Right of Way Success in Right of Way Under the Uniform Act Alaska - PDF document

2/1/2018 Empathy …. not Sympathy Understanding why and relating to others feelings because you have experienced it yourself or can put yourself in their shoes. not ……. Acknowledging another person's emotional hardships and providing comfort and assurance. Alaska 2018 Empathy Steps • Listen attentively to what the other person is saying • Let your body language convey empathy • Reflect upon what the other person just said Alaska 2018 Empathy Steps Validate the other's emotions; and let them know you heard them and understand what they just said Offer personal support if appropriate I know what you are going through, dear. I buried my husband last year - but they found him in time. Alaska 2018 FHWA Resource Center Env ‐ Realty Team 22

2/1/2018 Empathy Steps • Engage the other person in a partnership • Show respect whenever possible Alaska 2018 LISTENING Alaska 2018 Listening • Passive Negotiation Listening • Acknowledgement Listening • Active Negotiation Listening Alaska 2018 FHWA Resource Center Env ‐ Realty Team 23

2/1/2018 Listening Skills  Be motivated to listen  If you must speak, ask questions  Be alert to nonverbal cues Alaska 2018 Listening Skills Oh, I’m sorry, Did  Let the other party tell the middle of my her/his story first sentence interrupt the beginning of yours?  Do not interrupt when the other party is speaking  Fight off distractions Alaska 2018 Listening Skills  Write everything down  Listen with a goal in mind  Give the other party your undivided attention Alaska 2018 FHWA Resource Center Env ‐ Realty Team 24

2/1/2018 Listening Skills  React to the message, not the person.  Don’t get angry  Remember, it is impossible to listen and speak at the same time Alaska 2018 EXERCISE Listening Alaska 2018 Review Can you name the four skills you need to Negotiate? Alaska 2018 FHWA Resource Center Env ‐ Realty Team 25

2/1/2018 1. Communication 2. Credibility 3. Empathy 4. Listening Alaska 2018 Styles of Negotiations • Attitudinal • Bargaining • Integrative • Intra ‐ Agency Alaska 2018 Attitudinal • Important in all negotiations • Create relationship pattern ( open / restrictive) • Need communication Alaska 2018 FHWA Resource Center Env ‐ Realty Team 26

2/1/2018 Bargaining • Win ‐ Lose • Advocate for one side • My Interests • Restricted Communication Alaska 2018 Integrative • Win – Win • Problem Solving • Mutual Interests • Collaborate Alaska 2018 Intra ‐ agency • With in your own agency • Should not be bargaining • Not time consuming • Can be the hardest Alaska 2018 FHWA Resource Center Env ‐ Realty Team 27

2/1/2018 CONFLICT STYLES Alaska 2018 Alaska 2018 Competing/Directing • Strategies – Discourage disagreement, persuade, be firm, set limits Power - • From one’s role /position Benefits – • Speed, stability, preservation of one’s values • Costs – Destruction of relationships, loss of cooperation, anger depression Focus on Agenda - High Focus on Relationship - Low Alaska 2018 FHWA Resource Center Env ‐ Realty Team 28

2/1/2018 Collaborating • Strategies – Assert oneself while inviting other views, welcome difference, seek additional information • Power - From trust, skill, ability, creativity • Benefits – Mutual trust, high potential for creativity and growth • Costs – Fatigue and time loss, analysis paralysis • Focus on Agenda ‐ High • Focus on Relationship – High Alaska 2018 Compromising *Strategies– Urge moderation, bargain, split the difference •Power - From moderation and pragmatism •Benefits – Relatively fast, enables show to go on, provides a way out of a stalemate • •Costs – Mediocrity, blandness, likely to patch symptoms and not solve problems Focus on Agenda ‐ Medium Focus on Relationship ‐ Medium Alaska 2018 Avoiding • Strategies– Withdraw, delay/ avoid response, divert attention • Power - From calmness, silence, non-cooperative • Benefits – Freedom from entanglement in trivial issues or insignificant relationships, stability, preservation of status quo • Costs – Explosions of pent up anger, slow death of relationship, loss of accountability, sapped energy Focus on Agenda- Low Focus on Relationship - Low Alaska 2018 FHWA Resource Center Env ‐ Realty Team 29

2/1/2018 Accommodating • Strategies– Agree, support, give in, convince it is no big deal • Power - From relationships and approval of others • Benefits – Wins approval and appreciation of others, creates pleasant atmosphere • Costs – Frustration of ones who want to problem solve, resentment, over dependence on others Focus on Agenda – Low Focus on Relationship – High Alaska 2018 Review • What style of negotiations do you do ? • What conflict style is the most effective for you? • At work • At home • Buying a car Alaska 2018 Uniform Act Fundamentals Alaska 2018 FHWA Resource Center Env ‐ Realty Team 30

2/1/2018 Alaska 2018 Why do we do what we do? • United States Constitution • 42 USC, Chapter 61 ( The Law) • 49 CFR Part 24 – Uniform Act • 23 CFR Part 710 (Right of Way and Real Estate) Alaska 2018 Eminent Domain The power of any sovereign government to take private property without the consent of the owner. Alaska 2018 FHWA Resource Center Env ‐ Realty Team 31

2/1/2018 U. S. Constitutional Limitations on Power of Eminent Domain 5th Amendment “…nor shall private property be taken for public use without just compensation .” 14th Amendment “…nor shall any State deprive any person of life, liberty, or property , without due process of law… ” Alaska 2018 Uniform Act Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended (Public Law 91 ‐ 646) Alaska 2018 Uniform Act Twofold Purpose • Provide for uniform and equitable treatment of persons displaced from their homes, businesses or farms by Federal and federally ‐ assisted programs • Establish uniform and equitable land acquisition policies for Federal and federally ‐ assisted programs Alaska 2018 FHWA Resource Center Env ‐ Realty Team 32

