. Boucher,
the firm's vice president.
Home-Tech sent two of its inspec-
tors to the Georgia Institute of
Technology for asbestos certifica-
tion last spring in anticipation of a
surge ui this business, Stoeppel-
werth said.
"The banks are beginning to want
certification that there is no friable
asbestos m a residential property.
We think this testing is going to be-
come commonplace," he said.
Home-Tech charges $200 for the
service.
ASHI executive director Robert J.
Dolibois said, however, that he is not
convinced that home inspectors will
rush to meet any increase in demand
for the service.
"Asbestos [detection] is some-
thing you just cannot do visually, so
getting the lab results back is a real
tnck in a two- to three-day turn-
around time. That, I think, contrib-
utes to the limited response among
inspectors," Dolibois said.
There also has been an increase in
concern about lead in drinking water
and the paint of older homes. More
inspectors are conducting water-
firms offering the tests, according to
the ASHI survey.
Although water testing is usually
ordered by the purchasers of rural
houses using private water systems,
more and more urban home buyers
are seeking the service, Wasson
said.
"It is imprudent not to have your
water tested, and not just for lead,"
he said. He added, however, that on-
ly one in 300 or 400 of his inspection
customers does so, paying $50 per
sample for the service.
The House Master franchise in
suburban Maryland and the District
charges $100 or more for a lead
analysis of either water or paint.
Inspectors in other parts of the
country are providing other services
that have not caught on here.
A quarter of ASHI's members will
conduct termite inspections, for in-
stance, but no local inspectors do so,
according to a number of sources.
Such inspections are done here by
companies specializing in pest con-
trol.
Doing audits of homes' energy' ef-
ficiency under a sales contract also
may be in the inspection industry's
future.
John Nevin, an official with the
Federal National Mortgage Associa-
tion, the largest purchaser of home
loans in United States, said his com-
pany would like to push more mort-
gages that allow borrowers to quali-
fy for larger 'loans based on
projected utility savings in energy-
efficient homes.
Such mortgages have not caught
on, however, he told a recent confer-
ence on energy efficiency here, in
part because of a shortage of energy
auditors.
Home inspectors also see their
primary business, the basic inspec-
tion, expanding beyond resale home
customers. They are increasingly
called on to inspect newly construct-
ed homes and structures owned in
common by condominium associa-
tions.
Homeowners also are starting to
find that lenders are asking for in-
spections when they apply for re-
modeling loans or home-equity cred-
it lines, and that insurance
'-omoanies are asking for inspections
-------
THE W
Inspection Firms Expanding Services
More Homes Are Being Tested for Radon, Asbestos and Lead
By H. Jane Lehman
Specul to TV Wu*n«!on P
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-------
>• PARNELL, From PAGE 3
will note that I have excluded an income of $3,000 per month
since the loan amount qualified for really puts one in the FHA
category.
GROSS
INCOME
'4,000
'5,000
'6,000
PRINCIPAL &
INTEREST
« 918
•1,148
•1,377
LOAN AMOUNT AT AN
INTEREST RATE OP
9% 9tt% 10%
'114,090 '109,180 '104,600 '100,360
'142,680 '136,530 '130,820 '125,500
'171,140 '163,760 '156,910 '150530
And again taking the loan amount shown above and dividing
by .95 will produce an approximate sales price, if your second ra-
tio isn't exceeded.
Xow, what should you infer from these numbers? Well for
openers, with a larger down payment the ratios are easier, since
you have more of your own money in the property and the risk to
the lender is reduced. Second, when your down payment gets
less than 20 percent you will generally have to purchase mort-
gage insurance. And third, you probably can qualify for more
than you thought you could. My advice is to get together with
your favorite real estate professional or lender and get yourself
qualified. That way you can get on to the joy of owning your own
home.
So much for that. Let's take a minute and discuss this real
estate market. In this area, there are generally three kinds of
buyers. The first time buyer—the move up buyer—and the "be-
ing transferred to the DC area" buyer. The first and last cateeo-
ry generally support the middle category. Even in a somewhat
slow period like we've seen over the past few months, this mar-
ket is still about the best in the country. There are a number of
real estate agencies which offer programs for all the categories
above. Some offer seminars for the first-time buyer, some offer
relocation sen-ices for both in-bound and out-bound families.
Most lenders offer speicalized sen-ices for these categories also.
In short, the meti 'politan Washington area is a dynamic market
with a superb array of professional real estate agents and lend-
ers. I know of no other area which has so much to offer. And I
really don't understand a "rent now-buy later" mentality which
some folks have. In my opinion, buying a property in this market
should be everyone's first priority. Ownership and the tax bene-
fits which accrue far outweigh any perceived negatives. And, al-
most anyone can own something. Start small and end big, I al-
ways say.
Well so much for this week's musings. Here's a weekly dic-
tionary that was held over from last week. Have a great day!
Weekly Dictionary
Covenant—A promise that the borrower makes to the lender in
order to obtain a mortgage. Example: Covenant of Insurance
which requires the borrower to maintain Hazard Insurance on
the property.
Land Contract—Also called a Contract for Deed or Installment
Contract, this enables the seller to finance the buyer by permit-
ting the buyer to make a down payment followed by monthly
payments with title to the property being retained by the seller.
Escheat—The reversion of property to the state when a peson
dies without a will and leaves no heirs. This can also occur when
property is abandoned.
Bill Parnell is a mortgage banker with Guild Mortgage Co.
His address is 3959 Fender Drive, Fairfax, VA 22030.
-------
Calculate Your
Mortgage
How much wittyour new home cost?
With today's consantryfhicnatingiriimat ones, you'll want to kcepmte
quick-reference mortgage chart hand)-. Thte chart riwws you tbe moodily
principal and interest payments oo a 30-year loan. Tbcalnihnr your
mnrrjpfjr n imply fiiiil ilii linn innuini fi» jinn Imnir mfl rnm 11 i 11 IK i
it with the current me.
Amount 8% •'/»% 9«
10% IO'/I% 11%
15*
»60.000 440 461 4»3 505
549 >71 »»4 «I7 <40
170.000 514 55»
614 640 ife7 4»3
747 T74
tSO.OOO M7 615 644 673 702 752 74U 7»2 «25 154
190.000 660
734 757 7»0 «25 »57
»6l »»6
» 100.000 754 769 »05
«7« »15 »»2 99O 19>9 1067 »O6
1110.000 »0?
M5 92;
1006 IO*« 10>9
1174 1217
> 120.000 Ml 92? 966 1009 IO5? IPX H<3 IIM 12»t IMI 1527
tl?0.000 954 IOOO IO46 1093 1141 ll>9
1>T7 14M
1140.000 1027 1076 1126 1177 1229 IM1 135?
1440 I4»4 l»4»
» 1 50.000 1101 1H5 H07 U61 1316 1372
14»S
KOI 16»9
» 160.000 1174 1230 U87
I4O4 1464 U24 IM4
I7O» 1770
1170.000 1147 IMTT l»6< 1429 1492 1»5 1619 1 6*4 1749 I«U
$180.000
I»M 144« 1514 1»»0 164- 1714 17«3
1921
1190.000 l>94 1461 H29 H»8
1738
IM2 1»»4 MM Z102
1200.000 1468 1558 16O9 1682 17»5 I»M) 19O5 19<1
2135 22 U
1210.000 1541 1615 1690 1766 1 84 3 1921 20OO MM) 2l6() 2241 2525
1220.000 16U 1692 1TTO U»0 1951 2012
1179 216> 3>4» 24M
1230.000 I6M 1769 1851
2O18 21O4 2190 2278 1566 2455 2»44
» 240.000 1761 IMS 1931 2018 21O6 2195 22»6 25^7 3469 2X1 2655
1250.000 ISM 1922 2012 2102 2194 228" 2J«1 2476 2572 2668 2766
Clip 6 Sat* j
PITI
PITI is the abbreviation used to
describe a regular monthly mort-
gage payment. The figure includes
the dollar amounts you pay per
month for principal (PJ and interest
(I) on your loan, and the taxes (T)
and hazard insurance (I) on your
property. Often a payment will be
described as PI, principal and
interest only - usually in conjunc-
tion with discussing the types of
financing available. Don't forget
that you then have to add the TI for
the property you decide to pur-
chase, to come up with your total
monthly payment. Sometimes your
payment will also include private
mortgage insurance (PMI) and pos-
sibly your home owners association
dues (HOA).
-------
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Money Talks
by Jean C. Dryer
Vice President, Washington Financial Ttoist
The Mortgage Loan Process
It is helpful to have a bird's eye view of the loan process as you begin to
finance your new home. The chart follows a loan from application through
the settlement, insuring, guaranteeing and recycling of funds.
piaHflrarion BBBBBBBBBB Homebuyer meets with lender to ascertain
size of loan, pending credit approvals and appraisals.
C
••Consumer Protection __
Troth to tendmg-grres rate interpreted with points, APR.
•RESPA-Estimate of dosing com.
Appraisal ordered
VA—Through VA appraisers
FHA—Through FHA lenders, staff appraisers, for FHA agency appraisers.
Cotmstionai—Throngh tender's staff appraisers
Credit reports ordered through authorized credit
agencies. Verifications sent to employers,
bonks, mortgage company.
reoiiired to process toe loan.
All documentation back to lender: Credit report, appraisal all verifications.
—j
Loan packages must be approved (meets qualifying guidelines)
it may go toVA/FHA or an investor representing me lender.
T
Onceamiioml Settlement can be scheduled, (allow time for final documentation: Termite dear
• certificate, well-water certificate, hazard insurance policy, etc.)
Settlement lakes place in your title company or attorney's office.
• The seller and purchaser will attend. Purchaser's funds
• (certified) will be required. Lender's check will be present
After Settlement The settlement documents must be recorded, returned
to the lender and submitted to VA/FHA/Imtstor
-------
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-------
RATES AND POINTS
*> PARNELL, From 3
at the time of the original
loan application, as well as
the ARM information
disclosure describing the
specific ARM loan applied
for. The consumer must
receive an ARM disclosure
with the original
application, or when non-
refundable fees are paid.
whichever is earlier. An
applicant for an FHA ARM
must also receive a Worst
Case Scenario.
If a borrower applies for
a refinance loan in which
the borrower's primary
residence is being used as
collateral for the loan, the
borrower has the right to
cancel the transaction for
three business days after
the loan documents have
been signed. Thi.- "nirht of
recission" may not be
violated. i
Well *o much for the
legal le>>on.
Weekly Dictionan
Grantee—The ]>ei>on to
whom an interest in real
property is conveyed.
Grantor — The person
conveying an interest in
real property.
Forebearance — The act of
refraining from taking legal
action despite a mortgage
being in arrears.
Home Owners Warranty
(HOW>— Warranty on
major elements of a
structure, such as plumbing
and roof, for a specified
period, usually one year.
Can be used by a new-home
builder in lieu of some
interim FHA or V A
inspections.
And that's the end of this
tune. Hope everyone has a
great day. My philosophy is
that even' day is a great
day — some days are just a
little bit better than others!
Bill Puniell L" 3
banker with Guild
Company, the
private murtpxpe
comjwny in thr L'.S. Hi.-
Drive. Suite KH>. Fnirt;i\.
-------
ESTATE lAW/By KENT KIDWELL
A question that arises frequently at the settlement
table is whether I have given the sellers proper credit for
their most recent mortgage payment when calculating the
amount of money required to pay off the mortgage on their
property.
Normally, as I review the settlement statement with
the sellers and advise them of the amount needed to pay
off their mortgage, I provide them with a copy of the
payoff statement which I have received from their lender.
Invariably, one of the sellers will say:
"Mr. Kidwell, this balance is higher than the lender
told us. They told us that the payoff balance was $100,000
after our September payment, and here you show that our
payoff amount is $100,850. We made our Septmeber
payment and this statement must not give us credit for it.
I can show you my checkbook register. I sent in the
September payment on August 31. Can we call the lender
to verify that they received the payment?"
I respond that I would be happy to call the lender but
that the settlement statment which I have prepared on the
basis of the information provided to me by the lender and
the lender's payoff statement itself both give credit for the
September payment. I explain that the current payoff
balance of the mortgage is higher than they expected it to
be because settlement is occurring today, September 29,
and interest has accrued on the unpaid principal balance of
the mortgage for 29 days. If the mortgage had been paid
off on September 1 immediately after the September
payment had been made, then the payoff balance would
have been $100,000 and not $100,850.' The September
payment paid interest which had accrued on the mortgage
balance during the month of August. Unlike rent which is
paid in advance, mortgage interest payments are made
only after the borrower has had the use of the lender's
money for the preceding month. Since eetttlement is
taking place on September 29 almost a full month's
interest is owed. Were the mortgage loan not to be paid
off, the October payment would pay the 29 days of
September interest, plus one additional day.
H. Kent Kidwell lives in Herndoa and is a partner at
the lawSrm Kidwell, Kent & Sulliv&n in Fairfax City.
Readers with questions may write to Woodaon Square,
9695 C Main Street, Fairfax, Virginia 22031.
-------
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-------
IT'S YOUR MONEY/ByJ. MICHAEL MAY, ChFC, CLU
Following are four very
important risk management
concerns: Homeowners' or
Renters' coverage, Automobile
coverage, Personal Umbrella
coverage and Medical coverage.
Let's take a brief look at each.
Homeowners' or Renters'
Coverage
• Dwelling—Insure
approximately 80 percent of
market value to maintain full
coverage. Review annually!
More than half of all homes are
under-insured—is yours one of
these?
• Personal property—Determine
if your jewelry, art, silver,
collectibles, and other personal
property are insured for their
actual replacement costs. You
should schedule and have
appraisals to insure full
coverage.
• Comprehensive personal
liability—Unlimited potential
loss: $300,000 base required for
most umbrella policies.
• Other Structures—typically
limited to 10 percent of home
value. Is this sufficient to cover
costs of swimming pools,
garages, guest homes, etc?
Automobiles
• Liability—at least $100,000.
High-income people need
$300.000 to provide base for
umbrella policies.
• Deductibles—May be practical
to increase deductible amount
and reduce premiums.
• Property collision—On older
cars, consider dropping this
coverage.
• General—Check to see if your
premiums are as low as they can
be for your situation. Determine
whether you have taken
advantage of proper
classifications: including multi-
car discounts, good student
discounts, safe driving
programs, etc.
Personal Umbrella Coverage
• $1,000,000 or more. In view of
the substantial court
judgements, this coverage is
essential to high-income
earners or to those with a
significant net worth.
Medical Coverage
• Your insurance policy should
include a "catastrophic" major
medical coverage for
$1,000,000 or more. Liberal
family benefit maximums
would be desirous in case of
common accident.
• Be sure that any internal
policy limits are in line with
customary hospital and medical
expenses in your area.
• Small deductibles greatly
increase premiums. An
"emergency" fund to handle
unexpected medical bills would
allow a higher deductable and
potential savings to you.
• Your plan should have a stop-
loss feature, providing 100
percent coverage after your
initial out of pocket expenses.
If you haven't lately, I
suggest you contact your
insurance agent or financial
planner for a thorough analysis
of all your insurance needs,
including life and disability
coverage as well as the above
areas.
Michael May is president of
May Financial Services, Inc.,
in Reston.
-------
3LC.
THE MORTGAGE RATE CHART
Lender
Perpetual Mortgage Co.
American Home Funding *
Margaretten/United Mtge.
Trustfoank Savings F.S.B. *
First Washington Mortgage
CityFed Mtg./Kfcsell Dlv.
Ameribanc Savings •
B.F. Saul Mtge. Co. •
NVR Mortgage
Ahmanson Mortgage
Mortgage Funding Corp.
Dominion Bankshares Mtg. *
Fort Worth Mortgage *
Developers Mortgage Corp. *
Atlantic Coast Mortgage
Carey Winston Co.
First National Mortgage
Amertstar Financial
Capitol Mortgage Bankers '
Hot. type
30-year fixed
15-year toed
. i-»»*ra<»L
30-year fixed
15-year toed
1-veeradj.