2/1/2018 Major Components of the Uniform Act • Public Law 3.JPG Alaska 2018 When Must an Agency Follow The Uniform Act ?  When any phase of a project is federally ‐ funded , and:  Real property (any interest) is acquired , and/or  Property owners and/or tenants are displaced as a direct result of land acquisition, demolition or property redevelopment Alaska 2018 Federal Regulations • 49 CFR Part 24 – Department of Transportation ( all federal agencies) • 23 CFR Part 710 – Highways ( FHWA dollars) Alaska 2018 FHWA Resource Center Env ‐ Realty Team 33

2/1/2018 Alaska State Constitution Article I ‐ Declaration of Rights § 18. Eminent Domain Private property shall not be taken or damaged for public use without just compensation Alaska Code 09.55.240 Uses for Which Authorized : Rights of Way Alaska 2018 23 CFR 710.201 (c) Right ‐ of ‐ way (ROW) operations manual. Each STD which receives funding from the highway trust fund shall maintain a manual describing its right of way organization, policies, and procedures. Alaska 2018 REVIEW • What are the purposes of the Uniform Act? • Identify the regulations that implement the Uniform Act • Explain the importance of Uniform Act compliance 102 FHWA Resource Center Env ‐ Realty Team 34

2/1/2018 ACQUISITION Alaska 2018 Acquisition Before the Uniform Act • Why would a property owner object to a verbal offer? • If an agency did not use an appraisal, what would be the basis of the offer? • If an agency did not offer relocation benefits, what might happen to the people living in the home? Alaska 2018 Acquisition Before the Uniform Act • How would you feel if the State condemned your property without negotiating first? • If you were the property owner, how would you want to be treated? Alaska 2018 FHWA Resource Center Env ‐ Realty Team 35

2/1/2018 Real Property • Interests, benefits and rights inherent in ownership of physical real estate • Includes: − Fee simple − Permanent easement − Temporary easement Alaska 2018 Real Property (cont.) What rights or interests make up the “bundle of rights” when a person owns fee simple title to property? Alaska 2018 • Possession • Control • Enjoyment • Exclusion • Disposition Alaska 2018 FHWA Resource Center Env ‐ Realty Team 36

2/1/2018 W hat W ould You Do? • Dawn Parke is the fee simple owner of a commercial property. • Heather Morris leases the entire property to operate her Pizza Restaurant. • The Agency is acquiring a portion of the property. • What interest(s) does the Agency need to acquire? Alaska 2018 Alaska 2018 Alaska 2018 FHWA Resource Center Env ‐ Realty Team 37

2/1/2018 START Land Acquisition Process Flowchart 1 ‐ Present written No offer to property Property owner acquisition (in person or by mail) displaces 6 ‐ Condemnation residents? Agency acquires No 5 ‐ Continued 2 ‐ Give owner Successful? property through Yes opportunity to negotiations litigation consider offer If possible, make combined relocation No and acquisition offers Yes together Will Property 4 ‐ Closing – Owner 3 ‐ Negotiations ensue Yes signs conveyance acquisition owner ‐ Follow ‐ up with instrument & displace accepts phone call(s) or receives payment occupants? offer? personal contacts 8 ‐ Negotiations complete – consider property No management activities END Agency prepares ROW Certification 7 ‐ Complete Yes relocation Alaska 2018 activities Basic Acquisition Policies 49 CFR 24.102 a) Expeditious acquisition b)Notice to Owner c) Appraisal/ waiver / invitation to owner Alaska 2018 Basic Acquisition Policies (cont.) d) Establishment and offer of Just Compensation Alaska 2018 FHWA Resource Center Env ‐ Realty Team 38

2/1/2018 Fair Market Value vs. Just Compensation JC Can Exceed FMV for The purpose of an appraisal is to estimate fair Various Reasons market value (FMV), which is believed to be just • Property difficult to value accurately. compensation. However JC can exceed FMV for a number of • Recent court awards are higher. reasons. • Cost of litigation. • Risk of trial. Fair Market Value (FMV) Administration or 1 2 3 Legal Settlement Appraisal Yardstick Just Compensation (JC) – Actual Just Compensation (JC) Most often appraised value and JC are equal. 115 Basic Acquisition Policies (cont.) d) Summary Statement e) Basic Acquisition procedures Alaska 2018 Basic Acquisition Policies (cont.) g) Updating offer of just compensation h)Coercive action i) Administrative Settlements Alaska 2018 FHWA Resource Center Env ‐ Realty Team 39

2/1/2018 Basic Acquisition Policies (cont.) j) Payment before possession k) Uneconomic remnant l) Inverse condemnation Alaska 2018 Basic Acquisition Policies (cont.) • m) Fair rental • n) Conflict of interest Alaska 2018 Grand Street Exercise Alaska 2018 FHWA Resource Center Env ‐ Realty Team 40

2/1/2018 Negotiation Preparation Alaska 2018 Purpose of Negotiations • Acquire property and property interests • Expeditiously By Negotiation • Establish Rapport • Inspire confidence • Meet Agency Needs • Meet the Needs of the Public Alaska 2018 Preparation • How do you prepare? • What documents do you look at/ review before making an appointment to meet with the owner? Alaska 2018 FHWA Resource Center Env ‐ Realty Team 41

2/1/2018 Preparation • Check ownership • Be familiar with need / history of the project • Review the Appraisal / Plans Alaska 2018 Preparation (cont.) • Confirm property description • Funding available • Visit the project site Alaska 2018 Key Elem ents of the Valuation Process Appraisal Appraisal Review Establishment of amount agency believes to be just compensation P. L. 91-646, as amended Title III, Section 301 Alaska 2018 FHWA Resource Center Env ‐ Realty Team 42

2/1/2018 Basic Appraisal Concepts for the Acquisition Agent • Sales verification process • Approaches to Value – Sales comparison approach – Income approach – Cost approach Alaska 2018 Basic Appraisal Concepts for the Acquisition Agent •Larger parcel •Highest and best use •Consistent use Alaska 2018 Alaska 2018 FHWA Resource Center Env ‐ Realty Team 43

2/1/2018 Alaska 2018 Uneconomic Remnants  Property remnant with little or no value or utility Remainder to the owner 49 CFR 24.2(a)(27)  Agency must offer to acquire uneconomic remnants Acquisition 49 CFR 24.102(k) 131 Buildable Lot 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 49 CFR 24.403 Alaska 2018 FHWA Resource Center Env ‐ Realty Team 44

2/1/2018 Exercise Prepare to Meet the Owners! Alaska 2018 FIRST MEETING WITH OWNER Alaska 2018 First meeting to make offer • The appointment has been made, you arrive to make the first offer, what happens now? • Both the owner and you want to settle this without condemnation, how do you facilitate that outcome? Alaska 2018 FHWA Resource Center Env ‐ Realty Team 45

2/1/2018 Offer Meeting • Make the offer • Let the owner talk Listen to the owners comments and questions ( • objections / concerns) • Take Notes – ask questions • Do not argue • Engage in problem solving Alaska 2018 Offer meeting (cont.) Working with the Owner • Review the owner’s concerns / objections • Separate out what you can answer immediately and others you will need to follow up on • Set appointment for next meeting / interaction • Discuss monetary issues after addressing objections and concerns Thank the owner for their time • Alaska 2018 Techniques Reduce conflict • Focus on the facts • Investigate the owner’s objections • State a firm position • Explain the alternatives Alaska 2018 FHWA Resource Center Env ‐ Realty Team 46

2/1/2018 Time to meet the owner Alaska 2018 Set up the Meeting Chris tries to set up a meeting with Karen Jones Alaska 2018 Meeting Chris finally meets with Karen Jones Alaska 2018 FHWA Resource Center Env ‐ Realty Team 47

2/1/2018 Demand to Change the Project Karen is not happy with a temporary construction easement Alaska 2018 More Money Karen wants more money Alaska 2018 MANAGING THE RIGHT OF WAY PROCESS Alaska 2018 FHWA Resource Center Env ‐ Realty Team 48

2/1/2018 Right of Way Planning • Federal Funding in Phase • Staffing / In ‐ house • Number of Parcels • Relocation • Complicated Acquisitions • Timeframe Schedule • Critical Element • Tracking Delivery • Manage tasks Day to Day Why do we need schedules? • Think through a project • Provide a Road map for success • Manage Dollar Commitment • Increases efficiency • Prevent Problems • Create Performance Measures FHWA Resource Center Env ‐ Realty Team 49

2/1/2018 How to use them? • Use historical data • Determine if behind or ahead of schedule • Determine allocation of additional funds • Mentoring for future managers ROW Plans • ROW Limits • Utility Easements • Structures / Monuments • Signs / Fences • Encroachments • Septic Tanks, Sprinklers , Wells • Driveways and Parking Lots • Landscaping Title Reports • Accurate Ownership • Verification of Easements • Mineral Rights • Utilities • Ingress/Egress Rights • Secretary of State • Zoning FHWA Resource Center Env ‐ Realty Team 50

2/1/2018 Relocations • Planning • Notices • Advisory Services • Housing Payments • Residential • Housing of Last Resort • Business Acquisitions • Appraisal • Early Acquisitions • Administrative Settlements • Payment before Possession • Uneconomic Remnants • Donations • Federal land transfer Some key terms • Real property interest: • Any interest in land; • a contractual right to acquire any interest in land; • any other similar action to acquire or preserve rights ‐ of ‐ way for a transportation facility. • Donation: A property owner’s right …. • after being fully informed by the agency of the right to receive just compensation; • the agency is responsible for preparing an appraisal, unless released from such obligation by the property owner. • Matching credit: • Value of property contributed toward the State’s matching share of project costs. FHWA Resource Center Env ‐ Realty Team 51

2/1/2018 Alternative Acquisition Techniques Some other ways to acquire ROW: 1. Early Acquisition • State funded, no match or reimbursement State funded, matching credits • • State funded, federal funds reimbursement • Federal funding 2. Matching Credit for Contributions 3. Donations EARLY ACQUISITION Acquisition of Real Property Interests Prior to NEPA Clearance State funded, no match or reimbursement • The State may acquire real property interests any time it has legal authority to do so, with limited conditions if no matching credit or reimbursement will be requested: – Must comply with the Uniform Relocation Act – Must comply with Title VI of the Civil Rights Act – Cannot have an adverse environmental impact – Cannot limit the choice of reasonable alternatives • Authorities: 23 CFR 771.113(d)(4) and 40 CEQ 1506.1 FHWA Resource Center Env ‐ Realty Team 52

2/1/2018 State funded, matching credit • If the State will seek to use the value of real property interests acquired prior to NEPA clearance as a credit toward their matching share of project costs, the following additional conditions apply: • The real property interests acquired did not include lands protected under Section 4(f), pursuant to 23 U.S.C. 138; • The State determined and the FHWA concurs that the action taken did not influence the environmental assessment of the project, including the decision on the need to construct the project, the consideration of alternatives, and the selection of the design or location. State funded, federal reimbursement • If the State will seek reimbursement from FHWA for State funds spent on early acquisition, the following conditions apply: – Must be acquired in compliance with the Uniform Act; – Must comply with title VI of the Civil Rights Act of 1964; – State must have a comprehensive & coordinated land use, environment, and transportation planning process; – The early acquisition must be certified by the Governor as consistent with the State’s planning process; – The property must be incorporated into the selected alternative; – Environmental compliance of project required prior to reimbursement; – FHWA concurs that the early acquisition did not influence the environmental assessment of the project. Federally funded early acquisition • In order to obtain and use federal funds in early acquisition, the following conditions must be met: – The acquisition must be programmed and included as a project in the State’s transportation improvement program; – The programmed project may consist of the acquisition of a specific parcel, a portion of a transportation corridor, or an entire corridor; – In order to obtain FHWA authorization to proceed, the State must certify in writing that it has authority to acquire the real property interest under State law and that the acquisition: • Is for a transportation purpose; • Will not cause any significant adverse environmental impact; • Will not limit the choice of reasonable alternatives; • Does not prevent making an impartial decision on the choice of alternatives; • Will be acquired by negotiation without threat of condemnation; • Will not result in a reduction of benefits or assistance; FHWA Resource Center Env ‐ Realty Team 53