30-year fixed
15-year fixed.
1-yewad*.
3fryeer fixed
15-year fixed
1-year adj.
30-yeer fixed
15-year fixed
1-year adj.
30-year fixed
15-year fixed
1-year adj.
30-yeer fixed
15-year fixed
1 -year adj.
30-year fixed
15-year fixed
i -year adj.
30-year fixed
15-year fixed
1-year adj.
30-year fixed
15-year fixed
1-year ad).
30-year fixed
15-year fixed
1-year adj.
30-year fixed
15-year fixed
1-yeoradj.
30-yeer fixed
15-year fixed
1-year adj.
30-year fixed
15-year fixed
1-year «d).
30-year fixed
15-year toted
1-year adj.
30-year fixed
15-year fixed
1-year ad[.
30-year fixed
15-year fixed
1 -year adj.
.'30-year fixed
15-year fixed
1-year adj.
30-year fixed
15-year fixed
1-year adj.
90 and SO Percent Loam
Note rate Tola) points Loan ftmit
9%%
9H%
8VtK
• 9%%
ftAA .A*
SfWw
8VM6
9%%
9*%
8%%
9%%
9*4%
8%
9*4%
9%%
8*4%
9*4%
9H%
8Vi%
10%
944%
8%%
9'/4%
9*4%
8%
9%%
9*4%
8Vi%
10*4%
10.15%
8VS%
9%%
9W%
7*4%
9H%
9V4%
8%%
9H%
9W*>
9%
10%
9*4%
8Vi%
9%%
9W%
8%
9*4%
9V4%
7*4%
97/i%
9V4%
8*4%
9*4%
9*z%
8%
10%
9'/i%
8V*%
3V*
3*
3H
3
2*4
3
3W
3V4
3V4
3V4
2V4
3
3V*
2*
3
3Vj
3
3
2*4
2V4
3
3V4
2*4
3
2*4
3
3
2
2
2*4
3
2ft
2*4
3
3
3
3Vi
3
3
2V4
2V,
2tt
3V«
3W
3V-.
3
2H
2V4
3
3
3
3W
3V.
3
3
2H
3
$187,600
$187,600
$250,000
$187,600
$187,600
$187,600
$187.600
$187,600
$250.000
$187,600
$187.600
$187,600
$187,600
$187.600
$300,000
$187.600
$187,600
$250.000
$187.600
$187,600
$187,600
$187.600
$187.600
$350.000
$187.600
$187,600
$300.000
$187,600
$187,600
$300.000
$187,600
$187.600
$187,600
$187.600
$187,600
$300,000
$187,600
$187.600
$300,000
$187,600
$187,600
$250.000
$187.600
$187.600
$250,000
$187,600
$187,600
$187,600
$187.600
$187,600
$300.000
$187,600
$187.600
$300,000
$187,600
$187,600
$250,000
80 Percent Loam above $187,600
Note rate Total points Loan limit j
10V4%
10W%
8Vt%
10H%
10Vi%
8V4%
10Vi%
10V<%
8V4%
10W%
10V4%
8Vi%
10H%
10%
8*4%
10V4%
10tt%
8Mi%
10Mi%
10V4%
8*4%
icm%
10H%
8%
10H%
10Vi%
8V4%
11%
10*4%
8%
10V4%
10%
7V4%
1CW%
10V4%
8*4%
10*4%
10*4%
9%
10V4%
9V.%
8Vi%
10V4%
9*4%
8%
lOV-1%
10%
8%
10*4%
10*%
8*4%
10Vi%
10V4%
8%
10*4%
10W%
8V4%
3
3
3*
3
3
3
3
3
3V4
3
2
3
3
2V6
3
3
3
3
2*t
2*
3
3
3
3
3
3
3
2
2
2%
3
3
2*i
3
3V4
3
1V4
1V4
3
2V*
3
2Vi
2
3V.
3Vi
2*4
3
3
3
3
3
3Vi
3V4
3
3
3
3
$500,000
$500,000
$350,000
$500.000
$500,000
$500.000
$500.000
$500,000
$350,000
$500.000
$500.000
$500.000
$500,000
$325,000
$499.950
$500.000
$500,000
$500,000
$500.000
$500.000
$500.000
$500.000
$500.000
$500,000
$500.000
$500,000
$500.000
$500.000
$500.000
$500,000
$600,000
$500.000
$500.000
$400,000
$400,000
$500,000
$500,000
$500,000
$500.000
$500,000
$500,000
$350,000
$450,000
$500,000
$350.000 ;
$500.000
$500.000
$500,000
$500,000
$500,000
$500,000
$500.000
$500.000
$500.000
$500.000
$500.000
$500,000
I Mortgage rate often change dalty. For free daily rate quotes 24 hours a day from some. Washington-are* lenders, including tttos* marked with a • abovt.
call Touch Rates Hotline at 258-1000 and press 2500 when asked to enter user t.D. number. Local otters witn a touch-tone tewonone can obtain
information on fixed rates for 30-year loans, ant tut thn» yoi -etfruttabte-rate mortgages and VA and FHA Quotes The mortgage rate information aoov*
s compiled from the Peeke Report (8W37525Twhicri surreys more than 100 terriers r»ere eacf> week. The tist of 19 lenders, some of the largest in the
Washington area, is compfled by the real estate reporting service of Rufus S. Lustc I Son Inc. A blank listing means no rate quote was available this week
Information provided does not constitute »loan offer or commitment by the lenders. These rates are subject to change without notice and may be lower or
higher than those of other lenders in the Washington area Each point paid is roughly the eguivXeot of one-eightn of a percentage point on the interest
rate. The Umt on the entountef £yetr ed|utt*bi» rale mortgages may vary depsf»*Bg on the sae ef the oown ptyment
-------
THE MORTGAGE
Lender
Perpetual Mortgage Co.
American Home Funding
B.F. Saul Mtge. Co. *
Trasttoank Savings F S.B. *
Dominion Banksnares Mtg. *
i
Mortgage Funding Corp.
Note type
30-year fixed
15-year fixed
1-year adj.
30-year fixed
15-year fixed
1 -year adj.
30-year fixed
15-year fixed
l-yearad|.
30-year fixed
15-year fixed
1-year ad|.
30-year faed
15-year fixed
1-year ad|.
30-year fixed
RATE CHART
90 and 80 Percent Loan*
Note rate Total pomts Loan limit
9V*%
9%
8Vi%
9H%
9%
7V»%
9tt%
9%
7Vi%
9*%
8ft%
7*%
9W%
9%
77'i%
9V.%
2H
3%
3
2%
3
3
3V4
3H
3
3V.
3
3
3
3
3W
2V.
$187,600
$187.500
$250.000
$187.600
$187,600
$187,600
$187,600
$187.600
$350,000
$200.000
$200.000
$200,000
$187.600
$187.600
$300.000
$195.000
80 Percent Loans above $187,600
Note rate Total points Loan limit
9H%
10%
7'/»%
9K%
10V4%
7T't%
10%
9*4%
7Vj%
97/i%
9**%
8%
9*.%
9*4%
7'/t%
9*4%
37/a
3
3
3
2*4
3
3
3
3
3V.
2
3
3^
3
3Vi
3V.
$500.000
$500,000
$500.000
$500.000
$500.000
$500,000
$500.000
$500.000
$500,000
$500.000
$500,000
$500.000
$500.000
$500.000
$500.000
$600.000
15-year fixed
1-year ad).
9%
3 "A
$195.000
$195.000
8%
$600.000
$500.000
Ahmanson Mortgage
30-year fixed
15-year fixed
1-year ad|.
8.45%
2
2
2*
$187.600
$187.600
$300.000
108%
106%
795%
$500.000
$500.000
$500,000
First Washington Mortgage
30-vear fixed
15-year fixed
1-year ad|.
8%
$187.600
$187.600
$250.000
97t%
8%
3
3
2',3
S500.000
$325.000
$325.000
CityFed Mtg./Kissell Drv.
30-year fixed
15-year fixed
1-year ad).
9%
87/t%
2*4
$187.600
$187.600
$250,000
10'Y*
$500.000
$500.000
$500.000
NVR Mortgage
30-year fixed
15-year fixed
1-year ad).
9Vi%
3
2H
3
$187.600
$187.600
$300,000
10%
9'.%
&'•<•%
$500.000
$500.000
$500.000
Fort Worth Mortgage'
30-year fixed
15-year fixed
l-yearad|.
9%
8%
2V*
$187,600
$187.600
$187.600
2V7
8%
$500.000
$500.000
$187,600
Atlantic Coast Mortgage
30-year fixed
15-year fixed
1-year ad).
3V.
9%
$195.000
$195.000
$187.600
3V,
3
7*4%
$500.000
$350.000
$187.600
Developers Mortgage Corp. * 30-year fixed
15-year fixed
1-year ad|.
9'/4%
8%
$187.600
$187.600
$250,000
10%
97/i%
8%
2V?
2'/2
$500.000
$500.000
5350.000
Amenbanc Savings *
30-year fixed
15-year fixed
1-year adj.
9%
77/i%
3Vi
3
3
$187.600
$187.600
$187.600
10%
9%%
8%
2 H
2'/4
3
$500.000
$500,000
$500.000
Norwest Mortgage *
30-year fixed
15-year fixed
1-year ad|.
9%
$187.600
$187.600
10% 2Vi
10% 2*4
7'/i% 3
$500.000
$500.000
$500,000
Franklin Mortgage *
30-year fixed
15-year fixed
1-yearad}.
9"/4%
$187600
$187.600
$300.000
10%
9W%
T/t%
r/§
2
$500.000
$187.600
$500,000
NCNB Mortgage Corp.
30-year fixed
15-year ftxed
1-year ad).
8Vt%
$187.600
$187,600
$250,000
9V4%
8V4%
2V4
3
3
$500.000
$500.000
$500,000
Maryland National Mortgage
30-year fixed
15-year fixed
1-year adj.
9%
3Vi
3V.
3%
$195,000
$195.000
$187.600
9V.%
7V.%
$500.000
$350.000
$187.600
First National Mortgage
30-year fixed
15-year fixed
1-year ad).
9%
8V.%
$195.000
$195,000
$195.000
9**%
8'/4%
3
3
3
$300.000
$300,000
$300.000
Mortgage Rate Hotline
Mortsagt rates often change aaity. For free daily rate quotes 24 hours a day from some Washington-era lender*, including those marked wrth a • above.
cat! Toucft Rates Hottm* at 256-1000 and press 2500 wft«n asMd to em«r user 1.0 number Local caUen with a toucn-tone tewpnone can obtain
information on fixed rate for 30-year loans, one- and three-year ad|ustat*e-rate mortgages and VA and FHA quotes. The mortgage rate information above
is compiled from the Peek* Report (84O-57SZ). which surveys more than 100 tenders nere each week. The list of 19 lenders, some of the largest in the
Washington area, is comptted by the real estate reporting sennce of Rufus S. Lush i Son inc. A blank listing means no rate quote was available this week.
Information provided does not constitute a loan otter or commrtnwnt by the lenders. These rates are suUect to change without nctoce and may be lower or
higher than tfWM of other tenders m the Washington area. Each pant paid is roughly the equivalent at one-eighth of a percentage point on the interest
-------
SOME COMMON INDEXES FOR ADJUSTABLE-RATE MORTGAGES
nil t/n—
This chart is designed to show the
trends of some of the more common
indexes used to set rates on adjustable
mortgages. Borrowers facing adjustments
can use the numbers below to compute
what their new rate would be, assuming
no caps or other special limitations. To do
that, add the lender's margin to the
applicable index. If your loan is indexed
to one-year Treasury issues and your
lender's margin is two points, the current
rate on your loan is 9.87 percent. Data
on 30-year fixed-rate loans are included
for reference.
1-YEAR
TREASURY ISSUES/MOV. 14
7.87%
3-YEAR
TREASURY ISSUES/NOV. 14 7.89%
5-YEAR
TREASURY ISSUES/NOV. 14 7.87%
30-YEAR FIXED-RATE
MORTGAGES/NOV. 10
9.79%
FHLBB SERIES OF
CLOSED LOANS/SEPTEMBER
9.82%
MONTHLY AVERAGES
13%
12
M A M j
1987
JASONDJFMAM
1988
JA S OND J FMAM J JA S 0
1989
-------
STATE OF NEBRASKA
•
• COVIVNOI • L O U I ( I. LANIBITV • OIIBCTOI-1TATI*KNCIN|II
ROW! 08
Revised 1-21-85
(1)
R«: (2)
(3)
Dear
The State of Nebraska, Department of Roads, is proposing to (4)
construction will (5) on a tract of land located (6).
This
This notice is to inform you that you will not be required to vacate the property
or move your personal property for at least 90 days following receipt of this
notice. In any case, you will again be notified 30 days prior to the date on
which you must move. If our construction schedule allows you to occupy the
property after this date and if you desire to do so, we will contact you and make
the necessary arrangements for your extended occupancy.
We have adopted the two-notice policy to assure you continued occupancy until it
is necessary for the State to use the property.
If you should elect to move before the receipt of the final 30-day vacating notice,
please notify this office that you have completed vacating the property.
This notice does not revise or invalidate any contractual agreement you may
have signed with the Department of Roads regarding acquisition or property
management.
Sincerely,
John G. Brinjak
Right of Way Manager
Right of Way Division
JGB/
cc: File
ATTACHMENT
DD-1
DEPARTMENT OF ROADS. BOX W79I, LINCOLN. NEBRASKA 6t50M75>. PHONE (402) 471-4M7
-------
STATE
OF NEBRASKA
DEPARTMENT OF ROADS
_ KAY A. ORR
GOVERNOR
ROW105
G. C. STROBEL
DIRECTOR-STME ENGINEER
Revised 11-25-85
(D
(2)
(3)
1.
2.
3.
4.
5.
6.
& 8.
.410.
Dear
VARIABLE INSTRUCTIONS
Address
Project Number
Tract Number
Use "you" if owner; use "your landlord" if tenant.
Use street address. If none, use legal description.
(Use/Delete 6). Use on residential cases.
Self explanatory.
Vacating date.
The State of Nebraska, Department of Roads, has recently paid for the property
6) that we acquired from (4) . This property is located (5) . (6)
Jse/ On (7) , a comparable replacement property was located at (8) . We
Delete suggest you consider it and other possible replacement locations.
The purpose of this letter is to advise you that the State of Nebraska must now
obtain actual possession of this property. It will b« necessary that this
property be vacated on or before (9) , and this letter is your notice in
writing to do so.
You are also advised that if you were eligible for a payment for moving your
personal property, but do not move the personal property, you will not be
reimbursed for such abandoned or discarded property left on the premises after
(10) . The State of Nebraska, Department of Roads, will remove or dispose
of the property and will not be liable or responsible for any damage which
occurs to the personal property.
11) As soon as you have vacated the premises, please (12) the keys to
Jse/ (13) . This will be your notification to us that you have completed
Delete vacating the premises.
14) This is to remind you that you must provide us with reasonable advance notice
Jse/ of the date of the start of the move or disposition of your personal property
Delete which must be moved from the real estate that we acquired from you. Please
contact your Relocation Agent, (15) , by writing him at the address noted
on this letter or by calling him collect at (16) . This will allow us
the opportunity to monitor the move if we desire.
We hope that this will result in a minimum of inconvenience to you, but it is a
necessary step in order to proceed with the required preliminary work.
Sincerely,
John G. Brinjak
Right of Way Manager
Right of Way Division
JGB/
cc: File
VARIABLE INSTRUCTIONS CONT'D.
11. Use this stored paragraph if a building is
involved.
12.&13. Prank Blankenau should be consulted as to
disposition of keys.
14. Use this stored paragraph when non residential
displacement is involved. Use stored
Paragraph 11 and Variables 12 and 13,
if building is involved.