2/1/2018 • (continuation of conditions which must be met): – A NEPA review of the early acquisition project must be completed and approved by FHWA; – The early acquisition project will be treated as having independent utility; – The early acquisition project shall not limit consideration of alternatives for future transportation improvements; – Real property interests acquired for federally funded early acquisition projects may not be developed in anticipation of a project until all required environmental reviews for the project are completed; – If federal funds are used in the early acquisition and some of the acquired real property interests are not incorporated into the project, FHWA will offset the participating amount against funds apportioned to the State. Summary of key points • State may do early acquisition with its own funds; or, • State may do early acquisition and use matching credits; or • State may do early acquisition and seek federal reimbursement; or, • State may program and FHWA may fund an early acquisition project. • In all cases, these conditions must be met: – Property interests are acquired per all applicable laws & regulations; – Early acquisition cannot create significant environmental impacts; – Early acquisition cannot prejudice the selection of the alternatives; • Additional conditions apply to match and reimbursement. MATCHING CREDITS Alternative Funding Option for Early Acquisition FHWA Resource Center Env ‐ Realty Team 54

2/1/2018 Matching credits for early acquisition • Title 23 U.S.C. 323 allows state Departments of Transportation (DOTs) to credit the non ‐ federal share of project costs with the fair market value (FMV) of lands donated or lawfully obtained, and/or donated materials, and services that are incorporated into a specific transportation project. How it works • The FMV of real property contributions may be credited to the state matching share of the project cost. The value of land contributions for credit purposes is not related to just compensation, in that damage to the remainder property is not considered. Costs relative to relocation and incidental costs related to acquiring these properties are not eligible for credit. • Credits are not available for lands acquired with any form of Federal financial assistance, or for lands already incorporated and used for transportation purposes, as set out in 23 CFR 710.507(c). Example A project with a 20% match requirement has incurred cash costs of $1 million and the value of donations and previously acquired property is $100,000. The project has a total value of $1,100,000. To determine the Federal/state pro rata shares, apply the appropriate ratio to the total value of the project. To determine the actual cash outlay by the state DOT, calculate the state's pro rata share, then deduct the value of the real property contribution. FHWA Resource Center Env ‐ Realty Team 55

2/1/2018 Property Donations Agency must inform owner of right to: • have Agency appraise property • receive offer of just compensation • Agency must advise owner about effect of acquisition on remainder • Owner can donate all or a portion of real property Alaska 2018 Property Management • Disconnect Utilities • Asbestos/ Contamination • Demolition • Rodent Control • Exclusively for purposes of transportation facility Property Management Surplus • Inventories • Leasing • Right of Way Use Agreement ( air rights ) • Disposals FHWA Resource Center Env ‐ Realty Team 56

2/1/2018 Certifications • Prior to Advertising for Construction • ROW Availability Statement • Utility • Railroad • Exceptions Eminent Domain • Attorney Early Involvement • Necessity Clause • Legal Settlements • Court Deposit • Quick Take States • Court Awards CLOSING THE LOOP Alaska 2018 FHWA Resource Center Env ‐ Realty Team 57

2/1/2018 Documentation • Enter all interactions in a log or diary ( as soon as possible) • Maintain records of all paperwork, items discussed, people present • Written in legible, permanent form • If it is not written down, it did not happen Alaska 2018 Administrative Settlement • Purchase price exceeds amount offered as just compensation • Agency official approves settlement as reasonable, prudent and in the best interest. • Federal participation requires written statement Alaska 2018 Activity Evaluate the Silver Road Project acquisition files. Alaska 2018 FHWA Resource Center Env ‐ Realty Team 58

2/1/2018 Closings • Obtain property encumbrances releases • Prepare Settlement Statement • Pay Just Compensation • Pay incidental expenses Alaska 2018 Review 1. What are key elements of a negotiator’s attitude that make them successful ? 2. Name 4 skills needed to be an effective negotiator 3. What are some different negotiation styles ? Alaska 2018 Review 4. Describe different conflict styles 5. List at least 5 Basic Acquisition Polices found in 49 CFR Part 24 6. List keys to proper preparation for a negotiation 7. Name 2 techniques to reduce conflict Alaska 2018 FHWA Resource Center Env ‐ Realty Team 59

2/1/2018 Questions Alaska 2018 Resource Center Realty Team RELOCATION SEC. 1521: Uniform Act Amendments Moving and Related Expenses – Business Reestablishment payments up to $25,000 ($10,000) – Fixed Payments in lieu of actual moving and reestablishment up to $40,000 ($20,000) Replacement Housing for Homeowners – 90 day homeowner ‐ $ 31,000 ($22,500) – Reduces 180 days to 90 Day occupancy requirement Replacement Housing for Tenants – 90 day tenants ‐ $7,200 ($5,250) FHWA Resource Center Env ‐ Realty Team 60

2/1/2018 49 CFR 24.401(d) Increased mortgage interest costs NOT changed by MAP ‐ 21 …….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. Important Aspects • Who will be displaced? • What replacements are available? • Special problems. Planning • General information notice • Notice of relocation eligibility • 90 day notice Notices • Explanation of • Referral to available benefits and or property Advisory Services services • Referral to other • Personal interview services Payments • Needs of those being • Transportation displaced • Replacement housing Residential • Moving cost Non- • Reestablishment cost Residential 182 Relocation Planning & Advisory Services FHWA Resource Center Env ‐ Realty Team 61