15. Agent's name.
16. Agent's phont number.
PO BOX 94759 LINCOLN NE 6*509-4759 PHONE (402) 471-45*7, FAX (402)479-4325
AN EQUAL OPPORTUNITY AFFIRMATIVE ACTION EMPLOYER
-------
STATE OF NEBRASKA
DEPARTMENT OF ROADS
. KAY A. ORR C. C. STROBEL
GOVERNOR DIRECTOR-STATE ENGINEER
ROW104 Revised 6-15-89
(1)
Re: (2)
(3)
Dear
The Relocation Assistance Section has completed a Relocation Study and it has
been determined that you, as a tenant-occupant for at least 90 consecutive days
prior to the initiation of negotiations on this tract, are eligible for relocation
assistance payments provided that you relocate and occupy a decent, safe and
sanitary dwelling within a one year period.
These relocation assistance payments, made after your move, include:
A. Actual reasonable expenses for moving personal property, accomplished
by a commercial mover and supported by receipted bills, or scheduled
moving costs of $ (4)
B. A maximum rental replacement housing payment of $ (5) , provided
that you rent a dwelling with a monthly rent and utility cost of $
(6) , or more. Should you select a dwelling with rent and utility
costs for less than $ (7) a month, the payment is reduced
proportionately. You may rent a dwelling with rent and utility costs
in excess of $ (8) ; however, the maximum rental replacement
housing payment will remain at the computed figure; or
C. A replacement housing downpayment in the amount indicated above as your
rental replacement housing payment. If the amount of the required
downpayment is greater than the rental replacement housing*payment,
that amount will be paid, not to exceed $5,250.00. The "required
downpayment" means the downpayment ordinarily required to obtain
conventional loan financing for the decent, safe and sanitary
dwelling you actually purchase. The full amount of the downpayment
must be applied to the purchase price of the dwelling and related
incidental expenses.
The housing payment, which was described earlier, was based on a property for
(9) located at (10) which was available on (11)
ATTACHMENT
CC-2
PO BOX 94759 LINCOLN NE «5fM7» PHONE <4«2) 471-4S67, FAX (4*2)479-4325
AN EQUAL OPPORTUNITY AFFIRMATIVE ACTION EMPLOYER
-------
Date
Page 2
la addition to the above described monetary benefits, the relocation agent
presenting this letter to you is offering his services to assist you in Locating or
obtaining replacement housing. If you wish to.accept this assistance, please
contact the relocation agent.
The Relocation Agent presenting this letter to you will provide an explanation of
the above and answer any questions you aay have concerning relocation
assistance.
Sincerely,
John G. Brinjak
Right of Way Manager
Right of Way Division
JGB/
cc: File
ATTACHMENT
CC-2
CONTINUED
-------
68-3-01
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AVAILABLE COMPARABLE
No.:
. ana t * my otXHor «i«
TN« prapany «M
•ndMnary
•orQS«(«OR«nion
DA Ponn S3. ta* M
ATTACHMENT
-------
HHffUHIBII IF PUIBIUi IBUCBIEXT Mm P1YMEXI
STUD*
FINAL
OWNIN
' "TENANT*
STUOY AMOUNI
COMPARABLE NO. 1
COMPARABLE NO. 2
COMPARABLE NO 3
THE SELECTED COMPARABLE IS NO
TIMII
*ACTOM
LESS SUBJECT PROPERTY ACQUISITION PRICE
CQUALS I S
$
PURCHASE DIFFERENTIAL PAYMENT
•ACTUAl AMOUNT
ADJUSTED PRICE OF SELECTED COMPARABLE
PURCHASE PRICE OF THE REPLACEMENT DWELLING
LESSER OF THE ABOVE AMOUNT
LESS SUBJECT PROPERTY ACQUISITION PRICE
ACTUAL PURCHASE REPLACEMENT HOUSING PAYMENT
H»
ATTACHMENT
RR
OR Form 272, 0«c IS
rnis *OOM UC»I_ACCS O" 'COM 272 Aui '«
|>«CV>OUS COl riONl WILL «t OCSTKOvCD
-------
Countdown to a
Successful Move.
The secret to a smooth move is to plan early and plan welL The following
schedule puts you on a week by week countdown to moving day that will help
you and your family get on the right track for a successful relocation.
Week #5
D Start a moving ledger that will contain all receipts and notes.
D Hire the moving company.
D Purchase moving supplies (tape, boxes, etc.)
CJ Submit change of address forms to post office.
D Notify magazines, insurance company and credit cards.
O Notify utilities of your moving plans.
D Forward school, dental, medical and veterinary records to proper authorities.
G Make a list of your possessions, lake photos for insurance and personal inven-
tory purposes.
Week #4
G Begin sorting through possessions to discard what you don't need. Now's a
good time to have a yard sale.
G Clean out garage, attic and basement.
G Pack up fragile items and heirlooms and set aside.
G Make certain all bills and bank accounts are settled.
Q Obtain references from employers, banks and utilities.
Week #3
G Pack out of season clothing, books, photos, dishes (except for essentials) and toys.
Q Get necessary prescriptions filled.
G Map out your tnp. If it's a long road tnp, highlight points of interest. If you're
flying, make reservations and arrange accommodations (for your family and
pets).
Week #2
G Start packing. Beginning with smaller items and moving to larger items. Clearly
label boxes.
G Pack appliances and electronics in well padded boxes.
G Give away old plants. Pack the plants you want in plant packing boxes.
Q Cancel newspapers.
G Pare down foods to just essentials. Purchase easy to prepare foods, microwave
dishes or eat out.
Week#l
Q Pack all other remaining items. Schedule so you are packing for only a few
hours each day.
G Make final scheduling arrangements with movers.
G Clean rooms as you complete packing.
G Say goodbye to friends, family, neighbors and co-workers.
G Arrange to have utilities turned on at new home.
G Pack suitcases. Pack a box of essentials that you will need for the trip.
Moving Day
LJ Greet movers. Supervise loading. Make certain movers know how and where
to contact you once they get on the road.
G Check house to make certain it is completely empty.
Q Vacuum rooms.
G Load car. Say goodbye. •
-------
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ROW56
Revised 2-27-86
(5)Use/
Delete
(6)Use/
Delete
(7)Use/
Delete
(8)Use
Delete
(9)Us«
Dtlttt
(10)Use
Delete
PROJECT: (IT
TRACT: (3)
MOVE FROM:
MOVE TO:
BID PROPOSAL
NEBRASKA DEPARTMENT Of ROADS
NAME: (2)
ADDRESS: (4)
DATE OF MOVE:
SPECIFICATIONS:
PACKING AND UNPACKING LABOR:
Pack Man-hours x Cost Per Man-hour $_
Unpack Man-hours x Cost Ptr Man-hour $
- I.
- $
SUBTOTAL - $
(ll)Ua*
Dalata
PACKING MATERIAL:
Description
Quantity Charge
Attach txtra sh««t, if ncctssary.
SUBTOTAL: $
(12)Us«
D«ltct
(13)Ua«
D«l«tt
MOVING LABOR:
Man-hours
Cost Par Man-hour
SUBTOTAL:
EQUIPMENT:
Description
Hours/Miles Charge
Amount
Use extra sheets, if necessary.
(14)Use STORAGE: - Estimated Race Per Month
Delete
Estimated Pounds 8
SUBTOTAL: $
Insurance_
Other
9
per pound • $_
_ per $100 - $
• $
ATTACHMENT
XX
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ROW6L 2/11/86
INVITATION TO BID
NEBRASKA DEPARTMENT OF ROADS
PROJECT: (1) NAME: (2)
TRACT: (3) ADDRESS: (4)
REQUESTING AUTHORITY; The Nebraska Department of Roads (NDOR) is requesting a
bid for moving services for performing the work described on the attached Bid
Proposal form.
BID FORMAT; Your bid must contain the total cost itemized to include the hours
and hourly rates for labor and equipment to be used, charges for material to be
used, less salvage, if any, for recovery of such materials by you or the owner,
insurance, and other special charges.
SUBCONTRACTOR'S BID; If required, the bids are to be included in the itemization
and copies attached to this form.
PERFORMANCE; All work shall be performed in accordance with all laws, ordinances,
codes, or regulations which may govern or affect the performance of che work.
CERTIFIED INVENTORY; All the personal property, listed on the attached certified
inventory of the owner, will be involved in the move. The certified inventory
is not all inclusive, and it is noted that a walk-through inspection of the
premises was held on (Date & Time) in which
you inspected the property to be moved and the work location.
TIME; Time is made the essence of this bid in order that the (5) being moved
shall be disrupted no more than necessary.
TERMS AND CONDITIONS; The terms and conditions of this bid form, by this
reference, are made a part of your Bid Proposal and shall hav« che same force and
effect as if actually incorporated in your Bid Proposal.
SUBMIT TO; I understand that I am to submit this bid to (6) , Nebraska Depart-
ment of Roads, P. 0. Box 94759, Lincoln, Nebraska 66509-4759. I further under-
stand that this bid is made exclusively for the NDOR and that the amount is not
to be discussed with the owner until authorized by the NDOR. In addition, I under-
stand that the NDOR reserves the right to reject any or all bids.
AMOUNT: The final cost of said work shall not exceed $
NAME OF FIRM: (7)
ADDRESS: (8)
SIGNED BY:
TITLE:
DATE:
ATTACHVENT
7J.
CONTINUED
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(8-86)
Procedures for Submitting Estimates on Moving Costs to the
_ The -Relocation Office for selects various moving
companies from the • area to make estimates for the
se of determining reasonable moving costs. Moving costs include packing,
meeting, disassembling, loading, transporting (limit-50 miles),
unloading, unpacking and the physical reconnecting (excluding the cost of
materials or alterations) and any special services required.
fidures;
All estimates will be typewritten on company letterhead.
2. Property being viewed will be identified by name, address and
Project Number. Estimators will be given a certified inventory of items
to be moved along with appropriate exhibits.
3. The estimates should be broken down similar to the following:
Number of men, packing hours
Number of men, unpacking hours
Number of movers and van hours
Materials and tax „
Disassembling, Disconnecting, etc. $1
Re-installation of Electrical, Air,
Plumbing, Permits, etc. (if applicable) $.
Displacee Supervision hourq 8 S /hr. s_
Storage (if determined necessary by $.
Additional Insurance Premiums if Necessary $_
The State does not pay for new material
or alterations in the re-installation of
equipment unless specified. TOTAL
Any additional service such as safe moving, piano, refrigeration, Consultants,
etc. should be included on the basis of a
4. Real Property acquired by the - .._ and listed in Exhibits
will not be included in the estimate and will be stated on the estimate.
A complete list of the items of personal property to be moved as
determined by the certified inventory will be attached (to be furnished
by displaceej.
5. Two (2) copies of the completed estimate will be submitted to the District
Relocation Office at within a reasonable time.
DQ &Z£ submit the estimate or any amounts to the parties
concerned.
6. Payment for making these estimates will be on forms provided by the
The will be billed on a company invoice in duplicate based on the
reasonable time involved in preparing the estimate.
7. The company called upon to make the estimate must make a detailed
examination on the cost of the move and must thoroughly understand that
should they be called upon by the company to do the actual move, they
would be expected not to exceed their estimated amount unless there are
unforeseen circumstances.
fTnrpagnnahlo py inggmnlgfp pgtimatpg will not HP
Sincerely,
District Relocation, Appraisal &
Property Management Supervisor
-------
TIPS ON PERFORMING AN INVENTORY
1. Draw a floor layout. It can be a simple free-hand sketch showing location of major items,
access routes, approximate measurements, etc.
2. Take photos of all major items or groups of items.
3. The inventory should be performed in cooperation with the business operator.
4. Ask questions about unfamiliar items or intentions of the business: How is this
fastened? Can it be dismounted? Do you plan to sell it rather than move it? etc.
5. Don't rely on a "paper" inventory that many businesses maintain on a continuous basis.
Take a physical count.
6. Use specific units of measure to describe items or express quantities, such as: 6-8' metal
shelves; not 6 shelves. Use cubic feet (CF), linear feet (LF), pounds (Ibs.), etc.
7. Note the condition of items or special circumstances that are relevant to move method
or cost. For example: machine anchoring, delicate gloss display racks, machines
requiring special leveling and balancing.
8. Do not feel compelled to define special move methods or solve move problems while
taking the inventory. This is the task when writing specifications.
-------
9. Note items that are questionable as to status as personal or real property. Resolve these
questions before estimates or bids are secured.
10. Describe items sufficiently so that the mover can identify them. Use headings which
will group associated items or major areas of the premises.
11. Do not accept that items or material are too scattered, diverse, disorganized, intermixed,
etc. to take an accurate count anything tangible can be described and quantified.
12. The inventory of any ongoing business will change, sometimes significantly, before the
move occurs. Anticipate this by flagging items that you or the business operator think
will change.
13. Have the inventory typed. Not everyone can read your handwriting, particularly when
a clipboard is used.
14. Ask the business to certify to the correctness of the inventory as of the date : is
performed.
15. Flag items which are potential candidates for direct loss of tangible personal property
claim. Discuss this possibility with the business operator.
16. Perform a final inventory just before the move takes place. This is a critical task. There
should be prior agreement to adjust the move reimbursement (up or down) to reflect
significant additions or reductions.
-------
CASE STUDIES
-------
Case Study Approach
1. Identify displaced persons and summarize their current
situation.
a. Family size
b. Dwelling size, condition, and number of bedrooms
c. Finances, etc.
2. Review their acquisition benefits and costs and compare with
the situation before the acquisition.
3. Identify relocation needs which must be addressed
financially by the displacing agency and quantify them.
4. Determine additional needs which can be provided by advisory
services and identify available resources.
If these were actual cases, you would:
5. Review needs with displaced person(s) and identify possible
solutions. Distribute activities between yourself and the
displaced person(s). Make displaced person responsible for
solving some of his/her problems.
6. Communicate with the displaced persons on a regular basis
keeping them informed of your progress and checking on their
progress.
-------
Tiffin Relocation Plan
You have just completed field work for a relocation plan on an
upcoming project in Tiffin, Colorado, that will displace 22
owner-occupant families from 2, 3, and 4 bedroom, single family
houses. You have interviewed each family and made a rough
estimate of home value. You also made a survey of houses for
sale listings in the neighborhood. The results of your work are
on the following page.
QUESTIONS:
1. Identify the number of families that may need financial
assistance (replacement housing payments) to relocate. How
many are in 2, 3, and 4 bedroom homes?
2. Will any families need housing of last resort replacement?
Can you identify them from the information provided?
3. Can you make any conclusions from information at hand about
the time required to complete the relocation phase of the
project, the relocation benefit costs and the number of
relocation agents needed to work the project?
NOTE:
You may find it useful to make a grid to relate housing needs to
available units.
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-------
RELOCATION PLAN
TIFFIN PROJECT
HOUSING AVAILABILITY GRID
DWELLING
SIZE
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3 BR
4 BR
UNDER 45,000
NEED
HAVE
45,000-55,000
NEED
HAVE
56,000-65,000
NEED
HAVE
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NEED
HAVE
-------
Tiffin Relocation Plan
Supplement
You realize that you have insufficient information listed to know
the needs of the families other than bedroom numbers and price
ranges.
1. What additional information have you learned in your
interviews that would help your planning?
2. What additional data do you need about the available
housing?
3. What would change in your planning if:
a. Parcel No. 10 - Stanley - family of 5 (mother, father,
3 children - ages 2(m), 5(f), and 7(m).
b. Parcel No. 17 - Bradley - retired. Income limited to
social security and small pension. Mr. Bradley has
emphysema, uses oxygen and cannot climb stairs.
c. Parcel No. 7 - Jones - The Jones family currently
consists of Mr. & Mrs. Jones, their daughter, age 30,
and her two children who moved in six months ago
"temporarily." The daughter pays minimal rent, has a
job, and would like to get back into a place of her
own.
d. Parcel No. 2 - Smith (1) - has new home eguity loan to
pay off debts, seems to have a "drinking problem."
-------
The Allisons
Robert and Mildred Allison rent a small 1-1/2 story frame house
containing four rooms (2 bedrooms) and a bathroom. Their monthly
rent is $350, utilities not included. Utilities average $125 a
month. Bob is employed as a bartender at the Mountain Inn and
earns about $1,500 per month. They would like to purchase a 2 or
3 bedroom house rather than continue renting. You have had
several contacts with the Allisons and relocation options have
been thoroughly explained. You have also provided them with
three listings that can be purchased and numerous rental
listings. Mrs. Allison informed you that she had made rental
applications at two of the rental lists you gave her but they
were not accepted at either one. They have not made any offers
for the sale properties because of the rental turndowns. After
making a note of the rental property addresses where the Allisons
made application, you said that you would check with the rental
managers.
You later talked with both rental managers who turned down the
Allisons and was told that the credit check was poor and the
personal references hinted that Mr. Allison has a drinking
problem. This is undoubtedly the cause of the poor credit
rating.
-------
Later you discreetly questioned some acquaintances in the project
area who told you that Bob Allison is a well known neighborhood
drunk.
Question
List the various ways you may be able to help the Allisons and be
prepared to discuss the alternatives.
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The Cat Lady
Mrs. Clara Lott is an eccentric but harmless 69 year old cat
lover who owns and occupies a modest four room frame house in
poor condition (not DSS). She has 10 cats. The house contains 1
bedroom, living room, dining room, kitchen and a bathroom with
500 square feet of living area. The structure is 58 years old
and is located in a poor neighborhood of similar modest homes.
The property was appraised at $40,000 and the entire parcel will
be acquired. Mrs. Lott has a retirement income of $750 per
month. On the one hand, she would like to purchase a small
house, but she may consider renting an apartment or possibly
senior citizen housing if she can qualify. She is undecided and
changes her mind every time you discuss relocation with her.
Through your contact with the Fairmont Housing Authority it was
learned that the maximum annual income limits for one person to
qualify for senior citizen housing is $8,000. And in case Mrs.
Lott decides to rent an apartment, your analysis of the rental
market for standard existing housing indicates market rent of
$325 for a one bedroom unit. The rent includes all necessary
utilities including heat, electric, water, etc. Also, there are
no comparable one bedroom dwellings available to purchase or rent
but there are several two bedroom properties for sale with asking
prices from $42,500 to $55,000. Fair market rent for the
displacement property has been established at $250 per month,
utilities not included.
-------
Discuss the relocation services that may be necessary including
replacement housing options.
-------
The Close Shave
You are Susan Sweet's supervisor and have been called by Rafer
Edge, a displaced person assigned to her. The Edge family is
concerned because their 90-day notice is about to expire and they
have not purchased a replacement dwelling. They have not been
able to contact Susan for the last 28 days.
Rafer and his wife, Overna, have 10 children, 5 boys ages 18, 14,
8, 4, 2, and 5 girls ages 16, 12, 10, 6, and 1. He is the food
service manager for the local Doubletree Inn. They own a 5
bedroom, 2-1/2 bath frame ranch house on a 5 acre lot. Eighty
four days ago Susan was able to locate one house which was
identical to their present home with the exception that it was on
a 10-acre site. Susan offered this unit to the Edges as the
available comparable house with the 90-day notice. The offered
house is no longer on the market. The state has not acquired the
Edges' home which has been reappraised. The reappraisal utilizes
the offered comparable which subsequently sold.
Susan has received a new computation for the price differential
payment which she took to the Edges' 45 days ago but no offer of
a comparable was extended at that time. You have finally reached
Susan at the Ski Chalet where she has a part time job during the
skiing season. She tells you that the Edges have not been
10
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cooperative at all. You check the file and find that she has
made three visits to the Edge family and two phone calls. No
activity is noted for the last 45 days.
You make a reassignment and decide to send Red Whiskers to call
on the Edges. Red finds them to be most cordial. They accepted
the updated offer to purchase 60 days ago. During the interview
Red finds that two of the children have learning disabilities
which are being effectively helped in the school which is one
block away. He also discovers that Mrs. Edge cannot drive
because of a vision problem. The family obviously needs to
relocate close by.
Fifteen days later Red reports that the family will purchase a
home which he helped them find only a few blocks away and will
move in within 10 days.
1. Evaluate the performance of the two agents.
2. Suggest possible actions which the supervisor may want to
take.
11
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The KALBOR FAMILY
The Kalbors have contracted for the purchase of a 100-year old
dwelling to replace their house acquired for the highway project.
The house appears to be in good condition, considering its age,
but the Kalbors are not experienced in evaluating housing
quality. They have written a condition in the contract that
the sale is dependent on the property passing a state "decent,
safe, and sanitary" inspection.
As the relocation counselor assigned to the case, you make the
inspection which discloses the following:
Basement field stone walls have several cracks of up to 3/4"
wide. Walls are plumb (no bulges) and house is level.
House is heated with two large free standing gas space
heaters that are vented into chimneys that formerly served
fireplaces.
Ceramic bathroom sink has several chips and hairline cracks
but does not leak.
Old paint is peeling from one bedroom wall.
Front wooden stoop (3 steps) is tilted moderately, due
apparently to ground settlement.
12
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Living room floor sags slightly toward center of room
approximately 2" from level.
Electric fuse box has four fuses and reads "30 amps
capability."
QUESTIONS
1. Which of above items are critical "DSS" flaws and which (if
any) are of minor concern?
2. What other points would you examine carefully on a 100-year-
old house?
3. What would you tell or recommend to the Kalbor family based
^^ on the conditions you found?
^^ 4. What tools are useful in making a DSS inspection?
13
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COMPARABILITY CASE STUDY
Bill Sweeney owns a 5-year old, two-story brick dwelling
containing 2,000 square feet of living area. The dwelling is in
very good condition and is considered to be DSS for the Sweeneys.
It contains a living room, dining room and kitchen on the first
floor and four bedrooms and two bathrooms on the second floor.
The dwelling also contains a full basement with a forced air gas
furnace, gas hot water heater, and central air conditioning.
There is a one car detached garage at the side of the house.
*
The dwelling is located on the west side of town on a typical
residential lot in a pleasant middle class neighborhood. The
property is located about 5 miles from Mr. Sweeney's place of
employment.
The family will only require a three bedroom replacement dwelling
because the oldest daughter was recently married and moved into
her own home.
Mr. Sweeney recently informed you that the family prefers the
east side of town as a replacement location since the residential
neighborhoods are far superior to the west side. He also stated
that they prefer a smaller house since all of their children will
be grown and on their own in a very few years.
14
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From the following list of available properties select the three
most comparable to be used as the basis for the purchase
supplement computation. Be able to explain your reasons for
selection or elimination of available properties on the list.
Property #1 - This property is located on the east side; it may
be considered equal in all respects except that it is located ten
miles further from Mr. Sweeney's place of employment. Should
this property be utilized for computation purposes and why?
Property #2 - This property is located approximately six blocks
from subject; the only differences noted are that it is 15 years
old and has some DSS deficiencies. Should this property be
utilized for computation purposes and why?
Property #3 - This property is located in an equal west side
neighborhood about 1 mile from the subject; equal in all respects
with the exception that it is 2 years older than the subject.
Should this property be utilized for computation purposes and
why?
Property #4 - This property is located on the south side. It is
considered very comparable in all respects and appears to be a
great buy. One block away is the river and a sewage treatment
plant. Should this property be utilized and why?
15
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Property #5 - This property is located only three blocks away and
the only difference you note is that it is a one-story frame
ranch. Rooms and living area are equal to the subject, as is the
lot. Should this property be utilized for computation purposes
and why?
Property 36 - Located on the east side, it appears to have been
built by same builder as the subject. The only item of
dissimilarity noted is that it has a considerably larger lot than
the subject. Should this property be used and why?
Property 37 - This property is located on the far east side.
The only area of dissimilarity noted is that it has a well and
septic system as opposed to the subject's city services. Should
this property be utilized and why?
Property 38 - Located in an equal west side neighborhood. Very
similar in all respects except that it has a small finished game
room in the basement. Should this property be utilized and why?
Property 39 - This property is located approximately four blocks
from the subject; it may be considered equal in all respects
except that it has three bedrooms. Should this be utilized for
computation purposes and why?
16
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Property #10 - This property is located in the same general
vicinity; the only item of dissimilarity noted is that it has an
additional half bathroom located on the first floor and is
slightly larger in living area. Should this property be utilized
for computation purposes and why?
Property #11 - Located on the west side, this property is similar
except for the presence of an attached two-car garage with a game
room behind and no basement. Could this property be used?
17
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COMPARABILITY
IT IS YOUR FIRST VISIT TO MR. AND MRS. RAYMOND'S HOUSE WHICH IS
BEING ACQUIRED FOR A NEW ROUTE 16. YOUR PURPOSE IS TO INTERVIEW
THE FAMILY AND SURVEY THE HOUSE TO DETERMINE THE FACTORS THAT
WILL BE USED TO LOCATE COMPARABLE HOUSING. THE FOLLOWING
INFORMATION IS SECURED FROM THE INTERVIEW:
-» Mr. Raymond is retired. He has a heart condition that
confines him to the first floor of the two-story house.
Mrs. Raymond works as a bank clerk. She takes the bus to
work downtown. The bus stop is in the next block.
The Raymonds have three adult children and one son lives
at home.
The house is owned free and clear. Family income before
taxes is $17,000. This is from social security for Mr.
Raymond and Mrs. Raymond's salary. Mr. Raymond says they
are comfortably able to pay present taxes ($1,200) and
utilities ($1,600). The property is underassessed by about
75% due to town policy of only reassessing on a sale.
Mrs. Raymond conducts you on a tour of her house, pointing out
features that she feels are very important:
18
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The living room fireplace is a focal point of family life.
it is a "must have" in choosing a new home.
Two of the four bedrooms are in use. A third is furnished
as a guest room for occasional visitors and the forth is
used for household storage space.
The total gross floor area is 2,100 square feet. This
includes a higher than average amount of space devoted to
corridors and closets.
The house has two bathrooms; one on each floor.
Central air conditioning was added three years ago. Mrs.
Raymond says it is critical to her husband's health and
comfort during July and August.
There is a full basement, two-car garage, normal
landscaping.
The lot is double size. A part is used for a large garden
maintained by the Raymonds' son.
Questions:
1. Classify the above items as to their relevance to
comparable housing as follows:
19
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v - very important; c- a possible consideration; n - not
relevant.
2. What additional facts and information are necessary to
determine comparable housing?
20
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Domenic Cerelli
Mr. and Mrs. Cerelli are 74 and 71 years old respectively and
own a 45 year old frame house containing 3 rooms plus a bath (1
bedroom) on crawl space. There is 620 sq. ft. of living area on
a 25,152 sq. ft. lot. Mr. Cerelli is retired, receiving $600
month income. He pays $95 in utilities.
The house is debt free, decent, safe, and sanitary, has no garage
and is in fair condition. The acquisition cost of his property
is $50,000 which values the residence at $26,000 and the land at
$.95 sq. ft. The typical lot in this area is 8,000 sq. ft. The
Cerelli's are interested in senior citizens housing.
The following comparables in a similar area are available at this
time:
a. 4 room, 1 bedroom, 1 bath frame house 18 years old on a
6,000 sq. ft. lot with 548 sq. ft. of living space.
Valued at $40,500.
b. 4 room, 1 bedroom, 1 bath frame house 22 years old on a
7,000 sq. ft. lot with 720 sq. ft. of living space.
Valued at $38,000.
c. 4 room, 1 bedroom, 1 bath frame house 24 years old on
an 8,500 sq. ft. lot with 700 sq. ft. of living space.
Valued at $37,500.
21
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1. Compute the replacement housing payment and explain.
2. What if the Cerelli's elect to rent? What payment would be
computed?
-------
Roy Elk
Mr. Elk is 72 years old and rents a 3 room, 1 bedroom, 49 year
old house for $210 per month. The house does not have a
bathroom, is in poor condition, and is not decent, safe, and
sanitary. Mr. Elk is retired on a fixed income of $500 per month
of which $40 per month is paid in utilities. He is interested in
senior citizen housing.
You have located the following comparable rentals:
a. 4 rooms, 2 bedrooms, 1 bath, frame house 24 years old
in fair condition on a 10,000 sq. ft. lot. Rents
unfurnished for $325 per month including utilities.
b. 6 room, 2 bedroom, 1 bath, frame house 39 years old in
fair condition on a 3,800 sq. ft. lot. Rents
unfurnished for $300 per month including utilities.
c. 4 room, 2 bedroom, 1 bath, frame house 22 years old in
good condition on a 6,000 sq. _ft. lot. Rents
unfurnished for $335 per month including utilities.
23
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1. Compute the rent supplement for Mr. Elk and explain.
2. Give reason why you selected the most comparable.
3. How would you advise him on senior citizen housing? What if
there is a waiting list?
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The Swimming Pool
The Kent family is being displaced. Their home has been
appraised at a value of $110,000. There are several closely
comparable houses available on the market. None, however, have
an in-ground swimming pool with which the acquired property is
improved. The Kents use their seven year old pool often and
consider it an important element in their style of living.
You, as relocation agent assigned to the case, have located a
close comparable listing (except for the pool) priced at
$120,000. There are several other houses for sale priced within
a range of $6,000 and so you feel quite comfortable about basic
housing availability. The swimming pool matter concerns you,
however. The appraiser has assigned a value of $8,000 to the
pool. Several phone conversations with local pool contractors
reveal that it will cost at least $14,000 for the Kents to build
a pool assuming normal site conditions.
As you have not encountered this type of situation in your one
year as a relocation agent, you decide to ask more experienced
associates. Their advice is summarized below:
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Judy F
Disregard the pool. The selected comparable is close in all
essential items of comparison (number of rooms, living space,
etc.)- The computed payment should be $120,000-$110,000=$10,000.
Stan S.
The Kents should be provided the option to replace the pool. So
we should reimburse them for the cost ($14,000) if they buy a
house without a pool and have one constructed. If they do not
replace the pool, the replacement housing payment should be
limited to the $10,000 difference between the acquisition price
and the selected comparable listing.
Joe R.
The value of the pool ($8,000) should be deducted from the
acquisition price of the Kent's home. The maximum replacement
housing payment determination will thus be $18,000. ($120,000-
$102,000). It is of no concern whether or not they actually
replace the pool.
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John B.
John agrees with Stan, except that the maximum additional
reimbursement for the cost of constructing a pool should be
limited to $8,000 rather than $14,000 as argued by Stan.
You are surprised that there are several diverse approaches and
that each has a certain amount of logic. You must decide how to
handle this case and submit it for approval to the central office
before advising the Kents of their replacement housing amount.
Question
How would you recommend the swimming pool matter be handled? Are
there additional methods or refinements that have not been
discussed?
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THE REMAINDER
The sketch below indicates how the acquisition affects the
BidwelI res idence:
R/W Line
The acquisition of a 20 foot strip from the front of the lot will
leave a remainder of 60' X 180'. The remainder will conform to
local zoning requirements for a buildable lot.
The Bidwell's transaction with the highway agency is a follows:
Property acquired $90,000
Dwelling
Land
Value of Remainder
$80,000
$10,000
$20,000
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The agency relocation office determines a replacement housing
payment as follows:
Comparable Property Listing $107,000
Acquisition of Bidwell Property 90.000
Maximum Replacement Housing Payment $ 17,000
When the payment determination is presented the agent asks Mr.
Bidwell if he would prefer to buy his house from the state for
its salvage value and move it onto a new foundation. This might
be more satisfactory for all concerned. Mr. Bidwell says that he
sure does want to buy the house back and move it on to the
remainder, but not for his family's occupancy. The Bidwells plan
to move close by. A house is for sale at $115,000. They are
negotiating for its purchase and expect to qualify for the full
amount of the $17,000 determination, plus interest payment and
closing costs. Mr. Bidwell goes on to say he has been approached
by a local contractor to move the house to the remainder and
restore the site at a total cost of $20^000. A realtor who the
contractor introduced to Mr. Bidwell said she could sell the
property for $110,000. The realtor also said she had worked out
similar arrangements with several other occupants on the same
project.