2/1/2018 General Relocation Requirements • Relocation Planning ( § 24.205(a)) • Advisory Services ( § 24.205(c)) • Relocation Notices ( § 24.203) • Availability of Comparable Replacement Dwellings ( § 24.204) • Claims for Relocation Payments ( § 24.207) 49 CFR 24.205(a) RELOCATION PLANNING Relocation Planning • Begins early in the development of the process • Minimize adverse impacts to displaced persons • Expedite program or project completion 49 CFR 24.205 (a) FHWA Resource Center Env ‐ Realty Team 62

2/1/2018 Relocation Planning Occurs at Various Project Times : • Early Project Planning Stage • Environmental Assessment • Project Implementation 49 CFR 24.205(a) 49 CFR 24.205(a) Conceptual Stage Study • .. An estimate of the number of households to be displaced • ..An estimate of the number business, farms and non profits Components of a Relocation Plan • Data • Resources • Interviews FHWA Resource Center Env ‐ Realty Team 63

2/1/2018 Housing/Commercial Resources MLS Internet Searches Relocation Plan Template • Executive Summary • Description of project • Environment of project • Inventory of characteristics of families • Inventory of replacement properties • Residential analysis and correlation • Business displacements • Any Need for Last Resort Housing * • Conclusion Relocation Planning • Estimate the: o Number of households o Availability of comparable replacement dwellings o Number of businesses o Availability of replacement business sites • Identify special relocation services needed • Housing of Last Resort 49 CFR 24.205(a) & §24.404 FHWA Resource Center Env ‐ Realty Team 64

2/1/2018 Case Studies Relocation Plan Highway 205 Relocation Plan ADVISORY SERVICES FHWA Resource Center Env ‐ Realty Team 65

2/1/2018 Advisory Services • Providing information, counseling, advice, and encouragement • Often requires repeated and intense personal contact. • Necessary to minimize hardships • Provided from initial interview to final payment of relocation claims No other assistance, not even relocation payments, is more important to persons being displaced. 49 CFR 24.205(c) Advisory Services • Explanation of relocation services and payments • Explanation of relocation eligibility requirements • Determination of needs and preferences of persons to be displaced through personal interview • Effort to meet identified needs of displaced persons • Provision of appropriate services 49 CFR 24.205(c) Advisory Services Who is Eligible? • Persons: • Occupying real property to be acquired • Occupying real property adjacent to the acquisition if agency determines it will cause substantial economic injury • Who move or move personal property from real property not being acquired for the project. • Who move into property after acquisition FHWA Resource Center Env ‐ Realty Team 66

2/1/2018 Acquisition of the Parking Garage Parking Garage Medical Center Acquisition of Factory Paper Factory Big Mikes Diner Houses acquired on One Side of the Street FHWA Resource Center Env ‐ Realty Team 67

2/1/2018 Resource Center Realty Team Advisory Services Business Interview Requirements • Relocation Needs and Preferences A. Site requirements, lease terms, etc. B. Need for outside specialists C. Identify realty/personalty D. Estimated time required to move E. Estimate availability of replacement sites F. Identify advance relocation payments required 49 CFR 24.205(c)(2)(i) Advisory Services Businesses • Provide current & continuing information on available sites • Minimize hardship with counseling • Offer information on other Federal/State or Local programs 49 CFR 24.205(c)(2)(i) Advisory Services Residents • Relocation needs & preferences A. Provide current & continuing information on available sites B. Inform of specific comparable in writing C. Inspect for applicable standards D. Reasonable opportunities for minorities to relocate E. Offer transportation 49 CFR 24.205(c)(2)(ii) FHWA Resource Center Env ‐ Realty Team 68

2/1/2018 Advisory Services Residents (cont.) • Relocation needs & preferences F. Advise of government housing assistance requirements G. Minimize hardship with counseling/advice H. Provide information on Federal/State or Local housing programs/assistance 49 CFR 24.205(c)(2)(ii) RELOCATION NOTICES Relocation Notices • In writing, easily understood language • Foreign language may be appropriate • Delivered in person or certified mail , return receipt requested • Contain name and telephone number of contact person 49 CFR 24.5 FHWA Resource Center Env ‐ Realty Team 69

2/1/2018 Relocation Notices 1. General Information Notice 2. Notice of Relocation Eligibility 3. 90 Day Notice 4. Notice of Intent to Acquire* * Not required, issue with extreme caution! 49 CFR 24.5 General Information Notice • Format: brochure or letter that is general in nature • Given anytime – typically early • Conveys information about the relocation program, including right to appeal 49 CFR 24.203(a) Notice of Relocation Eligibility • Format: letter that is hand ‐ delivered or sent by certified mail • Delivered at initiation of negotiations (ION) or shortly thereafter • Establishes qualification for relocation assistance and may set amount 49 CFR 24.203(a) FHWA Resource Center Env ‐ Realty Team 70

2/1/2018 90 Day Notice • Format: letter that is hand ‐ delivered or sent by certified mail • Delivered at or subsequent to ION or after property acquisition • Assures displaced person minimum of 90 days to move • For residential occupant, a comparable must be offered 49 CFR 24.203(c) 90 Day Notice (cont.) • Two approaches for content Specific vacate date or 90-day notice with additional 30-day notice • For residential occupant, comparable must be offered to begin the 90 days • Emergency situations may require less than 90 day advance notice 49 CFR 24.203(c) Notice of Intent to Acquire • Format: optional letter that is hand delivered or sent by certified mail • Agency determines necessity • Establishes eligibility for relocation assistance prior to ION – Initiation of Negotiations 49 CFR 24.203(d) FHWA Resource Center Env ‐ Realty Team 71