Question
Is there anything the agency could do or should do to prevent the
kind of transaction Mr. Bidwell intends to undertake?
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Ambrose and Pearl McDonald
The McDonald's live on a farm jointly owned by him and his two
brothers. Ambrose McDonald operates the farm and he is paid a
salary of $2,000 per month by the estate which is paying monthly
mortgage payments on the farm of $400 per month. His utility
costs are $110 per month.
The McDonald's who are 48 and 46 years old have 3 children—2
sons who are 12 and 16 years old and 1 daughter who is 19 years
old. The two story frame house they live in is 20 years old, has
7 rooms—4 bedrooms, 2 baths, a basement, 1,320 sq. ft. of
living space and is sited on a typical rural site of 12,000
square feet. The entire strip acquisition consists of 21,287
square feet, which will include the house.
The carved out value is $80,000. Ambrose would like to move the
dwelling to the remaining land or construct a new one since he
must live at or close to the farm.
The following comparables are available:
a. One-story frame house with 7 rooms, 4 bedrooms, 2
baths, 1,225 sq. ft., 15 years old with a full
basement. Valued at $92,000.
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b. One-story frame rancher with 9 rooms, 4 bedrooms, 2
baths, 1,554 sq. ft., 5 years old without a basement.
Valued at $95,000.
c. Split-entry 8 room, 4 bedrooms, 2 baths, 1,425 sq. ft.,
8 years old without a basement. Valued at $92,000.
d. One-story rancher, 7 rooms, 4 bedrooms, 2 baths, 1,440
sq.. ft. , 5 years old with no basement. Valued at
$95,000.
1. What items need to be considered as you compute a
replacement housing payment.
2. Compute the replacement housing payment and explain.
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Harry K. Lum
Mr. Lum and his wife Ethel, who are 55 and 49 years of age,
reside in a 5 room, 2 bedroom, 1 bath, frame house on a 15,185
sq. ft. site which is considered to be commercial property with
an appraised value of $4 per sq. ft. The dwelling which is 20
years old contributes no value. This is a partial acquisition
which includes the dwelling and 9,201 sq. ft. of land. The
acquisition cost of the site is $36,804 with an after value to
the remainder of $24,000. The typical residential lot in this
area varies between 7,500 and 8,000 sq. ft. Residential lots
are valued at $1.35/sq. ft.
Harry is employed as a janitor at $1,500 per month and has a
mortgage payment of $250 per month and utilities of $100 per
month. The home contains 800 sq. ft. The Lum's wish to purchase
a 2-bedroom house in a nice neighborhood.
The following comparables are available on typical lots:
a. 2 bedrooms, 1 bath, 900 sq. ft., 20 years old. Valued
at $40,000.
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b. 2 bedrooms, 1 bath, 896 sq. ft., 25 years old. Valued
at $47,000.
c. 2 bedrooms, 1 bath, 910 sq. ft., 14 years old. Valued
at $55,000.
Compute the replacement housing payment and explain your answer.
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George Chewski
Mr. Chewski owns (debt free) an 18 year old (5 room) 3 bedroom 1-
1/2 bath frame house containing 650 sq. ft. of living space. The
home situated on a 10,000 sq. ft. lot is decent, safe, and
sanitary in good condition with a full basement and no garage.
The site is situated 1 mile from his employment, 1/2 mile from
shopping, 3 blocks from school and close to public
transportation. Mr. Chewski is employed by a building contractor
making a monthly income of $2,400.
This is a partial acquisition which includes the dwelling for a
total cost of $51,000. The after value of the remaining land is
$7,500 (6,500 sq. ft.).
Mr. Chewski has arranged to retain the dwelling and move it to
the remainder of the lot. Retention value was $5,000; site
preparation and landscaping is estimated at .50/sq. ft.; utility
hookups $3,500; cost to move and reestablish the dwelling is
$7,500; cost to construct a garage is $5,200. The basement,
sidewalk, and driveway costs are $5,500.
You have found the following comparables:
a. 5 room house with 3 bedrooms, 1-1/2 baths, and 700 sq. ft.
This is 22 years old and is listed at $59,990.
3 4
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b. 5 room house with 3 bedrooms, 1-1/2 baths, and 707 sq. ft.
This is 27 years old and is listed at $61,000.
c. 6 room house with 3 bedrooms, 1 bath, and 956 sq. ft. This
is 15 years old and is listed at $62,000.
1. Compute the maximum replacement housing supplement for Mr.
Chewski.
2. Process Mr. Chewski's claim of cost to move his house.
3. Assume the remainder lot sufficient to relocate the house
but Mr. Chewski also owns a 10,000 sq. ft. lot down the
street which he purchased 10 years ago for $3,500 and is
currently valued at $10,000. What would be the effect on
his payment if all other costs remained the same and he
moved his house to the 10,000 square foot lot.
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Gordon and Laverne Ramsey
Gordon and Laverne Ramsey, along with their 14 year old son,
occupy a one story log dwelling containing two bedrooms, living
room, eat in kitchen and one bath. And about 3 years ago Mr.
Ramsey added another large recreation room to the main structure
where he and his son have constructed one of the largest and most
elaborate model railroads in the State.
The Ramseys were informed several months ago that part of their
property would be acquired for the project. The partial
acquisition included the dwelling and about 3,000 square feet of
land. The residential lot size was originally 12,180 square
feet, leaving a usable remainder of a little over 9,000 square
feet. The remainder has sufficient land area upon which to move
and reestablish the dwelling. Rather than moving to a
*
replacement property, Mr. and Mrs. Ramsey decided to retain the
dwelling and move it back about 50 feet.
You are the relocation agent assigned to this case and you
explained to the Ramseys that in other cases displaced persons
have moved houses, the furniture, appliances, etc., had been left
in the houses and moved with no problems. You did recommend
however, that expensive or fragile objects should be packed in
36
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order to avoid damage even though the house movers say you can
leave the dishes, pictures, lamps, etc., in place during the
move; they are sometimes overly confident.
Subsequent to the acquisition Mr. Ramsey had a new foundation
constructed on the remainder and contracted a house moving firm
to move the house. He also decided to move the furniture, etc.,
with the house and his wife packed her china and other fragile
items in order to avoid breakage during the move. Mr. and Mrs.
Ramsey anticipated that they would have to stay in a motel one
or two nights at the most while the house was being moved and the
utilities were being reconnected.
Everything was going well on the day the house mover started to
get the house ready to move. Steel was placed under the house at
the appropriate places and the house was jacked up in a level
position until the floor sills cleared the foundation walls at
the proper height. All utilities were disconnected and the house
was moved a few feet off of the old foundation walls in
preparation for alignment with the new foundation. By this time
it was getting dark and the contractor could not complete the
move until the next day.
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During the night a heavy rainstorm struck the area and the lot
became very unstable due to the saturation caused by the storm.
The house mover was on the job early the next morning but when
the crew started to move the house, the wheels sank into the soft
ground. They worked for about an hour with wooden planks under
the wheels of the moving rig and finally pulled it free. It was
obvious that the mover would be forced to wait until the weather
cleared and the ground dried up before the house could be moved
to the new foundation. The Ramseys had checked into a nearby
motel the previous day and since their house was up on steel with
no utility connections, they would be forced to remain in the
motel until the house could be moved and made liveable again.
Questions
1. Mr. Ramsey called you immediately, explained the problem and
the fact that they may be forced to remain in the motel for
several days more than he had originally anticipated. He
wanted to know if your agency would reimburse him for the
additional expenses for temporary lodging and meals since
the delay was beyond his control. How would you respond to
the request and how would your agency resolve the problem?
2. Lets say your agency approved the Ramseys for reimbursement
for temporary lodging and meals for a period not to exceed
10 days. You and your supervisor concluded that this should
be a sufficient amount of time to get the house moved,
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utilities reconnected, and any repairs completed in order
for the Ramseys to reoccupy the dwelling. Several days
passed and finally Mr. Ramsey stopped by your office in
order to complete the claim forms for reimbursement. He
presented you with the following receipted bills and
estimates of expenses incurred:
See the next page for a summary of the receipted bills, etc
39
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Lodging - Sleepy Rest Motel
1 Double Room, 10 days at $62.00 $620.00
1 Single Room, 10 days at $39.12 $391.20
Total $1,011.20
Meals
Meals, 10 days at $20 per person
$200 X 3 = $600.00
Moving Costs
Fixed schedule move
Allowance $850.00
Total $2,461.20
After reviewing the bills and estimates prepared by Mr. Ramsey,
will you approve the claims for payment? Explain your answer.
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James and Ann Beck
James and Ann Beck reside in a very nice one-story house in a
pleasant middle class neighborhood. The house is about 8 years
old and contains 6 rooms, of which 3 are bedrooms, plus 2-1/2
bathrooms. There is also a 2 car attached garage.
James works for the U.S. Postal Service and his annual salary is
about $39,900. This is the only source of income.
James and Ann are in their early forties and they have four
children ranging in age from 6 to 16. They really need a 4-
bedroom house to adequately accommodate the family due to the
variation in ages and sex of the children.
The displacement property has been appraised at $99,000 and the
entire property is being acquired. The mortgage interest rate on
the displacement property is 9-1/2 percent with a monthly payment
of $519.46, and a remaining balance of $55,000.
Mr. and Mrs. Beck have made an offer in the amount of $110,000
to purchase a 4-bedroom property a few blocks from their present
home and they have asked you for some documentation to present to
the lending institution they have chosen to provide their new
mortgage. You have already inspected the replacement dwelling
and it meets all decent, safe, and sanitary requirements. You
also computed the price differential amount based on the most
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comparable available property about 2 weeks ago. You informed
Mr. and Mrs. Beck that the maximum price differential payment
would be $15,000 based on a $114,000 comparable. You told them
that they would have to purchase a replacement property costing
$114,000 or more in order to claim the $15,000 payment. This
information was prepared in a written document for the lending
institution. Since the Becks would have $44,000 in equity
following the closing on their present property by the acquiring
agency, they decided to keep about $10,000 to pay off some bills
and buy some new furniture, paying $34,000 down on the purchase
of the replacement property. This would leave them with a
$85,000 mortgage. They were able to get a 30-year fixed rate
mortgage at a 11-1/2 % interest rate. The buyer must pay 3
points.
The Becks knew that most of the incidental costs and closing
costs would be reimbursed by the agency but they would like to
know how much the increased interest payment would amount to in
case they decided to include this payment as part of their
downpayment and reduce their mortgage payment.
Question
Compute the increased interest payment.
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The Green House
Mrs. Green, a widow, shares her large (4 BR) home located in the
south side of Fairmont with her son Bob, his wife, and their two
children. All living and housing costs are shared. It is not a
convenient arrangement but will last until Bob and his wife can
accumulate the down payment for a home of their own. Mrs. Green
had planned to move to a smaller house or even a mobile home when
Bob's family moves.
However, the Green house is to be acquired for a new highway
interchange. The state has offered $45,000 as the appraised
value of her house plus $12,000 as a replacement housing payment
which is based on a specific comparable dwelling priced at
$57,000.
As relocation agent assigned to the project you are making a
routine follow-up call at the Green household. Mrs. Green has
seen the comparable house selected by the Agency and tells you it
does not at all suit their needs. They have an alternative plan.
Mrs. Green has located a nice fully equipped double wide mobile
home, including lot, for $40,000 that she would occupy alone.
Son Bob needs $10,000 more to purchase a 3BR home he has located.
You explain to the Mrs. Green that their is a "spend to get" rule
that means the Agency can only reimburse up to what is spent on a
replacement dwelling. Also, since the extended Green family
share a house, only one payment can be computed. Mrs. Green is
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upset. She tells you that not only would her plan save the State
$2,000, but were she to purchase the comparable house her heat
and taxes would be more than double that of the mobile home.
HOW DO YOU RESPOND TO MRS. GREEN? WHAT POSSIBLE OPTIONS DO YOU
SEE?
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Mrs. Phyllis Mitchell
Mrs. Mitchell lives in a basement apartment owned by her parents,
Richard and Edith Green. Mrs. Mitchell is divorced with two
children, a son 1 year old and a daughter 3 years old, who are
attended to by her parents when she is working at J. C. Penny Co.
where she is paid $720 per month.
She pays no rent for the 600 sq. ft. unfurnished apartment which
contains 3 rooms, 1 bedroom, and a bath. The displacement unit
is not decent, safe, and sanitary. The carve-out value of the
basement apartment is $10,000 and the market rent has been
estimated at $300 per month including utilities. Mrs. Mitchell
says that she is interested in low-rent housing but that she must
live near her parents. Her mother baby sits when she is working.
The following rental comparables have been found:
a. 5 rooms, 2 bedrooms, 700 sq. ft. Unit rents for $260
per month. Utilities should average $100 per month.
b. 4 room duplex with 2 bedrooms, 850 sq. ft. Unit rents
for $275 per month. Utilities should average $125 per
month.
1. Compute a rent supplement for Mrs. Mitchell.
2. What relocation strategies should be considered for Mrs.
Mitchell and her parents?
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Schultz and Potts
Thomas Potts and Joseph Schultz share a furnished sleeping room
in a 5-room house for which they pay $175 per month (utilities
included). Mr. Potts is Mr. Schultz1 father-in-law. Mr. Schultz
is a loan officer at the local bank where he is paid $1,500 per
month.
Mr. Schultz would like to purchase a 2-bedroom house if possible.
The following rentals are available:
a. One bedroom, 1 bath, 3-room, second floor apartment,
320 sq. ft., unfurnished. Unit rents for $200 per
month. Utilities are estimated at $100/month.
b. Two bedroom, 1 bath, 3 room house, 720 sg. ft.,
unfurnished. Unit rents for $250 per month. Utilities
are estimated at $120/month.
c. One bedroom, 1 bath, 3-room basement apartment, 425 sq.
ft., unfurnished. Unit rents for $225 per month, water
included. The rest of the utilities are estimated at
$75/month.
1. What are the alternatives for relocating Schultz and Potts?
2. Compute a rental assistance payment for them if they
relocate together.
3. What would be the maximum payment they would receive if they
relocate separately?
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LINDA AND PAUL
While performing interviews of site occupants in preparation for
a project you encounter the following situation:
A two bedroom flat in an acquired three unit building is occupied
by Linda M. and Paul S. The occupants are in their late
twenties. Paul is a carpenter and Linda is a student. She also
works part time. Linda and Paul have lived together for five
years, and have been at the current address for three years. In
discussing the relocation program and their displacement you
learn that Linda and Paul are not living together in the normal
sense. They had a serious falling out about six months ago and
since then have been sharing the apartment as a matter of
convenience and financial necessity. Each has a private bedroom
and eat their meals separately. Paul has most meals out but one
shelf in the refrigerator and a kitchen cabinet are exclusively
his. They are sharing the rent payments. They consider the
arrangement inconvenient but expect it to continue until Linda
graduates and gets a full time job or until either of them find
housing they can afford.
After you explain the basic relocation benefits, including the
rent supplement payment, Linda says she wants to relocate to a
one bedroom apartment nearby. It is evident that the pair
welcome their impending displacement as the opportunity to
separate. They are both extremely interested in the amount of
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money they will receive and are disappointed to be told it will
be at least a month before this is determined. Paul tells you
that neither he nor Linda have any savings and the present rent
is a burden since Paul has been working only three or four days a
week.
On returning to the office you discuss the case with the
relocation manager. He tells you that agency procedures state
that if occupants in a dwelling maintain separate households
their relocation benefit should be based on their moving to
separate dwellings.
QUESTION;
What criteria would you set for determining "separate households"
in the same dwelling? Would Paul and Linda qualify as separate
households?
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Sam Short
Mr. Short and his wife currently occupy a two bedroom apartment
in the Sanford Arms, an apartment complex acquired for the
construction of the main avenue interchange. They moved into
their apartment (29) twenty nine days before the first
acquisition contact and have lived there for (6) six months. The
Shorts pay a monthly rent of $540 which includes all utilities.