2/1/2018 Case Studies Advisory Services YUMM YUMMY DOUGH DOUGHNUTS TS Mr. Stuart Fox FHWA Resource Center Env ‐ Realty Team 72

2/1/2018 Review Learning Outcomes • When is the ideal time to conduct relocation planning? • Why is it important for early identification of Housing of Last Resort? • Who is eligible for advisory services? • Name examples of possible resources for relocation assistance Review Learning Outcomes (cont.) • What is the purpose of each of the four relocation notices? • What are the three required relocation notices? • How should the required notices be delivered? Replacement Housing For Owner Occupants FHWA Resource Center Env ‐ Realty Team 73

2/1/2018 Learning Outcomes At the end of the module you will be able to: • Assess comparable replacement housing • List the decent, safe and sanitary standards • Explain the components of the Replacement Housing Payment for displaced 90 ‐ day homeowner ‐ occupants Learning Outcomes You will also be able to: • Explain the goal of the “buydown” process • Compute a price differential payment • Assess the impact of a carve ‐ out or an uneconomic remnant on a price differential calculation Learning Outcomes You will also be able to: • Determine whether or not incidental expenses are reimbursable • Compute appropriate price differential payment based on changing facts • Identify the move options for residential displaced persons FHWA Resource Center Env ‐ Realty Team 74

2/1/2018 Comparable Residential Replacement Dwellings Summary (49 CFR 24.2(a)(6)) Comparable Replacement Dwellings are: 1. Decent, safe, and sanitary. 2. Functionally equivalent to the displacement dwelling. 3. Adequate in size to accommodate the displaced person. Comparable Residential Replacement (cont.) 4. Located in an area that is: • not subject to unreasonable adverse environmental conditions; • generally not less desirable than the location of the displacement dwelling with regard to public utilities and commercial and public facilities; and • reasonably accessible to the displaced person's place of employment 5. Located on a typical residential site. 6. Currently available to the displaced person. 7. Within the financial means of the displaced person. Decent, Safe and Sanitary (DSS)??? FHWA Resource Center Env ‐ Realty Team 75

2/1/2018 Comparable Residential Replacement Dwellings Decent, Safe and Sanitary (DSS)??? 1. Structurally Sound 2. Electrical System 3. Heating System 4. Adequate in size 5. Bathroom 6. Kitchen 7. Egress 8. Handicapped Accessible Case Study: What is Comparable? Mike Davis FHWA Resource Center Env ‐ Realty Team 76

2/1/2018 REPLACEMENT HOUSING PAYMENT Replacement Housing Payment Categories 1.Owner payments 2. Rental Assistance Payments 3. Down payment Assistance Resource Center Realty Team Replacement Housing Payments • Own and occupy displacement dwelling 90 days prior to initiation of negotiations • Price differential Cannot • *Increased Mortgage exceed interest cost $31,000 • Incidental expenses OR • Rental assistance cannot exceed computed price differential payment 49 CFR 24.401 FHWA Resource Center Env ‐ Realty Team 77

2/1/2018 Concept Acquisition Relocation Guarantee A + Funds Funds Replacement Home 90 ‐ Day Replacement Housing Payment Components Price Differential (49 CFR 24.401(c)) Increased Incidental Mortgage Expenses Interest Costs (49 CFR 24.401(e)) (49 CFR 24.401 (d)) 180 ‐ Day Replacement Housing Payment Components 1. Price Differential (49 CFR 24.401(c)) 2. Increased Mortgage Interest Cost Payment, aka MIDP or MID (49 CFR 24.401(d)) 3. Incidental Expenses (49 CFR 24.401(e)) FHWA Resource Center Env ‐ Realty Team 78

2/1/2018 Price Differential—Example Comparison Grid Price Differential Payment Cost of comparable replacement $315,000 dwelling Less acquisition cost -300,000 Maximum price differential payment $15,000 Acquired Dwelling Comparable Replacement Dwelling 49 CFR 24.401(c) Case Studies Replacement Housing Payment Owner Occupant FHWA Resource Center Env ‐ Realty Team 79

2/1/2018 The Stuarts The Stuarts Mr. and Mrs. Stuart own a home that they have occupied for at least 90 days prior to the initiation of negotiations with a Local agency . The home/property is needed for a public roadway project. The fair market value of the house is $100,000. Just a few blocks away, a similar house is on the market and can be purchased for $120,000. The Stuart’s are therefore eligible to receive a replacement housing purchase differential of $ 20,000 plus eligible closing costs and increased mortgage interest costs. The Stuarts To qualify for the maximum payment of $ 20,000, the Stuart’s must do the following: – Sell their property to the agency for $100,000 – Purchase another home for at least $ 120,000 which meets the decent, safe and sanitary standards – Purchase their replacement home within one year and file a claim within 18 months FHWA Resource Center Env ‐ Realty Team 80

2/1/2018 Questions 1. What are the Stuarts’ relocation benefits if they are illegal aliens from France? 2. What is their replacement housing payment if they settle for $ 130,000? 3. What is their replacement housing payment if they buy a home for $ 105,000? 4. What is their replacement housing payment if they buy a home for $ 150,000? 5. What is their replacement housing payment if they move to a home that is not Decent Safe & Sanitary? CARVE OUT Carve ‐ out of Major Exterior Attribute • Must be an exterior attribute ‐ items like excess land, swimming pools, outbuildings, waterfront properties • If selected comparable does not contain the attribute, deduct contributory value from acquired dwelling (carve it out) 49 CFR 24.403(a)(2) FHWA Resource Center Env ‐ Realty Team 81