Mr. Short "is employed as a Computer Operator by Data Bank at a
monthly salary of $1,500 and Mrs. Short is a part time Secretary
making $660.10 per month.
The State has reviewed the availability of apartment rentals
comparable to the existing unit and determined that a two bedroom
apartment will rent for $600 per month including utilities. The
States financial test is set at 30% of gross income.
QUESTIONS;
1. Are the Shorts eligible for replacement housing or rental
assistance payment?
2. What other benefits are they eligible for?
3. If the Shorts are eligible under #1 then why?
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Mr. and Mrs. Lewis
Mr. and Mrs. Lewis and their 1 year old son occupy an apartment
in a four unit building that is being acquired for the project.
The apartment is rented unfurnished with the exception of the
refrigerator, electric range, washer, and dryer. The apartment
has two bedrooms, a living room/dining room combination, a small
eat-in kitchen and 1-1/2 baths. The small dinette set in the
kitchen plus the cooking utensils, dishes, etc., belong to the
Lewis'.
Mr. Lewis has decided to move himself with the help of some
friends and he has selected the moving expense schedule method of
reimbursement.
QUESTION:
Based on the moving expense schedule, how much will the Lewis' be
reimbursed for their move?
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Mr. and Mrs. Roth
The Roth's have decided to be reimbursed for the cost of moving
the contents of their house based on the moving expense schedule,
rather than actual cost. Mr. Roth will rent a trailer and with
the help of friends, move on a Saturday.
The day before the move the State relocation agent makes a visit.
He counts 6 rooms and says, based on the schedule the claim will
be ( ). Mr. Roth points to the L shaped living/dining areas
and says "two rooms." Also, the garage was omitted from the
agents count. Mr. Roth believes he is eligible for payment based
on an 8 room count.
Who is correct?
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Mr. and Mrs. Murphy
Mr. and Mrs. Murphy are an elderly couple who occupy a small (5)
room house that must be acquired for the project. This is a two
story house containing a dining room, kitchen, and living room on
the first floor plus (2) bedrooms and a bathroom on the second.
There is also a full basement used primarily for laundry purposes
and storage space for Mrs. Murphy's home canned vegetables,
fruits, and jellies.
What used to be a detached garage was converted to a workshop by
Mr. Murphy several years ago. He constructs a variety of small
items such as bird houses and lawn ornaments as a hobby. He
sometimes tries his hand at cabinet work but has not mastered
this skill as yet. The garage contains several small woodworking
machines which appear to be quite old and of little value. A
variety of odd sized pieces of lumber are stored in every
available space inside the garage.
Mr. and Mrs. Murphy have decided to relocate to a similar
residential property a few blocks away and Mr. Murphy plans to
reestablish his workshop in the garage at the new location and
continue with his hobby as before. Their neighbor for many years
owns a pickup truck and has offered to help with the move.
Although Mr. Murphy is retired, he is still in good health and
wants to help with the move but he is also conscious of his
physical limitations.
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Questions
1. What are the various moving options you need to explain to
Mr. and Mrs. Murphy?
2. What advice would you give Mr. Murphy regarding the best
method to move the personal property to the replacement
location?
53
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Mr. and Mrs. Cerrilli
Mr. and Mrs. Cerrilli occupy a small one-story house containing
one bedroom, living room, kitchen, and bathroom. Their household
furniture is early American, massive in size and heavy. The
house does not have clothes closets but they do have a very large
wooden wardrobe with several drawers along the bottom. This
piece of furniture alone must weigh 275 pounds.
The Cerrillis are in their seventies and almost unable to cope
with this forced move situation. In addition to the relocation
problem, Mrs. Cerrilli suffered a stroke a couple of years ago
and she is partially paralyzed and confined to a wheelchair.
The Cerrillis own their home and had a wheelchair ramp
constructed to ground level so that Mr. Cerrilli would be able to
m
get his wife in and out of the house. They would like to get
into senior citizen housing but the waiting list is quite long
and it may be a year or more before they can be accepted. In the
meantime they will probably be forced to rent a house or a first
floor apartment until they can get an apartment in the senior
citizen high rise building.
Questions
1. What method would you recommend that Mr. and Mrs. Cerrilli
utilize to move their personal property?
2. How would you solve the need for a wheelchair ramp at the
replacement rental property?
54
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3. Will your agency participate in the cost of a second move
when senior citizen housing becomes available to the
Cerrillis1?
55
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The Carusos
Peter and Ana Caruso reside in a small one-story frame house
which they rent for $350 per month, utilities not included. The
house has two bedrooms, one bathroom, kitchen and living room,
containing 750 square feet of living area.
Peter is confined to a wheelchair and manages very nicely in the
house which has extra wide doors and a ramp constructed at the
front of the house which provides easy access to the outdoors.
Peter receives a modest disability pension from Social Security.
Anna is a nurse employed at Fairmont General Hospital. Total
gross income is approximately $1,800 per month.
As far as relocation is concerned, the Caruso's are undecided.
They would like to purchase a one-story two-bedroom house if they
can afford the mortgage payments, but the only suitable property
within close proximity to the hospital has a listing price of
$52,500. With a 10 percent downpayment and 11 percent mortgage,
total monthly housing expenses, including taxes and utilities
would run about $845 per month. They are managing at the
present time with a total monthly housing costs of about $450 per
month.
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Two bedroom rental properties available on the market at the
present time are going for about $700 to $750 per month including
utilities. Due to Mr. Caruso's disability they would need a one-
story house with a ramp for access, or an apartment building with
an elevator. They really need two bedrooms because Mr. Caruso
needs a hospital bed and other special equipment which takes up
quite a bit of space. Mrs. Caruso also needs a bedroom where she
can get some sleep during the day since she works the night shift
at the hospital.
QUESTION
What are the alternatives for relocating the Caruso's, and how
can you assist them other than providing listings of rental and
for sale housing? To date, the assistance you have provided has
proven to be totally inadequate.
57
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Stark Reality
The Stark farm is in the rural area just outside Fairmont. The
area to be acquired from the large farm for the expressway has
two dwellings on it that are rented to tenants. The dwellings
are not DSS, but could be made DSS for a reasonable expense. The
occupants of each house are small families with income that is
borderline poverty level. Both families pay a low rent because
they provide some services to Mr. Stark. They are Mr. and Mrs.
Weather and their 9 year old son and Mr. and Mrs. Moore and their
2 children, a boy 3 and a girl 6. Rental housing is almost
impossible to find in this area, especially with the low rent
paid by the Weathers and Moore's. And, now that utility costs
and the 30% of income rules for tenants have to be considered,
the Agency is looking at steep HLR payments. Mr. Stark says that
he would re-rent to the Weathers and Moores, but he doesn't have
any other houses on his 198 acre remainder. Maybe the houses
could be moved?
Weather's Moore's
Monthly Income $400 $500
Monthly Rent $125 $125
Utilities* $130 $140
Hsg. costs/mo $255 $265
*Heating fuel, electricity, free well water
1. How much should the Weathers pay for housing costs each
month? the Moores?
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2. What do you know about the replacement housing payments
before you find comparables?
3. What would be the HLR payments if two comparables were
located for $225 per month and average utilities of
$120/month?
4. What HLR options would you consider for the Weathers and
Moores? If there were two comparables as stated in question
3? If there is only one comparable available? If there are
no comparables available? Is there any solution that would
involve Mr. Stark?
5. What options have you selected for the Weathers and Moores?
Do you have their concurrences? Approximately how much will
it cost for the Weathers? for the Moores?
6. What would happen if Mrs. Moore loses her job? She provides
the family income and there are no other jobs in the
community. 1) loses her job before relocating? 2) loses her
job 6 months after occupying the replacement house you made
available using HLR?
59
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Joseph Amato
Joseph Amato has owned and occupied a 20-year old 12' x 50'
mobile home on a rented site in Mountain View Mobile Home Park
for the past 8 years. The mobile home site is 30' x 60' and
rents for $75 per month which includes water and sewerage. The
mobile home has a small wooden porch about 4 feet square at the
main entrance with a metal awning. The mobile home is enclosed
with fiberboard skirting which is in a very deteriorated
condition. The mobile home itself has not been properly
maintained, but it is possible to install some additional metal
bracing underneath the floor area which enable it to be moved.
The structural repairs will cost $300.
Approximately 75 percent of the mobile home park will be
acquired, including the site occupied by Mr. Amato. The
occupants of the remaining sites will also be displaced due to
the loss of access created by the project. Replacement sites are
becoming scarce in neighboring mobile home parks which have tried
to accommodate those persons displaced from Mountain View. Most
of the other parks are charging a nonreturnable entrance fee of
$250 due to the strong competition for available sites.
QUESTIONS
1. Should Mr. Amato be classified as a owner or a tenant?
Explain why.
2. What relocation payments is Mr. Amato eligible for if the
60
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mobile home is acquired as realty?
3. What relocation payment(s) is Mr. Amato eligible for if the
mobile home is considered personalty by the acquiring
agency?
4. Is the $250 mobile home park entrance fee an eligible
relocation expense?
5. If comparable replacement rental sites are being rented for
$110 per month will Mr. Amato be eligible for a rental
assistance payment? If yes, how much?
6. The mobile home is not acquired because it is considered
personalty by the acquiring agency. It cannot be moved
without causing substantial damage and the cost of repairs
is unreasonably high, rendering Mr. Amato technically
displaced. Fair market value of the mobile home is $3,500
as established by the agency; trade-in value is $1,000
according to mobile home dealers, and salvage value has been
established at $500 by the agency. Comparable mobile homes
in good repair are selling for $8,500. Is Mr. Amato
eligible for a replacement housing payment? If yes, explain
your computation.
61
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James Bloom
James Bloom occupies a 14' x 50' mobile home which is located
within the project limits. He owns the mobile home and rents the
site which is located in a mobile home park. The mobile home is
in very good condition. Mr. Bloom also owns an 8' x 10' metal
storage shed which is located on this rented site. He wants to
move the storage shed to the replacement site as well.
You, as the relocation agent, have explained to Mr. Bloom that he
is eligible for actual reasonable moving expenses for moving the
mobile home. Mr. Bloom said he would think about the moving
options and let you know when he is ready to move.
Four weeks passed since this last meeting with Mr. Bloom and you
have been very busy helping other displaced persons on the
project with far greater problems. But in today's mail you were
surprised to receive a moving cost statement from Mr. Bloom
requesting reimbursement. The statement contained the following
claimed items:
1. Remove metal skirting $100.00
2. Disconnect utilities $ 25.00
3. Remove blocking and insulation $ 50.00
4. Install tow frame and wheels $150.00
5. Tow mobile home to new site (3 miles) $ 75.00
6. Setup charge, leveling, etc. $300.00
7. New skirting $250.00
62
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8. Reinstall insulation and blocks $ 50.00
9. Remove wheels $ 25.00
10. Packing fragile items in mobile home
prior to the move $100.00
11. Utility hook-up charge $ 50.00
12. Move metal storage shed $300.00
13. Lodging at Worst Western Motel (2)
nights at $43 including tax $ 86.00
14. Meals for (2) adults for (2) days at
$25 per day per person $100.00
15. Entrance fee at Green Valley
Mobile Home Park $1,000.00
16. Telephone Transfer $ 50.00
Total $2,711.00
Items 1-12 were well documented by an attached receipted bill
from Fairmont Mobile Homes, Inc.
Mr. Bloom's moving cost statement also contained an explanation
that temporary lodging was necessary due to a problem and delay
in hooking up the utilities at the new mobile home site.
Question
Are all the costs incurred by Mr. Bloom reimbursable? If not,
which items are not reimbursable, and why?
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ACE CAM AND GEAR COMPANY
The Ace Company custom designs and produces gears and other
rotating parts for the machine tool industry. The plant is being
acquired for a rebuilt interchange. It is a 30,000 square foot,
two-story building. The manufacturing operations are entirely on
the 20,000 square foot first floor. The second floor houses the
firm's administrative offices, design engineering department, and
a testing lab. There is a 15,000 square foot material storage
area outside, including 7,500 square feet of open sided sheds.
The building was specifically designed for Ace 20 years ago. It
is fully utilized and unable to accept additional business. The
firm would like to expand.
The city of Blakeville is very concerned that the Ace Company
relocate within the city in order to retain the employment and
tax base.
Ace Company has hired an industrial engineering firm, Jackson
Associates, to search for a replacement site and plan and
coordinate its move.
-------
Six months before the scheduled start of highway construction,
executives from Ace arrange to meet with agency right-of-way
officials to outline their move plans. They want a commitment on
reimbursement for various types of move expenses.
At the meeting the firm has presented the following itemized list
of projected expenses and a summary of its relocation plan.
You, as manager of the relocation unit, have been asked by the
Director of Right-of-Way to analyze and provide comment on the
firm's plans. In particular:
1. Which items are reimbursable?
2. Which items are questionable?
3. What additional documentation is needed to support move
costs?
4. What are the problems and pitfalls we should be aware of?
65
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ACE COMPANY RELOCATION PLAN
A 60-year old factory building has been optioned and is located
on Van Woort Street in Blakeville. It is a former shirt factory
and has been vacant for 15 years. Purchase price is $150,000.
It contains 45,000 square feet on 4 floors. The Ace company will
use the first three floors for operations and will construct a
7,000 square foot one floor addition. The fourth floor will be
used as dead storage. Projected costs are as follows:
Property Cost $250,000
Building Renovations $150,000
Building Addition $375,000
Architectual, Planning $375,000
Legal Fees $ 75.000
$850,000
Commercial buildings over 40 years old are eligible for a 20
percent investment tax credit for all renovation costs. The
local industrial development agency has given indications that it
would approve issuance of tax free revenue bonds for $1,000,000
to finance additions and renovations. The current interest rate
on these 30-year tax free bonds is 9-1/4 percent. The company is
preparing a request to the city for a 10-year tax abatement on
real estate improvement costs.
66
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The Ace Company has prepared the following list of relocation
costs for which it expects reimbursement.
RELOCATION COST ESTIMATE
1. Move Office Equipment $5,000
2. Reprint Stationary $1,500
3. Utilities:
A. Electric Wiring - In Plant 55,000
B. Gas Line From Street 5,000
C. Gas Service - In Plant 8,000
D. Telephone Wiring 2,500
E. Men and Women's Rest Room
and Toilet Facilities 10,000
F. New Waste Line - To Street 5,000
4. Equipment Modifications:
A. To Meet OSHA Safety Requirements 35,000
B. Rewire Motors from 25 to 60 Cycle 40,000
C. Parts Replacement 15,000
5. Dismantling Equipment:
A. Rigger • 4,000
B. Electrician 13,000
C. Plumbing 3,000
6. Load and Transport Equipment 12,000
Extra for:
A. Premium Time - Nights and Weekends 6,000
-------
B. Phased Move 4,000
7. Reinstallation
A. Pits, Pads, Foundations 15,000
B. Reassembly 10,000
C. Leveling and Calibrating 5,000
D. Utility Reconnections 4,000
8. Move Planning 12,000
9. Ace Supervisory Personnel 9,000
10. Insurance - 4.000
Total $283,000
68
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Searching Expenses
EDITED COPY OF A LETTER SUBMITTED IN SUPPORT OF SEARCHING
EXPENSES
Dear
This is to advise you that I have completed the move of my
business, , from Sixteenth Street,
NW. to 527 Armour.
In the search for a replacement location, considerable time was
spent away from my business. This time was of great value to me,
causing me to miss time that I could have spent with my clients.
I hereby request reimbursement from the Department of
Transportation in the amount of $1,000.00 based on $20.00 hourly
rate for over 50 hours. From a period of March 3, 1989 through
July 29, 1989, I spent numerous days with Mr.
This time spent was well in excess of 50 hours.
I hereby certify that this is a true statement and apply for
reimbursement. Your prompt response in the handling of this
matter would be most appreciated.
Very truly yours,
Questions
1. How do you respond to this letter?
2. What would you do if you were the relocation agent for this
business?