2/1/2018 Carve ‐ out Computation Acquisition cost of acquired dwelling $300,000 Less contributory value of major -20,000 exterior attribute (i.e., pool) Adjusted value of acquired dwelling $280,000 49 CFR 24.403(a)(2) Price Differential–Carve ‐ out Computation Total Residential Acquisition Offer $300,000 Contributory Value of Pool ‐ 20,000 $280,000 Adjusted Base of Acquired Dwelling ************ Price of Comparable Replacement $315,000 Less Adjusted Base of Acquired Dwelling $280,000 $ 35,000 Price Differential Payment Price Differential–Carve ‐ out Computation: Uneconomic Remnant Remainder ($5,000) Acquisition ($180,000) Before Value: $185,000 $185,000 Remainder Value: $ 5,000 $0 Acquisition Offer $180,000 $185,000 49 CFR 24.2(a)(27) 49 CFR 24.102(k) FHWA Resource Center Env ‐ Realty Team 82

2/1/2018 Price Differential–Carve ‐ out Computation: Uneconomic Remnant Comparable Replacement Dwelling $200,000 Less Acquired Dwelling w/out UER $180,000 Price Differential Payment $20,000 (Displaced person still owns uneconomic remnant) Comparable Replacement Dwelling $200,000 Less Acquired Dwelling inc. UER $185,000 Price Differential Payment $15,000 (Displaced person sells the uneconomic remnant) Case Studies Carve Out Relocation Walker Family Farm FHWA Resource Center Env ‐ Realty Team 83

2/1/2018 180 ‐ Day Replacement Housing Payment Components 1. Price Differential (49 CFR 24.401(c)) 2. Increased Mortgage Interest Cost Payment, aka MIDP or MID (49 CFR 24.401(d)) 3. Incidental Expenses (49 CFR 24.401(e)) 90 ‐ DAY REPLACEMENT HOUSING PAYMENT COMPONENTS 1. Price Differential (49 CFR 24.401(c)) 2. Increased Mortgage Interest Cost Payment, aka MIDP or MID (49 CFR 24.401(d)) 3. Incidental Expenses (49 CFR 24.401(e)) NOTE: MIDP shall be based only on bona fide mortgages Increased that were valid liens on the displacement dwelling for at Mortgage least 180 days prior to the initiation of negotiations. Mortgage Interest Differential Payment • Compensates owner ‐ occupant for loss of a favorable interest rate • Old loan must be valid lien for 180 days prior to ION and new loan must have a higher interest rate • Based on a buydown process 49 CFR 24.401(d) http://www.fhwa.dot.gov/real_estate/uniform_act/relocation/midpcalcs/ FHWA Resource Center Env ‐ Realty Team 84

2/1/2018 Buydown Process Buys the principal amount down for the replacement mortgage so the principal and interest payments remain the same for the remaining term even though the interest rate is higher http://www.fhwa.dot.gov/real_estate/uniform_act/relocation/midpcalcs/ 90 ‐ DAY REPLACEMENT HOUSING PAYMENT COMPONENTS 1. Price Differential (49 CFR 24.401(c)) 2. Increased Mortgage Interest Cost Payment, aka MIDP or MID (49 CFR 24.401(d)) 3. Incidental Expenses (49 CFR 24.401(e)) Incidental Expenses Incidental Expenses • Reasonable • Necessary • Actually incurred 49 CFR 24.401(e) FHWA Resource Center Env ‐ Realty Team 85

2/1/2018 Incidental Expenses (cont.) • Reimbursable items • Partially reimbursable items • Not reimbursable items Incidental Expenses– Eligible 1. Legal closing and related costs 2. Loan application fees 3. Loan origination (not prepaid interest) 4. Professional home inspections 5. Credit Report 6. Title Insurance (not to exceed comparable) 7. Escrow agent’s fee 8. Doc stamps 9. Other incidental costs as determined by the Agency Incidental Expenses– Ineligible 1. Interest 2. Homeowner’s Insurance Premiums 3. Real Estate Taxes 4. Water/Sewer User & Assessment fees 5. Mortgage Insurance Premiums FHWA Resource Center Env ‐ Realty Team 86

2/1/2018 CCase Study Rental Assistance Replacement Housing Payment Categories 1. Owner payments 2.Rental Assistance Payments 3. Downpayment Assistance FHWA Resource Center Env ‐ Realty Team 87

2/1/2018 Rental Assistance Payment • Owners who choose to rent • Difference between comparable replacement rent/utilities and economic rent/utilities at the displacement dwelling • Payment cannot exceed computed price differential payment 49 CFR 24.401(f) Rental Assistance Payment Computation (for 90 Day Homeowner ‐ Occupants) Rental Assistance Payment Computation (for 90 Day Homeowner ‐ Occupants) FHWA Resource Center Env ‐ Realty Team 88

2/1/2018 Residential Move Options http://www.fhwa.dot.gov/real_estate/uniform_act/policy_and_guidance/fixsch96.cfm 49 CFR 24.301(b) Residential Moving Expenses • Transportation • Packing/unpacking • Disconnects/reconnects • Storage • Insurance • Damage during move • Other items, such as special services 49 CFR 24.301(g) FHWA Resource Center Env ‐ Realty Team 89

2/1/2018 Replacement Housing for Tenants and Other Residential Occupants Comparable Residential Replacement Dwellings Decent, Safe and Sanitary (DSS)??? 1. Structurally Sound 2. Electrical System 3. Heating System 4. Adequate in size 5. Bathroom 6. Kitchen 7. Egress 8. Handicapped Accessible Purpose of Rental Assistance Payment A payment to assure a comparable rental dwelling is made available to a displaced tenant or short ‐ term owner ‐ occupant FHWA Resource Center Env ‐ Realty Team 90

2/1/2018 Replacement Housing Payments 90 ‐ Day Tenant • Rent and occupy displacement dwelling 90 days prior to initiation of negotiations • Rental assistance payment Cannot exceed $7,200 OR • Downpayment assistance cannot exceed computed price differential payment 49 CFR 24.401 Replacement Housing Payments Less Than 90 ‐ Day Occupants • Rent or own and occupy displacement dwelling less than 90 days immediately prior to initiation of negotiations • Rental assistance Payable under housing of last resort OR • Downpayment assistance Payable under housing of last resort 49 CFR 24.402 49 CFR 24.404(c)(3) 90 ‐ day Occupant Rental Assistance Eligibility Computation 49 CFR 24.402(b)(2)(i-iii) FHWA Resource Center Env ‐ Realty Team 91

2/1/2018 90 ‐ day Occupant Rental Assistance Eligibility Computation • Base Monthly Rental of Displacement dwelling is the lesser of: 1. Actual Rent plus utilities 2. 30% of monthly income if qualified under HUD’s Section 8 Program Limits 3. Total designated amounts for food & shelter if on welfare program Rental Assistance Payment 49 CFR 24.402(b) Information Needed for Payment Computation • Length of occupancy • Household income • Household composition • Current monthly rental amount • Current average monthly utilities • Low income criteria • Government assistance payments • Rental values in the area FHWA Resource Center Env ‐ Realty Team 92

2/1/2018 Information Needed for Payment Computation (cont.) • Base Monthly Rental Determination • Monthly rent of selected comparable • New estimated utilities • Actual replacement property 90 ‐ Day Occupant Actual Rental Assistance (49 CFR 24.402) 90 ‐ Day Occupant Actual Rental Assistance Computation–Sample FHWA Resource Center Env ‐ Realty Team 93

2/1/2018 Case Studies Rental Assistance Payment The Sharp Family Mr. Sharp Sam Sharp occupies a rental dwelling unit and has lived there for more than 90 days prior to the initiation of negotiations. The agency has offered to purchase this property from Mr. Sharp’s landlord. Mr. Sharp pays $ 1000 per month in rent plus $150 per month in average utility costs. A few blocks away there is a similar dwelling unit available for rent for $100 more per month ($ 1095 for rent plus $155 for utilities). Mr. Sharp is entitled to a rental subsidy of $ 4,200 ($ 100 x 42 months). FHWA Resource Center Env ‐ Realty Team 94

2/1/2018 Mr. Sharp To qualify for the maximum amount of $ 4,200, Mr. Sharp must do the following: – Actually expend at least $1,250 per month for rent and utilities for a decent, safe and sanitary replacement – Rent and move to the replacement housing within one year and file a claim within 18 months Mr. Sharp Questions : What is the rental supplement if Mr. Sharp rents a place including utilities for $ 1500 a month? What is the rental supplement if Mr. Sharp rents a place for $ 1000 including utilities? Fall Creek Apartments FHWA Resource Center Env ‐ Realty Team 95

2/1/2018 Fall Creek Apartments A large apartment complex is being acquired for a road project. The project is displacing several occupants who are not familiar with the available comparable replacement rental properties in the market. They have been unsuccessful in locating replacement housing. Furthermore, they do not have the funds to make a lease deposit and first month’s rent. Fall Creek Apartments Question: What can the acquiring transportation agency do in this situation? Fair Market Rent vs. Actual Rent • If displaced person is paying little or no rent Agency may adjust to fair market rent • Agency may waive adjustment if it determines a hardship exists 49 CFR 24.402(b)(2)(i) FHWA Resource Center Env ‐ Realty Team 96

2/1/2018 Resource Center Realty Team 90 ‐ Day Occupant Actual Rental Assistance Computation–Sample Market vs. Contract Rent (49 CFR 24.402) 90 ‐ Day Occupant Rental Assistance—Utility Adjustment (49 CFR 24.402) Downpayment Assistance • Displaced person can convert rental assistance to downpayment • Payment limited to amount of computed rental assistance payment • Agency may adopt policy of uniformly increasing payment to $7,200 49 CFR 24.402(c) FHWA Resource Center Env ‐ Realty Team 97

2/1/2018 Case Study Down Payment Assistance The Murphy’s currently lease and occupy the lower unit of a 2 ‐ family flat. They have resided in the unit for about a year and a half prior to the initiation of negotiations for the purchase of the subject parcel. The Murphy’s have informed you they are planning on purchasing a replacement dwelling and they have located a home for $175,000. Current rent for the Murphy’s is $750 per month and about $150/month for utilities. Their gross monthly income is $5,000. Rental units similar to the Murphy’s flat are available for $800/month with estimated utilities at $150/month. Case Study Down Payment Assistance The following URA Income Limits are in effect for the Murphy’s community. What is the maximum downpayment eligibility for the Murphy’s? http://www.huduser.org/portal/datasets/ura/ura14/RelocAct.html Case Study Down Payment Assistance $750 (rent) + $150 (utilities) = $900 Comp is $800 (rent) + $150 (utilities) = $950 $950 ‐ $900 = $50 x 42 months = $2,100 Rent Supplement Payment FHWA Resource Center Env ‐ Realty Team 98

2/1/2018 Replacement Housing Payments for Less Than 90 ‐ Day Occupants “Subsequent occupants” cannot be denied a replacement housing payment solely because they do not meet the appropriate length of occupancy requirements. (49 CFR 24.2(a)(6)(viii)(C) and 24.404(c)(3) 7 ‐ 7 Resource Center Realty Team Residential Move Options http://www.fhwa.dot.gov/real_estate/uniform_act/policy_and_guidance/fixsch96.cfm 49 CFR 24.301(b) FHWA Resource Center Env ‐ Realty Team 99

2/1/2018 Residential Moving Expenses • Transportation • Packing/unpacking • Disconnects/reconnects • Storage • Insurance • Damage during move • Other items, such as special services 49 CFR 24.301(g) Review Learning • Explain the components of the Replacement Housing Payment for displaced 90 ‐ day occupants and less than 90 ‐ day occupants • State the purpose of a rental assistance payment • Explain the difference between fair market rent and actual rent Review Learning • Explain downpayment assistance eligibility • Compute rental assistance payment for 90 ‐ day occupants including tenants and short ‐ term owners • What are the residential move options? FHWA Resource Center Env ‐ Realty Team 100