69
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THE DUMPRY ARMS HOTEL
Mr. Ken Dumpry has just signed the agreement for the sale of his
30 room (single room occupancy) apartment building to the State
for $175,000. Dave Kup, the acquisition agent, told Mr. Dumpry
that you, Jim or Jill Crown, Business Relocation Agent for the
State, would be making an appointment to explain how he will be
reimbursed for the cost of moving all the personal property in
the building.
DUMPRY'S PROBLEM
Mr. Dumpry reflects on the day's events on the way home. He is
moderately pleased at the purchase price for his 75 year old
former hotel in which he has rented furnished rooms to elderly
residents on a month-to-month basis. Dumpry feels increasingly
uneasy however, about his meeting with the relocation agent. The
room furnishings are old and in poor condition (some he knows are
infested.) The 20 unit apartment building he has recently
purchased has most of the units rented unfurnished. The units he
plans to rent furnished will not be enhanced by the furniture
from the acquired building. Also, what is "personal property?"
Dumpry thinks of the iron fire escape he paid $5,000 to have
installed 6 years ago. And what about the walk-in cooler left
from his hotel days? The cost of the sprinkler system in the
lobby and hallways that the city made him install just 5 years
ago at a cost of $10,000, the cost of cafeteria equipment (steam
tables, gas ovens), custom built counters, the air conditioners,
switchboard, etc., began to worry him. The more he thinks about
70
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these things the less certain Dumpry is that they were fairly
considered, or considered at all, in the real estate settlement
he just signed.
On arriving home Dumpry pours himself a double scotch. He is
still worried and decides to call Dave Kup at home to settle his
mind. Kup says he does not know what individual items were
included in the settlement. The appraisal stated that the
building contained "typical fixtures and improvements."
"Anyway," Kup said, "don't worry, the relocation guy will settle
your problem. He has a program called "direct loss," I do not
know exactly how it works but essentially you will be paid for
not moving items which you own."
CROWN'S PROBLEM (2 weeks later)
You (Jim or Jill Crown) have just arrived back at the office
after your third meeting with Dumpry. At earlier meetings you
had explained the process for direct loss of tangible personal
property and asked that Dumpry secure an appraisal of value for
continued use and an estimate of the cost to move the property
for which he expects to claim a direct loss payment. Also you
have told him that he must make arrangements to sell the property
and apply the net proceeds of the sale against the claim for
direct loss. On the first visit you made a quick inspection of
the buildings contents with Dumpry. You recall seeing a great
amount of well used furniture and equipment, consistent with the
use as an old residency hotel. You made a point of telling
71
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Dumpry that the direct loss claim could not exceed the appraised
value for continued use of the property less the net proceeds of
the sale, or the cost of moving the items, whichever is less.
You expect a claim in the range of $5,000 - $10,000.
At this point you decide to open the envelope Dumpry has
provided. After quickly reviewing the appraisal, the moving cost
estimate and the letter concerning the sale you discover that the
claim may be a great deal more than you had expected. You decide
to arrange a meeting with Dumpry and you ask him to invite the
mover and the appraiser.
Review the attached material which Dumpry has provided. What
questions, requests or advice would you plan to present at the
meeting? How well did you explain the direct loss alternative to
Ken Dumpry in the first place, you ask yourself? Did Dumpry
understand your explanation? What action should you take?
72
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APPRAISAL
Personal Property - Dumpry Arms Hotel
Dear Mr. Dumpry:
The following is my estimate of value in place of items of
personal property at Dumpry Arms based on inventory supplied
by Mr. Dumpry.
Sincerely,
Joe Swell
Professional Business Consultant
30 beds @ $300 ea. - 9,000
30 bureaus @ $350 ea. - 10,500
30 room telephones @ $50 ea. - 1,500
32 12" TV sets @ $250 ea. - 8,000
5 typewriters @ $275 ea. - 1,375
4 Victor mech. adding machines @ $75 ea. - 300
34 coffee tables @ $50 ea. - 1,700
85 upholstered chairs @ $150 ea. - 12,750
15 illuminated EXIT signs @ $50 ea. - 750
1 wal in cooler - 2,000
1 gas oven - commercial - 1,000
10 kitchen tables & chair sets @ $200 ea. - 2,000
35 9 x 12 carpets @ $100 ea. - 3,500
1 fire escape - 5,000
35 room air conditioners @ $250 ea. - 8,750
cafeteria table ware - 1,000
cafteria steam tables - 2,000
25 square tables @ $125 ea. - 3,125
75 cafteria chairs @ $35 ea. - 2,625
3 freezer chests @ $400 ea. - 1,200
1 L shape formica and pine clerks
counter with shelves - 2,500
250 wood shelves @ $4 ea. 1,000
35 bookcases @ $10 ea. - 350
1 telephone switchboard - 1,500
54 heat sprinkler system - 10.OOP
TOTAL value for continued use - $93,425
73
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MOVE ESTIMATE
Dear Mr. Dumpry:
We are pleased to offer the following quotation for moving the
items of property located at Dumpry Arms as per your inventory
to a location within a 50 miles radius of the present site:
- $90,000
The above amount includes all special trades and work needed to
detach and reinstall equipment and fixtures at new location.
Thank you for the opportunity to make this estimate.
Sincerely,
Jason Moving Company
74
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AUCTION PROPOSAL
Dear Mr. Dumpry:
We would be pleased to conduct an auction of property located
at your building - Dumpry Arms. We will handle all details
including advertising organizing and tagging items and
conducting the auction. Our fee will be 15 percent of
gross proceeds plus permits and taxes or a minimum fee
of $1,500. We will require a $500 advance fee upon
acceptance of this proposal.
Thank you for considering our firm.
Sincerely,
I. M. Horse
Auctioneer
75
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76
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CLIMBERS WORLD
Mary Sue operates Voegle's Climbers World mountain climbing shop
in the Helena area. The shop has built a good reputation among
local climbing enthusiasts. The shop is being moved to make way
for an expanded interchange. Mary Sue presents the following
list of expenses she has incurred. Categorize these expenses as
"Moving Costs," Reestablishment Expenses", or "Ineligible Costs",
1. Reinstallation of compressed air system for filling rescue
tanks. Cost $800.
2. Interest on loan taken for payment of moving costs - $450.
3. Decoration of the new shop in "Big Sky" blue. $1,000.
4. Estimated increase in operating costs, $7,500.
5. Attorney's expenses, lease negotiations, $1,500.
6. New exterior advertising sign, $1,750.
7. Profit loss due to a 3 day down time as a result of the
move $2,500.
8. Advertising consultant to notify customers, $1,200.
9. Cartage of personal property from subject site to
replacement site, $7,500.
10. Cost of a new telephone system, $1,800.
11. Replacement of envelopes and preprinted checks, $250.
12. Display area needs expanded, resulting in removing several
walls, estimated cost $5,500.
13. One time impact fee for sewage hook-up, $15,000.
14. Hospitalization for two employees injured while making the
move, $2,500.
15. New carpet to match the existing furniture, $3,000.
16. Construction of an detached garage for storage of inventory,
77
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THE MEN'S SHOP
George Green owns and operates a small men's apparel shop in one
of the original neighborhood shopping centers which was
constructed about 1950. The shopping center is located on the
corner of a very busy intersection comprising an area of
approximately 1/2 city block. The center contains a variety of
stores and shops. The customers' parking area is small and
traffic is usually congested. The appearance of the stores has
become somewhat run down during recent years.
The rental rates are quite reasonable and has enabled most of the
businesses to operate at a profit even though earnings are on the
decline.
The shopping center is being acquired to provide the area needed
for an interchange connection to the expressway. A considerable
number of residential properties have already been acquired;
acquisition began in September 1986.
The Men's Shop was opened by George Green in 1976 and with the
help of his wife, the business has prospered. However, since the
acquisition began sales have decreased dramatically.
Negotiations for the acquisition of the shopping center began
October 1988 with the owner; George will probably have to vacate
shortly after the first of the year.
A new shopping center was recently completed about a mile away
78
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and an 800 sq. ft. space is presently available if George decides
to relocate the business. The location is ideal and pedestrian
traffic is excellent, but the area of the store is larger than he
needs and the rental rates are considered high by George at $15
per square foot. His present store has 500 square feet of space
and rents for $10 per square foot. The relocation agent has been
unable to locate any other suitable sites for rent or for sale to
accommodate the business.
George is presently 64 years of age and is not sure he has the
stamina to start over again. George is considering taking a
"Fixed Payment" (ILO).
Yearly annual Net Earnings are as follows:
1988 $6,800
1987 $7,250
1986 $10,000
1985 $18,500
1984 $18,000
1983 $14,000
1982 $10,500
Questions
1. Do you believe George could relocate the business to a new
shopping mall and be profitable?
79
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2. Explain George's options?
3. Is there sufficient justification for an "in lieu" payment?
If so, what criteria would you consider?
80
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THE HURRICANE FIZZLE COMPANY
The Hurricane Fizzle Company is a. private company specializing in
finding replacement personnel to salvage fading sports programs.
The Fizzle Company is run by J. J. and his wife of Dallas, Tx.
1. Based upon the attached returns determine the Fixed Payment
(ILO).
2. If the 1984 tax return remained the same, but the 1985 tax
return showed a Net Income of $15,000 what would be the
amount of the ILO payment?
3. On the other hand, if the 1985 tax return remained at
$15,000 but the 1984 Tax Return showed a Net Income of
$9,000 and a salary paid to Mr. J. of $10,000, and a salary
paid to Mrs. J. of $5,000 what would be the amount of the
Fixed Payment?
81
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I 1040 U.S. Individual Income Tax Return
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If joint return, does your spouse want $1 to go to this fund?.
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Filing Status XX
Check only
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1
2
3
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10 Taiabie refunds of state and local income taies. if any. from the worksheet on page 9 of Instructions.
11 Alimony received
Business income or (louKanacnScnedtrieC;
Capital pm or (\au) (ttttch Sehtaulf D)
12
13
14
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40%odvct»n. from the worksheet on page 12 .
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Abmeny part (raueMl»last uaM ___________
Deduction for a married couple when both worn tintcfi Sa*3v» W)
Add imn 2< threufh 30 These are vour total adjustments
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37 Tacablt Inetmt. Subtract lint 36 from tint 35. Cnttr tht rtsult (but
38 Cnttr tai htrt. Chtck if from Q Tai Tabia. D Tai Rjtt Schtduit )
39 Additional taats. (Stt pa|t 14 of Instructions.) Cnttr htrt and en
D Form 4972. or Q Form 55*4
40 Add imts 38 and 39 Cnw tit total . . ....
4 1 Cf tflrt for cniM and dtotnetnt cart notnsts (trticn Form 2*41)
CrfcoliS 42 Crtdit lor tht tidtrty and tht ptrmantmty and totaiiv disaMtd
(irttcn 5c/it0s/t ff)
f Stt
Instructions 4' RtsiOtntial tntrfy crtdit (ttttcti form 5695)
on p«(t 14) 44 avtiai crtoit for political comnbutwns for which you ha»t rtcttpta
45 Add lints 4 1 tnroufh 44 Thtst art your total ptrsonai crtdita . .
46 SuPtractiint4Sl,-o.'nunt40 Cnttr tht rtsurt (but not ttss than »ro
47 Fortifn tai crtdit (ttttcn form U 16)
48 GtntraibusmtucrtdiL Chtck it from Q Form 3800.
D Form 3468. Q Form 5884 Q .Form 6478
49 Add lints 4 7 and 48 Thtst art your tout busmtss and othorcrtcrB
50 SuStrtrt tmt 49 «fc«*itnt46 Enttr tnt 'Mu-T (Cut not itss than itfO
Ulncr 52 Alttmatrat minimum tai (trttcfi Form 6231) .
(Inciudmc ** SocalstcurrrytaiontipincorritnotrtoontOtotmoloytr^nacAfo
Aform5129;
Piymtnrs) 56 Add lints 50 throufn 55. This is your tttal tw
59 Carrtfl womt crtdit (stt otft 16) ... , .
vfz^lc"* *° Amount p*d with Form 4*68
anowZF 61 beoas soool steunty tax and MTA taa wrthnttd (two or mort
to Irom. Maaua-Mn
62 r>aMftrFtdtr«tHtnpsolmtandsoocuMfutls(Maa)/«rt)4/3i;
63 lltfuaMtd invostmtnt Company crtdrt fifttcft form 24 39). . .
64 Aoflhnts 57 throutjn 63. Thtst art your tttal Mymtnta . . .
•i Vant64«tanjtrmanl*it 56 tnttr amount OVIMPAIO . . .
Amount 67 Amount of *nt 65 to bt»w««dto your 1986«imt»«tM . . . a>
YOU Owt jkj « km 56 oanvtrwMM.tiw AMOUNT TOUO^^Aftadichact
_ . Under iintBia tt t*n*i. 1 OK»n m* i K^» •MHIXM ffw mturn MI mjtmnia
•.• -. -.- • . .>• .••; i^^.*/.-. o.
from Schtduit A. Dnt 26. ".; '
i daptndtnt on your paranttr
tot pact 13 if you art momod
34b|
34cl
34d
f (stt pa|t 14)
not itsa than itro) ....
C.Y.orZ.or D SchtduitG
tck if from O Form 4970.
41
42
43
^ 44 i
)
47
48
) k»
rm4137)
. »>
87 530J40
sr
59
6C 1
61
62
63
»»
^
p,
67
•l»85Ftrti 1040" tat. ....»
S
13 855 =:
34t T3.S3QJCr
1
fe
34.
1
35 f ]?. 573:1 -
36 ' 7 ?BO r'"
37 ( 5.393.::
38 • -0-
39
40
45
-0-
-0-
-0-
46 ' -Q-
H
1
50 ' -0-
51 '
52 -
!3 i
54
S3
56
•
''&
64
-0-
530.
40
«s 530.40
66 530J40
68
'tf/'&Xft^'rWftfflffi/fy
_. _ »_^_ __ _ i ... . .- ~* « « .-».••• Ka> ». «
rl
5l£fl W It.,, y A« Qf k
u m , , UULT L \ -HP ^ ,.. _, _ —
^^^^ w T^Hf ^tffWt^V OM9
A_.^ ^^ ^O
f SotwM i Mtjnttwm ("M"4 IB»OT, BOTKrnu* h$7i)
Pr»Birf s MCXI Mcwty ng
CfMoi* rn . .
I E.I.NO
-------
SCHEDULE C
(Form 1040)
Department et the Treasury
imemai Revenue Servo (0)
Profit or (Loss) From Business or Profession
(Sole Proprietorship)
Partnerships. Joint Ventures, etc.. Must Pile Form 1065.
Attach te Form 1040 or Form 1041. > See Instruction* for Schedule C (Ferm 1040).
09
Name o» proprietor
A~
product or service (see instructions)
C Business name and address
• Principal business cao« from p»gt 2
3079
C Method(i)>ised to value dosing inventory:
(l)£?Co*t (2) Z Lower of cost or m«r*et (3) Q Other (attach etoianation)
r Accovrvsg merss (1)5? Casn (2) C Accrual <3> ^ Ot^e'(specify) ^
C Wat there any change m determining Quantities, costs or valuations between ooenmg and closing inventory'
H "Yes." attach emanation
H D'fl vou aeduci noenseJ fe* an ef»'gf m yojr nom>* .
0 Employer iD number
1 a Cross receipts or sales '•
p Less Returns and allowances • • • •
c Subtract line Ib from ime la ana enter the balance here
2 Costof goods soon
from Form 4562 (not induced in Pan III
below) . ...
13 Dues and publications
14 Employee benefit programs . .
15 Freight (not included m Pan Ml below) .
1C Insurance
17 Laundry and cleaning
18 Legal and protemon* service* . .
19 Mortgage interest patf to financial
institutions (see instructions) ....
20 Off>ce expense
21
3,400.00
Jbl
3.016.00
22 Person ana profit-snaring plans
23 Rent on business property . .
24 Repair, MAI NT ...
25 Suppites (not men/fled m Part in below)
26 Taxes (Do not include
Profit T*i nere See »ne 30 )
27 Travel and entertainment .
28 Utilities ana telephone
29 a Wages
16,500.0
1
6..97Q.O
1.280.0
7.£65.9
6,840.0
b Joes credit
c Subtract ime 29b from 29a . . .
30 Windfall Profit Tax withheld in 1985
31 Other expenses (specify).
..REFUSE
K520iCC
«.EQUIPMENT/RENTAL/REPAIR.
4 .MISCELLANEOUS
, DRAWLS
f ASS- DUES. CONTRIBUTIO
g CONTRACT LABOR "
1.094. PC
172.2'
62.7i
U,985.0(
3,900.0i
15,600.0i
32 Aaa a mourns in columns torhnes6 tnrowgnJlg Tnese are the total deductions
32
83,663.
33
Net profit or
(lots).
ul»SF
Subtract tine 32 from line 5 and enter the result If a profit, enter on Form
Parti Me 2 for Form 1041 Ime 5) If a loss you MUST a on to line 34
1040.
line
12.
33
( ^
,737
!2
34 H you have a wss. you MUST answer this question "Do you h«ve amounts for which you »re not at nsurn thrs bunnev- seetnnructions)' Q Y«J
If "res." you MUST attach ferm <198. H "No." enter the loss on Form tQ4Q line 12. and on Schedule SE. Part I. une 2 (or Form 1Q41 i.nt 5)
l;/-;m cost of Goods Sold and/or Operations (See Schedule C Instructions for Part I
1 Inventory at begmmng of year (if different from last year s dosing inventory, attach explanation) .
2 Purchases less cost of items withdrawn for personal use
3 Cost of labor (do not include salary paid to yourself)
4 Materials and supplies ....
5 Other costs
6 Aod lines 1 through 5 . •
7 Less inventory at eno of year ...
8 Cost of |»oes sold and 'or operations. Subtract im« 7 *'om i.ae 6 Enrer here anp .n Ptn i line 2 above
500.0
44,050.1
44,550.
500.(
8 I
44,050.
ft* **t»r
-------
11040 U.S. Individual Income Tax Return UD34
r vjf* MIT January I -
19M. o> otn» tti T«*
. 19M
. 19
I CUB No
UM
IMS
Ottwr.
TOW hm n*m IM mui (rt wrn rtttx-
•"«••• i n«n* *na mtwil
w «••» routt)
PRODUCTION
HOME
fruiflintul
Btction
Ooyou warn 41 to goto tnis tuna?
If joint rttum. does your spoust want S1 to go to this fund?. .
XX I NO r^ff
r« •
XX
Filini Status
Chock onty
ontoox.
1
2
3
4
XX
Exemptions
Always entck
XX
I For
*ct *nd Piotrwerl
Notict SM lnstrKt<
ilmf joint fttum (tvtn if only ont h»0 incomt)
Mirmd
En If numotr .
r< n WITT Mm • f^^
XiWlW \-
Moak •> L2
WMoak
Total
36)
c
i ^w*QPt MM
IB J30»f •» I
Incomt
Pt«a»t anacn
Copy 8 Of your
FormiW-2 W-2G.
. uian^t. up*. «tc
. t»
rf you do not nav*
a w-2. stt
p»|t A ot
Instructions.
9a
c
10 Refunds of State and local income tarn, from the worksheet on pafe 9 of Instructions (do nor enter
in inount unini you /remuM otovttiom 'or that* tun m tn timer ^«r—««« Mft 9) ...
11 Alimony received
12
13
14 4Q% e« capital pm distributions not reported on hne 13 (see paeje 9 of Instructions)
IS
u
17a OHM> n~~*~» *Mt *«r**tm* JHftuAf^ mtH—* T«»«l n^».^ ! *7* ! j
• Tauo>e amount rf any, from me worufteet on page 10 of Instrueaom
11 ReTO. royertie*. partnerships, estates, trusts, etc. fJttacrt Sc/>e*u» f;
»WA«^ak ^a^»rii^Be^Bk «iv e^Mei % /jW**^^A C^4h^M^» i^* a^
r •mi VWW Vv \l«ll*/ (tJfUV JdwvW r/, ..*••..••»•*.•
20« Unemployment compensation (insurance).
7 i .£!,•»'».''
• 1
'/',,„, ',:,\
ftHHMtH4
, 9.1
b',;;//i
y/titt//*/**
10 i
20a
macn cntcn
w moorr
irotf n«f».
tlOof imtructiom.
2U Social security owwftts. (»M paf* 10 of Instructions) . . . .Lili.
t Ta&Oteamcuntrfany. frommewontsfteetonpafe llof Instrucums.
8 Oth»VK«ntUtaiiaatveea«aHn»--Maj«illi
11
12 i
7.99^17.
13
14
19 I
20* I
21b
23 Add liim 7 throufn 22. This is rovr totaJ incMt*
k> 123
Idjustmtnts
Se«
nstru
lonsi
-nil.)
24 Mowing
(MMft Form 3903 of 3903f)
(trttcn Form 2106) L£L
2(ai
k Cntsr ntrt MA pcrnwrns you mt)d« m 1915 that art nctodad
27 ^aymems to a Keocn (U.K. 10) retirement ptan
21 Penany on earn/withdrawal oisavmfs . . .
29 AJimonyp**
30
21
T/rf '//it
•rffM1'',
30 >
31 Add lines 2* throue* 30 These are vour total adjustments »
>"*e 31 rrom line 23. Tms /* jour Miyatee* cross utceme. it rms un* i* *ru men
r' /'//A/^i
\'ttilttHl\
131 !
dL
djusted
$10.000. M» "CtrnfO tncvnf Crmf(iin*59)onpigt j6 o/Jnsmxtwn*.
-------
Form 1040M9W1
Tu
CofllpB-
tltiOB
52.
Wtrvie*
tens on
PWH3-)
Credits
(Stt
Instruc-
P««t 14 )
Other
Taxes
(Inc-uflmg
Advanct
EIC
Paymtnu)
Payments
Attacti
Forms W-2.
W-2G. and
W-2P
to trout-
Refund or
Amount
You Owe
13 Amount from lint 32 (ad)usttd |rou ineomt) • •
»4« lfyMftamat.iltacnSctMdutoA(FomUOlO)ar4sflttrtntanM^
Caution: If r«u "** unMmtd ncomt and can Ot otomtd M a dtotnatm on yv oartnTl rtbn,
CfcKfchtrt •> U and swpatt 13 Of tht Instructions. Also stt ptft 13 if:
• You art mamtd Wing a stparatt rttum and your spoust rttrmxM dtducttom. OR
•You fit Form 4563. OR • You art a dual-status Man.
Wptgt 14. Thtntntt/tfit BJlOMbtt part o< your contnbutwns htrt
IS fciMrKtUrtt34aor34b.«micfttwappli«.fromlint33 . :
M MuttiprySl.OOO by tht total numbtr of «tmptio«clam>td on Form 1040. lint 6t
37 Taxabtt Incomt. Subtract lint 36 from Imt 35
34 Tax. Enter tax htrt and chtck if from (S Tax Tablt. U Tax Ratt Schtdult X. Y. or 2, or
D SchtdultG
39 Additional Taxts. (Stt pagt 14 of Instructions.) Enttr htrt and chtck if from [j form 4970.
D Form 4972. or U Form 55*4
40 Add lints 38 and 39 Errttr tht total *•
41 Cradit for child and dependent on mt^nt^^Hfeh farm 2441) 4l
42 Crtdrt for tht tldtrty and tht ptrmantntly and totally doabftd
(tttief* Sc^»tfi//« It)
43 RtSldtnt4l t"«*fy Crtdrt (ftfC* Form 569S) 4*
45 Add lints 4 Ithroufn 44. Thast art your total ptrsonalcrtdits
4* Subtract lint 45 from 40. Enttr tht rtsult (but not Itsttnanaro)
41 Gtntrai busmtss crtdrt. Chtck if fromQ Form 3800 Q Form 346C.
[j Farm MM [j Farm U7> <•
49 Add lints 4 7 and 48 Thtst art your total busintss and othtrcrtdrts
50 Sub*rietlint49from46 Enttr tntrtsuit fftut not itss tnanxtro) »>>
51 Stif-tmpioymtnt tax (iHKfi Sefteauit Si)
52 Alttmatwt mirwmum tax (ittteft Farm 6251)
S3 Tax from rtcapturt of invtstmtnt crtdrt (intcfi form 4255)
54 Social stcurrty taxon tipincomt not rtporctd totmpioytr^rtac/i'0rrn4JJ7^
55 Tax on an IRA (itticti Form 5329) ....
S« Add hnw 50 throuff 55. Thri »s your total tax t»
47 F«t^alineamtt«x»tnhMl . 57 1 2.570 90
59 tamtd ineomt rrtdrt rt fcntSSisuidtr HO'TOO Mtpt(t 18 "
•0 Amount paid with farm 48£A . ........... . *°
Cl Cxctss social stcwrrty ta> and RRTA tax wrtnnttd (two or mart
« fro^fr^s*iri4t»i»psi4-frtf«rit'f»f^r»ffif*F«<;» •*
M RtfuUttfl hwtftmtm Co^pt^y ertflt (»n*f* farm ftm ,M*^,. ,_„ ..,.-.,-
•4 Add hnts 57 through 63 Thtst ar* your total oaymtntt »>
•S Iflintl4islarftrtnanhnt56 tmtr amount OVERPAID **
M AmotfTtof hnt65tobtRCfUNDEOTOYOU ^
ptyabttto'lnttrnalRtvsiwSsnca/'Writtyourtdcajlstcur^rwrttv . • >
33 ( 29,474, :
**• 1? 0s;? c
1
IP
34b,
35 17,4?? t
« 7.0QO.C
37 10.422.4
mm |
" 1 879. C
39'
40 87?
''i'W/h
*£\
.C
D-
4« 879. C
>"/f/'\
4? .(
50 87 9. C'.
51 903 ;•:
52 '
53
54
55
5« 1,782
///7//3
m
«4 2,57
4
),
65 i 763.i
t* 788^
61
l^4/tr>:;?-,/.'?"r:T/^.T'
Pleas*
Sign
Here
. * o*cttr« mm i
tn«
IMAY 10/1985
Tour tifiuturt
0«tt
Plil
Pr»parer'j
UM Oalf
Pr*Mr»r'( \
Si|>Uturt |f
Firm t n«mt
-------
SCHEDULE C
(Form 1040)
OMtfTrrwnt of It* Treasury
IntcrnM ftt*«nu« Service (01
Profit or (Loss) From Business or Profession
(Salt Proprietorship)
Partnerships, Joint Ventures, etc.. Mutt Fit* Form 1065.
> Attach to Form 1040 or Form 1041. > See Instructions for Schedule C (Form 1040).
Name at proprietor
OUtN, 114W
HS)8.
09
SecMM Mcwrty MMiiMr
A Mam bwnmoetlvrry (see Instructions)
Product or Service
I Business name end address |*
i £
0 Methoo(s) used to value closing inventory:
(1)21 Cost (2) Q Lower of cost or market (3) C Other (attach explanation)
t Accounting method. (1) £7 Cash (2) D Accrual (3) u Other (specify) ^
F Was there any change m det ermmmg quantities, costs, or valuations between opening and closing inventory' .
If "Yes." atricn explanation.
C Did vou oeauct «ioen«es 'or an office in YOU' "om«>
yw^fiil incomt
1 a Gross receipts or sales
fe Less: Returns and allowances
c Subtract line Ib from line la and enter the balance here
2 Costof goods sold and/or operations (from Pan ill. line B) ....
3 Subtract line 2 from line Ic and enter the gross profit r»ere
4 a Windfall Profit Tas Credit or Refund received m 1984 (see instructions)
e Other income
5 *de"i«es 3 4a IPO 4b Thu ,» the fross income i**
I^I^iJ Deductions
C Employer 10 number
—
! 1 M I t
Yes *
1
la I 98,704-
Ib i |
le 1 98,7Ci
2 i 42.737.
3 ! 55.957.
** I 1
*• i 1
S i 55,967i.
, M^...-, 1,222.00 MBMMm
7 Bad debts from sates or services (Cash
method taxpayer*, see instructions)
• Bank service charges
9 Car and truck expenses
10 Commissions
11 Depletion
12 Depreciation and Section 179 deduction
from Form 4562 (not included in Part
ni below) ... . .
13 Dues and publications . ...
14 Employee benefit programs ....
IS Fret^nt (not inctjdeo m Part III betow) .
1C Insurance
17 merest on busineuinoeot eitness . .
IS Laundry and ctoonme
19 Legal and profesaanet serwces . . .
W Off ice eipenoa) , , ,
Zl Petntonandprewt ahannf pians . . .
t2 Cent on busmen orooenv . . .
10; .LL
P51 [j&
213 R5
TIP p^
?4 ^fi
T Q pnn hn
24 Supplies (not me
23 Taxes (Do not
Profit Ta* here. S
2t Travel and entert
27 Utilities and teiec
21 a Wages . .
e Jobs credit
c Subtract line
29 Windfall Profit T
30 Other expenses (
o. LOANS....
•EQUIPJiENT
«..MISELU>
uded m Pan ill tx
1 include Win
•e line 29.) '.
ammem . .
mone . . .
280 from 2&a
u withheld m 1
specrfy):
How)
3tan -
984
^REKTAL/RERAI
JiEOUS
.YS.TEMS
• DRAWLS
f ASS, DUES CONTRIBUTI
1
S)
I
11 Add amounts m coMMnns for knes 6 through 30i. These are the total deduction* k»»
12 Net profit e» (leeav Subtract tow 31 from tone S and enter the result. If a profit, amor on Form 1040. Une 12.
and on ScheduieSE. Part l.lme 2 (or Form 104 Mine 6) if a loss, you MUST fo on to line 33 . . .
31
32
4.912!
251.
6,524
(
2,577!
'•/ •• /!• ' ' '• •'•'/' . / i
'///.;;• ,/f ,,;'/,'.'/', ".',/'//I''//M//'"%
10.614
R 757
c
p
320 6
405
C
59*. f
DNS 134
47,972
.
i
7,9941
13 M you ha^ a loss, you MUST ar»wertn«so>i«tion:"r> you nave amouno for wrtchyow are riot at m^
"Yes." you MUST attach Form «19t. If "No." enter the lots on Form 1Q4Q. lm« 12. and on Schedule S£. Part I. line 2 (or Form 1041. line 6V
«t of Goods Sotd and/or Optrattont (So« Schtdulo C tnitructJoni for Part III)
I awontoty at bet>n«*m of year (if deferent from last year's doamg *>»ontoiy. attacft oipianaoon) . . .
2 Purcnaso *oi» cast at items antnorawn for personal use
3 Cost of laoor (do net include saury pato" to >ourseif)
4 Materials and supplies •
S Other ctm»
• Add lines 1 through S
7 Less- Inventory at end of year
I Cest ef goMt s«M and/or operotfens. Subtract hn« 7 from line 6. Enter nere and m Part I. (me 2. above
J_
3
4
_S_
«
"T
i
5001
42.737J
500.
-------
Construction Stage Problem
The Engineers have decided that the Federal-aid Secondary Project
on old Berry Road must be advertised next Thursday for the bid
opening to be held a month from now. This project was originally
scheduled for advertising three months from now, but the Federal
funds have to be used right away as the original project
scheduled would cost more than the funds available.
There are a total of 32 parcels;
1. Twenty-eight have been purchased and cleared.
2. Two have been purchased and leased to short-term occupants.
3. The negotiator is waiting for a right-of-entry for an
unimproved parcel from the Best Land Development Company.
4. One improved residential property has been acquired, but the
90-day notice does not expire for 20 days. The occupants
have not yet selected a replacement dwelling.
Questions
1. What should be stated on the right-of-way clearance
certificate?
2. What additional information is needed to fully evaluate this
situation?
3. What needs to be done to clear this project?
4. What responsibilities does the Relocation Agent have to
clear this project?
5. Are there any time frames to be established?
6. Could this situation have been avoided?
82
------- |